Publications

02.19.19 | Articles

Sanctions Stick Even After Settlement

New York Law Journal

An order imposing sanctions catches the attention of litigants, sometimes even encouraging the parties to settle. When they do, the sanctioned party often will seek to have the sanctions award vacated as part of the settlement. Increasingly, judges are resistant to vacating sanctions orders. In this article, we discuss Southern District Judge Victor Marrero’s recent decision in Rogue Wave Software v. BTI Systems, which highlights the trend away from courts vacating sanctions orders just because the parties’ settlement agreement provides for it, and concludes that going forward, the more egregious the conduct leading to a sanctions order, the less likely it is that a court will vacate it.

Related Lawyers: Edward M. Spiro, Christopher B. Harwood

02.14.19 | Articles

White-Collar Enforcement After Two Years of Trump

New York Law Journal

The halfway point of President Trump’s term offers an opportunity to examine and assess the impact of his administration on business-related prosecutions. In this article, we discuss the government’s shift in enforcement priorities, which focus on violent crimes, opioid cases, and most notably, immigration violations. We also highlight the decline not only in the number of traditional white-collar cases brought, but also in the amounts of fines and penalties imposed. Despite these numbers, however, the Trump Justice Department has remained aggressive and creative in its pursuit of individual wrongdoers in certain business-related areas, particularly in international corruption and foreign bribery.

Related Lawyers: Robert J. Anello, Richard F. Albert

01.17.19 | Articles

FBAR Penalties: Relief for Taxpayers?

New York Law Journal

By statute, taxpayers who fail to disclose accounts on a Report of Foreign Bank and Financial Account, commonly referred to as an FBAR, are subject to a maximum penalty of up to 50% of the funds in the undisclosed accounts. However, two recent district court opinions have held that the applicable regulations cap the FBAR penalty at $100,000 per undisclosed account. In this article, we analyze four recent cases that have split on the maximum permissible FBAR penalty and the implications of this debate.

Related Lawyer: Jeremy H. Temkin

01.08.19 | Articles

Government Misconduct in a Grand Jury Investigation: Is There a Remedy?

New York Law Journal

In cases of misconduct by the government, federal law strongly favors narrowly tailored remedies in criminal cases. The ultimate sanction, dismissal of an indictment, is reserved for the most extreme wrongdoing. In this article, we discuss the Second Circuit’s recent decision in United States v. Walters, which affirmed an insider trading conviction notwithstanding undisputed, improper leaks to news reporters by an FBI agent prior to indictment.  

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

12.17.18 | Articles

Specific Jurisdiction Through the Lens of New York Activity of Foreign Banks

In the past few years, the Supreme Court has issued a number of decisions emphasizing that the Constitution’s limits on personal jurisdiction have real teeth. In this article, we discuss Chief Judge Colleen McMahon’s recent decision in Nike v. Wu, which applied certain general principles of specific jurisdiction to the New York activities of a group of foreign banks against whom discovery was sought in the Southern District of New York in connection with a judgment enforcement proceeding.

Related Lawyers: Edward M. Spiro

12.04.18 | Articles

1MDB Scandal Tests Justice Department on FCPA and Corporate Prosecutions

New York Law Journal

The Justice Department’s prosecution of the 1Malaysia Development Berhad (1MDB) case illustrates how despite early predictions otherwise, Trump administration enforcement of the Foreign Corrupt Practices Act is alive and well. In this article, we discuss the 1MDB case and examine the extent to which the Justice Department will adhere to the Administration’s declared intent not to “employ the hammer of criminal enforcement to extract unfair settlements” from corporations where there is cooperation and evidence of a strong compliance structure.

Related Lawyers: Richard F. Albert, Robert J. Anello

11.21.18 | Articles

How Institutional Dynamics Have Shaped Insider Trading Law

The Review of Securities & Commodities Regulation

The past decade has brought multiple significant decisions in insider trading law, but has not substantially clarified the line between legal and illegal trading. In this article, we address how some degree of this lack of clarity can be traced to certain institutional dynamics at play in the courts issuing the relevant decisions. In particular, we look at both the Second Circuit’s uniquely strong preference for avoiding en banc review and the Supreme Court’s general preference for narrow decisions, and assess the ways in which these dynamics have shaped and may continue to shape insider trading jurisprudence.

Related Lawyer: Brian A. Jacobs

11.19.18 | Articles

Constitutional Questions in Corporate Internal Investigations

New York Law Journal

In recent years, the Department of Justice has made clear that when companies seek leniency they are expected to turn over incriminating information about current and former employees. In this article, we discuss recent criminal prosecutions in the SDNY and District of New Jersey in which the defendants claimed violations of their constitutional rights because corporate internal investigations became intertwined with federal criminal investigations.

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

11.15.18 | Articles

What Will Justice Kavanaugh Mean for Criminal Tax Defendants?

New York Law Journal

Notwithstanding the controversy surrounding Brett Kavanaugh’s recent appointment to the Supreme Court, practitioners need to consider how he will impact the Court’s jurisprudence for many years to come. Regardless of what they think about Justice Kavanaugh’s record on other issues, criminal defense lawyers are likely to view his approach to the imposition of sentencing as somewhat of a mixed bag. In this article, we note that while Justice Kavanaugh has articulated concerns that the post-Booker regime has brought too much unpredictability to sentencing, his decisions have demonstrated deference to district judges, who frequently give defendants convicted of tax offenses the benefit of substantial downward variances.

Related Lawyer: Jeremy H. Temkin

10.15.18 | Articles

Privacy Trumps Right of Access to Judicial Documents in ‘Giuffre v. Maxwell’

New York Law Journal

Southern District Judge Robert W. Sweet’s recent decision in Giuffre v. Maxwell addresses the press’s application to unseal potentially salacious documents covered by a protective order in an action concerning allegations of sexual abuse. In this article, we discuss Judge Sweet’s analysis of the law in the Second Circuit on protective orders and the sealing of “judicial documents,” and the tension between the public’s right of access and interest in transparency in the legal system and the individual’s right to privacy.

Related Lawyers: , Edward M. Spiro

10.11.18 | Articles

The Vanishing Federal Criminal Trial

New York Law Journal

Contrary to Hollywood’s fictionalized vision of our criminal justice system, a recent report from the National Association for Criminal Defense Lawyers confirms what many have recognized: trials are an endangered species. In this article, we discuss how the "trial penalty"-- the difference between the result a defendant may obtain by pleading guilty and the far harsher result that same defendant may receive if found guilty after trial -- has skewed our criminal justice system.   

Related Lawyers: Richard F. Albert, Robert J. Anello

10.04.18 | Articles

Hidden 'Time' Bombs in White-Collar Criminal Matters

Business Crimes Bulletin

Congress has armed the government with an arsenal of weapons to extend limitations periods in white-collar cases that prosecutors have used in increasingly creative ways that are often difficult for defendants to predict. In this article, we examine the various tools at the government’s disposal, including mutual legal assistance treaties in cross-border matters; FIRREA’s ten-year statute of limitations for frauds “affecting” financial institutions; criminal conspiracy charges; tax crimes; and war-time extensions. We highlight a recent decision in United States v. Bogucki, a wire fraud prosecution, which is a prime example of how the government may lie in wait before launching hidden “time” bombs to lengthen the applicable limitations period.

Related Lawyers: Robert J. Anello, Justin Roller

09.20.18 | Articles

‘United States v. Sertich’: Affirmative Obligations of Taxpayers

New York Law Journal

Under the Internal Revenue Code, employers are responsible for accounting for and paying over to the IRS taxes that they withhold from their employees. In United States v. Sertich, the United States Court of Appeals for the Fifth Circuit held that an employer who willfully fails either to account for or to pay over such taxes commits a felony under 26 U.S.C. § 7202. In this article, we address Sertich’s holding that, while Section 7202 lists a series of acts using the conjunctive “and,” the statute imposes mandatory obligations, all of which must be affirmatively fulfilled. Sertich is also noteworthy in its discussion of the government’s heightened burden of proving willfulness in criminal tax cases.   

Related Lawyer: Jeremy H. Temkin

09.20.18 | Articles

‘Obey-the‑Law’ Injunctions: Is Time Running Out for the SEC?

New York Law Journal

SEC enforcement actions are subject to a five-year statute of limitations on civil penalties, but the SEC has often been able to enlarge its time for bringing an action by seeking equitable relief, notably, “obey-the-law” injunctions and disgorgement. In recent years, however, courts have begun to curtail this de facto enlargement of the limitations period. In Kokesh v. SEC, the Supreme Court held that disgorgement is a penalty subject to a five-year statute of limitations. Following Kokesh, courts have begun to address another important question: whether so-called obey-the-law injunctions constitute a penalty subject to the five-year limitations period. In our latest article, we discuss a recent decision of Judge Nicholas Garaufis in SEC v. Cohen, which held that an obey-the-law injunction, like disgorgement, is a penalty subject to a five-year limitations period. 

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

8/21/2018 | Articles

In 'Ambac,' Judge Attempts to Make Sense of New York's Economic Loss Rule

New York Law Journal

New York’s economic loss rule, which acts as a check on asserting tort claims for purely economic damages, has long confounded practitioners. The rule, intended to preserve the distinction between contract and tort law and to protect defendants from disproportionate damages, has its most straightforward application in products liability and construction cases, but has been applied in a broad array of cases. In this article, we discuss a recent SDNY decision by Judge William H. Pauley III in Ambac v. U.S. Bank, which arises in the context of an RMBS case, but provides an interesting and informative lens for viewing the interplay between contract and breach of fiduciary duty claims under New York law.

Related Lawyers: Edward M. Spiro

8/16/2018 | Articles

Life After 'Booker': Insights From Federal Sentencing Data

New York Law Journal

Following the Supreme Court’s landmark 2005 decision in United States v. Booker, which transformed the United States Sentencing Guidelines from mandatory to advisory, the question of how sentencing judges would exercise their restored discretion has been a matter of great interest. In this article, we highlight insights from recent sentencing statistics and conclude that the data support the continuation of welcome trends: district courts exercising their restored discretion to tailor sentences individually, with increased regional differences and courts in the Second Circuit taking a leading role in mitigating the excessive harshness of the fraud guidelines.

Related Lawyers: Richard F. Albert, Robert J. Anello

7/19/2018 | Articles

The Full-Payment Rule Strikes Hard: A Look at a Recent Decision

New York Law Journal

It has long been settled law that a taxpayer challenging a tax deficiency assessed by the Internal Revenue Service in federal district court is required to “pay first and litigate later.” While taxpayers can obtain pre-payment review of such deficiencies in Tax Court, a recent decision by the United States Court of Appeals for the Second Circuit in Larson v. United States applied the so-called “full-payment rule” to preclude any judicial review of a civil penalty in excess of $60 million. In this article, we discuss this decision, its application of the full-payment rule, and potential impact on taxpayers.  

Related Lawyer: Jeremy H. Temkin

07.09.18 | Articles

Back to the Future: Criminal Insider Trading Under Title 18

New York Law Journal

In recent decades, the government has brought charges for illegal insider trading primarily under the securities laws, chiefly Section 10 of the Securities Exchange Act and Rule 10b-5. In this article, we discuss the recent SDNY prosecution in United States v. Blaszczak et al., in which the government charged insider trading schemes in violation of not only Rule 10b-5 but also Section 1348 of Title 18. We discuss the implications of the outcome at trial: acquittals on the Rule 10b-5 charges but convictions on the Section 1348 charges – even though the charges related to the same securities trading. 

Related Lawyers: Elkan Abramowitz, Jonathan S. Sack

06.19.18 | Articles

The Standard for Extending Discovery Deadlines

New York Law Journal

Last month Magistrate Judge Katharine H. Parker issued an interesting decision in City of Almaty, Kazakhstan v. Ablyazov. In this article, we highlight Judge Parker’s decision, which discusses the impact of the proportionality requirements in the Federal Rules of Civil Procedure on extension of discovery deadlines and articulates a five-factor balancing test to apply when considering requests to extend discovery. 

Related Lawyers: , Edward M. Spiro

06.08.18 | Articles

Sessions' Justice Department's Pragmatic Approach to Corporate Accountability

New York Law Journal

Many of the administration’s enforcement priorities may raise serious concerns for criminal defense lawyers and other champions of legal rights. In this article, however, we discuss the “anti-piling on” policy announced by Deputy Attorney General Rod Rosenstein, which is intended to reduce the perceived unfairness of repeated punishments for corporate misconduct. The policy bespeaks a welcome change in DOJ leadership’s attitude toward corporate accountability, but how the policy will be applied in individual cases remains to be seen.

Related Lawyers: Richard F. Albert, Robert J. Anello


Load More