Archive for June 2008

The Wisdom of Dagwood Bumstead

June 30, 2008

Dagwood Bumstead, featured in the long-running comic strip Blondie, has worked for more than 70 years for J. C. Dithers, the model for many a law firm senior partner. But that was not the way he started out comic strip life. His saga tells an interesting story about family business succession.

Dagwood began as the heir to an industrial empire, the Bumstead Locomotive Works. He fell in love with Blondie Boopadoop, whom his family considered beneath him socially. When he insisted on marrying Blondie anyway, his father disinherited him. Thus ended his future of becoming an executive in a large industrial concern, and he turned instead to more than 70 years of wage slavery, carpools, running into the mailman, etc. He seems to have become stuck as the equivalent of a third year associate. Meanwhile, Blondie started her own business, and the Bumstead Locomotive Works has disappeared. Perhaps Dagwood could have saved the company and redirected its business to defense contracting or microchips.

What’s the lesson for those thinking about family business succession, which is one of the most difficult goals to achieve but one of the most satisfying when it is achieved? It’s a better course of action for the family members to discuss each of their goals and plans. Bumstead Senior should have realized the consequences of leaving no one to follow him in the business. Dagwood could have suggested that he come into the business on a lower level so that he could prove himself. Senior’s lawyer could have explained how disinheriting his son would probably put an end to the plans to have the business remain in the family and successful. But I suppose that wouldn’t make for a good comic strip; better to feature big sandwiches and funny bowties.

Here are two sources of learning on the process of business succession, very different but both helpful. One is a book titled “Estate & Business Succession Planning,” by Russell J. Fishkind and Robert C. Kautz. The second is a series of programs on succession planning that feature a theatrical performance of vignettes in the story of family businesses. These programs have been arranged by a psychologist, Dr. Scott Budge, who has spoken for PBI on business succession planning. They are presented in Philadelphia from time to time.

Robert H. Louis
Saul Ewing
http://saul.com

Manufacturing Mootness

June 27, 2008

Federal courts of appeals deny petitions for rehearing every day and, unless a judge on the court dissents, there is seldom an opinion accompanying the denial. A case from the 11th U.S. Circuit Court of Appeals offers an exception to the rule and a lesson for lawyers who might be thinking about pushing the envelope of appellate advocacy.

Perez v. Sanford-Orlando Kennel Club would appear to be a garden-variety wage and hour dispute under the Fair Labor Standards Act, or FLSA. The amount of money involved in the case was just a couple thousand dollars. Yet, the defendants’ attorney risked sanctions (hinted at but not imposed by the court of appeals) or, at a minimum, scorn and opprobrium, for the tactics he employed in an effort to avoid a precedent he feared.

At trial, a jury found in favor of plaintiff and against most of the defendants, awarding $2,100 in damages. Both sides appealed, the defendants challenging the judgment and the plaintiff challenging the court’s failure to award him liquidated damages. After briefing and oral argument, the parties effectively settled their dispute, with defendants agreeing to pay the $2,100 judgment plus interest, as well as attorneys’ fees of about $29,000. They even filed a satisfaction of judgment with the trial court.

But nobody told the court of appeals. In fact, the court’s opinion makes clear that this omission was intentional. The defendants had two other FLSA cases pending in the trial court raising the same issues. Apparently thinking they could create a no-lose situation for themselves, the defendants chose to let the appeal proceed, figuring that if the court came out their way, they would have a good precedent to invoke in the pending cases (and any others that came down the pike), a result they must have thought worth the $31,000 and change they had paid to “settle” the first case. And if the court of appeals ruled against them, creating unfavorable precedent, well, they had an answer for that as well: file a petition for rehearing, seeking to have the court’s opinion vacated on the ground that the appeal was mooted when the defendants satisfied the judgment — more than three months before the court issued its decision.

Not surprisingly, the court was none too pleased by the defendants’ gamesmanship. It didn’t help matters that the defendants filed a supplemental brief in the court of appeals on a particular merits issue after oral argument and after settling the case, but did not mention at that time that the case was moot. Even more troubling, the defendants asked the trial court in the two pending cases to stay proceedings pending the outcome of the court of appeals’ decision in the Perez case — an outcome they would later argue was invalid because of the settlement that had occurred before they sought the stay.

Given all of these circumstances, the court of appeals denied the petition for rehearing, holding that the appeal was not moot because the parties clearly indicated their intent to pursue their appeals, even after the putative settlement.  That conclusion is no doubt correct, though left unsaid by the court is the fact that the defendants apparently intended to pursue their appeal only if they won.

This posting is intended only to inform, not to provide legal advice; and readers should seek professional advice for specific applications of the information.

Bruce P. Merenstein
Schnader Harrison Segal & Lewis LLP
www.schnader.com

U.S. Supreme Court Ruling on Habeus Corpus Rights for Gitmo Detainees

June 25, 2008

A major topic of debate among Constitutional rights and immigration advocates was whether so-called “terror” suspects had a right to challenge their detention in the civilian courts. Now, the U.S. Supreme Court has spoken. In a 5-4 decision, the justices handed the Bush administration yet another defeat in their quest to hold terror suspects indefinitely and without charges at the Guantanamo Bay Naval Base in Cuba. Justice Anthony Kennedy, who wrote for the majority in a 70-page opinion, stated, “We hold these petitioners do have the habeus corpus privilege.”  He further added that the Congress had failed to provide an alternative for the prisoners held at the U.S. Naval Base to contest their detention. 

In essence, the terror suspects were not afforded any real procedure to challenge their detention. Many Constitutional rights advocates hope that the U.S. Supreme Court’s ruling will lead to immediate hearings for many of the detainees. Some of the detainees have been detained for as long as six years to date. It is interesting to note that under the Geneva Conventions, these individuals could have been classified as prisoners of war. As such, the Bush administration could have detained them as POWs until the conclusion of the Iraq War, which would not have been for several more years. However, because the Bush administration was adamant that these “terror” suspects be tried in military tribunals, they could not be classified as prisoners of war.

Many Constitutional rights and immigration advocates, including the detainees’ lawyers, applaud the High Court’s decision and hope that their clients now have the opportunity to secure their freedom.  Some of them felt that the Bush administration was too quick to act in detaining these individuals indefinitely, without formal charges and any real procedures for challenging their detention in light of 9/11. Obviously, the Supreme Court shares the same opinion. 

Rob C. Tonogbanua
Dickie McCamey & Chilcote, P.C.
http://www.dmclaw.com/

First Civil Suit Filed Against Alleged Phila. ID Thieves

June 20, 2008

In what appears to be the first civil suit against a pair of identity thieves dubbed in the media as “Bonnie and Clyde,” the salon and a hairstylist that helped bring the scam to light are suing for fraud, breach of contract and terrorist threats via text message.

In Bisicchia v. Kirsch, Jennifer Bisicchia and her salon employer Giovanni & Pileggi are suing Jocelyn Kirsch and Edward Anderton for losses suffered after Kirsch used a fake identity to get $2,200 in hair extensions.

Kirsch and Edward were accused of living a lavish lifestyle off of the identities, and dime, of their Belgravia apartment building neighbors and others while attending local universities.

Arthur Goldman, attorney for Bisicchia and Giovanni & Pileggi, filed the suit in Philadelphia Common Pleas Court.

According to the complaint, Kirsch used the fake name “Morgan Greenhouse” and an accompanying checkbook to pay a $500 deposit for the hair extensions attached by Bisicchia, a $1,700 check to cover the rest of the balance and then a $250 check for a tip, which the complaint points out is well below the industry standard of 20 percent.

The complaint alleges it was Anderton who called the salon and acted as Mr. Greenhouse, “Morgan’s father,” to set up the appointment.

When the real Morgan Greenhouse called the salon to inquire about a charge for hair extensions she never received, Kirsch’s true identity was about to surface. Bisicchia placed several calls from her personal cell phone to the number Kirsch gave, trying to figure out what happened with the payment.

According to the complaint, Bisicchia received a text message in all capital letters “from the client who represented herself as Morgan Greenhouse.”

The message stated “Hello Jen Bisicchia. You Don’t know my name but I know yours. I also know ur nice place on wolf st and how u get home at night. Youre the one who should be worried about visitors at ur door. You have no idea what you’ve gotten urself into. You seem like a smart girl. Walk away now or you will regret it.”

The complaint says that Bisicchia was scared to leave her home and still suffers “severe emotional distress” due to the threats and the persistent request from the media for interviews. She ultimately cooperated with the police regarding the fraudulent payment for the hair extensions, and Kirsch’s true identity was brought forth.

The complaint alleges counts of fraud, terrorist threats/assault, intentional infliction of emotional distress, breach of contract and conversion.

— Gina Passarella, Staff Reporter

My Country or Yours? Part Two: Litigating Hague Convention Claims

June 18, 2008

The Hague Convention is an international treaty that many countries have ratified, including the United States. The treaty prohibits parents from wrongfully removing and/or retaining a child from his or her home country. In order to seek relief under the convention, both the child’s home country and the country where the child was taken must be signatories to it. 

As discussed in a previous blog entry, you may file your Hague Petition in federal or state court. It is your choice. 

In order to prevail to have the children returned to their original home country, the petitioner must prove his or her prima facie case by a preponderance of the evidence.  In the 3rd U.S. Circuit Court of Appeals, it has been held that the prima facie case involves four questions:

  • What was the date of wrongful removal or retention?
  • Did the parent that was left behind have custody rights of the child at the time of wrongful removal or retention?
  • Was the parent that was left behind exercising his or her custodial rights at the time of wrongful removal or retention?
  • Which country was the place of habitual residence at the time of wrongful removal or retention?

Date of Wrongful Removal or Retention

The date of wrongful removal or retention is the date that the parent that was left behind knew or should have known that the parent took the child from the original country or that the parent was not returning the child to the original country. This date establishes the cut off date for evidence of a child’s habitual residence. If the Hague trial does not go forward for several months or longer, the leaving parent does not reap the benefits of continued actions to attempt to change the child’s habitual residence. The court will not consider any actions after the date of wrongful removal or retention.

Custodial Rights at the Time of Wrongful Removal or Retention

Whether a parent had custody rights at the time of the wrongful removal or retention requires evidence of the law of the country to which the parent that was left behind resides.  In a recent Hague case that I successfully tried, we asked the left behind parent’s legal counsel to testify as an expert witness via telephone regarding the custody law for Australia. In many countries, simply being the child’s parent provides important custody rights, even if there has been no litigation regarding the issue.

Exercising Custodial Rights at the Time of Wrongful Removal or Retention

The next question is whether a parent was exercising his or her custody rights at the time of the wrongful removal or retention.  This question is very broad in scope.  The key custody question does not involve physical custody, but rather legal custody.  Unless a parent specifically rejects custody of a child, the left behind parent will satisfy this requirement. 

Country of the Child’s Habitual Residence

The final question that a court must answer in a Hague case is what was the child’s country of habitual residence at the time of the wrongful removal or retention. Because this is a complex question, it will be the subject of a later blog entry.

Summary

Once the petitioner successfully answers the above questions by a preponderance of the evidence, the burden will shift to the petition to show why the children should not be returned. If no adequate reason is raised to keep the children in the new country, then the court must order that the children must return to the original country.

Judy McIntire Springer
Fox Rothschild LLP
www.foxrothschild.com

 

Friends of the Barnes Foundation Won’t Appeal Ruling

June 17, 2008

A group of art students, alumni and neighbors of the Barnes Foundation have joined Montgomery County in deciding not to appeal a court decision denying them standing to oppose the move of the Barnes Foundation’s $6 billion art collection to Philadelphia.

Montgomery Common Pleas Court Judge Stanley R. Ott dismissed May 15 the county’s and the Friends group’s petition to re-open hearings in In re The Barnes Foundation, a Corporation because he said Pennsylvania case law did not give the county or the Friends of the Barnes Foundation, the citizens group, standing.

Ott’s 2004 ruling in the case allowed the Barnes Foundation to break Dr. Albert C. Barnes charitable bequest requiring his art collection to stay exactly as he had it hung at his Lower Merion Township property because of the foundation’s financial woes.

“We’re very glad that they did not appeal,” said Phyllis Beck, general counsel for the Barnes Foundation. “Judge Ott’s opinion was correct. It was very straightforward. It would have been … in my opinion, impossible to overturn.”

Beck said the Barnes Foundation will not be appealing Ott’s denial of their request to receive attorneys fees.

The Friends of the Barnes Foundation criticized Ott’s most recent ruling in a news release as turning “solely on narrow and technical question of legal standing” and failing to address the merits of their legal action.

“The judge’s failure to address the merits of the appeal leaves the Barnes Foundation, one of America’s great historic assets, under the continuous threat of destruction and raises issues of profound consequences of pubic trust throughout the commonwealth,” the release said.

In court papers, the county and the Friends group had wanted Ott to re-open the proceedings to consider a county funding proposal that might have made keeping the collection in Montgomery County affordable. They also wanted Ott to consider the import of their allegation that the foundation’s trustees concealed from the court during the original hearings over the Barnes move that a state budget bill signed into law in 2002 contained a line item dedicating $100 million to house Barnes collection in Philadelphia.

Montgomery County Commissioners Chairman James R. Matthews and Commissioner Joseph M. Hoeffel said in news releases Monday they would like to negotiate with the Barnes Foundation to keep as much of the Barnes operations in Montgomery County as possible and share the collection between Lower Merion Township and Philadelphia.

Beck said that under the Barnes’ indenture all of the art collection must stay together when it’s moved to the new museum site on the Benjamin Franklin Parkway in Philadelphia and be hung in an exact replication of how the collection currently is arranged in Lower Merion Township.

However, she said, the foundation would love to cooperate with Montgomery County leaders on how the grounds and the use of the foundation’s art archives are developed.

“We’d like to move from litigation into the next phase, which would be constructive: constructing a museum, constructing a positive relationship with the neighbors and the government entities in Montgomery County and in Lower Merion,” Beck said.

— Amaris Elliott-Engel, staff reporter

 

First Women in the Profession Summit Kicks Off This Week

June 17, 2008

The first-ever Women in the Profession Summit in Philadelphia will be held this week under the aegis of the Philadelphia Bar Association’s Women in the Profession Committee.

The event will offer both substantive and ethics continuing legal education credits and the chance for women in the legal profession to erase the feeling that they’re isolated, said Maria A. Feeley, a partner with Pepper Hamilton and co-chair of the Philadelphia Bar Association’s Women in the Profession Committee.

The event starts at 11:30 a.m. Wednesday and continues through lunch, the keynote by Charisse Lillie, vice president of human resources for Comcast Corporation and senior vice president of human resources for Comcast Cable, and includes four CLEs and a cocktail reception. The event is at the PBI CLE Conference Center in the Wanamaker Building.

Feeley, now her second-year as a committee co-chair, said she hopes the summit will chip away at the isolation she hears from women in the profession because they will see “there are many people, including leaders in the profession, that understand their situation” and are working to bridge the gap between men and women obtaining leadership roles in the legal world.

Lilly was chosen as the keynote, Feeley said, because “she’s inspiring in the levels of success she’s obtained, and if you survey the biggest companies in the country and the ones that have a big Philadelphia presence and you look at the leadership positions … there aren’t a lot of women in those positions.”

The CLE panels address the best practices for retaining and promoting women attorneys in the corporate counsel realm, the best practices for retaining and promoting women attorneys in the law firm realm and hot topics for women.

The “Women in the Courtroom – Communication Across the Gender Gap” was designed to appeal to both men and women, Feeley said.

The panel includes Philadelphia Common Pleas Judge Marlene Lachman, Philadelphia Common Pleas President Judge Frederica A. Massiah-Jackson, U.S. District Judge Norma L. Shapiro, U.S. Court of Appeals Judge Dolores K. Sloviter, U.S. District Judge Petrese B. Tucker and Diane M. Welsh, a mediator with JAMS-The Resolution Experts and a retired judge.

“We thought that having judges talk about communication styles of men and women, what they have seen as effective, including inside and outside the courtroom … that people could learn a lot from these judges,” Feeley said.

 — Amaris Elliott-Engel, Staff Reporter