But aside from rebuttal, where you can't divide up the issues in advance because you don't know what the rebuttal will have to focus on, why was there no division of issues to ensure deeper focus on crucial points and presentation of a larger number of points? My guess, which unhappily may sound harsh but for which I have a basis that I will partly keep to myself, is this: each of several lawyers thought they should do the oral argument, and would be best at it. This had an effect on cooperation -- I know, for example, that who would be the oral advocates was in contention, apparently bitter contention, until nearly the very end -- and at least possibly was a reason why the lawyers were perhaps unable to, and in any event did not, split up the argument by issues.
Ron Stein of NIAP, Dave Bernfeld and I discussed this question of who would argue for a couple of weeks, although Ron and I were wholly out of the loop and David was only somewhat knowledgeable about what was occurring. The reasons for our discussions were that we could sense what might occur and had qualms about the appellate experience and appellate expertise of the lawyers. Given my own prior experience with numerous expert Supreme Court advocates and given what is sometimes written on this subject in the Times or the National Law Journal, we knew that there are major league Supreme Court specialists who in the last ten to twenty years or so have headed, or who are part of, special appellate sections of major law firms, sections of law firms that specialize in both Supreme Court work and federal court of appeals work. The idea of trying to hire such a lawyer for the appeal (and then for later Supreme Court work that will arise) seemed a good one. But there wasn't enough time left to do it and we believed the NYC group of lawyers were likely to object strongly to the very idea of being displaced on appeal by an appellate specialist, even one of (deserved) national reputation.
The idea we were discussing, however, should be resurrected. There are at least three reasons. First, if we lose in the Second Circuit, we might wish to seek a rehearing en banc, i.e., a rehearing from the entire Court, not just the three judges who heard the case on March 3rd. (The other side might do the same if it loses.) In seeking or opposing such a rehearing, and in orally arguing if rehearing is granted, it would be wise to have an appellate specialist of the type I'm discussing.
Second, regardless of which side wins in the Second Circuit, the loser will ask the Supreme Court to hear the case and the other side will oppose this. No one can doubt the wisdom of having our side represented in such proceedings by a high Court specialist who is expert in gaining and opposing Supreme Court review and, if a Supreme Court hearing is granted, in arguing cases before the high Court. This is only the more true when one considers that in Supreme Court proceedings the SEC may well be represented by, and likely will at minimum receive the advice of, the Solicitor General's office, the U.S. Government's highly expert office of Supreme Court lawyers. (Most, and maybe even close to all, of the Supreme Court experts in private practice spent time in the SG's office.)
Finally, the entire problem is going to repeat itself -- beyond question. As said, there is soon going to be omnibus briefing before Lifland on vital issues. While I am not privy to the details of what the Trustee and the group in charge are determining those issues to be and what the schedule of briefing will be, on January 10 I did receive a preliminary memo about this and do believe the issues will include such crucial ones as whether the CICO calculation of net equity should incorporate the time value of money. My personal opinion is that the omnibus briefing should include certain other issues that I doubt will be included, such as whether victims should receive credit, in their net equity calculations under CICO, for the approximately half billion dollars (I believe it is) that Madoff admittedly earned on monies from the 703 Account that were invested every single night of the scam in short term instruments, Treasuries, money market funds, etc., and whether the Trustee can lawfully demand that victims repay him tax refunds they receive from the U.S. Treasury (an expert tells me that there is precedent against this, and I shall read the cases he cites as soon as possible). In any event, the omnibus issues will be important ones, and the losing side will appeal them -- perhaps to the district court (the trial court) and then to the Second Circuit, or perhaps directly to the Circuit -- and the losing side in the Circuit will seek Supreme Court review. The situation which existed with regard to the appeal on net equity will almost certainly affect us again with regard to the omnibus argument on appeal unless our side hires appellate experts of the kind discussed here. Tomorrow would not be too soon, so that whoever is hired will have ample time to acquaint him/her/their selves with the omnibus questions. Not to mention the need to acquaint him/her/their selves with the net equity part of the case for purposes of a possible en banc rehearing in the Second Circuit and requested Supreme Court review.
Writing discursively, before moving on let me briefly discuss the relationship to David Becker of a point adverted to above: the time value of money. Much probably remains to be learned about the Becker situation, but one thing I have not yet heard is what I consider the real conflict of interest from the standpoint of victims.
As far as we now publicly know, some of the victims' lawyers -- including ones from large law firms -- wrote a memo asking the SEC to require use of the final statement method rather than CICO. The SEC could have done this because, as was said by the Second Circuit in the first New Times case, quoting the Supreme Court, Congress gave the SEC "plenary" authority to supervise SIPC, even though, as the Circuit also recognized, the SEC has failed to exercise the authority Congress gave it. (What else is new?) The memo the lawyers wrote to the SEC was very good -- I read it at the time; it was an apt forerunner of later briefs submitted to Lifland by the same lawyers, which also were very good. The lawyers then, I believe, met with Becker (as others did too). When they met with him, they were meeting with someone who would have had to be chary about requiring SIPC to use the FSM even had he agreed, honestly and on the merits, that use of the FSM was the only legitimate course. For, were he to push the FSM upon SIPC, he could have been accused of doing so to feather his own nest by possibly eliminating clawbacks against him and his family. (If the FSM is used, then the money he took out for his mother's estate might well be considered real profits and not subject to clawbacks (though Picard later determined to deny this, and to say that monies taken out in excess of monies put in are "clawbackable" even if the FSM is used. This will be an issue if the Second Circuit rules in favor of using the FSM.)) Because he could rightly be accused of feathering his own nest if he forced the FSM upon Picard, Becker could not do so even if he had completely agreed that the FSM, not CICO, was proper. So, unbeknownst to them, the lawyers and others from our side who met with Becker were meeting with someone who was ethically disabled from implementing their view even if he thoroughly agreed with it. From our standpoint, that is where the appearance of conflict lies.
As I've said to a few, were I one of the persons who met with Becker, and had I known he would benefit from the FSM, I would have been horrified and would have demanded that he recuse himself immediately. For, as said, he could not propound for our side without opening himself to charges of misconduct, and nobody wants to be trying to persuade an official who will be subject to ethical misconduct charges if he rules your way. Those who say that the conflict was no big deal because Becker decided against his own interests have not thought of or have failed to grasp the critical point discussed here. Yet would they want to be judged by a judge who cannot decide in their favor, no matter how right he may think they are, lest he be accused of serious ethical misconduct?
Next Page 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10
(Note: You can view every article as one long page if you sign up as an Advocate Member, or higher).
