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Facing a throng of reporters in the federal courthouse in San Francisco, where 11 TV cameras were trained on him, David Boies found himself in an unusual spot — on the defensive. In three swift and harrowing hours on the afternoon of Wednesday, July 26, the judge in the record industry’s case against his new client, Napster Inc. — the Web site that lets users trade music files over the Internet — found that the company was facilitating wholesale copyright infringement and ordered it to “figure out a way” to stop it by midnight that Friday. Asked whether he expected an increase in user “hits” to the Napster site, Boies offered, “I took a few hits today myself.” His work on the government’s antitrust case against the Microsoft Corp. had ended with U.S. District Judge Thomas Penfield Jackson’s June 7 breakup order. But Boies was unable to join his government colleagues for a press conference that day because he was en route to a hearing in Miami, where he was about to be named co-lead counsel in a mammoth class action against the nation’s health maintenance organizations. The Napster and HMO cases top a list of headline-grabbing suits that Boies and his Armonk, N.Y.-based firm, Boies, Schiller & Flexner, have taken on. The firm was named lead counsel in a class action against Sotheby’s Holdings Inc. and Christie’s International, stemming from the Justice Department’s investigation of price-fixing by the auction houses. And Boies is representing fashion designer Calvin Klein in a nasty trademark infringement suit against his longtime licensee, Warnaco Inc. The cases are all high-risk, and the biggest involve major questions of public policy. THE NAPSTER CASE Marilyn Hall Patel, the chief federal judge of the Southern District of California, had ruled once against Napster by the time Boies was hired to join the defense team in early June. Patel is known for being harsh in the courtroom. Lawyers are quoted in the Almanac of the Federal Judiciary as describing her as “acidic” and “mercurial.” On July 26, she lived up to her billing. Patel cut Boies off when he tried to explain that her injunction could not be implemented without shutting Napster down. “That’s the system that has been created,” she said, “and I think you’re stuck with the consequences of that.” When Boies tried to go on, she cut him off again. “I mean, they can have their chat rooms and they can solicit all those new artists,” she said, her voice crackling with sarcasm. After her ruling, Boies and his partner Jonathan Schiller discussed the emergency motion for a stay of her order as they walked through San Francisco’s Tenderloin District back to the offices of Fenwick & West, which is also defending Napster. In an interview at Fenwick’s offices the next afternoon, after the stay motion had been filed, Boies is still pondering what he could have done to change the judge’s mind. “Scale was something that was obviously critical to her,” he says. “She viewed broad-scale sharing as illegal, even though small-scale sharing would not be.” At the hearing, Boies had mentioned that 80 to 90 percent of the copied materials at issue in Sony Corp. of America v. Universal City Studios Inc., 464 U.S. 417, were copyrighted. That 1984 Supreme Court case cleared the Betamax VCR of copyright violations. “They weren’t sharing with the world,” Patel shot back. Boies says there are “two basic problems” with Patel’s focus. First, the Sony case and relevant laws don’t distinguish between a little copying and a lot. Second, he says, is that she had no evidence on how much individual Napster users are sharing. “She does sort of take it as a given,” he says. “But the whole point of a trial is that you’re not supposed to take things as a given.” On Friday, deadline day, Boies was on the telephone with Hank Barry, Napster’s chief executive, talking about how to comply with Patel’s order. They couldn’t see how to do it without shutting down the system. In the middle of the conversation, they got the news that the appeals court had granted a stay. The tables had turned dramatically. Boies’ reaction is characteristically low-key. “You don’t want to read too much into a stay motion,” he says. The two-page stay order cites “substantial issues of first impression going to both the merits and the form of the injunction.” More significant, says Professor Lawrence B. Solum of Loyola Law School, may be one of the two jurists who signed it — U.S. Circuit Judge Alex Kozinski. “His libertarian legal philosophy is exactly in line with Napster’s,” says Solum, who teaches Internet law. A quirk in local procedure may render Boies and his client doubly lucky: usually, the panel of judges that hears emergency motions does not hear the case as the appeal moves forward. But the motions panel has the discretion to keep appeals from preliminary injunctions, a power that has been the subject of some controversy but is settled law. If Kozinski opts to hear the case, Solum says, “Napster clearly has a shot.” IN MIAMI, HMOS About two weeks after Napster’s near-death experience, Boies was in a Miami courtroom, again facing long odds, this time against HMOs, before U.S. District Judge Federico A. Moreno. Lawyers from more than 40 law firms, led by Boies and Richard Scruggs, the tobacco-slaying lawyer from Pascagoula, Miss.’ Scruggs, Millette, Bozeman & Dent, hope to corral suits against the entire industry before Moreno. A motion to dismiss by Humana Inc., the case furthest along, is before him. Days before the Aug. 17 argument, the 3rd U.S. Circuit Court of Appeals had affirmed the dismissal of a class action against Aetna Inc. in language that seemed to strike at the heart of the issues before Moreno. The decision in Maio v. Aetna Inc., No. 99-1894, determined that the plaintiffs’ central claim — that they paid too much for an inferior health insurance product — failed to established the injury to property required for their civil RICO claims. “If you put a mirror up to Maio, it’s this case; they’re no different,” Humana’s lawyer, John H. Beisner of the Washington, D.C., office of O’Melveny & Myers argued to Moreno. The Miami hearing packed the courtroom. Plaintiffs’ lawyers even filled the jury seats. Before the hearing, many were spinning the Maio case as irrelevant. When Boies stepped up to argue, he took an unusual tack. “I would be delusional, your honor, if I thought the Maio case was a helpful case for us,” he said. “It is not.” He admitted that the facts of the two cases “are very similar.” But the legal theories differ, he contended. “We’re saying that Humana lied about the amount of coverage,” he said. Humana’s disclosure documents, he said, failed to disclose to policyholders that it provides cash bonuses and other incentives to claims reviewers who deny claims. “If they are going to disclose something, they have a duty to make the disclosure fair and accurate,” he said. Why even bring up Maio? “This is going to be a long case,” Boies says. “We’re going to be in front of Judge Moreno a number of times, and you’ve got to be credible. If you get up and you try to pretend that the Maio case is a really good case for you or doesn’t have anything to do with what the issues are, that’s not credible.” MORE NAPSTER, AND AUCTIONS Boies’ argument was the first of a series about the Humana case before Moreno that day. As it happened, Napster’s plea to the 9th Circuit was due the next day — and it was still more than 20 pages too long. During a recess, an assistant rushed in with the draft so that Boies could work on it. The brief presents a view of the case starkly different from the one in Judge Patel’s Aug. 10 opinion, which relegated one of Boies’ main arguments — that noncommercial copying of music onto computer hard drives is immunized by the Audio Home Recording Act of 1992 — to a footnote. She called language from the 9th Circuit case from last year irrelevant because the plaintiffs before her did not bring claims under the act. How important is Boies’ firm to the Napster team? Very, it turns out. “They were very much on our mind, even before we made the investment,” says Hank Barry, Napster’s chief executive and a partner at the San Francisco venture capital firm Hummer Windblad, which sunk $13 million into Napster in May. Napster offered Boies a stake in the company to take the case. Boies is sometimes willing to take on much more risk than his fellow lawyers. Consider the auction-house class action. In April, U.S. District Judge Lewis A. Kaplan of New York, who is overseeing more than 50 class actions stemming from the price-fixing investigation, put the coveted role of lead counsel for the litigation out for bid. Boies’ firm won, ruffling the feathers of six law firms that Kaplan had appointed as interim lead counsel. The auction process required firms to submit proposals with an X figure, representing the 100 percent gross recovery that class members would receive before the lawyers got a penny. Boies’ firm asked permission to share its sealed bid with several others it was considering hiring as co-counsel, including Houston’s Susman Godfrey and New York’s Kaplan Kilsheimer & Fox. But none of the firms signed on. “I hope they reach their X, but I think it’s a huge, huge risk,” says a lawyer at one of the firms. There have been settlement discussions, but Boies says he doesn’t believe the defendants are willing to pay the damages the class deserves. Sometimes the risk doesn’t pay off. In January, Boies sued the legal giant Reed-Elsevier on behalf of Jurisline.com, a fledgling Web site that for several months had been offering an archive of opinions copied off of CD-ROMs purchased from Reed-Elsevier’s Lexis division. The suit sought a declaration that the cases on Lexis are public domain materials that can be copied freely. Had it succeeded, Jurisline might have offered free cases to lawyers, much like Napster’s free music for the people. Lexis’ counsel, from New York’s Proskauer Rose, counterpunched immediately, with a state court complaint charging Jurisline’s co-founders, both of them lawyers, with fraud in connection with the CD-ROM purchases. Proskauer’s Stephen R. Kaye extracted a quick settlement after the judge presiding over the federal case rejected Boies’ arguments that the fraud case should be pre-empted. But of all Boies’ cases, Calvin Klein’s brawl with Warnaco promises to get the ugliest. His complaint charges that Warnaco and its chief executive, Linda Wachner, “have become a cancer” on the designer’s trademarks by selling to discounters. U.S. District Judge Jed S. Rakoff of New York dismissed counts that sued Wachner personally and alleged that she usurped corporate opportunity by negotiating the sale of Calvin Klein jeans with discounters like Costco to get her annual bonus. “It is simply disguised name-calling,” Rakoff said. “It is the functional equivalent of saying I’m a goody, and you’re a baddy, nyah, nyah, nyah.” All of this suggests that Boies, whose reputation as an invincible trial lawyer was set in concrete by the Microsoft case, isn’t afraid of the prospect of losing. “Win or lose,” he says of Napster, “it was the right case to take on. “It’s a case of great importance, very substantial issues. If we’re not going to take this kind of case, then what are we doing?”

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