Not sure how many people here know this, but there’s an old saying that when one is running on Ponzi scheme, one needs total focus. It’s a lot of work defrauding investors and while some activities by your staff are tolerable (smoking weed in every corner of the office, as well as the parking garage and the courtyard out back and having sex with prostitutes on the desk), a line must be drawn at those which create unacceptable distractions, like dealing said pot and purveying said prosties. If that doesn’t make any sense or you’re confused at the finely drawn distinction, perhaps convicted Ponzster Scott Rothstein, who was deposed on the matter today, can shed some light. Continue reading »
Lawyers
Convicted Ponzi Guru Scott Rothstein Wasn’t Worried About Whores, Hotboxing Derailing His Scam
By Bess LevinAs some of you may recall, back in June we informally crowned Raj Rajaratnam’s attorney John Dowd lawyer of the year. Dowd responded to what he deemed an unfair article in the Wall Street Journal by telling the reporter “This is the worst piece of whoring journalism I have read in a long time,” asking “How long are you going to suck [U.S. Attorney for the Southern District of New York] Preet’s teat?” and concluding thusly “Preet is scared shitless he is going to lose this case so he feeds his whores at the WSJ. What a disgrace for an otherwise great paper.” He told CNBC “Get the fuck out of here. That’s what I’ve got for CNBC” when asked if he wanted to give a comment. And on the steps of the courthouse, he declared the Raj guilty verdict a “23-14″ victory for the defense. If anyone was to find themselves in some kind of legal trouble, be it of the insider trading variety or otherwise, he was the guy you wanted in your corner. Unfortunately, according to Dowd, the Galleon case was his last. And he’s truly not to be coaxed out of retirement, we’d like to suggest an alternative for your go-to legal counsel. He may not be versed in securities laws, but he’s got the fire inside him. Continue reading »
Market Apparently Shocked To Find Out Goldman Sachs CEO Takes Investigations Seriously, Hires Best Lawyers Money Can Buy
By Bess Levin
Goldman Sachs Chief Executive Lloyd Blankfein has hired Reid Weingarten, a high-profile Washington defense attorney whose past clients include a former Enron accounting officer, according to a government source familiar with the matter…The move to retain Weingarten comes as investigations of Goldman and its role in the 2007-2009 financial crisis continue. The Securities and Exchange Commission scored a $550 million settlement against the bank in a fraud lawsuit in July 2010, but other investigations continue. “Why do you bring in someone like that?” said the source, who was not authorized to speak publicly. “It says one thing: that they’re taking it seriously.” [Reuters]
Everyone knows that a public company merger is a feeding frenzy for service providers. When you’re writing a multi-billion dollar check for a transformative acquisition, you’re not so worried about a million in fees here and there. So bankers make a lot, lawyers make a bit less, and printers and accountants and proxy solicitors and the SEC all get a piece of the cash cheerfully handed out by acquirers. What is less obvious to people outside the M&A business is that there’s also a tax paid to a group of securities plaintiffs lawyers, who make it their business to sue the board of every company involved in a merger.
The process is pretty straightforward. A merger is announced. A group of law firms sue, on behalf of the target’s shareholders, claiming that the board followed a defective process, had a variety of conflicts of interest, and obtained an inadequate price. The board disagrees, but doesn’t want to run the risk of a court holding up the merger and so agrees to pay off the law firms. It’s not legal just to pay them to go away – they represent shareholders, after all, so they have to get something for those shareholders.
Occasionally what they get is a 5 or 10 cent increase in the merger price, but more often it’s just some added disclosure in the merger proxy. The company amends its proxy to say “we forgot to mention that our lead banker plays a lot of golf with the acquirer’s CEO so he was probably talking smack about us on the side,” the lawyers can say that they got something for the shareholders, and everyone signs a settlement that the judge can approve and that includes a $500k payoff to the law firm. Shareholders get nothing other than additional reading material, but it’s a pretty profitable business for the law firms.
Today’s WSJ has an excellent story about how judges in Delaware have started taking a closer look at these cases:
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What Do Wall Street And The Connecticut Man Who Had His Way With A Horse Have In Common?
By Bess Levin
First off, you remember the Connecticut man who fisted a horse, yes? For those who fail to recall, last fall, Shelton resident Marian Wegiel was accused of forcing himself on a horse, having been found with “much of his arm inside the animal’s vagina.” Continue reading »
James Woolery, a partner at Cravath, has been named co-head of North American mergers and acquisitions, alongside Chris Ventresca. [Bloomberg]
On Monday night, Stephen Colbert announced that after one of his writer’s had found a lost credit card belonging to Goldman Sachs partner Buckley T. Ratchford, he would be giving out one number per show each day that BTR failed to appear on the Colbert Report to talk Wall Street bonuses. Though Buck presumably had the mental faculties to cancel the card upon losing it, we wagered that he would prefer the information not to be distributed. And, also, that Goldman would not be offering up a body and if need be, Blankfein would head over to the studio to bust some skulls. Luckily for Steph-o, it didn’t come to that. Continue reading »
Layoffs Watch ’10-’11: Capitalize On The Millions Of People Who’ve Always Wanted To See A Wall Streeter Scrub A Toilet
By Bess Levin
Earlier this week, Meredith Whitney forecast that Wall Street firms will cut 80,000 jobs in the next 18 months. Naturally we hope the Dollar Dominatrix is off in her prognostication but in the event she’s seeing the ball on this one, it’s important to think about what you might do in the event you are unfortunately axed. An equally desirable gig in the financial services industry might not immediately present itself. In the interim, you may need to do something to tide yourself over. Perhaps involving rubber gloves and that French maid outfit you’ve been dying to put to use. Take a page from this enterprising lady’s playabook. Continue reading »
A few months back Patricia Cohen, ex-wife of Steve, dropped the lawyer who initially helped her file a suit against the SAC founder, claiming he hid marital assets, had engaged in insider trading, and yada yada yada. Then in April, she filed a newer, even bolder suit. Previously, Patricia had requested around $300 million from her former husband. This time, she dreamed bigger. She wanted SAC Capital. A “substantial, if not controlling interest.” The PMs, the P&L analysts, the Silver Fox. They were all gonna be hers. And not just that, she’d take the embalmed pets too. And all the fleece jackets in the back. The vests too! Today, that dream has been stalled. Patricia’s second lawyer, Gaytri D. Kachroo, has informed a court she’s finished with this lady. We’re told GDK is saying she wasn’t paid, or paid as much as she was promised. There are also claims– by others– that Kachroo was actually fired. Whatevs! It’s all relative. Any takers for round three? Continue reading »
Paul Batista Claims Patricia Cohen Left In The Middle Of The Night And Didn’t Even Have The Bedside Manner To Say Good-Bye
By Bess LevinOn Monday it was announced that Steve Cohen’s ex-wife, Patricia Cohen, had switched attorneys, from Paul Batista, a prominent RICO specialist, to Gaytri Kachroo, who is not a litigator. Supposedly the ex-Mrs. SAC did so because she felt her case “wasn’t getting the attention it deserved.” Apparently this came as a surprise to Batista, who, in a motion to withdraw, claims that Patty Cakes never once complained about the quality of his work (and in fact praised it), that he was in contact with her “virtually every day” since they started working together, and that he was informed his service would no longer be necessary when PC’s new lawyer called him up and identified herself as the lady of the night’s new representation (he also gets in a nice zing about having never heard of PC’s new squeeze I think– I think– implying the woman’s a nobody in the legal world.
I’m totally kidding? Just busting your hump? Who am I to know? But getting serious for two, Patricia Cohen has indeed fired her lawyer, Paul Batista, a prominent RICO attorney, and hired Gaytri Kachroo, who is not a litigator. Apparently Pat didn’t think her case was getting “the attention it required,” presumably as it related to man hours on her counsel’s part, and not spotlight in the media. SAC spokesman Jonathan Gasthalter is not fooled by the diversion, saying in a statement:
