Monthly Archives: March 2011

Attorney’s Incentives: Why Conviction Rate-Based Bonuses for Federal Prosecutors Are Unjust

By corporate observer guest on March 31st, 2011 Posted in In the Courts

District Attorney Carol Chambers, who instituted the policy late last year, has pitted monetary incentive directly against Justice Sutherland’s eloquent summary of a prosecutor’s duty. By paying only for trial success and ignoring successful plea bargains (not to mention cases dropped for lack of merit), Ms. Chambers unconditionally encourages her office to take cases to trial; unsurprisingly, in 2010 her district held vastly more felony trials than districts like Colorado’s Second District, which includes Denver.

Almost Live from the US Chamber of Commerce: Elizabeth Warren Speaks Eloquently to a Skeptical Crowd

By Steven Berk on March 30th, 2011 Posted in Consumer Protection

Professor Warren is really good; straightforward, persuasive and… well… charming. And this was no friendly audience. She followed Congressman Spencer Bachus of Alabama to the lectern. He is the Chairman of the House Financial Services Committee. The Congressman rather derisively referred to Professor Warren as “a nice lady”. He then went on to suggest she and her agency — the CFPB — were omnipotent and would destroy competitive markets, while imposing a Maoist (that’s no typo) style of “total regulation” on the capital markets.

Chris Nidel and Daniel Stockin: Fluoridegate and Fluoride Litigation: What Law Firms Need to Know About Fluoride Toxic Tort Actions

By corporate observer guest on March 30th, 2011 Posted in Consumer Protection

You have probably heard the recent news in the media about fluoride risks; a growing “Fluoridegate” scandal; cities dropping their longstanding policy of water fluoridation; and concerns about fluoride harm to kidneys, bones, thyroid glands, and teeth. For decades, Americans have heard of a long-simmering controversy over the whole-body safety of ingested fluorides. Now government agencies and private sector groups are admitting concerns about the impact to the body from fluorides in numerous consumer products, including water, beverages, foods made with fluoridated water or containing fluoride fumigant residues, and oral care products.

Elizabeth Warren, Bankers and Billions: Its time for Congress to Stand Up for Home Owners

By Steven Berk on March 29th, 2011 Posted in Banks and Financial Services

Far from being penalized, even slapped on the writs, big banks–specifically Bank of America, JPMorgan, Citigroup, Wells Fargo, and Goldman Sachs–are enjoying the time of their lives. They are saving tremendously to the tune of billions by refusing to service distressed properties and loans. “Walk away fellas and don’t look back.” Instead, they are using some of that money wisely to lobby Congress and it’s working.

Wiretaps: A Prosecutor’s Best Friend Can Also Turn Out to Be Their Worst Enemy

By Steven Berk on March 28th, 2011 Posted in In the Courts

Prosecutors may have gotten just a bit too greedy in this one. They need to be conservative and beyond reproach. Their job is not to win cases, but it is to a higher calling. As the Supreme Court famously said over a generation ago, they are empowered to do justice. In some cases that might mean walking away from even the strongest of evidence.

Jeffrey Goldberg, the Intelligent Observer: Libya Politics – Gingrich, Exits and Pundits

By corporate observer guest on March 26th, 2011 Posted in Weekend Edition

In a previous post in The Intelligent Observer I expressed my opposition to American military action in Libya. Now we are in it, and as Sarah Palin said the other night to Greta Van Susteren, “as long as we’re in it — we better be in it to win it. And if there’s doubt, we… Continue Reading

The AT&T and T-Mobile Merger: A Tentative Thumbs Up

By Steven Berk on March 25th, 2011 Posted in Consumer Protection

As a consumer advocate, I should be against this one. Concentration of economic power corrupts. Having only one phone company (or two) means higher prices, less choice, onerous contract terms and stifled innovation. Didn’t we break up the “old” AT&T for this precise reason?

A Blunder: The Rajaratnam Prosecutors’ Decision to Call Goldman Sachs CEO Lloyd Blankfein to the Stand May Have Been an Error

By Steven Berk on March 24th, 2011 Posted in In the Courts

It is only natural for the jury to be distracted. Mr. Blankfein’s presence overshadows the courtroom dynamic of prosecution versus defense. Although I was not in the courtroom, it also seems as if the jury could take away the conclusion that this is all about making money and Raj, Lloyd and Mr. Gupta are all just trying to get their piece of the pie.

Goldman Sachs CEO Lloyd Blankfein Testifies Against Raj Rajaratnam: Bad Move By the Prosecution

By Steven Berk on March 23rd, 2011 Posted in In the Courts

Presumably, the prosecution reasons that it is powerful evidence to hear Goldman’s CEO confirm that the phone call “violate[s] Goldman Sachs’ confidentiality policy.” Bad decision. Sure, it looks powerful to call the CEO of Goldman to the stand, but isn’t that using a sledgehammer to crack a nut?

Judge Rakoff Decries the SEC Practice of Allowing Bad Guys To Settle Without Admitting Or Denying Wrongdoing

By Steven Berk on March 22nd, 2011 Posted in In the Courts

Last year it was Judge Rakoff’s refusal to accept a proposed settlement between Merrill Lynch, soon to be Bank of America and the SEC. He almost made the parties go to trial but in the end accepted some modest changes to the settlement and let the parties move forward. The Judge was hardly throwing real punches, just shadow boxing. Well he’s at it again.

Elizabeth Warren, Neil Barofsky, and Senator Tom Coburn: Who is the Most Courageous Politician in Washington?

By Steven Berk on March 21st, 2011 Posted in Consumer Protection

In government, as in life, it is always easy to take the path of least resistance. “Keep your head down, let someone else make a decision and do what makes everyone around you happy.” But leadership takes courage. It takes a willingness to stick your neck out for what you believe. Over the weekend, I thought of these three very different, yet courageous leaders and wondered who would be viewed as the most courageous:

Rajaratnam Jurors Hear Compelling and Credible Evidence of a Cover Up

By Steven Berk on March 18th, 2011 Posted in In the Courts

Mr. Rajaratnam and his legal team sure have their work cut out for them. These audio tapes are devastating. They have, as we prosecutors and former prosecutors have often said, "the ring of truth to them". Of course people are going to be nervous about trading on insider information. Remember, for the most part this gang… Continue Reading

Elizabeth Warren, Synthetic Derivatives and the Need For a Robust Consumer Financial Protection Board

By Steven Berk on March 17th, 2011 Posted in Consumer Protection

So Congress, let’s not bemoan Professor Warren’s appropriate role in discussions regarding mortgage servicing reform. Answer to your constituents on main street and let Professor Warren do her job.

Berk Law Featured on Public Citizen’s Consumer Law and Policy Blog: American Express Merchants Score a Huge Victory

By Steven Berk on March 15th, 2011 Posted in Consumer Protection

The Consumer Law and Policy Blog keeps readers abreast of the issues of the day in consumer law. Today’s post features an article I wrote about American Express’ ability to control thousands of merchants with just one simple contract provision.

The Better For Business Bureau: aka The Better Business Bureau

By Steven Berk on March 15th, 2011 Posted in Consumer Protection

No doubt consumers may rely on those BBB ratings and spend hard earned money on a product or service that not only doesn’t deserve an A+, but one that they wouldn’t purchase if they knew the truth. How does that foster trust in the marketplace? Finally, what’s the incentive of doing a better job when companies can get an A + without even going to class?

The Government’s Stategy in the Raj Rajaratnam Insider Trading Prosecution

By Steven Berk on March 11th, 2011 Posted in In the Courts

Following that strategy, batting lead-off, instead of at number three or four, is Raj’s friend from the Wharton School of business, Mr. Anul Kumar. Mr. Kumar dispassionately explained how the defendant offered him $500,000 per year for inside information.

Jeff Goldberg: The Revolution in Libya and America’s Insatiable Appetite For “Doing Something”

By corporate observer guest on March 11th, 2011 Posted in Weekend Edition

The Post doesn’t call for specific actions in Libya, but seems to suggest the following: a no-fly zone, arming the rebels, and recognizing the rebel’s administration in Benghazi. This is a fairly typical formulation by the proponents of “doing something.”

The Raj Rajaratnam Insider Trading Case: It Was Over Before It Began

By Steven Berk on March 10th, 2011 Posted in In the Courts

Forget the theatrics of the opening statement. Most cases are won or lost before trial. Over the strenuous objections of Mr. Rajaratnam’s attorney John Dowd, Judge Howell allowed the prosecution to introduce 2700 taped conversations. He will more than likely be found guilty of something.

Whistleblowers, the IRS and Reducing the Budget Deficit

By Steven Berk on March 8th, 2011 Posted in Whistleblowers

It’s fair. A tax increase to lower the deficit forces everyone to pay more – even those who have already paid their fair share. The whistleblower targets those that tried to cut corners — putting the burden on others. So charge on whistleblowers and thank goodness the IRS is finally responding.