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Zuckerman Speader: Two-Time
“Litigation Boutique of the Year” Finalist
Washington, DC / New York / Tampa / Baltimore / Wilmington, DE
Litigation Boutique of the year
The American Lawyer, January 2009
Shelter in a Storm
The Washington, D.C., firm is a haven for clients in trouble.
By Drew Combs
PHOTOGRAPH BY deborah feingold
W
in or lose, lawyers at Zuckerman
Spaed
­ er like to say they stand by
their clients. In April, after a nearly four-week trial, Tone Grant, the former
president of commodities broker Refco,
Inc., was convicted of federal fraud charges
and sentenced to ten years. While preparing
his appeal, two partners, Roger Zuckerman
and Aitan Goelman, joined Grant as he surrendered at a minimum security prison in
Duluth, Minnesota. Grant had until 2 p.m.
to report, and the lawyers knew that he
wanted to stay free for as long as he could.
So that autumn afternoon Zuckerman and
Goelman drove their client around the aging port city in a rental car as the minutes
ticked away. “We got him there at 1:58
p.m.,” says Goelman, with a muted sense of
accomplishment.
Grant was a relative rarity among Zuckerman Spaeder’s clients in the last two years
in that he was sentenced to prison. The 96lawyer Zuckerman is often the firm that
spares powerful executives and high-profile
politicians from such fates. But the dedication Grant’s lawyers showed is typical. For
six years, for instance, Zuckerman represented the Milberg firm, indicted in 2006
for paying clients to serve as lead plaintiffs
in class action cases. In June 2008 Zuckerman Spaeder partner William Taylor, along
with cocounsel, negotiated a nonprosecution agreement that called on the Milberg
firm to pay $75 million over five years,
but—critically for the firm’s survival—acknowledged that continuing partners were
not complicit in the fraud.
Zuckerman Spaeder’s defense of former
Enron Energy Services executive Lou Pai
also reached a climax in 2008. Over the last
seven years, Pai has been investigated by the
U.S. Department of Justice’s Enron Task
Force, plaintiffs attorneys, and the Securities and Exchange Commission. All of them
wanted to know the circumstances of Pai’s
sale of more than $270 million in Enron
shares in the months before its collapse. The
timing of the sale seemed suspicious, but
Zuckerman Spaeder was able to minimize
Pai’s civil exposure—and spare him criminal
charges.
“They had definitely done their homework,” says one member of the Enron Task
Force, regarding an early meeting with
Zuckerman Spaeder attorneys. “They presented a complete case as to why none of
the trades [was] problematic and why we
should not do a full-blown investigation.”
In July, Pai reached a deal with the SEC in
which he agreed to pay $31.5 million, but
will receive credit for legal fees and did not
admit guilt. “I am indebted to [Zuckerman
Spaeder], says Pai, “especially given the
outcome for some of my peers.”
Despite its high profile, the firm’s criminal defense work actually represents only 25
percent of its revenue. The rest comes from
more than a dozen other practices ranging
from IP and commercial cases to contingency
work. Partner Norman Eisen, for instance,
has expanded Zuckerman Spaeder’s practice
advising state attorneys general and government agencies in civil litigation. Over the past
year the firm played a key role in settlements
between states and financial institutions rezuckerman spaeder
SIZE OF FIRM
Partners 38
Other 31
Associates (includes staff attorneys and counsel)
Offices
Washington, D.C.
New York
Tampa
Baltimore
Wilmington
REPRESENTATIVE CLIENTS
Roxane Laboratories, Inc.
Congressman Charles B. Rangel
Wiley Rein LLP
Tone Grant, former president, Refco, Inc.
Lou L. Pai, former Enron executive
27
garding lending practices, including the Bank
of America deal that will permit thousands of
home­owners to restructure their mort­gages.
“They provided a high quality of work across
the board,” says one state attorney general.
“Their legal strategy and research was firstrate.”
Zuckerman Spaeder’s legal professional
and ethics practice has been increasingly
active of late. In May 2008, for example,
partner Mark Foster won the dismissal of a
legal malpractice suit brought by Blackwater Security Consulting against Wiley Rein.
The private military company claimed that
Wiley Rein, its former counsel, failed to have
a wrongful death lawsuit—filed by the families of employees killed in Iraq—removed to
federal court and dismissed.
Zuckerman Spaeder has also been successful when it comes to appellate work. In
April 2008 the U.S. Court of Appeals for
the D.C. Circuit ruled in favor of Zuckerman client Azhar Ali Khan, whose former
employer, Parsons Global Services, Ltd.,
attempted to force him to arbitrate claims
against it in Switzerland. Khan, an accountant, had been kidnapped while working for
Parsons in the Philippines. He brought suit
against the company following his release.
(Khan eventually settled with Parsons.) The
firm also won a new trial for client Robert
Quinn, who had been convicted of violating export control laws. Ultimately Quinn
accepted a deal to plead guilty to a single
count of making false statements to federal
agents.
Tone Grant is hoping that Zuckerman
Spaeder is equally successful in his appeal.
“I think we have very good issues on appeal,” Grant said during a telephone interview a few days before he had to report to
jail. He added, “I am very satisfied with the
firm. They are outstanding, and they develop
a personal relationship that makes you feel
they are with you.”
E-mail: [email protected].
From left: partners
paula Junghans,
Chairman Graeme Bush,
and Aitan Goelman
special
report
On the day that Robbins, Russell, Englert, Orseck, Untereiner & Sauber
opened its doors, name partner Lawrence Robbins took special note of a package of yellow Post-it notes.
Robbins and three of his fellow founders had left the safety and security of Mayer Brown partnerships to
venture out on their own, and there had been a few misgivings. But as he stood in the supply room amid
the new firm’s pens, notepads, and Post-its, Robbins thought to himself: “These are my yellow sticky
notes. This is my firm.” It was a feeling of ownership, he says, that he’d never had before.
Practicing at a litigation boutique is different from practicing at an Am Law 200 firm. To be clear: We
are not referring to the quality of the boutiques’ ­cases or the level of their advocacy. The firms we considered for Best Litigation Boutique honors—which ranged in size from 11 to 96 lawyers—are involved
in some of the highest-profile, highest-stake cases in the country, in both the civil and criminal arenas.
Their clients are banks, accounting firms, airlines, energy companies, tobacco and pharmaceutical giants,
hedge funds—a list that any big firm might aspire to.
Instead, where they diverge from the big firms is in their culture, a word worn to banality in the
recruiting brochures of The Am Law 200. At litigation boutiques, culture is not a cliché. It’s Gibbs &
Bruns’s lockstep compensation, Bredhoff & Kaiser’s determination not to handle management-side labor
work, Wallace King Domike & Reiskin’s deep commitment to a diverse partnership. Would a big firm refuse to bill by the hour or hire laterals? Bartlit Beck Herman Palenchar & Scott does. How about letting
associates vote on whether to take a contingency-fee case, as Susman Godfrey does; or paying five-figure
bonuses to staff members when the firm has a good year, which is Robbins, Russell’s policy?
The clients of these firms told us that the boutiques, in the main, deliver what they promise: They
are nimble, efficient, flexible, and smart. They’re also often a lot less expensive than their big-firm competitors—a quality that clients now appreciate more than ever. Several boutiques even told us that they
turned away work in the last year. How many big firms can say the same?
Reprinted with permission from the January 2009 edition of The American Lawyer. The cover design prepared in collaboration with the firm for the purposes
of this reprint and not an actual American Lawyer cover. © 2009 Incisive US Properties, LLC. All rights reserved. Further duplication without permission is prohibited. For information, contact 877-257-3382 or [email protected]. # 001-01-09-03
Litigation Boutique of the year
Boutique of
Year
Li t igat
n
e
th
For our finalists,
it’s not the size that
matters, it’s the skill.
Also the joy of success.
io
The American Lawyer, January 2005
Finalist
Z u c k e r m a n Spaeder
Small Is Beautiful
n an era when law firms
feel an almost biological imperative to grow larger, there is still
one practice area where some of
the best clients send some of their
best work to some of the smallest
law firms: big-stakes litigation. This
is a high-profile anomaly, one that
brings intense interest, competition, and even a bit
of envy from colleagues working in firms that are
now the size of villages.
But who is doing the best work? Who is playing at the highest level, in the cases with the biggest
impact, for clients who can afford to hire anyone?
To find out, we decided to hold our first Litigation
Boutique of the Year contest, a competition open to
firms who were not members of The Am Law 200.
We invited the firms to report on their
litigation records between January 1, 2003, and
June 30, 2004. Specifically we asked for up to five
examples of “significant achievements” in a broad
range of litigation activities. In addition, we asked
for client references, names of opposing counsel, and a list of firm partners who tried cases to
verdict during that time period.
We winnowed the candidates and supplemented
their submissions with reporting. We developed
a shortlist of five finalists and then visited each of
them, offering these master advocates the chance to
make their case.
The contest was very close. One caveat:
We were judging a specific 18-month time period, not a law firm’s oeuvre. Our special report
features the winning firm, the runner-up, and the
other three finalists, plus three microfirms whose
work and approach seemed particularly interesting.
These firms manage to combine cutting-edge
technologies, palpable tastes for risk, and an
old-fashioned sense of partnership. The rewards
are obvious: Their clients are stellar, and so are
their profits. The partners are more than names
on a Web site: They don’t need name tags at
summer outings. That’s not an accident: Many fled
large firms to rid themselves of conflicts or anonymous alienation. Some just wanted the pleasure of
uncertainty. And, best of all for those with the metabolism of gunfighters, they often get to try their
cases, not just litigate them.
They say they’re determined to stay small. And
their very scale drives—and changes—almost
everything. They don’t have to hire platoons of
young lawyers for pretrial trench warfare. They
are content to cede the document churn to their
megafirm cocounsel. They add lawyers as needed, by ones and twos, typically bringing on federal court clerks they hope will grow into partners.
Think how different a firm’s atmosphere would
be if associates were not regarded as fungible
but as the future.
Because they’re small and focused, their
clients tend to come only with important
problems. And, because they’re small and don’t aspire to a full-service menu, they get referrals, especially from lawyers who don’t have enough Xanax on
hand to face a trial judge.
One more thing. We can’t say these firms are
sharper or more loyal or harder-working than the average Am Law 200 outfit. But after a month’s worth
of interviews, we’ve never met a group of litigators
who seem happier.
—Aric Press
Zuckerman Spaeder
wins high marks
for preparation, integrity,
and results.
They Try Harder
By Alison Frank e l
illiam Taylor III, a partner at
Washington, D.C.’s Zuckerman Spaeder
and the dean of its white-collar criminal
defense practice, says a particular ethos
is embedded in the 93-lawyer firm’s
litigation style. “It’s a commitment to
thoroughness, a belief that there’s always
something else [you can] do,” says Taylor,
60, a bearded and soft-spoken southerner who joined the firm in
1978. “That’s taught here: You’re never really
quite ready.”
Taylor and partner Blair Brown vividly
demonstrated the benefits of preparedness in
the November 2003 criminal trial of Thomas Welch, the former president of the Salt
Lake City Olympic Committee. The case had
already been what Welch calls “an emotional journey, with ups and downs.” In 2001
Zuckerman lawyers won a dismissal of
the bribery indictment against Welch,
ZUCKERMAN SPAEDER
Size 42 partners, 27 associates, 6 counsel,
18 staff attorneys
Founded 1975
firm origin Roger Zuckerman and Roger
Spaeder are former assistant U.S. attorneys.
Up next Defending Kenneth Langone,
former chairman of NYSE compensation
committee, in Richard Grasso pay investigation;
on behalf of creditors committee, investigating
Kirkland & Ellis, White & Case, and KPMG, all
advisers to Spiegel Inc., which didn’t file SEC
reports in 2002 and 2003.
P h o t o g r a p h B y Da n i e l L i n c o l n
but the Tenth Circuit reinstated the charges. Taylor and his
team, meanwhile, investigated every crevice of the lives of
the government’s three key witnesses, from the memo lines of
canceled checks to the Federal Communications Commission
license applications of another. At trial the Zuckerman team
used the evidence it had uncovered to demolish the credibility of
the government’s case. One witness told the judge he felt ill and
rushed out of the courtroom in the midst of Brown’s brutal crossexamination—after Brown had confronted him with tax records
Year
Li t igat
io
Boutique of
e
th
that suggested the witness had lied to the government and violated
his plea agreement. At the end of the prosecution’s case, the court
granted Zuckerman’s motion for a judgment of acquittal. “I was so
impressed with the quality of their work and their tenacity,” says
Welch, who before trial turned down a no-jail plea offer.
Zuckerman Spaeder’s lawyers bring the same intensity to the
firm’s civil docket. Some examples:
■ In a legal malpractice case, Tampa partner Morris “Sandy”
Weinberg, Jr., had to master the nuances of FCC regulations dating
back to 1990, the year that client Dow Lohnes & Albertson advised
a precursor of Home Shopping Network on a “placeholder” contract
to ac­quire 45 percent of a Chicago station.
■ Norman Eisen, a 44-year-old partner, spent a year developing
evidence of a link between Citigroup Inc.’s commercial and
investment banking arms in an effort to prevent Citigroup from
collecting on a $67 million loan to the bankrupt Metromedia Fiber Network, Inc. Metromedia was one of the companies about
which Citigroup analyst Jack Grubman was accused of publishing
fraudulent research.
■ Michael Smith led a team of Zuckerman lawyers who fanned
out to state and national archives, finding old documents to prove
that the Oneida Indian Nation owns thousands of acres of land in
upstate New York.
In each case, Zuckerman Spaeder won. Home Shopping’s
claims against Dow Lohnes were dismissed on summary judgment.
MFN settled with Citigroup after a bankruptcy judge upheld the
sufficiency of its complaint. The Oneidas won a U.S. Court of
Appeals for the Second Circuit affirmance of the district court
ruling protecting the tribe from a levy of property taxes on land it
repurchased. (That case will be argued in the U.S. Supreme Court
later this year.) “They’ve done a fabulous job,” says Oneida general
counsel Ray Halbritter, who first hired Zuckerman partner Taylor to
represent his tribe almost 20 years ago.
Much of Zuckerman Spaeder’s practice falls in the intersection
of civil and criminal proceedings, representing defendants facing
investigation by not only prosecutors, but also government regulators
and plaintiffs lawyers. Founding partner Roger Zuckerman, a brash
62-year-old former assistant U.S. attorney, points to two white-collar cases to demonstrate the firm’s reach and reputation. Zuckerman represents Lou Pai, the former head of Enron Energy Services and one of the few high-level Enron executives to have avoided
criminal charges, in both civil and criminal proceedings. Meanwhile,
Zuckerman’s partner, Taylor, is defending the plaintiffs firm
investigating Pai—Milberg Weiss Bershad Hynes & Lerach—in
its own federal grand jury inquiry in California. Both Pai and Milberg Weiss (now split into two firms, Milberg Weiss Bershad &
Schulman and Lerach Coughlin Stoia Geller Rudman & Robbins)
granted Zuckerman Spaeder the waivers necessary for such
n
Finalist
Z u c k e r m a n S pa e d e r
overlapping representations.
Clients and opposing counsel contacted for this article gave
Zuckerman Spaeder high marks for integrity—a critical trait for a
firm whose business model relies heavily on referrals. Zuckerman
Spaeder does have a handful of institutional clients. The nursing
home giant Kindred Healthcare, Inc., for instance, first hired the
firm when it was the subject of a criminal and regulatory probe in
Tampa, and has since asked Zuckerman Spaeder to serve as national counsel in defending several hundred malpractice claims. Recently elected chairman Graeme Bush and partner Carl Kravitz are
also expanding the firm’s plaintiffs practice; they won a pair of
eight-figure settlements in securities cases in the last two years.
But the bulk of the firm’s cases—the reason for profits per partner
that, according to Roger Zuckerman, are higher than average profits at indigenous Washington, D.C., firms in The Am Law 100—
come from referrals.
And for that, the firm may have not only its results, but also its
personality, to thank. Several of Zuckerman’s lawyers, chief among
them Taylor, are former public defenders, and they’ve fostered an
attitude of treating clients sympathetically. “They really listened to
my story,” says one client whose initial meeting was attended by
Zuckerman and partner Steven Salky. “I ­wasn’t being prejudged,
and they didn’t have any misgivings about me.” This client, in
the midst of what he calls “a hornet’s nest” of regulatory and
criminal investigation, says he appreciates the faith that Salky,
who has led his defense, has always shown in him, particularly after
press accounts of the case.
“There’s a whole psychology component to this,” says the client, who recently received the good news that an administrative
law judge had recommended dismissal of regulatory charges
brought against him. “These guys are not only my lawyers,
they’re my friends.”
E-mail: [email protected].
This article is reprinted with permission from the January 2005 edition of the
american lawyer. © 2005 ALM Properties, Inc. All rights reserved. Further
duplication without permission is prohibited. For information, contact American
Lawyer Media, Reprint Department at 800-888-8300 x6111. #001-01-05-0002
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