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Bill seeks to alter DOJ corporate fraud probes Outgoing senate Judiciary Committee Chairman Arlen Specter, R-Pa., last week laid the groundwork for a congressional override next session of controversial Justice Department guidelines on waiver of attorney-client and work-product privilege in federal civil and criminal investigations. Specter introduced the Attorney-Client Privilege Protection Act of 2006, which sends a signal that there is growing congressional support to undo the guidelines if the Bush administration does not act, although it is unlikely to see action this session. The bill prohibits any federal agent or attorney from demanding or conditioning treatment or a charging decision on waiver of the protections. Business and personal bankruptcies drop in ’06 Business bankruptcy filings declined by 20% to 27,333 for fiscal year 2006 compared with the 2005 period, according to the Administrative Office of the U.S. Courts. Ailing companies have been able to skirt bankruptcy over the past year in large part because of increased capital flowing from hedge funds and private equity firms into distressed companies, restructuring lawyers have said. Overall bankruptcies, including personal bankruptcies, dropped by 38% for fiscal 2006. Lack of diversity in N.Y.’s top court is criticized With implicit pressure on New York Governor-elect Eliot Spitzer, witnesses at a judicial diversity hearing last week made clear their view that the new administration must do more to promote blacks and other minorities in the judiciary. The paucity of blacks on the appellate courts has become a rallying cry for those who say that diversity is crucial to maintaining the respect and confidence of the public in the judiciary. Only two of the 64 appellate judges in the state are black, and there are no blacks on the state high court for the first time since 1984. Former Republican state Senator John Dunne, vice chairman of the Committee for Modern Courts, noted that while 71% of registered state voters find the judiciary fair and impartial, there is a “significant racial divide,” with only 51% of African-American voters agreeing that judges are fair and impartial. Verizon goes on offense with ‘pretexting’ suit In a wave of federal court suits, Verizon Wireless is attacking the increasing practice of “pretexting,” by which impostors pose as customers to obtain their billing records, calling details and other information. The suits, the most recent of which was filed last week in Newark, N.J., do not allege ulterior motives but charge that the defendants accessed customers’ accounts online by entering telephone numbers and other personal data. In Cellco Partnership d/b/a Verizon Wireless v. Worldwide Investigations Inc., No. 06-05792, Verizon alleges violations of the Computer Fraud and Abuse Act, 18 U.S.C. 1030, and the New Jersey Computer Related Offenses Act, Sec. 2A:38A-1. Feds in L.A. win a key Milberg discovery battle Los Angeles federal prosecutors have won a behind-the-scenes discovery fight in the undying probe of plaintiffs’ firm Milberg Weiss Bershad & Schulman. In a sealed ruling issued the day before Thanksgiving, U.S. District Judge A. Howard Matz ordered the production of reams of discovery that prosecutors had sought from various plaintiffs’ firms, according to lawyers familiar with the case. Attorneys for Milberg-which was indicted in May, as were two of its name partners, on charges of paying kickbacks to clients-had argued that the material was covered by work-product privilege. The documents relate largely to payment agreements with other firms for John Torkelsen, a former expert witness for Milberg, said the attorneys. H-P to pay $14.5M to settle claims in leak case Hewlett-Packard Co. will seed a $13.5 million California state fund that will finance future prosecutions of privacy and intellectual property crimes, under the terms of a civil settlement stemming from the company’s highly publicized leak investigation. The Palo Alto, Calif., company will also pay a $650,000 fine and $350,000 to cover the California attorney general’s probe into allegations that Hewlett-Packard executives authorized the use of “pretexting,” or lying, to obtain the private phone records of board members and reporters. In exchange, state prosecutors agreed not to file civil claims against former and current company officers and employees, according to documents filed last week in Santa Clara County, Calif., Superior Court.

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