Today's the Day!

It's here, folks - October 9th. Today is the day that the Stoneridge case (No. 06-43) will be heard in the Supreme Court. While you can't be a fly on the wall, you can still read the argument transcripts. The transcripts are posted same-day on the Supreme Court's website, so check that site later today. Stay tuned for the court's decision.

Stoneridge is an important case, which is why you've been hearing a lot about it lately. Two good articles to peruse:

"Enron Investors Banking on High Court," from the AP, focuses on the Enron case before the court which will be affected by the Stoneridge opinion. (The court has considered Enron but not issued a decision as to whether the case will be heard.) The article highlights an important consideration: who is responsible for reporting financial problems to shareholders. In other words, if a company's bank is aware of financial problems, are they responsible for alerting shareholders? When is inactivity equal to "deception"? This is a fascinating legal question. The Stoneridge decision should give more guidance to banks, lawyers, accountants, and others who regularly have detailed knowledge of corporations' financial states. Ultimately, the decision may affect the ability of Enron investors to recover from banks which advised Enron.

From Legal Times, "In 'Stoneridge,' the Supreme Court Should Focus on Who Really Gains" is an interesting viewpoint of how securities fraud laws should be structured based on the true winners in the fraud. The author demonstrates that it is ultimately the investors who lose in almost all securities fraud litigation, and often the only "winners" are the lawyers. His proposed solution is very thought-provoking: "The bottom line is that investors would gain if securities fraud litigation were limited to derivative actions on behalf of the securities issuer, with any damages recovered from the culprits to be paid only to the company. Of course, the SEC would still be free to pursue enforcement actions."

35W Bridge Collapse - The Fight Begins

The Associated Press has a great article about the sides gearing up for litigation after the 35W bridge collapse (http://www.law.com/jsp/article.jsp?id=1190624583024). This should be interesting to watch, especially since the attorneys and companies involved are local.

Online Networking

California attorney Steven Choi has started LawLink.com, a social networking site just for lawyers. The format appears to be similar to LinkedIn, a social networking site for professionals. Both are intended for professional networking, and so are a lot less intimidating than Facebook or Myspace for "older" professionals.

If you haven't gotten on the bandwagon yet, now may be the time. A lot of people may think this is all hype, but online networking has allowed me to reconnect with people I had lost touch with. And we all know that networking is the key to marketing and career success, right? So if you haven't signed up yet, you should really consider taking 10 minutes of your time and getting started. The sites are very user-friendly, and you never know what connections you will find!

By the way, you can find me here at LinkedIn, and here at LawLink. Let's link up, shall we?

Corporate Ethics

Law.com has a series of articles on "Penetrating the Private World of Corporate Monitoring," http://www.law.com/jsp/ihc/PubArticleIHC.jsp?id=1190192573192. The first, "Someone to Watch Over You," discusses the roles a monitor may take in an organization and offers suggestions on choosing a monitor, limiting the monitor's power, and how to use a monitor to better the company. The second article, "Bristol-Myers Takes Its Medicine," reveals an antitrust violation that the company engaged in while a monitor was working with the company.

The need for corporate monitors and the Bristol-Myers example show that all of this talk of corporate ethics seems to fall on many deaf ears. This is frustrating for companies who do walk the line (and myself, who supports and represents those companies). When news of Enron, Worldcomm, and Tyco was on the front page, it was "corporate America" that became the devil, not only those companies. And many companies who never did anything wrong have paid for it - thousands or millions of dollars spent to comply with Sarbanes-Oxley, loss of goodwill, and suspicious customers and regulators watching their movements with narrowed eyes. This is similar to the problems that the legal profession has when attorneys misuse their power, take advantage of clients, or simply break the law - it reflects poorly on all lawyers, and that is why the Board of Law Examiners screens applicants to the Bar to attempt to weed out future trouble-makers. (No comments on their lack of success - they can only see so far into the future!)

Alas, there really is no good solution for the business community. Forcing all executives or managers to go through some kind of screening process could be possible for public companies, but it has its limits just as with potential lawyers. Many business schools require corporate ethics courses, but teaching the rules of ethics is not the same as instilling values. Just because lawyers know the Rules of Professional Conduct does not ensure that they cannot willfully violate the rules.

I believe that the source of the problem goes much deeper. The source is the same that has made ours a culture of cheating, that credits Barry Bonds with breaking Aaron's recond, and that exhibits unbelievably high levels of marital infidelity. It is a culture of Me First, or dishonesty or cheating, or whatever label you like. I believe that only parents have the power to undo this, not Congress. Unfortunately, parents are often the problem. The best thing to do, then, is to ensure that there continue to be negative consequences for those who lie and cheat. When we begin to let things slide, huge ethical abuses are sure to follow.

GMAT Update

Since I've been slow about posting on my blog because I've been studying for the GMAT, I thought it would be fair to let you know how I did. I scored 730, which is in the 96th percentile! Yay! So I don't know if the math fairy was smiling on me, or God really wants me to go to business school, but I am one happy test-taker. And I promise I'll get back to posting two posts per week.