July 2014

Trends in Litigation: Crisis Management By Karen Dunn, Michael Gottlieb, Heather King, and Lee Wolosky

One of the biggest challenges that can with arguments made publicly and with the confront any twenty-first century company company’s long-term strategic interests. INSIDE THIS ISSUE is the sudden emergence of a crisis. This can Outside counsel must also make sure that take many forms, including an allegation deliberations and communications forged Crisis Management 01 of wrongdoing from inside or outside the in crisis are protected to the maximum International Outlook 02 company; a breach of security, such as when permissible extent by applicable legal private customer data is compromised; or a privileges. Litigation Update 03 shift in the geopolitical landscape. Whatever Rep & Warranty Insurance 05 the cause, these crises often have two things Companies will also have a significant Corporate Update 06 in common: they arise unexpectedly and, if advantage if they choose lawyers who not managed properly from the outset, they have experience in different branches of Partner Moves 07 can quickly spiral out of control, threatening government, including the White House, David Boies on Prop. 8 08 the business itself. Congress, and executive agencies such as the Department of Justice, the Federal When a company is engulfed by such an Trade Commission, and the Securities and government relations and communications event, its problems are rarely confined to a Exchange Commission. These days, no professionals, as well as with a company’s single courtroom or the offices of a single intelligent response to a multi-dimensional outside consultants. regulator. Most often, events that pose the business crisis can ignore Washington. greatest risk involve actual or threatened Companies facing enterprise-threatening litigation, intense media scrutiny, and One of us, Heather King, recently crises benefit when they hire outside overlapping inquiries by state, federal, or participated in a two-year global public counsel who, in addition to knowing their foreign regulators. Failing to coordinate policy and legal defense of Bank of New York way around a courtroom, are savvy crisis responses on all of these fronts, from the Mellon in a $22.5 billion claim filed by the managers skilled in navigating the corridors moment the crisis emerges, risks prolonging Russian government in Russian court. The of Washington. For years, Boies, Schiller & investigations, invites unnecessary litigation, work involved meeting with various branches Flexner has excelled in handling the most and ultimately increases the threat to the of the U.S. and Russian governments to complex and high-profile public-facing company’s reputation and profitability. explain how the lawsuit was damaging to matters, and our lawyers have sharpened business interests in both countries and to the skills needed to defend our clients both And wherever the company’s headquarters their respective economies. Ms. King worked in the courtroom and in the broader public are located, it is hard to imagine a major with members of the U.S. Congress and arena. We’ve learned that only an integrated controversy these days that does not involve with the State, Treasury, and Commerce approach can ensure that strategy remains some corner of Washington, whether it departments to raise policy arguments the same across all aspects of a major is a civil enforcement action, a criminal for bilateral discussions with the Russian controversy. And we have an established track investigation, or a congressional inquiry. government, and to explore a face-saving exit record of counseling clients through crises, Since the financial crisis of 2008, regulatory for the Russian government. Our strategy helping them emerge stronger and more oversight of financial institutions and public contributed to a settlement for $14 million, profitable on the other side. companies has intensified. Meanwhile, U.S. less than 1 percent of claimed damages. antitrust enforcement has deepened, and Karen Dunn ([email protected]) is a partner Congress has ramped up its investigations of Currently, we serve as global lead counsel in the Washington, D.C., office of Boies, Schiller businesses accused of wrongdoing. for Burisma, the leading private gas producer & Flexner. She is a former federal prosecutor and in Ukraine. Our work for the company former associate counsel at the White House under In this environment, among the most includes leading the public policy and media President Obama. important factors determining success strategy related to U.S.-Ukraine energy or failure during a crisis is the company’s security issues. We also counsel a large global Michael Gottlieb ([email protected]), a choice of legal counsel. Outside counsel company contending with the trifecta of partner in Washington, is also a former federal must investigate swiftly and thoroughly, and litigation, regulatory investigation, and media prosecutor and former associate counsel at the they must ensure that positions taken before scrutiny. Typically in this type of engagement, White House under President Obama. regulators or in litigation are consistent both we work closely with in-house lawyers and (continued on page 7)

1 July 2014

Boies, Schiller & Flexner in London Questions for Natasha Harrison, the managing partner of the Firm’s first overseas office.

What was the thinking on opening an the Trustee for refusing to declare an event How do you office in London? of default and then for refusing to accelerate see the outlook without the benefit of a €1 billion indemnity for financial It was client-led. Most of our core clients (we took that to the Supreme Court and won, litigation? have an international presence, and London clarifying the law), then against the Issuer is one of the world’s most important financial and its parent for the amounts due under the Busy, but the and legal centers. Litigation is increasingly bonds. We litigated all over Europe (Poland, emphasis will shift as international, and an office in London helps Germany – wherever we could find an asset) the key cases us to better serve our clients, to deepen our as well as in the U.S. and ultimately recovered following the 2008 existing relationships, and to create new the full amount due under the bonds together crisis become opportunities for the Firm. with significant default interest. We then went statute-barred. The significant increase of for the equity kicker and obtained a further regulation of financial institutions following What is the benefit for clients and nine-figure judgment – paid to our clients as the financial crisis, combined with active co- future clients? part of a final settlement. operation between and among regulators in various jurisdictions, means that this will be an We provide a seamless service on cross-border And the second one? important focus for our clients, and litigation litigation and investigations by providing will undoubtedly flow from the increase in best-in-class lawyers in London, New York, Iceland. As part of its response to the financial regulatory activity. and Washington. The opportunities and issues crisis, the Icelandic government retroactively facing our clients are rarely confined to one prioritized depositors over bondholders. I ran For investment funds, we will continue to see jurisdiction, and a closely knit cross-border a group of 90 bondholders of the three largest inter-creditor disputes as opportunities are team can deliver not just in the U.S. but also banks, holding bonds with a total face value exploited in finance documents; an increase beyond. London is the gateway to Europe and of €20 billion. It involved issues of human in the use of schemes of arrangement as the to Asia, and we have extensive experience rights – do hedge funds have them? – and the English court continues to extend its long- building the legal strategy and coordinating steps a state can legitimately take when faced arm jurisdiction and associated litigation complex international litigation with local law with a financial crisis to expropriate property over defined classes of creditors; challenges firms across the globe. without compensation. to the “white list” concept in debt trades, where sponsors/borrowers are trying to How are we positioning ourselves? What is your take-away from that case? block secondary hedge fund investors from elevating and becoming lenders of record; We are building an office founded on the key Iceland is just one example post 2008 of state and continued litigation in the sovereign debt principles developed in the U.S.: litigation- intervention into the banking sector and the markets. We are also likely to see challenges focused and staffed with the most creative and “bailing in” of subordinated debt holders. We to steps taken by states intervening in the talented lawyers; maintaining the core client have seen similar steps being taken across banking sector and bailing in subordinated strategy by both extending existing client Europe (e.g., Britain, Ireland, Greece) in debt holders. relationships to Europe and building new key response to the financial crisis, and more relationships; and, of course, winning our recently being threatened in Austria and How big is the London office? cases. Portugal. Any expropriation of property must be compensated and any change in the law We’re fully operational with a core group of What is the biggest case you worked on to give effect to the expropriation must be lawyers, and by the end of the year we expect in your career? proportionate. The Iceland case took place to hit double figures. against a highly politicized backdrop, with the There are a number, but two really British and Dutch governments also being What attracted you to Boies, Schiller & stand out. The first is Elektrim, a Polish closely involved. It reminded me that you Flexner? telecommunications company, where I acted never litigate in a vacuum and it is important for holders of €525 million bonds. The to have a deep understanding of the culture, Shared values, brilliant lawyers, and the company started breaching covenants and this economics, and politics of the country in opportunity to build something with one of triggered eight years of litigation: first against which you are litigating. the best in the business.

2 July 2014

Litigation Update

HALLIBURTON Carl Goldfarb, Sigrid McCawley, Robert BARCLAYS In Halliburton v. Erica P. John Fund, one of Silver, and Stuart Singer worked on the Boies, Schiller & Flexner continues to take the most widely watched securities cases matter, assisted by co-counsel. Our legal a leading role representing Barclays, with in years, the U.S. Supreme Court in June team also included counsel Hampton more than fifty individual and class actions reaffirmed the “fraud-on-the-market theory” Dellinger, Eli Glasser, David Nelson, and Eric involving the London Interbank Offered established in Basic v. Levinson a quarter of Posner, along with associates Andrew Adler Rate (Libor) that have generated several a century ago. The theory serves as the and Aaron Marcus. significant decisions from both district and foundation for most securities class actions, appellate courts. Boies, Schiller & Flexner is which Congress, the SEC, and the Supreme COLLEGE ATHLETICS on Barclays’ list of preferred law firms. Court have all recognized are important to In 1995, Ed O’Bannon led UCLA to the the integrity of securities markets. Under NCAA basketball championship. Years later, This litigation has been brought against the theory, rather than establish reliance O’Bannon, who now works as a car salesman Barclays and other banks arising from their separately for each class member, plaintiffs in Nevada, noticed his image in a video submissions to the bodies that set interbank can presumptively establish reliance for all game and questioned why he had received offered rates in various currencies. Most class members based on the twin premises no compensation. In June, 19 years after cases are consolidated into a multidistrict that material misrepresentations are O’Bannon’s college championship season, litigation involving the U.S. Dollar Libor impounded into the stock price and that a federal judge in California presided over before Judge Naomi Reice Buchwald of the investors rely on the integrity of the stock an antitrust trial that could reform National Southern District of New York (In re Libor- price. Halliburton argued that the efficient Collegiate Athletic Association rules that Based Financial Instruments Antitrust Litigation, market hypothesis, which underpins the prevent college players from sharing in No. 11-md-02262). Other significant actions fraud-on-the-market theory, had been revenues from broadcasts and licensing such include Laydon v. Mizuho Bank, Ltd., No. discredited by economists, and that securities as video games. Boies, Schiller & Flexner 12-cv-3419; a case before Judge George B. class actions did little to deter fraud or partner Bill Isaacson, the only lawyer in the Daniels involving the Yen Libor, Sullivan v. compensate investors. Boies, Schiller & United States who has tried three previous Barclays Bank PLC, No. 13-cv-2811; a case Flexner Chairman David Boies argued for antitrust class actions to verdict in recent before Judge P. Kevin Castel involving the the plaintiffs before the Supreme Court in memory, was co-lead trial counsel for Euro Interbank Offered Rate (Euribor); March, maintaining that most economists O’Bannon and the other plaintiffs. and a securities fraud action pending before still believe that material information Judge Shira A. Scheindlin, Gusinsky v. Barclays affects stock prices, and that under the stare In a three-week trial, Isaacson systematically PLC, No. 12-cv-5329, all in the Southern decisis principle, the court should defer and effectively undermined the NCAA District of New York. Since the cases were to Congress, which could overrule Basic witnesses, including Neal Pilson, the former filed, judges Buchwald and Daniels have if it wanted to and which has repeatedly president of CBS Sports, and Mark Emmert, issued rulings dismissing significant claims legislated in the securities class action arena the current president of the NCAA. A asserting billions of dollars of damages. without doing so. journalist sending live updates from court via Twitter described Isaacson as a “bull dog,” Led by Managing Partner Jonathan Schiller, Chief Justice John Roberts, writing for six and another characterized Isaacson’s cross- the attorneys working on Libor-related members of the court, held that Halliburton examination of University of Texas Athletic matters for Barclays include partners David had failed to justify overturning Basic. The Director Christine Plonsky as “one of the Boyd, Mike Brille, Bill Isaacson, Jonathan Supreme Court did hold that the lower court more entertaining moments” of the trial. Shaw, Jim Denvir, Todd Thomas, Mike had erred in refusing to afford defendants an ESPN wrote that Isaacson “distinguished Gottlieb, Melissa Felder Zappala, and David opportunity at class certification to seek to himself . . . as a formidable advocate.” By Zifkin; counsel Hampton Dellinger; and rebut the presumption by establishing that the end of the trial, a Wall Street Journal associates Leigh Nathanson, Amos Friedland, the alleged misrepresentations did not impact reporter wrote that Isaacson and his co- Mike Mitchell, Abby Dennis, Wells Harrell, the stock price. The other three justices counsel had laid bare the “deeply embedded Karen Paik, and Nishanth Chari. would have overturned Basic. contradictions and occasional bits of outright absurdity” in the NCAA’s case. Judge Claudia GOLDMAN SACHS After the decision, Law360 put Halliburton Wilken is expected to rule this summer. Boies, Schiller & Flexner successfully at the top of its list of the biggest securities Isaacson was supported at the trial by defended Goldman, Sachs & Co. against cases of 2014, and Litigation Daily named associate Martha Goodman. claims of fraud, breach of fiduciary duty, Mr. Boies its Litigator of the Week. Partners and breach of contract brought by two of its

3 July 2014 brokerage clients, who alleged that they were approval. During a hard-fought trial, Boies, AIG’s American General Life, challenged subject to improper margin calls and who Schiller & Flexner partner Nick Gravante the modifications in Delaware’s Court sought damages in excess of $300 million. presented evidence that the company was of Chancery. A team led by partner Alan Jonathan Schiller, David Boyd, and David worth in excess of $4 billion as of the Vickery brought a motion for judgment Zifkin represented Goldman, Sachs & Co. October 2010 valuation date, far more than on the pleadings, reasoning that the case at a FINRA arbitration in January. The panel the $200 million valuation placed on the was not ripe and that, in any event, the decided in favor of Goldman Sachs in March. company by Mr. Vultaggio and his counsel. contracts permitted the changes. The motion Although the court will determine how was briefed principally by partner Jennifer THERANOS much the company must pay Mr. Ferolito Altman and associates Matt Kaden and David Boies, Schiller & Flexner successfully to buy out his 50 percent interest, mid-trial Siffert, with tax arguments formulated by represented Silicon Valley consumer Mr. Gravante presented an irrevocable, tax partner Michael Kosnitzky. Mr. Vickery healthcare company Theranos in a patent binding $2 billion offer from Mr. Ferolito to argued the case for Zurich and American dispute over blood test technology. That buy out Mr. Vultaggio’s half of the company. General at a hearing in April, after which technology, which was the brainchild of Notwithstanding his testimony that AriZona Vice Chancellor Sam Glasscock observed Theranos founder Elizabeth Holmes, is worth between $200 and $260 million, that he gets to hear arguments “from the permits laboratories to conduct tests that are Mr. Vultaggio rejected the $2 billion offer best of the bar around the country, and this quicker, more affordable, and less painful to during cross-examination. Mr. Gravante and was a privilege to hear . . . it is unusual, in patients. Theranos alleged that Fuisz Pharma partner Helen Maher tried the case, assisted my experience, that an oral argument is as and its principals, Dr. Richard Fuisz and by partners George Carpinello, Karen helpful to the Court as this one has been.” Joseph Fuisz, misappropriated Theranos’s Dyer, Michael Merley, William Ohlemeyer, In dismissing the case, Vice Chancellor confidential information – including Jeremy Vest, and Richard Weill. Attorney Glasscock wrote that it presented a question information in Theranos’s unpublished consultant Stephanie Reger, and counsel of first impression under federal tax law, but patent applications – and patented the same Rosanne Baxter and James Grippando also that the objections raised by Aviva were not technology. Specifically, Theranos alleged worked on the case throughout trial, as did ripe for decision. that a family member of the defendants, who associates Brooke Alexander, Paul Fattaruso, was a partner at Theranos’s former law firm, Matthew Cushing, Ievgenia Vatrenko, Dan STRAUSS passed the information to the defendants. Boyle, Sebastian Swett, Amy Donehower, In November, the Firm was engaged by the After two days of trial in federal court and Miguel Lopez. Justice Timothy Driscoll Strauss company, a family-owned Israeli in San Jose, California, and during David of the Commercial Division of the Nassau food company largely known in the United Boies’s questioning of Richard Fuisz, the County Supreme Court has said that he will States for its Sabra product line. The Strauss defendants agreed to invalidate all claims of rule as soon as October. company retained a team led by Jonathan their own patent. As part of the settlement, Schiller and assisted by Josh Schiller and the defendants also agreed to a broad release ZURICH Benjamin Margulis to provide counsel in and covenant not to sue, which precludes In April, the Firm won dismissal of a lawsuit an Enterprise Chambers proceeding in Fuisz Pharma from asserting any legal claims challenging two subsidiaries of long-time Amsterdam. The proceeding was brought against Theranos for five years. Partners client Zurich Insurance over changes they against the company by private equity Michael Underhill, William Marsillo, and had made to an investment fund’s guaranteed firm TPG relating to a contested IPO Michael Jay worked on the case, as did minimum growth rate and surrender terms. arising out of a joint venture in the Strauss associates Joseph Lasher, Michael McCarthy, One change capped the fund’s guaranteed international coffee business that the parties and Meredith Dearborn. 8 percent growth rate because the divergence entered into in 2008. After prevailing in the between the market performance of the Enterprise Chambers proceeding, Strauss ARIZONA fund’s underlying investments and the also retained the Firm’s corporate group, A New York State judge held a six-week guaranteed growth rate threatened to including George Liu, Thomas Fritsch, bench trial that ended on July 2 to value the violate federal tax laws relating to insurance Lidia Frenkel, and Daniel Grossman to, in AriZona Iced Tea company and break a long- products. Another change clarified that, if addition to ongoing litigation advice, advise standing deadlock between the company’s the policyholder elected to surrender the the Strauss Group through the contested IPO two 50 percent owners. Boies, Schiller & policies, liquidation and distribution of discussions, which are ongoing. Flexner’s client, John Ferolito, had been proceeds would be delayed until the market seeking for years to sell his family’s half of value of the underlying investments caught the company, but had been prevented from up with the guaranteed value. Plaintiff Aviva doing so by a 1998 agreement with co- Life, which invested $180 million in the owner Domenick Vultaggio that restricted fund in 2001 through two Company-Owned sales to outsiders absent Mr. Vultaggio’s Life Insurance (COLI) policies issued by

4 July 2014

Trends in Corporate Law: Rep and Warranty Insurance By Stefan dePozsgay

Sellers and buyers in private control consideration be deposited with a third- of the target business’s operations and transactions negotiate a host of issues when party escrow agent (or held back by contingent liabilities. documenting the change in ownership of a the buyer) for the potential satisfaction target business. While the general economics of future indemnification claims. The There are also benefits to buyers. Because of private company merger and acquisition customary requirement for a “backstop” these policies may be attractive to sellers, deals tend to make their way into the news of indemnification obligations transforms a buyer’s willingness to use insurance media, risk allocation issues are often left to a “legal issue” into a “money issue,” since may be enough to distinguish its bid in a the fine print of transaction documentation, buyers and sellers are forced to quantify competitive sale process. In our experience, despite their importance to both sellers and risk. Over the past several years, the sellers are also often willing to provide a buyers. insurance industry has emerged to address more comprehensive representation and risk allocation and quantification in private warranty package when a policy is in place, Understandably, sellers usually have company M&A transactions through a since much of the risk has been transferred substantially more familiarity with a target new product, representation and warranty to the insurer. Furthermore, the coverage business than potential acquirers, resulting insurance. period for rep and warranty insurance in an information disparity that is difficult typically exceeds the survival period for to overcome through due diligence alone. Rep and warranty insurance protects the representations and warranties set forth in Realizing the impracticality and costliness insured (buyer or seller) from certain the acquisition agreement, thereby providing of a prolonged and invasive due diligence losses it may incur as a result of a breach of additional protection for the buyer. process, sellers and buyers historically covered representations and warranties, or have addressed this “information gap” by other matters that may be insured under the However, using a rep and warranty insurance supplementing due diligence efforts with a policy. Insurance can be structured to cover policy does raise some additional issues for package of representations and warranties specific representations and warranties or to the parties to consider. First, they must about the target company made by sellers cover the entire package of representations decide who pays for the policy. Premiums for the benefit of buyers. Representations and warranties given by the sellers under usually fall within the range of 1 to 6 percent and warranties in acquisition agreements the acquisition documents. A standard rep of the amount of coverage. Insurers also are usually accompanied by indemnification and warranty insurance policy can act as typically require that one or more parties mechanics to ensure that buyers are either security (backstopping or extending (customarily the seller) retain some risk on protected against losses arising from the coverage of a seller’s indemnification representations and warranties in the form of inaccuracies. Indemnification provisions can obligations for breaches of representations a deductible, which is often set at 2 percent be complicated: sellers and buyers must and warranties) or as the primary source of to 3 percent of the total transaction value but negotiate whether known and unknown risks coverage (replacing the indemnity entirely). may vary from deal to deal. The party paying will be covered, whether indemnification the premium does not necessarily have to be will be “capped” at some percentage of the More and more frequently, our clients are the insured. However, the insured’s actual transaction consideration, whether there considering the use of rep and warranty knowledge of a breach is typically excluded is some threshold or deductible of losses insurance policies to bridge the gap on from the coverage, and since sellers usually that a buyer must sustain before a seller risk allocation between sellers and buyers. have more knowledge about the target becomes liable, and whether a buyer’s prior For sellers, these policies can maximize business than buyers, buy-side insurance knowledge of breaches will absolve sellers of their closing date payouts by reducing (where the buyer is the insured) is generally liability, among other things. or eliminating the need for escrows or considered to be more comprehensive and is, holdbacks. This is particularly advantageous accordingly, more expensive. The treatment Unfortunately, no matter how heavily for private investment funds that are trying of seller fraud is another significant negotiated or well designed they to maximize their internal rates of return distinction between sell-side and buy-side are, representations, warranties, and or other performance metrics to improve policies. Sell-side policies exclude fraudulent indemnification provisions are only valuable their track records. If the sellers are a misstatements by the sellers from the to a buyer if they can be enforced against consortium, an insurance policy can alleviate coverage, whereas buy-side policies typically the seller. Without a creditworthy seller complications associated with joint and do not. This is largely because buyers are not providing indemnification (and often even several liability for breach, which is often in a position to know which of the sellers’ with such a seller), buyers will typically required by buyers but may be onerous for statements are fraudulent. demand that a portion of the transaction sellers with varying levels of knowledge

5 July 2014

The parties must also decide the breadth and of coal. With this selection, Boies, Schiller 50 percent stake in its asphalt joint venture scope of insurance coverage. The specifics of & Flexner becomes one of a select few earlier this year, it turned to Boies, Schiller a particular deal are material in determining foreign law firms to undertake substantial & Flexner’s corporate group to handle the scope of the coverage. Rep and warranty representation of Mongolian interests in the transactions. NuStar, which sought to insurance usually covers breaches of reps the country’s burgeoning natural resources continue its focus on its core oil pipeline and warranties but customarily does not sector. and terminal businesses, completed the cover breach of post-signing covenants, transfer of its equity interest in the business since compliance with covenants is generally The project will establish and operate to its joint venture partner, an affiliate of under the control of the sellers. However, a best-in-class coal mine with modern the investment firm Lindsay Goldberg, in rep and warranty insurance can cover integrated mining and processing February. In connection with the transfer of specific contingent liabilities (for example, technology, in accordance with national the equity interest, the Firm assisted NuStar outstanding litigation) and other general laws and international health, safety, and with amendments to its debt facilities, indemnities (for example, indemnification environmental best practices. Development terminal leases, and oil supply contract with for pre-closing taxes). On the other hand, will take several years and will require the joint venture, which was renamed Axeon circumstances may dictate that certain new infrastructure for coal extraction Specialty Products. NuStar, which has been representations be excluded from the and processing, power generation and a client of the Firm since 2009, sold an initial coverage, typically when the potential transmission, water supply, and rail 50 percent stake in the asphalt business to exposure is high. An example of this transportation. The project is expected to an affiliated fund of Lindsay Goldberg in would be coverage of a representation on result in the construction or improvement 2012. The asphalt business originally was environmental matters where such issues of public roads, schools, hospitals, housing, purchased by NuStar in 2008. Partner Jason are a disproportionately material risk of the local government buildings, and community Hill, along with associates Michael Anastasio target business. centers. and Joseph Eno, worked on the transactions, with assistance from partner Robert Lia and The benefits of rep and warranty insurance Boies, Schiller & Flexner’s work has three counsel Ivan Mitev. have been documented extensively by separate phases. The first will involve practitioners, and the market has moved negotiation with foreign investors seeking YES dramatically in recent times toward to become joint venture partners in the Earlier this year, Boies, Schiller & Flexner widespread adoption. We would strongly project. The second will involve negotiation represented Yankees Entertainment and recommend that our clients, whether on with the Mongolian government on behalf Sports Network in connection with the the buy side or the sell side, consider the of the joint venture. The investors will sale of a 31 percent equity stake to 21st use of rep and warranty insurance in their agree to certain minimum investment Century Fox. The YES Network televises acquisition strategies. commitments, environmental standards, and New York Yankees baseball and Brooklyn local employment and social investment, Nets basketball, as well as other leading local Stefan dePozsgay is a partner in the corporate and will agree to pay certain taxes, royalties, and national sports-related programming. group at Boies, Schiller & Flexner in New York. and other fees to the government. In return, The transaction raised 21st Century Fox’s the government will ensure a stable and ownership in the YES Network to 80 percent predictable legal structure. The third phase from the 49 percent it had acquired in 2012. will involve advising the joint venture on The Firm also represented the YES Network Corporate Update international project financing to fund the in connection with the 2012 transaction. project. Boies, Schiller & Flexner is also Associates Russell Franklin, Lidia Frenkel, MONGOLIA representing Erdenes Tavan Tolgoi on certain and Elaine Tapp worked on the most recent After a 5-month competitive procurement matters associated with its current mining transaction. process involving 12 top-tier international contractors and offtakers. law firms, Boies, Schiller & Flexner, CAITHNESS in a representation led by Managing The team of lawyers is headed by In late April, the Firm assisted longstanding Partner Jonathan Schiller, was selected as Mr. Schiller, with assistance from partners client Caithness Energy with the sale of international counsel for the Mongolian Robert Leung, Mike Huang, and Jonathan development assets relating to a proposed state-owned coal company Erdenes Tavan Sherman and associates Michael Anastasio, 569 MW nominally rated combined-cycle Tolgoi. The company holds the rights to Lidia Frenkel, Joseph Eno, and Gloria Ho. power facility to be located in Riverside develop the Tsankhi portion of the Tavan County, California, to an affiliate of Canadian Tolgoi strategic coal deposit, near the Gobi NUSTAR power company AltaGas. Partner Jason Hill Desert, one of the world’s largest untapped When NuStar Energy disposed of its and associate Joseph Eno worked on the reserves with an estimated 6.4 billion tonnes transaction.

6 July 2014

In Partnership Honors & Recognition Litigation Trends

Boies, Schiller & Flexner partner Tanya Chairman David Boies and his wife, (continued from page 1) Chutkan won confirmation from a Mary Boies, were honored by the Wilson unanimous Senate to become a judge on International Center with the Woodrow Heather King ([email protected]), a partner in the U.S. District Court for the District of Wilson Award for Public Service. Washington, was special assistant and policy Columbia. She joined the Firm in 2002, after advisor to the Senate office of former senator 11 years as a public defender. During her Managing Partner Jonathan Schiller Hillary Rodham Clinton. time here she helped bring three antitrust became Chairman of the Board of Trustees of class actions to successful jury verdicts for Columbia University. Mr. Schiller graduated Lee Wolosky ([email protected]), a partner in plaintiffs and brought a civil case to a positive from both Columbia College and Columbia NewYork, served at the White House as the director settlement mid-trial. Law School. for transnational threats on the National Security Council under presidents Clinton and George W. Richard Feinstein rejoined the Firm in Stephen Zack, the administrative partner Bush. Washington, D.C., after four years as the of the Miami office, became a member of the Federal Trade Commission’s top antitrust Council on Foreign Relations. Last year he enforcer. His main practice areas include served as an alternate U.S. representative to antitrust litigation and advice. the United Nations General Assembly.

Karen Dunn joined the Firm in February Anne Hinds, counsel in the Fort to focus on high-profile litigation and crisis Lauderdale office, received the Juvenile Law management. She previously served as an Award from the Legal Aid Society of Palm associate White House counsel, an assistant Beach County and a commendation from U.S. Attorney in the Eastern District of the Florida Supreme Court for her work Virginia, and the communications director advocating for children in foster care. and a senior advisor to then senator Hillary Clinton. Melissa Felder Zappala, on behalf of the Firm, was awarded an Outstanding Michael Gottlieb joined the Firm in Achievement award by the Washington October to focus on government litigation, Lawyers’ Committee for Civil Rights and white collar criminal investigations, Urban Affairs for her pro bono work for enforcement, securities litigation, data disability rights. privacy, cyber security, and constitutional litigation. He previously served as a special Nick Gravante, the administrative partner assistant to President Obama and an associate in New York, was awarded the Attorney of White House counsel. the Year Award by the Brooklyn Independent Democrats for his legal advocacy and support Parker Bagley will move to Oakland, for the Brooklyn Public Library. California, this summer to boost the Firm’s IP practice there. Heather King, Michael Merley, Luke Nikas, and Ansgar Simon were promoted to partner.

7 July 2014

Why I Took the Case Boies, Schiller & Flexner’s chairman writes about his reasons for joining former rival Ted Olson in the lawsuit that led to a court decision ending California’s ban on same-sex marriage, a decision that the Supreme Court upheld in June 2013. By David Boies

The case Ted proposed was an opportunity to First, I believed we would win. This was not confront, and hopefully eliminate, the core of a case where we were asking the courts to antigay bias. In a sense it was not a proposal recognize a new right, merely to hold that I was free to immediately accept. The case an established right could not be withheld would, I knew, require a great deal of my based on sexual orientation. The combination time and my firm’s resources – time and of Loving and Lawrence, together with resources for which I was aware our plaintiffs numerous Supreme Court decisions holding could not begin to pay. I also knew that the unconstitutional state laws barring marriages nature of the case would arouse fierce and by imprisoned felons and people who had passionate opposition, and that there would abused a prior marriage, were compelling. be a fringe that would direct their anger at Even as staunch an opponent as Justice Scalia my family as well as myself. (During Bush seemed to recognize the inevitability. v. Gore death threats against my youngest son, Alexander, had been called in to his Second, both our individual plaintiffs and elementary school, and many were made tens of thousands of couples like them in against me.) California wanted to exercise what they and we believed to be their constitutional right Fortunately, when I discussed the case with to marry. I did not know how to tell them my wife Mary, my children, and my partners this was not their time, that only future at Boies, Schiller & Flexner, later that day, generations could enjoy that right. I found that they were as determined as I was that this was a case we should accept. Third, I believed that simply bringing this Although the American Foundation for Equal case, and the national discussion it would case that was decided first be prepared, Rights, which was sponsoring the litigation, engender, would advance the cause of tried, and presented on appeal as perfectly as had offered a partial payment, Jonathan equality and public support for it. The possible. With our experience, and with the Schiller, Donald Flexner, and my other opposition to marriage equality did not have unparalleled resources our two firms offered, partners agreed that we would take the case arguments that could withstand scrutiny. we were confident that we could prepare, entirely without a fee. They had a tautological bumper sticker try, and appeal the case as well as, and (MARRIAGE IS BETWEEN A MAN AND probably better than, any alternative team. I soon discovered that many in the gay A WOMAN) and a religious belief (“God community, including most of those who forbids gay marriage”) that, however A few times, I asked myself whether my had long led the fight for equality, were sincerely held, was barred by the First desire to accept this case, and to do so with adamantly opposed to our proposed lawsuit Amendment as a basis for legal decisions. Ted, was causing me to too quickly dismiss to challenge Proposition 8. They did not, of In part because of our reputations (and our the arguments of those who counseled course, oppose our objective, but believed “odd couple” relationship that I knew would caution. Each time I concluded this was the that the time was too soon, that the federal make good copy), I felt that Ted and I could right case, in the right place, at the right courts were too conservative, that we would bring this issue to mainstream America, and time, and that Ted and I and our team were lose, and that in losing we risked setting back I believed that when we did, the common the right lawyers to bring it. the movement. sense and fairness of the American people would do the rest. From “Redeeming the Dream: The Case for Coming as they did from people who had Marriage Equality,” by David Boies and Theodore worked much longer and risked much more Fourth, we believed there was no way that B. Olson. Published by Viking. Copyright 2014. in the battle for equal rights than I had, a federal constitutional challenge could those concerns were entitled to respect. I be avoided. If we didn’t bring this case for nevertheless decided it was right to proceed these plaintiffs, someone else would do so for four reasons. for other plaintiffs. It was essential that the

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