stacks of cash

With the 2014 World Cup set to kick off Thursday in Brazil, the U.S. men’s national soccer team is preparing for a showdown in the dreaded Group of Death, which includes the home country’s Seleção, Germany and Ghana.

Even as the U.S. men’s team mounts its long-shot bid to win the world’s most popular tournament, the organization that controls the squad, the United States Soccer Federation, is among those feeling the impact of a leadership controversy involving professional and amateur soccer’s worldwide governing body, the Zurich-based Federation Internationale de Football Association.

As federal tax filings prepared by leading Swiss law firm Niederer Kraft & Frey show, FIFA itself has “no office, fixed place of business or other establishment” in the United States, which means the nonprofit does not have to report to the Internal Revenue Service what it pays its executives and outside vendors.

Howwever, the Chicago-based USSF is a registered U.S. nonprofit and must disclose many of the financial details related to its operations in the Form 990 that the IRS requires all such organizations to submit each year. A review of the USSF’s three most recent filings reveals that the organization—whose general counsel Lisa Levine took home $208,384 in total compensation in 2012, according to its latest Form 990 filing—has paid Latham & Watkins at least $10.8 million for legal services since the last World Cup in South Africa four years ago.

The documents in question—which span the period from April 1, 2010, through March 31, 2013—show that Latham received more than $3 million in 2010, nearly $6.4 million in 2011 and roughly $1.4 million in 2012—a year in which sibling publication the Litigation Daily reported the firm secured a big win for the USSF in an antitrust and racketeering case. (The USSF also paid Littler Mendelson $110,498 in 2010.)

A Latham spokesman told The Am Law Daily via email that the USSF has been a firm client since at least 1990. Among the assignments Latham has taken on for U.S. soccer’s top organizational body since that time include helping launch the National Women’s Soccer League last year and advising a U.S. bid committee in 2010 on its ultimately unsuccessful attempt to host the 2022 World Cup, whose voting process awarding those games to the Persian Gulf emirate of Qatar continues to attract scrutiny today.

As previously noted by The Am Law Daily, retired Latham litigation partner Alan Rothenberg also played a key role in founding Major League Soccer two decades ago. The nation’s top pro soccer circuit, which launched in the afterglow of the U.S.-hosted 1994 World Cup held in the U.S., once awarded its annual champion a trophy in Rothenberg’s name.

Rothenberg, a member of the National Soccer Hall of Fame who served as chair and CEO of 1994 World Cup and later president of the USSF, is considered a godfather-like figure in U.S. soccer history. But his close ties to Latham and the USSF have not been without some controversy.

A 1996 Sports Illustrated story reported on a wrongful termination suit filed by former men’s soccer team employee Michael Hogue—a longtime Rothenberg critic—who accused the soccer powerbroker and Latham of profiting excessively from the sport’s growing popularity in the U.S. Hogue specifically cited what he claimed were at least $11.3 million in fees that Latham collected during the early nineties for its World Cup work, $7.4 million in compensation paid to Rothenberg and a $107,321 salary that went to his then-20-year-old son Bradford. (Brad Rothenberg sold his youth soccer marketing business BRC Group to LeadDog Marketing in late 2012.)

That controversy notwithstanding, Latham’s soccer connections remain strong. A separate 2010 tax filing by the last U.S. World Cup bid committee shows the firm earning another $600,000 in fees from that entity. Latham’s soccer expertise, like the firm itself, extends well beyond the U.S. borders.

In 2012 Latham took the lead advising Manchester United, the flagship franchise of the English Premier League, as it raised $233 million through an initial public offering on the New York Stock Exchange. An SEC filing for that listing shows it generated $4.24 million in legal fees and expenses.

Gibson Dunn Bills Big on Bridgegate, Students

A month after it was revealed that Gibson, Dunn & Crutcher had earned $1.1 million for its first month of work on the so-called Bridgegate scandal, documents obtained and publicized by media outlets show that the firm’s total tab in the mater has now reached $3.2 million.

According to an 81-page invoice reviewed by The Star-Ledger of Newark and The Wall Street Journal, the latest $2.1 million fees cover work done by Gibson Dunn lawyers in February—the month before the firm released its controversial 344-page report clearing Gov. Chris Christie and key members of his administration of wrongdoing before, during and after the series of huge traffic jams in the vicinity of the George Washington Bridge last September.

New Jersey’s acting attorney general John Hoffman also approved payments to other outside firms representing current and former Christie staffers, at least one of whom has cast doubt on some of the conclusions reached by Gibson Dunn, according to sibling publication New Jersey Law Journal. (Riker Danzig, one of the Garden State’s largest firms, is representing 15 Christie staffers.)

Gibson Dunn, which has also been well-compensated in recent years for its work fighting to overturn a California ballot initiative banning same-sex marriage, scored another big West Coast win this week that could yield a similar windfall.

The victory in question came when a state court judge in Los Angeles struck down California’s teacher tenure laws as unconstitutional, according to sibling publication The Recorder. The case was brought on behalf of nine public school students who claimed that state laws kept inadequate teachers in their jobs and compromised their education.

The suit, which was filed in 2012 by Gibson Dunn appellate litigation cochairs Theodore Boutrous Jr. and Theodore Olson, went to trial earlier this year. The plaintiffs are being backed by Students Matter, a Silicon Valley-based nonprofit founded by entrepreneur David Welch. The group’s 2012 tax filing shows that Gibson Dunn received $1.1 million that year, while Quinn Emanuel Urquhart & Sullivan collected another $356,358. (A 2011 tax filing by Students Matter shows that Quinn Emanuel was paid $515,919 by the group that year.)

San Francisco’s Altshuler Berzon took the lead for the two main defendants in the litigation, the California Federation of Teachers and the California Teachers Association, the latter of which has amassed substantial legal expenses of its own.

A 2012 tax filing by the CTA reveals payments to the following five California firms: Schwartz, Steinsapir, Dohrmann & Sommers ($1.3 million); Beeson Tayer & Bodine ($900,192); Tuttle & McCloskey ($835,464); Langenkamp & Curtis ($786,352); and Trygstad, Schwab & Trygstad ($675,585). The CFT is an affiliate of the Washington, D.C.-based American Federation of Teachers.

School Ties a Boon to Some Big Firms

The continuing debate over the merits of a U.S. law school education—and the challenges plaguing some lower-level institutions—have been well-covered in this space and that of our sibling publications in recent years.

A corollary to that discussion is the escalating cost of undergraduate tuition, which according to a recent story in Slate has increased 12-fold over the past 30 years. That story prompted The Am Law Daily to review the tax filings of the nation’s 20 most expensive colleges to get a sense of their external legal expenditures.

An examination of records on file with the IRS shows that the cost of legal fees and services were among the top five payments to external vendors for the following schools: Bard College ($754,639 to Skadden, Arps, Slate, Meagher & Flom); Carnegie Mellon University ($4 million to K&L Gates); Rensselaer Polytechnic Institute ($207,473 to solo immigration law practitioner Michele Santucci); and the University of Chicago ($893,482 to DLA Piper).

Miscellaneous Matters

—The Harvard Management Company, the Boston-based investment management firm that runs the $32.7 billion endowment for Harvard University, announced this week that its president and CEO, Jane Mendillo, will step down at year’s end. HMC’s 2012 tax filing shows it paid $10.3 million to Ropes & Gray for legal services that year.

—Elsewhere on the academic front, a report this week by nonprofit advocacy organization the Environmental Working Group cites public records showing that lobbyists from Barnes & Thornburg have been doing work for both the School Nutrition Association and the American Farm Bureau Federation. The EWP cites a buffet-sized batch of lobbying filings showing how Barnes & Thornburg has allegedly handled work for groups with sometimes dueling interests. The AFBF also paid $653,138 to Crowell & Moring in 2012, according to a tax filing by the nonprofit.

—Markit, a leading financial data company for bond information and derivatives trade processing, is seeking to raise up to $1.14 billion through an IPO on June 18. Davis Polk & Wardwell and Bermuda’s Conyers Dill & Pearman are advising Markit on the pending share sale, while Skadden has taken the lead for underwriters, according to an SEC filing by the company. That filing shows that the listing expects to generate $7.3 million in legal fees and expenses. Markit’s chief administrative officer and general counsel is former Proskauer Rose corporate partner Adam Kansler.

—Texas Lawyer, a sibling publication, raised the curtain this week on a $50 million malpractice case currently unfolding in Houston against Andrews Kurth. The allegations levied against the firm by a former client touch on the ties between convicted Ponzi scheme R. Allen Stanford and Spencer Barasch, an Andrews Kurth partner and head of the firm’s corporate governance and securities enforcement practice. Barasch, a former SEC lawyer who was the subject of a scathing report by the commission’s inspector general in 2010, was the recent focus of two in-depth stories by Vice Media probing his interactions with Stanford before and after he joined Andrews Kurth. Vice reports that the firm received at least $6,588 for its work representing Stanford-related entities, and likely earned significantly more than that, despite the fact Barasch was barred from ever representing Stanford under SEC ethics rules.

—The Am Law Daily reported last month on the legal fees paid out to Am Law 100 firms by the National Football League Players Association over the past year, but the organization isn’t the only labor union with links to the gridiron that kept outside lawyers busy. An annual LM-2 filings made with the U.S. Department of Labor by the National Football League Referees Association shows that the union paid $402,524 over the past two years to Kansas City, Mo.-based Arnold, Newbold, Winter & Jackson to advise on labor negotiations and other issues. NFL referees were locked out by the league in 2012 before both sides eventually reached a new collective bargaining accord after the start of the 2012-13 season.

—Finally, the USSF isn’t the only major U.S. sports governing body keeping its outside lawyers busy. USA Swimming, the Colorado Springs, Colo.-based organization that runs competitive swimming in the U.S., saw executive director Charles Wielgus apologize this week to sexual abuse victims. The mea culpa, written in the form of a blog post on USA Swimming’s website, arrives four years after Wielgus insisted that there was nothing inappropriate going on at his organization’s training program. Tax filings show that the nonprofit paid Bryan Cave $696,152 in 2012 and paid Holme Roberts & Owen nearly $1.4 million all told in the two years prior. The firms merged on Jan. 1, 2012.