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DEFENSE STRATEGY PAYS OFF FOR BELNICK During the larceny trial of former Tyco International Ltd. general counsel Mark Belnick, his defense team worked to portray him as a dedicated lawyer who earned millions through his hard work. In doing so, they sought to distinguish him from Tyco’s former chairman and chief executive officer, L. Dennis Kozlowski, whose reputation for ostentatious living came to symbolize executive greed. It appears the strategy was successful. Last week, a New York jury acquitted Belnick of all charges that he stole more than $30 million in compensation and loans from the company. Belnick’s defense team was headed by Reid Weingarten of D.C.’s Steptoe & Johnson. “We are happy, relieved, but not surprised,” Weingarten said after the verdict July 15. “We always believed we represented an innocent man, and we were confident that when a fair-minded jury heard the evidence, we would be fine.” The verdict came on the fifth day of jury deliberations, following more than two months of testimony. Belnick was facing up to 25 years in prison. In trial, Weingarten and other Belnick lawyers argued that the general counsel earned the money through his hard work on a 2000 inquiry by the Securities and Exchange Commission into Tyco’s accounting practices. The prosecution, led by Assistant Manhattan District Attorney John Moscow, had argued that Belnick received a $17 million bonus and more than $14 million in interest-free loans without board approval because he helped Kozlowski cover up his own thefts from the company. The centerpiece of the defense’s case was Belnick himself, who took the stand for several days of testimony. On direct examination by Weingarten, he presented himself as an honest lawyer and outsider at Tyco who failed to establish a rapport with Kozlowski and encountered active hostility from other Tyco executives and members of the board of directors. Belnick described how he hired and worked with lawyers at the D.C. firm then known as Wilmer, Cutler & Pickering — now Wilmer Cutler Pickering Hale and Dorr — to resolve the SEC probe. He said Kozlowski had promised the $17 million bonus at the investigation’s successful conclusion. Throughout his time on the stand, Belnick acknowledged that his compensation was high, but he said Tyco was known for rewarding performance. He said he relied on Kozlowski’s word that the CEO had the ability to set the general counsel’s compensation. Belnick’s acquittal is a blow to Manhattan District Attorney Robert Morgenthau, whose office’s prosecutions against Tyco executives have been among the most high-profile cases of alleged corporate crimes. “The jury has made its decision and we, of course, accept it,” a spokeswoman for the D.A. said after the verdict. — Anthony Lin, New York Law Journal RIGGS RECOURSE No doubt, PNC Financial Services Group Inc.’s successful $779 million stock and cash bid for troubled Riggs National Corp. wasn’t made without a large helping of due diligence. William Mutterperl, vice chairman of PNC, says the Pittsburgh-based bank has a protective clause in its contract that allows it to renegotiate or back out of the deal if Riggs is hit with more federal fines before the transaction closes in early 2005. New York firms Wachtell, Lipton, Rosen & Katz and Sullivan & Cromwell represented PNC and Riggs, respectively, in the deal, announced July 16. In May, Riggs paid $25 million in fines to the Treasury Department for failing to report suspicious transactions. And five of its executives were on Capitol Hill last week to answer questions from the Senate Permanent Subcommittee on Investigations about allegations related to its international banking division, including that the bank hid assets from international prosecutors on behalf of ex-Chilean dictator Augusto Pinochet. “We’ve done a lot of due diligence,” says Mutterperl. “But it may well be there are more shoes to drop.” — Lily Henning SHEPPARD’S FLOCK Sheppard, Mullin, Richter & Hampton has lured another lawyer from the leadership ranks of D.C.’s U.S. Attorney’s Office. In August, Daniel Seikaly, the Criminal Division chief, will join the year-old D.C. office of the Los Angeles-based law firm. Seikaly will reunite with Roscoe Howard Jr., former U.S. attorney for the District, and Mark Nagle, the office’s former Civil Division chief, both of whom joined Sheppard, Mullin in June. Meanwhile, interim U.S. Attorney Kenneth Wainstein continues to make changes in the office’s ranks. G. Bradley Weinsheimer, chief of the felony trial section, has been tapped for chief of the Superior Court division. Weinsheimer replaces Clifford Keenan, who will become a special counsel. — Christine Hines and Tom Schoenberg FEE FOES Legislation that would increase application fees for the U.S. Patent and Trademark Office and stop PTO-generated fees from being sent to non-PTO programs remains stalled in the Senate. The U.S. Patent and Trademark Fee Modernization Act of 2004 sailed through the House of Representatives by a 379-28 vote. But Senate Appropriations Committee members are not happy with it. A May 4 letter addressed to Senate Majority Leader Bill Frist (R-Tenn.), and signed by four committee members including Chairman Ted Stevens (R-Alaska) and ranking member Robert Byrd (D-W.Va.), objected to a provision that would refund fees back to PTO applicants if the amount of fees received by the agency exceeds the amount appropriated for the PTO by Congress. The senators complained that refunding the fees would cause problems in calculating next year’s budget and that the measure would reduce the committee’s authority to allocate money to the PTO. Herbert Wamsley, the Intellectual Property Owners Association‘s executive director, says his and other industry groups are willing to compromise as long as the bill prevents the diversion of PTO fees to unrelated government programs. Brigid Quinn, spokesperson for the PTO, says there had been similar issues on the House side as well. “We’re confident that they’ll be worked out on the Senate side, too,” she says. — Christine Hines BAWDY BLOG When the lawyers are away, the judges will play, and one gossipy blogger wants the world to know what they’re up to. A new Internet blog titled Underneath Their Robes pokes fun at the federal judiciary with Page 6-like blind gossip items, a feature called “Bench-Slapped” that chronicles judicial-branch infighting, and an Article III beauty contest of sorts. An anonymous lawyer who goes by the handle Article III Groupie (A3G for short) started the site in June. In her first posting, A3G asked, “What do federal judges have going on ‘underneath their robes’? (Does Chief Justice Rehnquist wear boxers or briefs? Probably boxers, except when playing tennis with his law clerks.)” A3G’s judicial beauty pageant, “Superhotties of the Federal Judiciary,” has drawn attention from the legal community. In fact, Judge Alex Kozinski, of the U.S Court of Appeals for the 9th Circuit, nominated himself as the juiciest jurist in a letter to the anonymous blogger. “I had my own photo-spread in George magazine, with lots of sexy pictures of me jumping,” he wrote. Via e-mail, the secretive blogger tells Legal Times, “I’m rather paranoid about remaining anonymous.” But the lawyer gives away a few clues to her identity, albeit vague ones. In the “About Me” section of her site, the former federal clerk claims to have graduated from a “top-five law school in the late 1990s.” Now she “toils away in obscurity” at a “large law firm in a major city.” — Marie Beaudette LONDON BRIDGE Pittsburgh-based Kirkpatrick & Lockhart says it concluded talks last week with Nicholson Graham & Jones, a 135-lawyer London firm. The firms’ respective partnerships are slated to vote on the merger in September. The move will open a gateway to continental Europe, says Kirkpatrick chairman Peter Kalis. Kirkpatrick — with 10 U.S. offices and 800 lawyers, including 135 in D.C. — has nearly doubled in size over the last decade. Kalis says both firms have “substantially completed” due diligence and “are highly confident that the combination will take place.” The firms will work together in a range of areas, including mergers, acquisitions, real estate, litigation, intellectual property, construction, and insurance coverage. — Lily Henning SUPERIOR SITE The D.C. court system has for the first time gone online with a Web site offering residents and lawyers information on courthouse operations, court opinions, and pro bono assistance. For the past four years, some of that data was available on the Internet via the D.C. Bar. The new site,, includes general information about D.C. Superior Court and the D.C. Court of Appeals, such as directions, phone numbers of judges and officials, job listings, and filing fees. And it has plenty of insider data — the court system’s budget, its five-year strategic plan, and court rules. Eventually the site will hold daily court schedules. The site is also available in Spanish. “Basically, we designed it to make it easy for the public to interact with us and for them to learn about us,” says D.C. Superior Court Chief Judge Rufus King III. — Tom Schoenberg LOCAL LEADER McKenna Long & Aldridge has appointed one of its D.C. partners to manage the firm. T. Mark Flanagan Jr. officially took over as managing partner on July 1 replacing Atlanta-based partner Thomas Hall, who retired the day before. Flanagan says he will split his administrative duties as firm manager with his government contracts and litigation practice. Hall had been managing partner of the firm since 2002 when it was created from the merger of McKenna & Cuneo and Long, Aldridge & Norman. Flanagan says the merger is going well and that he is looking forward to leading the eight-office, 375-lawyer firm. “I think we’re really poised to have several good years in front of us,” Flanagan says. — Christine Hines MARKET MOVER After five years as the chief marketing officer at Covington & Burling, John Neidecker is moving across town to Steptoe & Johnson, where he will help build Steptoe’s small marketing department. When Neidecker came to Covington in 1999 from accounting firm PricewaterhouseCoopers, where he was director of marketing for the mid-Atlantic region, the firm had no formal department at all. Now Covington’s marketing department has a staff of 12. “It’s been a great run here,” he says. “I greatly enjoyed it. I’m very proud of what I’ve accomplished.” Larissa Engelman will replace Neidecker as the interim marketing chief while Covington conducts a search for a permanent replacement. “John, who leaves behind a terrific team that he was instrumental in recruiting and training, departs with our gratitude and best wishes,” says Covington partner Mitchell Dolin. — Marie Beaudette

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