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Good morning. Lawyers for Mexico today will press claims against U.S. gun makers at a key hearing in a federal appeals court as the country looks to revive its $10 billion lawsuit over weapons flowing in from the U.S. Plus, more lawyers just left a firm roiled by its founders’ racist emails; New Jersey hired a King & Spalding team to sue New York over traffic; and the 5th Circuit will take a fresh look at an Elon Musk tweet about unions. Catch up on Barbie’s world of litigation before you head to the theater. Thanks for reading!
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Mexico to press its $10 billion lawsuit against gun makers in US appeals court
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REUTERS/Jose Luis Gonzalez
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The Boston-based 1st Circuit today will take up claims from Mexico that U.S. gun makers should be held responsible for facilitating the trafficking of deadly weapons across the border. Mexico appealed the dismissal of its $10 billion civil lawsuit last year, in an effort to crack down on drug cartels acquiring firearms.
In his ruling, Chief Judge F. Dennis Saylor in Massachusetts said federal law “unequivocally” bars lawsuits seeking to hold gun manufacturers responsible when people use guns for their intended purpose. He said the law contained several narrow exceptions but none of them applied.
The opinion was a victory for defendants including Smith & Wesson, Sturm, Ruger & Co and others that argued they would be punished for sales of firearms “that are not only lawful but constitutionally protected in the United States.” Some U.S. states and two Latin America and Caribbean nations threw their support behind Mexico’s lawsuit.
Jones Day’s Noel Francisco, a Trump-era U.S. solicitor general, will argue for the gun manufacturers at today’s hearing. Cozen O’Connor, Day Pitney and other firms also represent defendants in the case. Plaintiffs’ lawyer Steve Shadowen and Jonathan Lowy, former chief counsel to the Brady Campaign, represent Mexico. Circuit Judges William Kayatta, Gustavo Gelpí and Lara Montecalvo will hear arguments.
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- At least two more partners are leaving the fledgling law firm formerly known as Barber Ranen, which was left reeling one month after it was launched in May by the disclosures of bigoted emails written by its former founding partners. The firm, now known as Daugherty Lordan, is losing LA managing partner Rachel McClintock and partner Kelsey Scherr, who are joining Dinsmore’s Los Angeles office. (Reuters)
- Hausfeld, Quinn Emanuel, Korein Tillery and Cohen Milstein are among the law firms representing plaintiffs in antitrust litigation in New Jersey federal court against four global fragrance and flavor makers. The companies, defended by Skadden, Paul Weiss and other firms, are accused of conspiring to fix prices. Plaintiffs include candle shops and fragrance manufacturers that directly purchased ingredients. (Reuters)
- Dentons sued its former client Steel Connect in New York state court, alleging the publicly traded supply management firm has failed to pay more than $1.7 million in legal fees. Dentons said it was hired by the strategic planning committee of Steel Connect’s board of directors to provide legal services “in connection with potential strategic transactions.” (Reuters)
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That’s the maximum daily toll that New York City aims to start charging on vehicles entering or remaining in the central business district as early as next year. The state of New Jersey, represented by King & Spalding’s Randy Mastro, sued the Biden administration to block New York City’s congestion pricing plan. Last month, the plan cleared a roadblock when the U.S. Department of Transportation’s Federal Highway Administration said the city had adequately assessed how the congestion charge would help the environment.
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It’s never a good sign when a judge says in the second sentence of the opinion resolving a sanctions motion against your clients that your case is “a cautionary tale of what can happen when parties over-litigate.” Yikes! Alison Frankel has the story of why a couple of clothing retail executives who sued Marcus Lemonis and NBC after appearing on an episode of the television show “The Profit” are now on the hook for defense fees and costs.
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“There is a very strong, negative reaction to four days a week.“
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—Kate Reder Sheikh, a partner in the associate practice group of legal recruiting firm Major, Lindsey & Africa, who told columnist Jenna Greene that many young attorneys aren’t in favor of law firm policies requiring four days a week of in-office work. Weil Gotshal, Skadden and Davis Polk recently announced that attorneys are required to work out of firm offices four days a week beginning Sept. 5. There aren’t many firms following suit, Greene writes.
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- In Boston federal court, U.S. District Judge Indira Talwani will convene a pretrial conference in the prosecution of Jack Teixeira, the Air National Guardsman accused of leaking U.S. military secrets. Teixeira last month pleaded not guilty to six federal counts of willful retention and transmission of classified information relating to national defense. Teixeira has remained jailed since his arrest in April over the disclosure of U.S. documents related to the Ukraine war and numerous other sensitive issues.
- The challengers to bans in Tennessee and Kentucky on the use of puberty-blocking drugs and hormones for transgender children are due to file their opening briefs in the 6th Circuit. The appeals court earlier this month said the Tennessee law can go into effect immediately. In the Kentucky challenge, U.S. District Judge David Hale found that the ban likely violated the U.S. Constitution but said he had to put his order on hold following the 6th Circuit’s order in the Tennessee case. The appeals court panel said advocacy groups that had challenged Tennessee’s law could not show they were likely to prevail.
- JPMorgan Chase is expected to ask U.S. District Judge Jed Rakoff in Manhattan to reject the U.S. Virgin Islands lawsuit seeking to hold the bank liable for ignoring sex trafficking by the disgraced late financier Jeffrey Epstein, a former client. The bank has denied the allegations. The request from the bank’s attorneys at WilmerHale is expected to come in a motion for summary judgment to dismiss the case. The U.S. Virgin Islands, represented by lawyers from Motley Rice, is seeking at least $190 million.
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Court calendars are subject to last-minute docket changes.
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- On Tuesday, a 5th Circuit panel in Louisiana will hear arguments from relatives of people killed in two Boeing 737 MAX crashes who are challenging a Texas U.S. judge’s rejection of their bid to prosecute the planemaker. The relatives want the appeals court to reopen or dismiss Boeing’s January 2021 deferred prosecution agreement. The DOJ agreement gave Boeing immunity from criminal prosecution over fraud conspiracy charges related to the plane’s flawed design. In return, Boeing has to pay $2.5 billion in fines and compensation to the government, airlines and a crash-victim fund. U.S. District Judge Reed O’Connor ruled he did not have legal authority to grant the relatives’ requests despite what he called “Boeing’s egregious criminal conduct.”
- Also on Tuesday, Alex Mashinsky, founder and former CEO of bankrupt cryptocurrency lender Celsius Network, is expected to appear in Manhattan federal court for an initial conference after being charged earlier this month with misleading customers and artificially inflating the value of his company’s crypto token. Mashinsky has pleaded not guilty. Three federal regulatory agencies have sued Mashinsky and Celsius in connection with the case.
- On Wednesday, President Joe Biden’s son Hunter Biden will make an initial appearance in federal court in Delaware to face misdemeanor tax and gun-related charges. The DOJ said Hunter Biden has agreed to plead guilty to two misdemeanor charges of willfully failing to pay income taxes and to enter into an agreement that could avert a conviction on a gun-related charge. The younger Biden has worked as a lobbyist, lawyer, consultant to foreign companies, investment banker and artist.
- Also on Wednesday, U.S. District Judge Lewis Kaplan will weigh prosecutors’ claim that indicted FTX founder Sam Bankman-Fried (above) has engaged in witness tampering and that he and others should be barred from making public statements likely to interfere with a fair trial. In a filing, prosecutors argued Bankman-Fried shared certain documents with the New York Times in an effort to malign the credibility of a key government witness. In a filing, Bankman-Fried’s lawyers denied he had done anything improper. Bankman-Fried has pleaded not guilty to various charges tied to the collapse of FTX.
- On Friday, U.S. District Judge Colleen Kollar-Kotelly will hold a status conference in the prosecution of a former top FBI official who was charged with working for sanctioned Russian oligarch Oleg Deripaska. Charles McGonigal, who led the FBI’s counterintelligence division in New York before retiring in 2018, has pleaded not guilty to four criminal counts including sanctions violations and money laundering. McGonigal is represented by lawyers from Bracewell.
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- A proposed court settlement between AMC Entertainment and holders of the company’s common stock failed to receive approval from a Delaware judge. The plaintiffs alleged that the company rigged a shareholder vote on a stock conversion plan, but Delaware Vice Chancellor Morgan Zurn cited concerns about releasing potential claims by preferred shareholders in rejecting the deal. AMC’s chief executive officer on Sunday said the company filed a revised petition for a stock conversion plan. (Reuters)
- An American couple accused of laundering $4.5 billion in cryptocurrency stolen from the 2016 hacking of virtual currency exchange Bitfinex have entered into a plea agreement with federal prosecutors. Ilya Lichtenstein and his wife Heather Morgan are set to appear for a plea hearing on Aug. 3 before U.S. District Judge Colleen Kollar-Kotelly in D.C. (Reuters)
- Former President Donald Trump’s criminal trial over claims that he mishandled classified documents will begin on May 20 next year. Trump’s lawyers had resisted setting a date but said any trial should take place after the November 2024 U.S. presidential election. Prosecutors had sought a December 2023 trial date. (Reuters)
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