The Crash of Air Philippines 541

By Robert Yates

Eight years ago April 19, 2000, Air Philippines Flight 541, with 131 passengers and crew members, left Manila at 5:21 a.m., flying to Davao City, on Samal Island, about 600 miles southeast of Manila.

As it approached the airport at around 7 a.m., another aircraft was on the runway. Flight 541 began to circle in low clouds, waiting for the plane on the ground to move off the runway. As it circled, Flight 541 slammed into the side of a mountain, 500 feet above sea level. The plane caught fire and disintegrated, killing everyone on board. It was the worst air disaster in the history of the Philippines. But there is more to this story than another horrible air crash. As airplanes in the American fleets wear out when they reach a point where the cost of overhauling the planes, which can run between $2 million and $8 million, is no longer worth it they are retired to the Arizona desert. There are thousands of worn-out planes lined up in the desert waiting for a second life. From there, leasing companies purchase the planes and lease them to other, usually foreign, usually developing, airlines.

Flight 541 was a Boeing 737, a 22-year-old plane that had been put out to pasture by Southwest Airlines, and bought by AAR Aircraft & Engine Group, a publicly traded company based in Wood Dale, Ill. AAR leased the plane to Air Philippines in January 1999 and sold the plane in April 1999 to Fleet Business Credit Corp., now a division of Bank of America, and assigned Fleet its rights under the lease.

The lawsuit against AAR and Fleet was filed in Cook County Circuit Court and, following litigation over the forum issue, including an appeal, stayed here. The lead plaintiff was a Chicago resident, Boeing’s corporate headquarters are here, and AAR is in Wood Dale. Donald J. Nolan of Chicago’s Nolan Law Group, who represented 47 of the plaintiffs, was appointed lead counsel. There were three other firms representing plaintiffs, all from the San Francisco Bay Area: Sterns & Walker; Bowles & Verna; and O’Reilly & Danko. Gary W. Westerberg, Christopher R. Barth, T. Patrick Byrnes, and Mark A. Deptula of Locke, Lord, Bissell & Liddell, represented the defendants.

The case settled in November 2007 for $165 million, which, Nolan said, worked out to about $1.5 million per victim.

Aside from the inherent interest of a huge settlement, the case is interesting as yet another feature of globalization in this case, the globalization of the airline industry, and the ethical and legal obligations of the companies that buy and lease the planes to airlines in countries where the safety standards are well below American and European standards and where even the culture plays a role in the safety of airlines. In the last five years, there have been more than 10 fatal commercial airline crashes involving aircraft leased to developing countries, the latest occurred on April 15 in the Democratic Republic of the Congo, killing at least 75 people.

Chicago Lawyer sat down recently with Nolan to discuss the case.

Chicago Lawyer: What were the liability issues in the case?

Nolan: There were four main issues: crew resource management, the failure to provide an enhanced ground proximity warning system under our product liability theory and spoliation for the destruction of the wreckage and failure to perform maintenance under negligent entrustment.

Chicago Lawyer: Let’s start with crew resource management. First, what is it, then, how is that an issue?

Nolan: Prior to the crash, the FAA mandated in the U.S. that crews have crew resource management (CRM) training, and what that deals with is a culture of deference in the cockpit, where human factors engineers learned and taught, and the FAA adopted, the idea that you have to have a system of checks and balances in the cockpit.

A co-pilot might notice something of imminent danger that the pilot did not notice, and it’s necessary to call that out complete deference is not afforded to the pilot in command. Whereas the FAA mandated that and has a directive in place for crews in the U.S. to have this CRM training, the government in Philippines did not so require.

Asian countries have a storied past with deficiencies in CRM, because it’s a clash with Asian culture, with deference to seniors.

For example, there was a Singapore Air crash in October 2000, on an international flight bound for Los Angeles international flight SQ006 when the crew took off in a typhoon in Taipei. There, none of the crew, even though they knew that it was not an appropriate takeoff, ever checked the action of the pilot in command.

In the Air Philippines case, the pilot was being supervised at the time of the crash by a check airman, meaning a superior on a check ride, and the check airman was one whose actions were not countered by a lower pilot, so we knew there were issues of CRM training.

Chicago Lawyer: How can the lessor be held liable for the crew’s training?

Nolan: AAR never checked to see what the standards were in the Philippines, and just presumed the Philippines would be following the FAA standard, when, in fact, they were not. So, under negligent entrustment law, which deals with what someone knew and should have known [they could be held liable].

Chicago Lawyer: And your negligent entrustment theory also relates to maintenance?

Nolan: This airplane was taken off the desert floor by AAR. It was purchased from Southwest Airlines, which is a high-mileage operating fleet, and this was a [22-year-old] airplane. Southwest Airlines is high-cycle, high-time. They really work their airplanes. Southwest made a decision somewhere along the line not to continue with that airplane a cost-benefit analysis of maintenance, upkeep, and the returns they’re offered on that.

Chicago Lawyer: How much was the lease for?

Nolan: The lease was on a per-month basis. The transactions were seven-figure transactions. I think when the plane crashed they made seven figures just on the insurance. When the plane crashed they had a financial return and a profit on the hull liability clause.

Chicago Lawyer: Who’s responsible for the maintenance?

Nolan: Both the lessor and the lessee. The lessor, having in the lease reserved to itself rights of inspection, and requiring that maintenance and safety be followed under that scenario on a legal basis it can face responsibility for the loss of life. Here, this fleet was not equipped with up-to-date manuals from Boeing.

Q & A: Georgia Logothetis

Georgia Logothetis

Age: 25

Education: A 2003 graduate of Northeastern Illinois University, and a 2006 graduate of DePaul University College of Law.

Career: An associate in the litigation group at Arnstein & Lehr.

• What is the last big deal or big case you worked on that you can discuss, and what did it entail?

I’m working on some very high-profile litigation out in Kane County. It is for the village of Campton Hills. Our firm incorporated a village and Illinois law allows residents who do not want to be part of the village to petition for disconnection. And there is a steady stream of residents in the village who don’t want to be part of the village for one reason or another who have filed these petitions for disconnections. We’ve taken four or five to trial. It is interesting because the cases essentially go from complaint to trial within 30 or 45 days.

It’s also interesting because you have these petitions for disconnections, but at same time there are other collateral attacks on the village. The more high-profile one was an attempt to place on the Feb. 5 ballot an initiative to dissolve the village in its entirety …

A [temporary restraining order] and a complaint were filed to get that proposition on the ballot. I was part of the team that argued under Illinois law that the referendum could not be placed on the ballot. We also argued that there were various procedural and substantive flaws in the complaint. We ended up winning that. That was a huge deal because, had that been placed on the ballot, it would have been very dangerous to the village, and the village may have been dissolved …

• If you could have lunch with anyone, living or dead, who would it be and why?

Barack Obama.

At this point in time having a conversation with him about where this nation is going, what types of policies he wants to implement, and how he will react with Congress when enacting the laws that we as lawyers will be litigating in court, I would love to have this conversation with him. So, Barack, if you are reading this, give me a call.

• What is your favorite book, movie, or television show about lawyers, and why?

I love ”Boston Legal” because, first of all, it’s extraordinarily well-written. It’s not close to the reality of my practice at all, but not many TV shows based on lawyers are.

What I love about ”Boston Legal” is the ways that they weave in commentary into their plot line … I distinctly remember one episode where they addressed torture. [The lawyer] gave the closing argument or opening statement, I can’t remember which one, essentially laying out this fabulous, brilliant case about how in the world we can be debating whether the best country in the world is engaging in torture.

Whenever I watch that show I wish that whoever is writing those types of speeches would write the speeches for the members of Congress or the political candidates because the writing on that show is so great.

• What advice do you have for new lawyers or those wanting to become lawyers?

The one thing that I’ve found from first-year associates and recalling from my experiences as a first-year, I remember sometimes I would have a typo in one of my briefs and I thought it was a horrible reflection upon me. Sometimes I would file something in the wrong division, just by accident, and I thought it was the end of my career as attorney. I was obviously making those traditional first-year types of mistakes …

As a first-year, if you make an error, you shouldn’t dwell on the fact that you made the error, because all first-years make errors and people who have been practicing for 20 or 30 years make errors. You should view that error as: okay, this happened, but why did it happen? But, more importantly, how do we fix it in the best interest of our client? The second piece of advice I would say is to have fun … I think, as first-years, instead of freaking out about an assignment, embrace it. This is your assignment. You get to shape it. You get to produce a product. Put your spirit into it and realize that you are part of team, part of a firm that’s helping people — whether these people are corporations or individuals.

• What do you do in your free time?

Outside of the office, I am a political writer. I’m a contributing editor at the nation’s most popular online political community. And to speak to those who know me, they will call me a political junkie. I’m addicted to C-SPAN. I love following the political process, and that takes up the bulk of my time kind of researching and writing and kind of being part of that movement.

• What do you like the most and the least about being a lawyer?

You can work on something and kind of put your blood, sweat, and tears into it and feel like that one project or that assignment almost killed you. That is probably my least favorite part about being an attorney — just the amount of personal investment that you have to make sometimes on a given case. That is expected and that is what you get when you sign up to be an attorney. That is especially what you get when you sign up to be a good attorney, and when you promise yourself that you are going to be the best possible attorney that you can be …

On the flip side of that, the thing I like most about being an attorney is that when you do win it feels great, and feels great especially when you have put in all of that time, energy, and work. It becomes that much sweeter when you win, knowing that those are the fruits of your labor.

• If you didn’t become a lawyer, what career would you have chosen?

I’m a writer by nature. If I hadn’t become an attorney, I still would have done something with the law, something with talking about the political process or doing something to that effect. My dream job would have been being a speech writer to the president.

— Interviewed by Olivia Clarke

Nelson-Beverly removes the barriers to her dreams

By Olivia Clarke

Heather Nelson-Beverly has rarely taken no for an answer.

When she began researching entertainment law as a career, she received negative responses from some lawyers she contacted. They told her she couldn’t have the type of career she wanted, and warned her that Chicago doesn’t have a thriving entertainment business. But she pushed past the pessimism, and created the kind of practice she dreamed about.

At age 37, Nelson-Beverly has owned the Law Office of Heather Nelson for 10 years, and practices entertainment and entertainment-related law. She lectures around the country, and is active in such organizations as the Chicago chapter of The Recording Academy, which is responsible for the Grammy Awards.

She’s looked to several key role models, especially legendary and now-deceased attorney Donald Hubert, who taught her how to not only be a good lawyer, but also how to run a successful practice.

”I really, really truly believe that there is more than one way to accomplish something,” Nelson-Beverly said. ”There is a huge thriving entertainment law practice, but you’ve just got to have the stuff.

”I would definitely say that I’m driven. I would definitely say I’m purposeful. I like to think that I’m fun along the way, despite the stresses and the schedule and the pressure a lot of the time.”

Learning the ropes

As a ninth-grader growing up in Minneapolis, Nelson-Beverly’s mother and stepfather told her that she couldn’t be the type of college student who went away to school to find herself.

There would be no backpacking trips across Europe or semesters spent searching for a major. She needed to find a career path early on because college can be expensive.

She remembered going to a library and finding a book that matched personality traits with different careers. She decided that marketing fit her personality.

She attended the University of Wisconsin-Madison and earned a bachelor’s degree in business administration and marketing, with an emphasis on communications.

But the thought of taking more classes to earn an MBA did not appeal to her, so she decided to attend Chicago-Kent College of Law. She didn’t plan on practicing law, but felt law school would give her more experience and options, she said.

”Fast-forward, I get into law school and in my first year it is so different than the business school kind of curriculum,” she said. ”But I loved it. It was in my first year of law school that I started to think, ‘Gosh, if I actually decided to practice law, what area would it possibly be that I would practice in?”’

She narrowed her focus to litigation because she was fascinated by the courtroom and oral presentation; and sports law because she played competitive tennis for 10 years and is an avid sports fan.

”As I reached out to more and more friends of mine from college who actually played professional sports, football players and basketball players, to do a little bit of case study on how I would get into doing sports law, it became a little bit ominous,” she said. ”A lot of these kids were either directly referred to agents and representatives, or there’s been someone who has been around for a long time, a friend of the family, or whatever.

”I definitely thought it would be kind of challenging to walk right out of law school expecting to say, ‘Hey, I’m a sports lawyer.”’

But she kept her goals in the back of her mind while attending Chicago-Kent. At the same time she faced the challenges of affording law school.

She said a couple of deans and a financial aid administrator suggested that her only option was to withdraw if she didn’t have the finances.

Nelson-Beverly instead got a job at the Law Offices of Joseph V. Roddy — even though working and attending law school was discouraged, she said.

While in the school cafeteria one day in her work suit, a man approached her and asked if she was a lawyer. He wanted to post an internship opening for his law firm, which handled such areas as entertainment law. She introduced herself as a law student with an interest in entertainment law.

She interviewed, and got the internship at Jones & Walls, a general practice firm. Because the firm represented music groups, it dealt with things like record contracts, music licensing, and deals involving artists and producers. It also handled criminal defense, discrimination and personal injury.

”I’m working. I can’t really afford to be in law school, so I decide to get out early,” she said. ”I really fast-track my course work so I can graduate in two-and-a-half years.

”I want to say, towards the end of my second year I started really thinking seriously about what would be the next step.”

Meeting her mentor

During a Chicago-Kent career day in her last semester, students could pick different workshops and sessions to attend.

Most law students picked the big and mid-size firm sessions, because that’s where the bigger money is, she said.

But Nelson-Beverly read Don Hubert’s biography, and the information about his solo and small-firm workshop.

”In reading his bio, I was absolutely blown away, and I asked to be transferred into that workshop,” she said. ”I went into that workshop, and saw him speak, and he was talking about himself and the practice area and the benefits of being in a small environment and the family environment at [a small] firm.”

At the end of the workshop she asked for his business card, but he said he didn’t have any. She told him she would like to intern for him, but he said he had no positions. But she wasn’t dissuaded.

She said she at least wanted to meet with him at his office. She went there the next day with her resume in hand. He sat down with her and again told her there were no positions, but he wanted to know her story.

”I told him, ‘After seeing you speak and after learning more about you, I would give anything to just have the experience of working with someone with the credentials you have and the caliber of the caseload you have,”’ she said. ”I said, ‘I really just want to learn how to be a good lawyer.”’

Nelson-Beverly said Hubert was very concerned about what she hoped to get out of an internship with only a few months left of law school. He said he was definitely not looking for an associate.

”I told him, ‘You know, six weeks with the best, even if I have to leave, is going to be worth it for my career,”’ she said.

She interned for him in the fall of 1995, and he hired her as an associate in 1996 because he needed extra help handling a large Chicago ward redistricting case.

Her first year as an associate was an interesting, whirlwind year. The firm not only handled a large caseload, but Hubert also had a very public, and somewhat political position, as president of the Chicago Bar Association, she said.

”Whenever you start at a new firm or a new job, you are always told to be the first to get there, be the last to leave,” she said. ”But no matter how hard I tried I couldn’t do it. Don would be there at the crack of dawn and he would work until the wee hours of the morning, just late, late nights.

”He never stopped working, yet was always composed, always sharp — especially in public. His public persona and demeanor were just absolutely magnetic.”

Hubert often spoke candidly with Nelson-Beverly and the other associate, Debby Goldman. Eating pizza at 10 p.m., as they got ready for a case, he would tell them war stories or offer coaching advice, she said.

”It was like working for your dad, it really was,” she said. ”Even with all the demands on him personally, he still took so much time in the personal development of myself and Debby Goldman. He’d be there for us to practice our opening statements and closing arguments for cases.”

Making the leap

Despite enjoying her time working for Hubert, Nelson-Beverly never gave up her passion for entertainment law.

She said she knew she couldn’t pursue this dream right out of law school because she needed to learn how to be a lawyer first. But Hubert recognized her desire to pursue entertainment law, and sent her to workshops and conferences that focused on that area.

While attending conferences, she started meeting people who were looking for legal help. Hubert allowed her to work on those entertainment matters on the side.

”What happened is I actually started developing a practice that I saw had the potential to really grow,” Nelson-Beverly said. ”It was at that point that I had a talk with Don and said, ‘I’m thinking of doing my own thing.”’

Hubert offered to start an entertainment side within the practice so that she would stay, but she said there was really no room.

She made the decision to go out on her own, but she asked Hubert and two other lawyers to work cases with her while she got started.

At first, she not only handled entertainment law, but also areas like criminal defense and real estate. But within nine months she focused only on entertainment law.

”It was definitely a little intimidating, because the buck stops with you,” she said. ”It is now up to you to be able to generate the business in order to really survive.”

Early on she lucked out. One of the first music groups she represented locally, hip-hop group Do or Die, found success in the music industry and sold over 800,000 copies of its first album.

”They ended up being a really big deal,” she said. ”And, quite frankly, entertainment, like any other area of the law, is one where word-of-mouth is very important. If you get associated with what turns out to be a high-profile client, it starts to serve as its own advertising.”

As she built her firm, she was very thankful for her business degree, and for the time she spent working for Hubert. She learned valuable lessons from him about the business side of a small law firm.

”By being in an environment where it is a small firm you have contact with clients the minute they come in the door, until you close their case,” she said. ”You are involved in all elements of running the business, which was a benefit. [My firm] really kind of took on its own life, thank goodness … I pretty much tried to plan as best I could to be prepared for it.”

Today’s entertainment industry

Nelson-Beverly has worked with such clients as ”The Apprentice” star Omarosa Manigault-Stallworth, and former White Sox player Frank Thomas with regard to his record label.

She primarily represents clients in the music industry. Many of her clients tend to be businesses, such as independent record labels and marketing companies. But she also maintains a steady client base of artists, music producers, and songwriters.

Nelson-Beverly said lawyers often intimidate artists, so she tries to be approachable, and she explains the legal side of the music industry in easy-to-digest information so that they understand what is going on.

”It’s wonderful to have a relationship and know that these clients kind of depend on you and kind of trust your word,” she said. ”I have a young producer right now who, for the last several years, would just call me and say, ‘I’ve got questions. I just want to learn.’

”Now he’s got his first placement with a major record company. He’s being looked at by some pretty big-deal artists … We started when maybe he could only give me $50, but I’m like, ‘I don’t care. You are eager to learn.”’

Today she represents many gospel music artists, such as, Shari Addison, runner-up in the BET show, ”Sunday Best.” She also represents Sheri Jones-Moffett, who had a 2007 Grammy-nominated song.

Nelson-Beverly works with Jonathan Nelson, an award-winning songwriter, who, she said, has written for some of the biggest names in gospel music. She has worked with him for several years, and negotiated his recent contract with Integrity Music.

”She’s the best. She’s phenomenal,” Jonathan Nelson said. ”My wife is a hard sell and she met Heather face-to-face not too long ago and they’ve turned into girlfriends. They just hit it off — She has helped me to become further established and organized.”

He said Nelson-Beverly is responsive to her clients’ needs, and, if she doesn’t have an answer, she commits to finding the right one within 24 hours.

”If you can’t get along with Heather Nelson then there is something sorely wrong with you, he said. ”I just wish that more people knew about her. She will become a highly sought-after attorney in the future.”

On the corporate side, she represents such companies as Nu Face Entertainment, a full-service boutique marketing and branding house.

Rita Lee, the company’s founder and CEO, said Nelson-Beverly’s ethics and service-oriented approach make her a good lawyer. She helps her clients understand the law, as opposed to simply giving them paperwork and telling them to sign it.

”She makes sure your business has the protection and the infrastructure to do business for years to come,” Lee said. ”If you want to adjust or change your company, the infrastructure put around you is very flexible.”

Peter Strand, senior counsel at Holland & Knight who focuses on entertainment and intellectual property, said Nelson-Beverly knows what she’s talking about.

”Heather has all the skills and she is also a good face to put on entertainment representation because she is competent and pleasant and she knows what things to battle over and what things not to battle over,” Strand said.

Life-work balance

One of the strengths she believes she brings to her law firm is that she handles litigation, which many entertainment lawyers don’t do, she said.

Her skills helped her, for example, when she represented a client with contracts with a major record label and a prestigious artist manager. The client needed to get out of both contracts because she was filing for bankruptcy.

When Nelson-Beverly and her client showed up to court on the first day, about five large-law firm lawyers, which the record label hired, greeted them. The lawyers ended up not arguing the case because it was briefed fully. The judge wrote a written opinion, and read his ruling in her client’s favor.

”It was kind of one of those David-and-Goliath type moments, especially when you are solo,” she said. ”I might have still been practicing out of my living room.”

When she started her career she interviewed in Los Angeles at places like Paramount Pictures and Sony, but they looked down on the fact that she didn’t attend a top 10 law school.

But she said she knew she made it in her career when that didn’t matter anymore. For example, Harvard Law School invited her to speak at the school about entertainment law — an experience that meant a great deal to her.

Nelson-Beverly said owning her own firm gives her flexibility.

When she first started her law firm, her grandmother was dying from cancer. She was able to gather some paperwork and her laptop and head to Minnesota. She could handle work, and still visit with her grandmother before she died.

”When I was there I was able to spend more one-on-one time with my grandmother than some of my relatives who lived there because they, of course, had to go to work,” she said. ”It was kind of like the light bulb goes on and you go, ‘This is what this is for.”’

She said if it allows her to provide for others or see loved ones more regularly, ”At the end of the day, that’s what it’s all about and that’s what really motivates me.”

That flexibility allows her to live with her husband Anthony Beverly in California while still practicing in Illinois. She splits her time each month between both states.

She also has many more goals beyond her legal practice. She’s trying to write two books, and is in the process of starting a non-profit organization called, What’s Your Legacy? She wants to inspire others to look beyond instant gratification, and focus on what their legacy will be to society.

When asked what her legacy is, she said, ”It is to inspire others to dream big, and not pay attention to all the no’s, and to not take adversity as a block to getting what you want, but to see it as something that you’ve got to overcome to get what you want.”

Just as she received mentoring from such lawyers as Hubert, she too tries to mentor others. She said she remembers what it was like when some lawyers didn’t help her, and how she benefited from those who did.

”I got a lot of unanswered calls when I tried to do research [about entertainment law],” she said. ”I vowed that I would never do that.”

One person she mentors is Shayla Cooper, who is of counsel to her firm.

”She just trusted me with her business, trusted me with her clients and made herself available to me for anything,” Cooper said. ”The way that she gives of herself, her expertise, her career — basically everything that I know about the entertainment industry I know because of her.”

Law evolves with growth of biotechnology

By Maria Kantzavelos

Louis Pasteur may have received a patent on his work with yeast — a living organism — back in 1873, but it was Ananda Chakrabarty’s invention of a live, genetically engineered bacterium capable of breaking down crude oil that was at the heart of a 1980 U.S. Supreme Court decision that is said to have opened the door to the business of biotechnology.

Industry experts point to the high court’s ruling in Diamond v. Chakrabarty, which established that genetically engineered life forms are patentable, as the impetus for the commercialization of an evolving technology that generally involves the manipulation of living things to make or change products — such as human therapeutics to treat certain forms of cancer, crops that are resistant to drought, or new forms of fuel.

”It was just a matter of timing and rather interesting technology that made for headlines and heavy-duty investment,” said Michael F. Borun, of counsel to the intellectual property boutique Marshall, Gerstein & Borun. ”A patent is a short-term monopoly, and investors love monopolies. When people saw that there was a space for some exclusivity in this technology, then the money came floating in.”

So did a new niche in the practice area of intellectual property law.

”It’s economics,” said Borun, who is considered a pioneer in biotech patent law. ”Law firms said, ‘There’s money to be made in providing services in this area to clients, but we don’t have anybody with a technical background. Let’s start hiring people with PhDs in molecular biology.”’

Chakrabarty, now a professor of microbiology and genetics at University of Illinois at Chicago, was working as a scientist for General Electric when he came up with the oil-eating bacterium that would be used to clean up oil spills.

Since the high court’s decision holding that the tiny, live creature is patentable subject matter as an article of ”manufacture,” the U.S. Patent & Trademark Office has issued numerous patents on genetically modified microorganisms and other life forms, as well as cells, tissues, and molecules derived from those things — like nucleic acids and proteins. The patents cover such areas as immunology, antibody production, gene therapy, and genetically altered, or transgenic, crops and animals.

The United Nations Convention on Biological Diversity defines biotechnology as: ”Any technological application that uses biological systems, living organisms, or derivatives thereof, to make or modify products or processes for specific use.”

Many biotechnology inventions serve as the building blocks to potential products that eventually make it into the marketplace. Those results could be a life-saving drug; a pet cat engineered to be hypoallergenic; transgenic plants like one that allows tomatoes to be picked green and ripen thereafter, or soybeans and other crops that are resistant to herbicides; and livestock engineered to produce proteins in their milk.

Headline-grabbing developments talk about cloning animals like prize bulls, or the possibility of one day using stem cells to ”grow” human organs or tissue, or specially engineered microorganisms to aid in the development of biofuel.

The applications of biotechnology tools are wide-reaching.

When Janet M. McNicholas talks about the industry, the biotech patent lawyer who co-chairs the life sciences practice group at Bell, Boyd & Lloyd borrows a motto from the Washington, D.C.-based Biotechnology Industry Organization to point out that biotechnology can work to help ”heal, feed, and fuel” the world.

”What biotechnology does is, it provides solutions,” McNicholas said. ”We’re talking about solutions for problems, whether that problem is that you can’t grow enough corn to feed people, or you have cancer and you need something to get rid of it. There’s some problem that relates to human beings in a really important way — that’s something the technology has the ability to solve.”

IP is crucial

In today’s research-intensive, highly regulated industry of biotechnology — a field steeped in ideas, invention and science — a company’s intellectual property can be its main asset, particularly when the company is getting started.

As such, industry experts stress, the protection of that intellectual property — often in the form of patents — is fundamental to the industry.

Janet M. McNicholas of Bell, Boyd & Lloyd and David W. Clough of Howrey (with Kevin E. Noonan of McDonnell Boehnen Hulbert & Berghoff back to camera) in a lab of the Department of Biochemistry & Molecular Genetics at the University of Illinois at Chicago’s College of Medicine.

”It’s especially important to the biotechnology industry, because the investments that are necessary to bring a biotech product to market are so huge that unless you have very strong intellectual property protection, the risk is so much higher than with, say, a software company,” said David Miller, president of the Illinois Biotechnology Industry Organization, a local biotech trade group.

For example, it can take up to $1.2 billion and sometimes more than a decade to fully develop a new therapeutic protein — an antibody to treat a disease like cancer — and to bring it through U.S. Food & Drug Administration approvals and into the marketplace, said McNicholas, who is also a former molecular biologist.

”These things — the products — come from living things. Those living things — whether it’s a living plant or a living cell — that’s not the same as some kind of cheap plastic product from China,” McNicholas said. ”’These are very complicated systems, and they require a great deal of research and development, and they’re regulated.”

That’s where lawyers with a mix of expertise in the biological sciences and intellectual property law enter the picture.

Clifford’s Notes: The dilemmas of confidentiality

By Robert A. Clifford
Clifford Law Offices

”This memorandum, even if it’s authentic, which I doubt, I highly doubt, is protected,” Karen Crowder tells Michael Clayton, one of the lawyers at the firm that represents the company for which she is general counsel. ”It’s a cut-and-dried case of attorney-client privilege.”

Tilda Swinton won an Academy Award for her performance as Crowder in the movie, ”Michael Clayton,” a legal thriller that centers on a critical internal memo containing damaging information. I won’t ruin the ending for those of you who haven’t seen it. The short of it is, Clayton works for a powerful law firm that is representing a large corporation in a multibillion-dollar class-action lawsuit. One of the partners is feeling guilty about the harm the corporation has caused and is about to release this very incriminating internal memo of his client’s.

When that partner is killed, Clayton, played by George Clooney, discovers it as well, and finds himself in an ethical dilemma: whether to reveal client confidences that will surely cause the firm’s client to lose the case.

Aside from this movie, the issues surrounding the attorney-client privilege have been making real news in the past few months, following the controversial recent policies of the federal government that have eroded the privilege and work-product doctrine, particularly in a corporate context.

Various federal agencies have been pressuring companies and organizations to waive their privileges as a condition for receiving credit for cooperation during criminal investigations.

For an innocent man on death row, the privilege was the subject of a Chicago Sun-Times editorial (”Attorney-client secrets need some exceptions,” March 11, 2008).

And the U.S. Senate is considering S.186, the Attorney-Client Privilege Protection Act of 2007. The identical bill, H.R. 3013, passed the House last November.

The American Bar Association calls the bill and the ”proper balance between effective law enforcement and the preservation of essential attorney-client privilege, work product and employee legal protections,” with practical and clearly defined limits on a federal agency.

Proponents say it preserves the ability of prosecutors to obtain non-privileged factual material needed to punish wrongdoers and enforce the law. At issue are the Sixth Amendment right to counsel and the Fifth Amendment right against self-incrimination.

In Illinois, the Supreme Court adopted in 1990 the current Illinois Rules of Professional Conduct, which were largely based on the 1983 ABA Model Rules of Professional Conduct. The ABA then updated its Model Rules of Professional Conduct in 2002.

The Illinois Supreme Court, and the Illinois State Bar and the Chicago Bar associations established committees to review the ABA’s update. The result is a comprehensive proposed change to the Illinois Rules of Professional Conduct, which has been submitted to the Illinois Supreme Court.

The committees have proposed rules that include new language and even some new rules. For example, proposed Rule 1.13, ”Organization as Client,” clarifies the duties owed by a lawyer to an organization when the lawyer discovers wrongdoing on the part of an officer or employee of the organization. Rule 1.18 provides guidance and codification of precedent on ”Duties to Prospective Client.”

One of the most significant changes will be whether the Illinois Supreme Court will adopt official comments to the Rules — something new for Illinois — that are meant to better explain the intent and purpose of each rule.

For example, the comments dealing with Rule 1.6 on ”Confidentiality of Information” are nearly five pages long.

As in the fictional case of Michael Clayton, the comments suggest that if a lawyer learns about a client discharging toxic waste into a town’s water that creates a ”present and substantial risk,” the information must be revealed to authorities.

In the real case of the man on death row, proposed Rule 1.6(b)(3) acknowledges that there may be situations where crime or fraud can be prevented, rectified, or mitigated, but the privilege may not be broken when the person who has committed the crime employs the lawyer for representation concerning that offense.

The Chicago Lawyer discussed this issue recently in a lengthy article, ”When Ethics Clash with Morality,” March, 2008.

Significantly, proposed Rule 1.6 on confidentiality has been revised so that information received by a trained intervener, such as a mediator or arbitrator, also should be protected by the attorney-client privilege.

It must be remembered that the privilege belongs to the client, not the lawyer, and it enables open communication so that clients need not be concerned about confidentiality. After such scrutiny of the Illinois Rules of Professional Conduct by so many qualified attorneys throughout the state who really care, the rules still have the same underlying message in encouraging professional conduct and protecting the public:

• Play fair.

• Work hard for your clients and communicate with them.

• Don’t misrepresent anything to anyone.

And as the Bible teaches, don’t do anything to others that you don’t want done to you.

Diversity in Practice: Yes, I know, but …

By Arin N. Reeves, J.D., Ph.D.
The Athens Group

Barack Obama delivered a speech on race March 18 entitled, ”A More Perfect Union,” that captured the nation’s attention. In this speech, Obama called for a national conversation on race that is honest, collective, and immediate. Although Obama was widely praised for the courage and candor of his words, it is in the nuance of the ”yes, but …” responses to his speech where we see our country’s real racial fault lines. Voices like Bill O’Reilly on Fox News commented that, yes, a national conversation on race was a laudable goal, but white America was reluctant to talk about race because the margin of verbal error was too small and the threat of being labeled a racist was too high.

Many African-American voices (for example, blackcommentator.com) said, yes, the speech was brilliant and necessary, but they noted that African Americans were already engaged in a national conversation on race, just without their white counterparts.

Commentators like Daniel Schorr (npr.org) added yet another voice by, yes, applauding the speech, but simultaneously expressing disappointment that Obama can now no longer claim to represent the ”post-racial generation that had transcended America’s past racial division.”

I heard many of these and similar sentiments echoed in social settings and workplaces across this country. Always a yes, followed by a but.

Yes, we should talk about race, but who is going to start the conversation? Yes, I think race is an issue, but is it really the most important issue we face right now? Yes, we need to deal with race, but do we really need to talk about slavery? Can’t we just talk about what is going on today?

Yes, I want to bring up race, but I don’t want to be labeled as the angry minority. Yes, his speech was amazing, but do I really want to take on the task of educating all the white people in my workplace?

The ”yes, but …” responses pull the curtain back on this difficult-to-define, uncomfortable-to-broach, and impossible-to-ignore subject of race and reveal a few poignant truths:

It is easier to talk about race in theory than it is to approach the historical and festering wounds of our racial histories that lie along our nation’s racial divides. The necessary conversation we need to have is not a conversation on race itself — it is a dialogue on the consequences of racial stereotypes, racial prejudice, and racial identity.

It is easier to parse and critique Obama’s speech with co-workers than to discuss the possibility that racial bias continues to play a role in the racial composition of legal workplaces.

A national theoretical conversation on race is safer than a personal interaction with a neighbor or colleague.

The landscape of racial dialogue still has a perceptible line separating minorities and whites, with the former viewing race as an inseparable piece of everyday realities that needs to be constantly negotiated for survival and success, and the latter viewing race as a conversation into which they will enter when conditions are right and the emotional space is made safe.

The ”yes, but …” responses illustrate that we are all already talking about race - we are just talking past each other and not listening to each other.

For minorities, talking about race is a necessary reality, one that is raw, pained, and heavily laden with our own experiences, as well as the shared memories of our parents, grandparents, and communities.

For whites, talking about race is a difficult choice tinged with the risks of misunderstandings and blame, but it is still a choice.

We are talking about race as us versus them — a zero-sum game where each side realizes it can’t win, but it fights like hell to not lose.

It is in this context that diversity and inclusion attempt to create a new paradigm, a ”we” that melds the ”us and them” into a new definition of community.

Obama is right that we need a collective, honest, and immediate conversation to get us to this new paradigm. But before we can talk with each other, we need to actually trust each other. In this extraordinary election year, our cultural truths have confronted us. We don’t yet trust ”them” to understand ”us.” We cannot have a conversation yet because we do not have trust yet.

Minorities have to be able to trust that our experiences will not be discounted or softened to make the majority more comfortable.

Whites who grew up with race as background noise, a reality to be encountered only when a minority entered the room, have to be able to trust that honest verbal errors will not create character stains.

This trust cannot be created collectively or immediately; it has to be built one brave uncomfortable honest personal conversation at a time.

And, when enough of us can have real conversations on race in our neighborhoods, schools, and workplaces, we will be able to, on a national scale, say yes without the but.

3L and the City: Graduation and reflection

By Maria Vasos
Chicago-Kent College of Law

On May 18, 2008, I will officially graduate from law school and join the throngs of other survivors in the legal profession, (once, of course, I pass the bar).

As I reflect on my three years of study, I note that I was fortunate to have many positive, and only some not-so-positive, experiences. What stands out by far was my involvement in my law school’s criminal defense clinic. I strategically chose to do the clinic during the summer, when I did not have any classes to get in the way of my participation, including going to court on an almost daily basis.

And, I chose to do it after my second-year, after I had already taken evidence and two trial advocacy classes. I was able to assist on a full, two-week-long, felony jury trial from start to finish. The defendant was found ”not guilty” on all four counts and I was even thanked by him and his family for my help on his case.

Not only did the clinic strengthen my resolve to go into litigation, it more importantly strengthened my resolve to finish law school. It was often hard to get excited about legal writing memos about fake clients with fake problems. In the clinic, helping real clients, real people, fight the good fight, made all the difference.

On a related note, I was lucky enough to do two different externships as well that were also great hands-on experiences. I highly recommend clinics and externships to everyone in law school and think that at least one should be mandatory, similar to a residency program for doctors.

To that end, I generally enjoyed all of my practical skill courses, which I feel have helped prepare me for the actual practice of law, courses such as evidence, trial advocacy, and criminal litigation (affectionately referred to as, ”trial advocacy on steroids” by its professor).

This leads me to a terrible law school pitfall, the first-year curriculum, and unfortunately pretty much the rest of the ‘’substantive law” curriculum as well.

There is a reason why Harvard Law School announced in October that it would devote fewer hours to the traditional first-year curriculum and add practical courses, such as problem solving, into the mix.

The reason is that the entire first year of law school is useless, except as a battle of wills to weed out those who cannot stomach it. I am fully aware that I will have to re-learn what I need for the bar exam in July. I, like many others, am not certain as to how much of torts I actually even learned in the first place. God bless bar prep courses and supplements.

But, in my experience, most, if not all, of the other substantive law courses are completely ineffectual as well. When, in an actual legal career, would you need to memorize any law, because you could not look it up, much less Model Code that has not even been adopted? Dare I say, never. When would you be confronted with a five-page long hypothetical problem that you would have to dissect in its entirety and resolve in only two hours? Again, I venture that this would never happen.

Law students are failed in that respect because they can take all of these courses and upon graduation and passing the bar, only be prepared to be law students, not lawyers. Would society let doctors practice medicine without having even touched a human body or step foot in a hospital? Of course not. Why a law student can graduate, pass the bar, and be licensed to practice law, without having ever drafted a motion or stepping foot in a courtroom is beyond me.

I am told that this is the age-old debate between the legal academics and practitioners regarding just how much of a trade school law school should actually be. Obviously, you can see what side of the fence I am on.

But lastly, since I already compared law school with medical school, it stands to note that medical school is traditionally entirely pass-fail. This promotes cooperation in learning and fosters a low-stress environment for students, encouraging them to finish medical school and become successful doctors.

In contrast, law school has a harsh mandatory curve, so even if all of the students in a particular class did great on the final exam, a professor is only allowed to give 5 percent As, 10 percent A-minuses, 20 percent B-pluses, etc. So, the difference between an ”A” and a ”C” could be only five points.

And, most law schools require between a B-minus and C-plus grade point average to stay in school. One is in constant battle of the curve, with his or her equally competent peers, to stay in school, at least in the first year, when there are no other grades to balance the scales. This promotes extreme competition, stress, bad will, and higher attrition rates.

Many potentially excellent lawyers, who are not perfect law students, get downtrodden, abused, and overlooked in this perverse hazing system that confuses law students with sacrificial lambs, for no good reason, because, to reiterate, most of law school does not prepare you for actual legal practice anyhow.

All in all, am I glad that I went to law school and will be embarking on a career as a lawyer? Absolutely. If I had it to do all over again, knowing what I know now, would I have done things differently? No, I have no regrets.

Would I like to continue on with more years of law school, just for fun, and maybe pursue an L.L.M. or something? No, I am not a masochist.

In the Woodpile: Mistakes and the modern lawyer

By Shawn Wood
Seyfarth Shaw

To err is human, but to really foul things up you need a computer.
—Paul Ehrlich

Month after month, my inbox is flooded with solicitations for tech-law seminars. While I’m always struck by the sheer number of these programs and their inspired use of fear as a marketing strategy (”What Every Lawyer Must Know About E-Discovery”), I’m also amazed that these seminars consistently omit one of the most important ”tech” topics of all.

Specifically, I’d like to see a program called: ”How to Avoid Technology Mistakes That Make You Look Really Stupid.”

Professionals clearly need more instruction in this area, and I’m not just talking about minor errors like forgetting to attach a document to an e-mail or those ”all-firm” blasts that always begin with something catchy and sincere like ‘’sorry for the blast e-mail.”

Stories flow through every office about those three terrifying words ”Reply to All” and how a promising career can be sabotaged by sending the wrong e-mail to the wrong 800 people.

In our office, if you click ”Reply to All” in response to an e-mail, the IT folks installed a helpful prompt for the focus-impaired that says: ”DO YOU REALLY WANT TO REPLY TO ALL?” If this doesn’t work, I dropped a note in the suggestion box recommending a second prompt that says: ”HEY IDIOT, IF YOU KEEP SENDING THESE TO EVERYONE, THE FIRM WILL REVOKE YOUR E-MAIL PRIVILEGES.” If they implement my suggestion, I think I win a free taco.

In 2008 alone, there have been at least two incidents of lawyers ending up in the news after inadvertently hitting the ‘’send” button.

In February, The New York Times broke a story about confidential settlement discussions between Eli Lilly and the federal government. Portfolio.com subsequently reported that the drug company’s outside litigation counsel inadvertently sent a confidential e-mail intended for her co-counsel to a NYT reporter, who had a similar name and e-mail address.

This story shot through the blogosere with no shortage of schadenfreude that a mistake had been made by a ”high-priced” partner from a ”fancy” law firm. By the time the reporter clarified that he derived the details of his story from other sources and that the inadvertently sent e-mail consisted of only two sentences (merely stating that the government’s demand was in the ‘’stratosphere”), the damage was done. This story became a parable for the need to exercise greater care when communicating about confidential information.

The second recent e-mail gaffe involved the settlement of a lawsuit an insurer had filed against the Mississippi attorney general. The Associated Press reported that a Skadden, Arps, Slate, Meagher & Flom attorney representing the insurer was copied on an e-mail sent to reporters that contained a press release by the attorney general. The lawyer intended to forward the e-mail to her internal team while commenting that the attorney general should be held in contempt for misrepresenting the terms of a confidential settlement. Instead, she hit ”Reply to All.”

Her comments were sent to a dozen reporters. I suspect this problem could have been avoided by having an auto-prompt that says, ”ARE YOU SURE YOU WANT TO SEND THIS TO A DOZEN REPORTERS?” Remind me to add that to our suggestion box.

Beyond these inadvertent disclosures, the ever-increasing prevalence of blogging creates entirely new avenues for professional blunders.

My personal favorite goof on the blogging front occurred in the context of a medical malpractice trial in Boston last year. Dr. Robert Lindeman, a graduate of Yale University and Columbia University’s College of Physicians and Surgeons, was sued for allegedly failing to diagnose a patient’s diabetes. It turns out defendant Lindeman also maintained an anonymous blog under the screen name ”Flea.” (Ah, yes, sign me up for medical care by the dude who refers to himself as ”Flea.”)

Doc Flea, according to the Boston Globe, was maintaining a real-time blog during his own medical malpractice trial, in which he ridiculed the plaintiff’s case, revealed the defense strategy, and accused members of the jury of dozing. He also wrote about the plaintiff’s attorney Elizabeth Mulvey, who he nicknamed ”Clarissa Lunt,” and remarked about her habit of biting her nails, and reportedly mused: ”Wonder if she’s a pillow biter, too?”

So imagine the surprise of Doc Flea and his lawyer when, at the close of the day during cross-examination, Mulvey asked if Lindeman maintained a blog and whether he was Flea. After Lindeman answered yes to both questions (”D’oh!”), with Mulvey having telegraphed that she was prepared to delve into Flea’s colorful descriptions regarding the case (and everyone in the courtroom), the case promptly settled.

With this non-exclusive list of recent stories involving professional pitfalls, it seems appropriate to add ”avoiding stupidity” to the list of topics at the next round of tech law seminars.

In the meantime, I recommend reserving use of your computer for the really important things, like fantasy baseball, searching for new music on Pitchfork, or watching that Jimmy Kimmel-Ben Affleck video on YouTube.

Or, if nothing else, just avoid ever hitting ”Reply To All.”

Around the water cooler — Q & A with Ethan Trull

Each week we will pose these three questions to different lawyers in the legal community.

This week we talk with Ethan Trull, a litigation partner at Ungaretti & Harris who has been practicing for 19 years. His practice is mostly commercial litigation with an emphasis on securities, antitrust, products liability, and intellectual property litigation.

– What do you find most interesting about your practice?

Especially in litigation, technological change is a constant element. For example, remarkable advances in medical science have simultaneously resulted in brand-new causes of action, brand-new defenses and brand-new methods of proving both.

Similarly, the development of mass electronic storage of data revolutionized business, but now exists as one of the easiest litigation pitfalls for the unwary business (or its counsel who fails to give suitable advice on electronic data preservation and production). As technology becomes more advanced, affordable, and pervasive, legal professionals necessarily also have to become even more technologically proficient. Maintaining technical expertise in areas that affect my clients’ business is one of the most interesting and challenging aspects of my practice.

– What makes a good lawyer?

We’ve all worked with lawyers whom we consider to be “good,” and our positive assessment can spring from any number of quality traits. For example, many lawyers are good because they are exceptionally quick on their feet. Others seem to write effortlessly. Some lawyers have sufficient charisma to charm even the most jaded jurors and clients. Perhaps a tougher question is how to predict which lawyers may possess any of these good qualities.

Many employers heavily rely on academic credentials as their primary predictive tool, whether they are seeking in-house counsel or a prospective legal partner. Unfortunately, the same qualities that guarantee academic success do not always translate into real world ability. The better answer, I think, is to expect future success based upon practical track history and positive outcomes. In other words, in the practice of law, experience still matters.

– What is the biggest legal news, and what is its impact?

There is so much legal news nearly every day that it is nearly impossible to point to one or two things. Obviously the trend toward nationalizing firms continues which impacted, and in fact reinforces, my decision to rejoin private practice in one of the very few truly mid-sized firms left in the city. I read last week that in England an investor group has actually purchased a law firm and, in essence took it public.

I can’t imagine that happening here, but then again I never thought that a lawyer could get away with charging $1,000 per hour (and I suspect that in fact they won’t get away with it). It used to be the rare firm that had office outside of the United States. Now apparently every firm needs an office in Prague. Is that really what we need?

Around the water cooler — A book about cross-examination

Each week I profile a different legal happening or event. I solicit your thoughts and opinions on this topic.

The new book, “Your Witness: Lessons on Cross-Examination and Life from Great Chicago Trial Lawyers,” which was edited by Steven F. Molo and James R. Figliulo and published by the Law Bulletin Publishing Company, addresses how 50 prominent trial lawyers view cross-examination.

Two of the lawyers who contributed to the book are Jenner & Block Partners Chris Gair and Robert L. Byman.

Byman’s section, entitled, “Crossing with Technology,” described how technology sometimes improves cross-examination. He said in the book: “Our cross-examination, when assisted with a little technology, can become works of art.”

The best advice he has for those lawyers looking to improve their cross-examination, he said, is to ”get up on your feet as often as you can. It’s a talent that you can grow by doing more and more, but you have to start with some talent and do it … Read this book, go to courtrooms and watch people do it, and don’t try to imitate. Take snippets of the best you see and incorporate it into your own style.”

Gair’s section, is entitled, “Life Is Short - Take a Chance.” Gair said he wanted to challenge the conventional wisdom that exists about cross-examination.

The rules are just guideposts, he said. A lawyer sometimes asks a question he or she doesn’t know the answer to — based on his or her feel for how the witness is going, and because of a need to get the confession he or she wants.

Understanding a witness’s psychology can challenge lawyers because they may need to make a witness to look bad. This means understanding how the witness will approach the questions, he said.

“Another challenge is the cost-benefit analysis that you have to do,” he said. “Is it worth asking a particular question knowing you could get an answer that doesn’t help you …”

Next Page »