A NOTEPAD ON COMPANY AND FINANCIAL LAW, NEWS AND REGULATION
Following the Kay Review’s suggestion that the operation of fiduciary duties in the investment management industry should be reviewed, in March 2013 the Law Commission announced that its has started work on this project. The Commission expects to open a consultation in October 2013, with recommendations to Government being made by June 2014.
The Law Commission’s page on its review, containing its terms of reference, is here.
See page 172 of the Salz Review document.
The 244 page Review only makes one mention of Barclays’s General Counsel (and that is in the context of his membership of a board committee).
The Review’s section on Board governance and the Appendix on “What is Culture and How Can It Go Wrong?” are vaguely interesting. Otherwise, the Review adds little to the recommendations of the Walker Review of Corporate Governance in UK banks.
Just come across this astute January 2013 analysis from The Media Briefing of Thomson Reuters’ acquisition of Practical Law Company:
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Sefton Resources, Inc. statement of 25 February 2013:
“Legal proceedings have been issued against Tom Winnifrith and Daniel Levi (Broker Man Daniel) for libel in the Queen’s Bench Division of the High Court of Justice.
· Complaints have been made against Tom Winnifrith and Daniel Levi to the Financial Services Authority (FSA) regarding apparent breaches of the Financial Services and Markets Act 2000.
· US counsel has been engaged to review comparable actions with US courts and regulatory authorities.
Jim Ellerton, Chairman of the Board said:
“Sefton is accelerating the development of its oil and gas operations both in California and Kansas to create shareholder value. Sefton is not against free speech and people expressing their opinions in the press or on the internet; however, when boundaries of common decency are breached the Company will vigorously pursue anyone and the vehicles they utilize, that seek to illegally damage Sefton.”"
Mary Jo White, presently a partner at Debevoise and Plimpton, is to be nominated by President Obama to head up the US’s lead securities regulator. Here is Bloomberg’s take on the appointment, the New Yorker’s, and the Economist’s.
The FT has lunch with Sydney Kentridge:
“Sir Sydney, who started his career as a lawyer in South Africa in 1949, marked his 90th birthday in November by representing the Law Society in a constitutional case in front of the UK Supreme Court.
The fact that he is still on his feet after six decades is, however, only one reason for his eminence. He has represented three Nobel Prize winners in court – Nelson Mandela, Desmond Tutu and Chief Albert Luthuli. At the inquest in 1977 for Steve Biko, the South African anti-apartheid activist who was beaten to death by police, he appeared for Biko’s family…
…I press him to explain why he values the rule of law so highly…he starts a lengthy, intricate disquisition on the roots of constitutional law. He concludes with a story about the arrest of a Russian ambassador in the reign of Queen Anne, which so upset the Tsar of Russia that he wrote, demanding that those responsible be executed.
“Queen Anne sent a wonderful reply, saying the Tsar must understand that she has no power to put even the lowliest citizen to death, save by the operation of the law, and she trusts that the Tsar will not compel her to impossibilities.” He places an elbow on the table and slowly wags a long forefinger at me in epiphany. “That’s the rule of law.”
The Law Society published a letter on 16 January 2013 setting out its opposition to the Government’s plans for a new employment status – the “employee shareholder” (see this post for the Government’s most recent statement on its plans).
In its letter, the Law Society says:
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The snappily-named Listing Rules Joint Working Party of the Company Law Committees of the Law Society of England and Wales and the City of London Law Society has published its response to the FSA’s October 2012 consultation on “Enhancing the effectiveness of the Listing Regime” (we discussed the consultation in this post).
have published their annual preview of expected legal developments in the year ahead.
“The terms of the deal were not disclosed” – boo!
Inevitably BPP Law School is involved. From the BIS press release:
“Graduate and post-graduate level apprenticeships will soon be available in subjects including law, accountancy and advanced engineering, Skills Minister Matthew Hancock announced today.
From next year, changes to the Specification of Apprentices Standards for England (SASE) will mean that level six and seven apprenticeships – equivalent to bachelors and masters degree level – are available for the first time, making vocational learning an attractive alternative to the traditional higher education route.
There are already a number of these top-level schemes in development, including in accountancy, law and human resources. BPP Law School is looking to develop a Legal Apprenticeship pathway which could be an alternative route to the legal profession and qualification as a solicitor. It is in discussion with the relevant regulatory body and sector skills council, Skills for Justice, to progress its proposals.
Skills Minister Matthew Hancock said:
“In the past, apprenticeships were restricted to only some trades, and some parts of the economy.”
“Now we are introducing apprenticeships in all types of jobs, including a new route to the professions, to ensure everyone can reach their potential.”
“These new apprenticeships will help more young people to receive on-the-job training at top companies like BPP Law School, ensuring a vocational route to success in accounting, insurance, and the law.”
Director of BPP Professional Apprenticeships James Hammill said:
“We are committed to improving social mobility and diversity in the work place by opening up some of the most prestigious professions and employers to school leavers as an alternative to the traditional route. Apprenticeships are an excellent way for employers to recruit talent early and design a structured training programme that incorporates technical learning as well as invaluable work based skills.”
See also: The University of Law
The College of Law has been granted full University status and will now call itself “The University of Law”. Announcement here.
The College is a for-profit body owned by Montagu Private Equity.
See also: College of Law bought by owner of waste management firm
Reuters Breakingviews reckons that there isn’t much point to M&A lawyers:
“U.S. deal lawyers are not as valuable as they may think. Financial markets are largely indifferent to the legal terms of agreed public company mergers, new research shows. That may be because most transactions close regardless of the fine print. M&A attorneys have their uses, but agonizing over detailed wording isn’t the best way to serve clients.”
Although this poorly-argued piece does drag itself to concluding that “lawyers, of course, play useful roles in structuring deals, clearing regulatory hurdles and guiding clients through transactional risks”.
In July 2012 the Code Committee started three consultations on possible changes to the Takeover Code, as we reported here.
The Takeovers Joint Working Party of the City of London Law Society Company Law Sub-Committee and the Law Society of England and Wales’ Standing Committee on Company Law have published their responses to these consultations:
1. Profit forecasts, quantified financial benefits statements, material changes in information and other changes to the Code, PCP2012/1 – response here.
2. Pension scheme trustee issues, PCP 2012/2 – response here.
3. Companies subject to the Takeover Code, PCP 2012/3 – response here.
This piece from the New York Times discusses the trend in US law schools to focus on more specialised legal education as a response to the challenges facing the legal sector – the same challenges as in the UK.
From the New York Times, Wilson Sonsini Retools Strategy to Land Internet Start-Ups:
“…reflects the firm’s evolving mind-set as lawyers jockey for the attention of start-ups. In an effort to build credibility among new technology companies, Wilson Sonsini and others are employing a broad set of tools, including offering free services, cozying up to incubators and writing blogs.
Such efforts are critical. While early-stage ventures represent just 20 percent of the firm’s business, those companies can generate hefty fees as they mature. Wilson Sonsini and other firms also make small investments in young start-ups, which can pay off in later years.
“Small deals would not have interested these firms a few years ago,” said Joseph A. Grundfest, a Stanford law professor. “Now, it’s the new normal.”
For years, Wilson Sonsini dominated Silicon Valley, shepherding young technology companies like Apple, Netscape Communications and even the ill-fated Webvan. In 1998, Lawrence W. Sonsini, the firm’s patriarch, introduced two Stanford graduate students to Sequoia Capital and Kleiner Perkins Caufield & Byers, two top venture capital firms. Six years later, Wilson Sonsini helped their company, Google, go public.”
See also: StartupCompanyLawyer.com, run by a Wilson Sonsini partner
Follow us on Twitter @CoFinLaw
Today’s NYT DealBook special supplement on the legal profession can be read here. Highlights:
Even more about how amazing Cravaths is and how terrible Dewey was
See also: “There are now far more capable lawyers and law firms than there is work for them to do”
HMRC announced yesterday that it is launching a new taskforce “to tackle tax dodgers – including one targeting the legal profession in London”. In HMRC’s words:
“Taskforces are specialist teams that undertake intensive bursts of activity in specific high risk trade sectors and locations in the UK. The teams will visit traders to examine their records and carry out other investigations.”
Maybe the revolution is finally coming.
Philip Collins in The Times today discusses what’s wrong with the leaderships of Cameron, Clegg and Miliband, but his summary of Kurt Lewin’s leadership research applies just as much to running law firms:
“In 1939 the psychologist Kurt Lewin conducted an experiment that contains all that needs to be said about leadership styles. He observed a group of children in an arts and crafts project as an authoritarian leader told them what to do and how to do it. Then, he took notes as a laissez faire leader let them do much as they pleased. Nobody much liked the first leader but they respected him and the job got done. In the second group, the children kept coming back for more directions and the project dissolved into acrimony with nothing much done.”
Follow us on Twitter @CoFinLaw
Tom Crone, former Head of Legal at the News of the World, has been arrested as part of the police investigation into phone hacking.
Mr Crone is the author of the book “Law and the Media“, described on Amazon as “providing an essential source of reference for the key legal issues encountered by those who work in the media such as journalists, editors and producers, as well as media lawyers”.
Globalisation, alternative legal service providers, virtual law firms, legal process outsourcing – good graphic from the Wall Street Journal:
The new lawyer graphic – WSJ Law blog
Anthony Salz, former senior partner of Freshfields, has been appointed to lead a review of Barclays business practices (the Review). The Barclays press release announcing the Review is here and the Review’s terms of reference are here.
The Review was initiated following Barclays fine for the attempted manipulation of the LIBOR. The terms of reference assert that:
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The cab firm Addison Lee has committed to a “babies at work” scheme, the first UK company to do so. How Addison Lee decided on its scheme was featured earlier this week in two fascinating documentaries on BBC2 (stiill on iPlayer).
Here’s what the Daily Telegraph made of it. Here’s what happened when the Evening Standard tried it – described by the (female) editor as “hopeless as an idea”.
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So the City of London is described in an exhibition currently running at The Walbrook Building in the City.
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TheCityUK lobby group, whose mandate is:
“is to promote the competitiveness of UK financial services – to make the UK the best place in the world to establish and grow a financial services business and, in turn, to maximise the sector’s contribution to the UK”
has a new Chairman. Gerry Grimstone of Standard Life will success former Clifford Chance lawyer Stuart Popham in October 2012.
See also: Promoting the UK Legal Services Sector: Government Plan for Growth
From the WSJ Law Blog:
“…firms looking to maximize the use of space in their pricey digs are doing things that in past decades would have been unthinkable. As in:
- Shrinking lawyer offices
- Giving all lawyers the same-sized office (gasp) regardless of seniority
- Moving some offices away from the windows and into the building core (where secretaries and file cabinets used to sit).”
See also: “There are now far more capable lawyers and law firms than there is work for them to do”
A stimulating interview with Nigel Savage, Chief Executive of the College of Law, in Legal Week, including this comment on Scottish law schools in the 1970s:
“Savage also valued Scotland’s approach to education. “The country had exceptional law schools that were taught by practitioners, rather than pure academics. They knew what they were talking about and had the experience to back it up,” he says.”
Which will not be everyone’s experience of the modern-day College of Law.
See also: College of Law bought by owner of waste management firm
The Times reports today (here, paywall) that:
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With insufficient resources to recruit professional staff, the National Archives plans to use trained volunteers to update legislation at legislation.gov.uk. More in this article from the Law Society Gazette.
Follow us on Twitter @CoFinLaw
Here are the meeting minutes of the Company Law Committee of The City of London Law Society for January 2012 and April 2012.
A summary of current and stated private equity interest in investing in law firms from the excellent Legal Futures website.
See also: Everyone’s getting on the ABS bandwagon – no, make that lorry…
Disrupting the law firm model: Online legal services supplier files for $120 million IPO
IBM General Counsel opposes non-lawyer ownership of law firms
The GC100 Listing Rules Working Group, supported by Practical Law Company, has updated and revised (May 2012) its three-part guidance on complying with the Listing Rules:
Part II: Guidelines on the requirement to maintain insider lists.
Part III: Guidelines on obligations to notify dealings and Model Code compliance.
A disaster merger, an ocean of debt, guarantees to dozens of (supposed) “superstar” lawyers, a seemingly disfunctional partnership…what could possibly go wrong? Dewey & LeBoeuf has last night filed for Chapter 11 bankruptcy in the US.
A run down of what went wrong from the New York Times.
All our Dewey stories are here.
According to research by the law firm Pinsent Masons, the Serious Fraud Office has not carried out a single dawn raid since its flawed search of the offices of the Tchenguiz brothers in early 2011.
That compares to a much greater level of activity in the preceding years, says Pinsents:
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The Times reports today that Stobart Group, the logistics business best known for its distinctive lorry fleet, is launching a legal service that will connect retail customers and small businesses with barristers without going through a solicitor. Stobart will take a percentage of the fee charged by the barristers. The “Stobart Barristers” website is here.
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LegalZoom, “the leading online destination for small business and consumer legal services”, has filed its S-1 Registration Statement for an IPO that is expected to raise around $120 million.
The online business disintermediates the lawyer-client relationship, selling access to a variety of personalised legal documents to individuals and small businesses. $120 million will give LegalZoom the capital to expand its services and to move into new geographies, including the UK – so the IPO represents the zeitgeist both of US tech businesses coming to the public markets, and the delivery of law through alternative business structures.
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John Gapper of the Financial Times on how the end of Dewey symbolises the changes coming for large law firms:
“Like Lehman, Dewey was a second-tier institution that over-borrowed and overextended itself in a push to become one of its industry’s global elite…
…In austere times, with greater cost pressures, law firms cannot borrow money and make rash promises to force their way into the top tier. Those beneath the UK’s “magic circle” and firms such as Cravath and Davis Polk in the US will have to be more like utilities. They will be lower-margin businesses doing higher volumes of ordinary work, perhaps owned by outsiders.”
For more Dewey, see here.
