EMBARRASSING FEE DISPUTE WITH FIRM’S CLIENT SETTLES
NEW YORK — DLA Piper’s public feud with an ex-client who alleged the firm overbilled him has been resolved a month after the client released headline-grabbing internal emails by DLA attorneys who discussed a "churn that bill, baby" approach to billing.
Adam Victor reached a settlement with the firm, said Larry Hutcher, a partner at Davidoff Hutcher & Citron who represents Victor. Victor exposed the emails obtained in discovery in response to a lawsuit brought by DLA claiming Victor owed $679,000 in legal fees.
DLA was hired in April 2010 by Project Orange Associates, which was owned by Victor, to handle its bankruptcy. DLA, in a statement released after the emails became public, said the messages "were in fact an offensive and inexcusable effort at humor."
MORTGAGE LENDER SETTLES INVESTOR CLASS ACTIONS
LOS ANGELES — The mortgage lender Countrywide Financial Corp., absorbed by Bank of America Corp. in 2008, has agreed to pay $500 million to resolve class claims that it misled mortgage-backed securities investors.
The settlement, announced on April 17 by plaintiffs counsel at Cohen Milstein Sellers & Toll; Robbins Geller Rudman & Dowd; and Kessler Topaz Meltzer & Check, resolved three related investor class actions brought against Countrywide following the financial crisis.
If the deal is approved by U.S. District Judge Mariana Pfaelzer in Los Angeles, it will be the largest settlement yet in a securities class action brought by mortgage-backed securities investors, eclipsing a $315 million deal Bank of America subsidiary Merrill Lynch reached in December 2011.
JUDGE HINGES SETTLEMENT ON APPEAL IN SEPARATE CASE
NEW YORK — A federal judge in New York on April 16 conditionally approved a $602 million insider-trading settlement that SAC Capital Advisors reached with the U.S. Securities and Exchange Commission last month.
However, U.S. District Judge Victor Marrero became the latest judge to raise concerns over the SEC’s practice of allowing defendants to settle enforcement actions without admitting or denying the underlying allegations.
In questioning the SEC’s use of "neither admit nor deny" settlements, Marrero cited colleague Jed Rakoff’s controversial November 2011 refusal to sign off on a $285 million deal between Citigroup and the SEC. He took the unusual step of conditioning final approval of the SAC settlement on the outcome of the appeal in the Citi case. The U.S. Court of Appeals for the Second Circuit heard arguments in February over whether to reverse Rakoff.
LAP-BAND PROMOTERS SETTLE FALSE ADVERTISING LAWSUITS
LOS ANGELES (AP) — A company that promoted Lap-Band weight-loss surgery has agreed to pay $1.3 million to settle a false-advertising lawsuit, with some of the money going to billboards warning the public about the risks of weight-loss surgery, a newspaper reported.
From 2009 to 2011, five patients died after Lap-Band surgeries at clinics affiliated with the 1-800-GET-THIN ad campaign, the Los Angeles Times reported. Relatives of two of the dead patients, Ana Renteria and Laura Faitro, filed the lawsuit as a class action in 2011.
The lawsuit sought damages from several companies and two brothers, Michael and Julian Omidi, who court documents said owned and managed Top Surgeons, a weight-loss business. John Hueston, an attorney for the Omidis, said the settlement was not an admission of wrongdoing.
NEW TRIAL ORDERED FOR RAPE CONVICTION IS FIRST IN STATE
CHEYENNE, Wyo. (AP) — A judge on April 16 granted Wyoming’s first retrial based on DNA evidence, offering a new opportunity for freedom for a man who has served more than 23 years of a life ­sentence since being convicted of breaking into a Cheyenne woman’s apartment and raping her.
Recent testing showed Andrew Johnson, 63, was not the source of male DNA taken from the victim after the 1989 attack. The DNA instead matched the victim’s fiance at the time.
However, prosecutors say they still have other strong evidence against Johnson — including testimony from the victim. Johnson has remained jailed, but Laramie County District Judge Thomas Campbell set bond at $10,000 and said terms of his potential release would need to be worked out.
SECOND TRIAL AGAINST MENTAL PATIENT ENDS IN DEADLOCK
NEW YORK (AP) — The murder trial of a mental patient who slashed a psychotherapist to death with a meat cleaver ended April 16 with the jury deadlocked, unable to decide whether he was too psychotic to be held criminally accountable.
The defense didn’t dispute that David Tarloff killed Kathryn Faughey in February 2008, but a defense lawyer said Tarloff was so psychotic that he couldn’t tell that what he was doing was wrong. The district attorney’s office plans to retry the case.
Ten days into deliberations in a trial delayed for years by Tarloff’s schizophrenia, jurors said, for a third time, that they couldn’t reach a verdict, and the judge declared a mistrial. Prosecutors, Tarloff and psychologist Faughey’s family now face the prospect of a third attempt at a trial. The first, in 2010, collapsed during jury selection when Tarloff’s behavior disintegrated and he was found unfit for court.
TROUBLED-MORTGAGE INSURER AGREES TO PAY $10 MILLION
ALBANY, N.Y. (AP) — New York regulators reported a settlement on April 18 requiring QBE Insurance Group Ltd. to pay a $10 million penalty and reform practices when insuring troubled mortgage loans.
The state Department of Financial Services said the agreement also called for restitution to homeowners hurt by force-placed insurance, which lenders obtain when the homeowners fail to maintain coverage required by the mortgage, often because they are in financial trouble.
It followed a similar settlement last month by Assurant Inc. The two companies are responsible for at least 90 percent of that coverage in New York, and the deal should result in far lower premiums, according to the department. Its investigation found premiums charged to homeowners for less protection, finding some two to 10 times more expensive than voluntary insurance policies.
HITACHI LOSES INFRINGEMENT CASE OVER SIGNAL TECHNOLOGY
MARSHALL, Texas — A federal court jury on April 12 ruled in favor of television manufacturer TPV Tech­nology Ltd. in a patent case brought by Hitachi Ltd.
Capping a one-week trial before U.S. District Judge Rodney Gilstrap, a jury concluded that TPV didn’t infringe four Hitachi patents related to receiving television signals. The jury also found that two of the patents were invalid.
TPV is the world’s fourth-largest manufacturer of LCD televisions, and designs and manufactures televisions marketed by brand-name electronics companies. Television manufacturer Vizio Inc., which is a customer of TPV, was also named in the suit but settled with Hitachi the same day jury selection began. Terms of the settlement were not disclosed. The Hitachi patents at issue concern how televisions receive certain digital broadcast signals.
HELMET MANUFACTURER HELD LIABLE FOR STUDENT INJURY
DENVER (AP) — A Colorado state court jury in a lawsuit brought by the family of a severely injured high school football player found on April 13 helmet maker Riddell Inc. liable for failing to warn players about concussion dangers.
The ruling came as the company faces a similar lawsuit in Los Angeles, plus a complaint by thousands of former National Football League players against the league and Riddell. The jury awarded $11.5 million to the family of Rhett Ridolfi, who suffered a concussion during practice at Trinidad High School in 2008. Ridolfi, now 22, wasn’t immediately taken to the hospital and now has severe brain damage, as well as paralysis on his left side.
The lawsuit was originally brought against Riddell and several high school administrators and football coaches in Las Animas County, about 200 miles south of Denver near the New Mexico border. The jury assessed 27 percent of the fault for Ridolfi’s injuries to Riddell, making the company responsible for paying $3.1 million of the damages.