Category: Legal Issues – Specific Litigation

Fake

The Book of the Week is “Fake” by Kenneth Walton, published in 2006. This book’s author tells a suspenseful story about his 2003 eBay activities that were deemed a crime.

A friend who was well-versed in the business, sparked Walton’s passion for hunting for paintings at antique shops, thrift stores and flea markets, and reselling those paintings at a profit on the online auction site. However, as Walton honed his entrepreneurial skills, he got greedy and began to collude with his friend, using deception to make more money.

Read the book to learn of what happened when Walton found himself in serious trouble, and how he realized he could make money honestly through a different pursuit for which he had natural ability, and for which he developed a passion.

The Billionaire’s Apprentice

The Book of the Week is “The Billionaire’s Apprentice” by Anita Raghavan, published in 2013. This ebook describes the investigation into the activities of a few Wall Streeters who were accused of insider trading in the past several years. Most of the accused happened to be of South Asian descent–from  Sri Lanka and India.

One concept the book conveys to readers is that it is unknown how many American securities-industry professionals are benefiting from insider trading, but the people in this book just happened to get caught because there was sufficient evidence against them to prompt the SEC, US Attorney’s office and FBI to go after them, rather than other possible offenders. The departments involved included the SEC’s Market Abuse Unit and the Department of Justice’s Securities and Commodities Fraud Task Force in the legal jurisdiction of the Southern District of New York (covering Manhattan and the Bronx, according to the author).

Another concept is that the investigating organizations and the securities industry are staffed with many people who, during their careers, switch allegiances. They might go from being a prosecutor to being a defense attorney, or from brokerage executive to government regulator, or vice versa. In this book the “old boy network” is alive and well. Arguably, conflicts abound.

Read the book to learn, among other extremes, about wiretapping (not the NSA’s), about one of the accused who “had several phones– at least thirteen– and he used them all” and a $30 million legal bill.

Law Man – Bonus Post

This blogger skimmed the book “Law Man” by Shon Hopwood published in 2012. In this personal account, Hopwood details his actions as a bank robber, and their consequences, complete with the romantic subplot.

In May 1999, the author was permanently placed in prison in Peoria. He felt relief because “Mostly I wanted my hard time to begin so it would start to end.” He told the reader of the term “chester”– short for “child molester.” Luckily, early on, Hopwood found an inmate who became his mentor, who taught him how to fashion a wooden-handled steel rod; the best weapon in the prison– which housed a metal fabrication plant. “… you can run it straight through a man’s liver. But what’s better is a lot of friends.”

More than three quarters of the prisoners were wannabe rap stars. Hopwood wrote, “You must have a job in prison; it’s not supposed to be a vacation, after all.” Postage stamps were the major means of exchange. Whenever the post office raised the price of stamps, the prison economy was disrupted.

On one occasion there was a gang brawl in the exercise yard involving attempted murder, resulting in a four-day lockdown of the entire prison. “In a world of attention-craving narcissists, lockdowns border on cruel and unusual punishment.”

Read the book to learn how the author was responsible for a change in a major legal ruling, an occurrence whose odds were akin to winning the lottery.

The Hoax

The Book of the Week is “The Hoax” by Clifford Irving, published 2006.

This is a personal account of an incredibly talented, savvy phony and writer, who, starting in 1969, with a co-conspirator, Dick Suskind, proceeded to write the autobiography of reclusive businessman Howard Hughes; phony, because he had never met Hughes.

McGraw Hill, Irving’s publisher, believed Irving when he told them he had actually spent time with Hughes. McGraw wanted to believe that it was going to produce an exclusive work on a billionaire businessman who, up to that point, had refused to let anyone publicize significant information on his personal life.

Irving and Suskind perpetrated their deception because: trying to get away with preying on the gullibility and greed of the publishing industry was a challenge that would make them feel alive.

Pursuant to the writers’ scheme, the book was “…based on fact and yet we had the freedom and power to infuse fact with the drama of fiction.” The writers did extensive research– spent hours poring over old city telephone directories, old maps, surveys, society columns and classified documents in order to perfectly embody Hughes’ voice in print. When they were concocting anecdotes, they inserted (real) people who were dead because dead people couldn’t sue for libel.

Incidentally, a whole other book could be written on the name for the marital anguish: soul-vomit, that Irving caused his wife with his adulterous behavior– that has so much female appeal on the big screen and in books.

Read the book to learn what was becoming of Irving and Suskind when Irving was heard to say, “You know, I’ve had a lot of experience in this past year burning manuscripts. It takes a long time and it’s not easy.”

Savage Spawn

The Book of the Week is “Savage Spawn” by Jonathan Kellerman, published in 1999. This short ebook, authored by a child clinical psychologist, discusses topics associated with violent children, including serial killers, psychopaths, psychology professionals, the nature/nurture controversy and violence in the media.

The cynical Kellerman writes that “profiles” of serial killers should be taken with a grain of salt: “Profiles are most effective as career builders for retired FBI agents seeking to be best-selling authors and consultants to the film industry, but they miss the mark as often as they hit.”

Kellerman believes that psychopaths (conscienceless people) cannot be rehabilitated because:  1)  “…no medication has been found that alters antisocial behavior” and 2) they do not respond to the treatment of traditional psychotherapy because they lack insight and the desire to change.

At least since the mid-twentieth century, due to competition with psychotherapists (who hold PhD’s) to treat patients, psychiatrists have been big advocates of attributing biological causes to mental health disorders in order to prescribe medication.

The author provides a real-life example of two boys, thirteen and eleven, who, in spring, 1998, went on a shooting spree at a middle school and killed four girls and a teacher, and wounded ten other kids and another teacher. Kellerman thinks that had the kids not had access to firearms, “…their misdeeds likely would have expressed themselves as some variant of schoolyard bullying, perhaps a knifing.”  He proposes one simple rule for “…preventing child criminality: Restrict access to firearms [to kids].” Teaching psychopathic kids “practical shooting” will result in their bullying other kids. After the occurrence of untoward events, adults who gave kids guns, even with training, should never wonder why such events occurred.

Obviously, it is hard to pinpoint all of the exact causes of violent incidents. Psychological research that would produce a general consensus on the causes of extremely violent behavior would require: a) a long-term study of a sufficiently large number of subjects, and b) other difficult, expensive measures that would minimize bias. Kellerman mentions that longitudinal biological studies of psychopathology have been performed in Scandinavia, but he fails to provide details.

It is inconclusive which, genetics or the environment, is the more responsible for violence committed by kids. The fact that “Genetic traits can make themselves apparent at any age.” throws more of a wrench in the works. The author opines that media violence is not a proximate cause of violent behavior; kids who injure or kill people would probably do so anyway, regardless of the movies or TV shows they had watched. The author’s own children consumed a large quantity of carnage on-screen, and were none the more physically hostile for it. However, Kellerman cannot resist saying, “…media violence is likely to endure as a fruitful source of research grants for social scientists…”

Read the book to learn:  a) the relationship between the heart rate of certain toddlers and probable future violent behavior;  b) three strong predictive factors of violence in teenagers; c)  the age before which, if there is an arrest record– a lifetime of criminality is likely, too;  and d) how to intervene in the lives of high-risk youngsters to try to head off violent behavior.

The Good Girls Revolt

The Book of the Week is “The Good Girls Revolt” by Lynn Povich, published in 2012. This short ebook discusses what happened when a group of female employees sued Newsweek magazine’s parent company in March 1970, for gender discrimination.

Shortly thereafter, similar litigation followed at other publications– at Time, Inc., Reader’s Digest and various newspapers across the United States. The author briefly describes the historical backdrop before, during and after. One of many cultural phenomena she relates is that the year 1973(!) saw the elimination of classified ads divided into “Help Wanted– Female” and “Help Wanted– Male,” the former of which were mostly for menial and/or low-paying jobs. “Saying you worked at Newsweek was glamorous compared to most jobs available to college-educated women.”

The author says that from the early 1920’s up until the aforementioned lawsuits, periodicals publishers relegated women to dead-end positions. At Newsweek, the vast majority of female employees held the title “researcher”– a fact-checker, who could never become a reporter or editor like, or get paid as much as, the male employees. Besides, many of the men were hired “…as reporters and writers with no prior professional journalistic experience” and most of the female researchers had the same qualifications as they did.

One reason many women did not protest or were not even consciously angry about their situation, is that they were conditioned by the workplace and society in general to comply with gender stereotypes. Four decades ago, women were limited in their opportunities and criticized if they chose a male-dominated career field. They were given to believe they should not aim too high, but stay where they were, because otherwise, they would encounter difficulty.  It became a self-fulfilling prophecy for most of them. Even many women’s colleges at that time had the goal of providing an education with the assumption that a graduate might get a job, but she would quit the workforce when she had children.

Even today, in the American workplace, there is an environment in which women are jockeying for position and power. According to the book, they are less well-liked, the higher up the corporate ladder they climb. The opposite goes for men. In certain aspects of their lives, such as weight-loss groups and fitness, women band together and cheer each other on. But not usually in the workplace.

Read the book to learn about the consequences of the initial legal action, and whether Newsweek’s workplace policies changed when, in 2006(!), three female employees recognized the recurrence of gender discrimination.

Dot Bomb

The Book of the Week is “Dot Bomb” by J. David Kuo, published in 2001. This ebook details the business dealings and the ensuing suspenseful power struggle at a dot-com company called Value America between 1996 and 2001.

The online retailer’s intended brand image was to boast maximum selection of merchandise shipped directly from sellers. This delivery-on-demand arrangement allowed the company to remain inventory-free, and thus minimize overhead costs. However, in reality, it needed to use resellers for many of the supposedly infinite products it sold.

Value America’s founder and leader, Craig Winn, was a charming megalomaniac who had grand plans to partner with various major corporations in order to attract investors and make the company worthy of an IPO. Unfortunately, Winn had planned to sell stock to the public just after the peak of the dot-com boom, when brokerages’ confidence in internet companies had started to wane.

After Value America went public, Goldman Sachs issued a report that Amazon.com was the internet retailer with the highest potential for success because it had high sales margins on its then-merchandise consisting only of books; a $30 billion valuation was not out of the realm of possiblity. Goldman went on to say Value America had the worst prospects, with sales margins of 1% and runaway costs. It would have to achieve revenues of billions of dollars in order to make any money.

Toward the end of the story, the author realized “Despite the hype, headlines, and hysteria, this was just a gold rush we were in… a lot of us were kin to those poor, freezing fools in Alaska who had staked everything on turning up a glittering chunk of gold.”

Read the book to learn the fate of the author, his family and the other Value America employees with dollar signs in their eyeballs.

Louis D. Brandeis, A Life

The Book of the Week is “Louis D. Brandeis, A Life” by Melvin I. Urofsky, published in 2009. This is the lengthy biography of an attorney and Supreme Court Justice.

The youngest of three siblings, Brandeis grew up in Louisville, KY in the 1850’s and 1860’s, and graduated from Harvard Law School.

Prior to the early 20th century, Brandeis felt that his job as an attorney was to help develop a fair solution for all parties involved in a dispute. He felt he was a mediator and moralist, rather than an attorney being paid to favorably act on behalf of and give legal advice to only his client. This mentality led Brandeis to engage in a few conflicts of interest in dealing with his firm’s clients.  For instance, he represented a corporate client in litigation in which a third party was represented by his firm.

Despite becoming embroiled in a few episodes of hypocrisy, Brandeis fought against corrupt, monopolistic practices of various large American institutions. He felt obligated to do what he considered public service, pro bono. Fortunately, his income as a law partner allowed this.

In the United States at the turn of the twentieth century, there were three big insurance companies that wielded an amount of power similar to that of big-name brokerages in the early 2000’s. The outsized ego and greed of the insurance executives, too, led them to manipulate the government, commit accounting irregularities, and abuse their power and the public’s trust. Brandeis took them on, exposing what he thought was their moral depravity. He then found a way for the public to avoid adding to the profits of the evil insurance corporations by initiating the sale of affordable life insurance through savings banks.

Brandeis was nominated a Supreme Court Justice by President Woodrow Wilson in 1916. “When confronted with the first Jew named to the Supreme Court, and in a time of growing nativism, clearly those who ‘feared foreigners’ would oppose the appointment.” Brandeis had to endure four stressful months of hearings and background checking before he was appointed.

Around 1920, Brandeis became active in the Zionist movement. He controversially defined the movement as one in which oppressed Jews could receive financial assistance to improve their lot through settling in Palestine. Since the persecuted Jews who had found a haven in the United States had become successful in their adopted country, they did not need to go to Palestine to build a homeland there. But they were urged to help their fellow Jews who were worse off than themselves, to do so. Other people in the movement felt Brandeis did not truly understand the mentality of the oppressed Jewish immigrants, who viewed Palestine as a place they could freely practice their religion.

During the 1930’s, when Great Britain realized that Arabs greatly outnumbered Jews, and that there was so much oil in the Middle East, she changed her political position on Zionism as mentioned in the Balfour Declaration. She found the Jews argumentative, and wanted Palestine to be “an Arab-dominated region under English tutelage.”

Brandeis favored a workday shorter than twelve or fourteen hours, in order to give unionized American workers time to fulfill their civic responsibilities to get involved in local politics and “as parents and members of their communities.”

As a Supreme Court Justice, Brandeis left an influential legacy in that he had a “… great impact not only on jurisdictional matters but on commercial law, antitrust, administrative law, utility regulation, federalism, and individual liberties.”

Until the Sea Shall Free Them

The Book of the Week is “Until the Sea Shall Free them” by Robert Frump, published in 2001.

This wordy, repetitive, yet suspenseful book tells the detailed story of the February 1983 shipwreck of the Marine Electric, among many other briefly described maritime catastrophes. The scurvy old 605-foot bulk carrier transported coal in the North Atlantic Ocean from Boston, MA to Norfolk, VA.

The investigation of what happened conducted by the Marine Board– a panel of industry officials– was subject to the vagaries of the maritime legal system. Safety inspections of ships were performed by the U.S. Coast Guard and the American Bureau of Shipping. The National Transportation Safety Board was yet another regulatory body of maritime matters.

The Marine Board generated reports on shipping accidents. In rare cases, its recommendations might include Justice Department investigation and prosecution of a shipping company executive, or a review of the license of a ship’s captain; the latter, for criminal law violation, like for negligence in putting men’s lives at risk for failure to follow safety procedures.

A ship’s officers were usually blamed for disasters because ship owners and builders had a friendly relationship with the federal government. Political contributions helped elect candidates who turned a blind eye to regulating safety in marine commerce.

The ship’s top officers were under tremendous pressure to go on a voyage despite safety violations. Whistle-blowing behavior might get them fired. There was always the threat that a rival union would be awarded their current shipping contract. Some men waited more than a year before they could be assigned their next job on a ship.

For years, disasters were waiting to happen, due to the “rationalization, denial, greed and stubbornness” in connection with repairing and mantaining of decades-old ships. In the mid-1970’s, more than one fifth of all deaths from shipping accidents were due to structural failures of the vessels.

Heartbreakingly, during a winter storm at sea, some crew members die when they are so close to surviving. The lifeboats are buffeted about by rough waves and dashed on rocks or into a seawall, or men who lack protective clothing and proper safety equipment, fall into the freezing water while trying to board a rescue boat.

As in many other industries, shipping is one in which the big companies care more about money than seeking to reduce dangerous conditions. Despite poor safety records and the expenses of lawsuits and damage to their reputations, the large players stayed in business through the decades of the twentieth century. On the flip side, in accidents, numerous greedy seamen abused a lenient system that awarded them big bucks in personal injury cases.

Read the book to learn the fates of the parties associated with the Marine Electric after its fall from grace.