Blawgletter®

Quote the Day: Thomas Jefferson

[L]et facts be submitted to a candid world.

Declaration of Independence, July 1776.

Do Politicians Make Better Justices?

George Washington University law professor Jeffrey Rosen has -- or tomorrow will have -- a new article out about the pro-business turn of the U.S. Supreme Court these days.  He calls it "Supreme Court Inc."

Blawgletter commends the article, which appears in the NYT Sunday magazine, to your reading if you feel more than a passing interest in the interesection of law and economics, the U.S. Chamber of Commerce, or the Court itself. 

Also politics.

Near the end appears this paragraph about whether the next President will appoint an "anti-business" Justice to the Court:

Still, the possibility does exist. If the economy continues to decline and blue-collar voters end up being crucial in the election, a Democratic president might appoint an economic populist to the Supreme Court as a kind of payback. Earlier this month, on the campaign trail in Ohio, Obama mentioned Earl Warren, who served as governor of California before becoming chief justice, as a model of the kind of justice he hoped to appoint. “I want people on the bench who have enough empathy, enough feeling, for what ordinary people are going through,” Obama said. He praised Warren for understanding that segregation was wrong because of the stigma it attached to blacks, rather than because of the precise nature of its sociological impact. Appointing a former politician to the court would almost certainly introduce a more populist element: the Supreme Court that in 1954 decided Brown v. Board of Education included, in addition to a former governor, three former senators, a former Securities and Exchange Commission member and two former attorneys general. (By contrast, the Roberts court is composed of nine former judges.)

Our feed believes in block quotes.

Reddy Ice Gets Grand Jury Subpoenas

Remember The Iceman Price Fixeth?  The post that reported a raid of Reddy Ice's Dallas headquarters by federal antitrust enforcer types? 

The raid now looks like the tip of a solid water object that floats and bobs in liquid water near the polar regions. 

The Annual Report on Form 10-K of Reddy Ice Holdings Inc. came out yesterday, March 14, 2008.  On page 24, the report includes this interesting paragraph:

  In March 2008, we and certain of our employees, including members of our management, received grand jury subpoenas issued from the U.S. District Court for the Eastern District of Michigan seeking information in connection with an investigation by the Antitrust Division of the United States Department of Justice ("DOJ") into possible antitrust violations in the packaged ice industry.  In addition, on March 5, 2008, federal officials executed a search warrant at our corporate office in Dallas, Texas.  We expect to make available documents and other requested information to the DOJ's Antitrust Division in connection with the investigation.  The subpoenas we and our employees received are part of a broader industry inquiry; at least one other packaged ice manufacturer has also received such a subpoena.  Senior management is not award that the Company has engaged in anticompetitive behavior, or other activities, which would violate the antitrust laws.  On March 6, 2008, our Board of Directors formed a special committee of independent directors to conduct an internal investigation of these matters.  The special committee's investigation is ongoing and the outcome of the investigation is unknown.  The special committee has hired special counsel to assist in its investigation.

Customers of Reddy Ice and its biggest rival, Arctic Glacier out of Winnipeg, have started filing class action lawsuits for price fixing -- three by our count so far in Minneapolis alone. 

Blawgletter expects to see one or more similar filings in Dallas federal court soon.

Our feed can seldom resist commodity puns.

That's Gonna Leave a Mark

Friend of John Grisham, brother-in-law of Trent Lott, kajillionaire lawyer for the sick and hurting.  Richard "Dickie" Scruggs pleaded guilty today to conspiring to bribe a state court judge.  He faces up to a five-year stretch in a federal corrections facility, a $250,000 fine, and probable disbarment.  Stories here, here, here, and here.

Very ugly stuff.  The only bright spot that Blawgletter can see for the trial bar?  That Scruggs's lawyer son, Zachary, didn't plead guilty, too.  We hope it's because his dad was at least a good enough father not to have corrupted his son, too.  If not, Dickie deserves a lot more than five years.

Deliberations About America in Japan

Trial lawyer and jury consultant Anne Reed just got back from a sojourn in Japan, where she delivered a talk on jury stress and did lots of other cool stuff.  And she has started sharing her thoughts about things she learned and re-learned during the trans-Pacific trip. 

We especially like this snippet from her latest Deliberations post:

Americans widely believe that the voice of the citizen in the courtroom is important.  In the big Harris Interactive poll on juries in January, half of respondents said they would trust a jury more than a judge to render a fair verdict, while only 23% said they would trust a judge over a jury.  (The rest were unsure.)  Juror blogs and the juror questionnaires I've seen repeat this theme often; juror after juror says it will be inconvenient to serve, but it's a civic duty they recognize and value.

Spring has sprung.

Quote of the Day: Steve Buscemi

So, how long you been with the escort service?  Find that work interesting,do ya?

As Carl Showalter in Fargo (1996).

Our feed stays abreast of current events.

Questions About Fed's $200 Billion Bank Bonanza

The Federal Reserve yesterday announced a plan to lend up to $200 billion of taxpayer money to Wall Street banks.  The collateral?  Essentially, a bunch of mortgages that have a piece of twine holding them together.  The news sent the Dow Industrial Average reaching for the stars.  Not so much today though.  WSJ article here.

Blawgletter read somewhere that the Fed has authority to make loans like that but didn't see anything about how the Fed valued the collateral for purposes of determining its adequacy as security for the $200 billion.  Did it use face value?  Something less?  How much less?

Because the whole thing looks like moving the deck chairs around on that ship that sank after hitting an iceberg and inspired an interminable movie with nudity (and more!) in a jalopy aboard the vessel prior to its voyage to the bottom of the sea.

Moving a bundle of mortgages from the balance sheet of, say, Goldman Sachs to that of Uncle Sam doesn't, in our view, make the bundle worth more.  It just makes GS's financial condition look better.  And, if GS has to take the bundle back, what really has changed?

Perhaps Ben Bernanke has the magic wand that, by calming an irrational market, restores true value.  But with underlying real estate values continuing to fall, we wonder if something less Disneyesque has happened. 

Can you say bailout?

As a matter of fact, we do plan to visit the Magic Kingdom next week.

Study of State Supremes Shows Influence

Adam Liptak penned a Sidebar column today on a study of the influence that each of the 50 or so state supreme courts exerts over its brethren and sisteren. The big winner? The Golden State's highest court -- yes, the Supreme Court of California.

How did Blawgletter's home state judicial Olympians fare? Not so great. For the period 1940 through 2005, the Supreme Court of Texas ranks fourteenth despite sitting in the second biggest (after Alaska) and second most populous (behind California).

Now for the worse news: The court's standing fell to twentieth if one takes only 1986 through 2005 into account. One wonders how well the court would've done for 1940-1985 if 1986-2005 hadn't dragged down the ranking for the long sweep of 1940-2005.

We feel certain that Their Honors have an excellent explanation.

The Iceman Price Fixeth?

Last week, federal antitrust authorities raided the Dallas headquarters of Reddy Ice Holdings Inc., the biggest maker, packager, and distributor of ice in the United States.  The other gargantuan ice vendor in North America, Arctic Glacier Inc., with main offices in Winnipeg, Manitoba, also reported a brush with the antitrust probe.

See the Reddy Ice press release here and the Arctic Glacier one here.

Blawgletter just had a chilling thought.  Never mind.

Brain freeze.

The Hourly Squeeze

The March issue of Litigation News includes two items that will make beaucoups of hourly lawyers grimace.  The titles say it all: 

• "Corporations Balk at Outside Counsels' Automatic Rate Increases:  Wal-Mart, Shell, and other corporations say rising associate salaries are to blame"
• "In-House Counsel Are Keeping Closer Tabs on Outside Lawyers:  Law departments use vendor management techniques to monitor billing"

To which Blawgletter says not "yikes!" but "hallelujah!"  We welcome in-house lawyers' insistence on getting value for their legal dollars. 

We also have two words for them:  contingent fee.

The plastics of tomorrow.  Sorry, Dustin.