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I hate to be the one to break this to you, but litigators make money from lawsuits to enforce [View All]

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No Elephants Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Dec-01-12 04:28 AM
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I hate to be the one to break this to you, but litigators make money from lawsuits to enforce
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the legal duty of one party to another party.

That has been true since at least Old Testament times. (The bible speaks of representing people before judges, witnesses, etc., so something like modern day courts was going on then. And, I am assuming that, if someone represented you before a judge in Old Testament times, you had the decency to offer him at least a cold beverage or a warm meal for his troubles.

Apparently, though, some headline writer at Reuters just caught on and thought it was literally headline news.

By the way, foreign corporation doing business in the U.S. are also subject to lawsuits if their U.S. operations violate U.S. law.

But adding "U.S." to the headline makes lawyers seeking to enforce U.S. law against those who violate U.S. law makes those danged law enforcing, hard working money earning lawyers seem somehow worse.

IMO, the real news is that corporations have been pretty much ignoring a provision of Dodd Frank, a law taxpayers paid very well to get passed, and, worse, judges, who are paid by taxpayers to enforce legal duties, gave corporations a pass on their lawless behavior.
As far as lawyers not commenting on the monetary details of settlements, settlement agreements usually contain a nondisclosure clause (one of the reasons it takes so long for pedophile priests, polluters and other kinds of wrongoersto be found out, if they ever are).

Even if that were not so in these lawsuits, an attorney owes his or her client a heavy duty of confidentiality. Anyone writing about lawsuits for an outfit as big as Reuters should know these very fundamental realities.

As far as a legal of $625,000, a typical lawsuit against a deep pocket corporation takes a long time, a lot of aggravation, a lot of money spent out of pocket (FEDEX, court costs, long distance calls, overtime, after hours meals and transportation costs, etc) and a lot of a firm's personpower--secretaries, messengers, people whose job it is to make copies, etc.

And if the law firm that brought the cases is not talking about money, who is? How does the reporter know what the fee is? And notice who the reporter is relying on for information---a report written by a law firm that usually defends corporations against lawsuits by shareholders. The report is probably written for their corporate clients, as a stealth marketing measure, so that a corporation hires them, either when the corporation is sued, or to help the corporation get sued. Because, after all, if they wrote the report, they must know all about this new kind of lawsuit, right? And you can bet this report is not going to portray stockholder suits or the stockholder bar in a good light.

If anyone has a right to complain about a successful litigating firm's fee, it should be the clients (who won the case), not the defendant or the defendant bar.

If the clients did not feel it was worth it to them to hire lawyers to pursue their rights, they would not have done so. And, unless they are complaining, we can assume they felt they got their money's worth. And, maybe the fee was a contingent one, anyway. And how come so few stories are written about how much coporations pay their counsel to defend their lawbreaking or their lobbyists?

And this is only one example of how media seeks to manipulate our thought processes without our realizing it.

Do headline writers and reporters have to take some kind of loyalty oath to the GOP or something?

Speaking of the GOP, how come the don't want to apply their supposedly beloved free market principles when it comes to compensating attorneys who sue corporations for violating their duty to stockholders?


Insight: Lawyers gain from "say-on-pay" suits targeting U.S. firms

By Nate Raymond

NEW YORK | Fri Nov 30, 2012 8:56pm EST

(Reuters) - Since the Dodd-Frank law gave shareholders a say in executive pay in 2010, courts have routinely rebuffed efforts by shareholders to force companies to heed their voice.

Now, lawyers have found a new way to bring lawsuits over executive pay, resulting in a handful of legal settlements. But the settlements to date have produced no changes in executive compensation and no money for investors. In fact, the main financial beneficiary so far has been a small New York law firm that brought the bulk of the cases.

The law firm, Faruqi & Faruqi, said the settlements benefit shareholders by giving them the information they need to make investment decisions, but it declined to comment on monetary details.

The Dodd-Frank Wall Street Reform and Consumer Protection Act requires companies listed in the United States to hold shareholder votes at least every three years on the compensation of top executives. These "say-on-pay" votes are advisory and nonbinding.

While most of them pass, a few fail, sometimes resulting in shareholder lawsuits against company directors. Of the 12 such cases that have been decided by courts, 11 have been dismissed, according to a report by the law firm Pillsbury Winthrop Shaw Pittman.

The lawsuits filed by Faruqi & Faruqi, however, are brought before votes are even taken and do not challenge compensation packages directly. Instead, the lawsuits accuse companies of failing to give shareholders enough information on compensation plans to make informed votes.

This can either be executive compensation, which is subject to the advisory votes, or employee share plans, which require shareholder approval. In both cases, the lawsuits seek to prevent votes from going forward at annual shareholder meetings.

Some 20 public companies including Microsoft Corp, H&R Block Inc and Clorox Co have been hit with these lawsuits in the past year, according the report by Pillsbury and court records. Pillsbury usually represents companies that are defending themselves against shareholder lawsuits. It is not representing any defendants in the current wave of case.

At least six of the new cases have resulted in settlements in which the companies have agreed to give shareholders more information on the pay of their executives or on the employee share plans. The settlements have also resulted in fees of up to $625,000 for the lawyers who brought the cases.

I do not wish lawbreakers or people who refuse to provide information to stockholders well.

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