Legal Research

U.S. JUDGE REVIVES CONGOLEUM BANKRUPTCY AND TAKES OVER CASE
"After 12 failed attempts at a Chapter 11 reorganization plan that would set up a trust for tens of thousands of asbestos claims against Congoleum, a federal judge has reinstated the case and, in an unusual step, has withdrawn it from the bankruptcy court so he can handle the confirmation process himself. A bankruptcy judge dismissed the Chapter 11 case earlier this year, fed up over the proponents' repeated failure to address concerns about unequal treatment of claimants and $2 million in "facilitation fees" for claimants' lawyers. But U.S. District Judge Joel Pisano in Trenton held Monday that the favored treatment of claimants who settled before the Dec. 31, 2003, bankruptcy filing did not preclude the plan's confirmation. He also required submission of a new plan that does not try to block judicial review of the facilitation fees."

APPEAL CHALLENGES JUDGE'S OUTSIDE RESEARCH IN BENCH TRIAL
"A federal appeals court has been asked to limit the right of judges to do their own research in bench trials, lest they be swayed by facts not before them. U.S. Magistrate Patty Shwartz in Newark no-caused a medical malpractice claim after consulting published and unpublished cases ? not cited by the parties ? that dwelled on the type of injury the defendant doctor was accused of inflicting. A Third Circuit panel affirmed the verdict, saying the research was for 'informational' purposes only and was not the basis for Shwartz's decision. The plaintiff, seeking en banc review and a new trial, asks: Was Shwartz's inquiry akin to jurors making clandestine visits to an accident scene or doing Internet research in the middle of a trial?"

BUYER'S LAWYER WHO FUDGED NUMBERS AT CLOSING DRAWS 3-MO. SUSPENSION
"A Jersey City solo who signed off on a fraudulent real estate transaction deserves a three-month suspension, despite his lack of a prior disciplinary history, a state ethics panel says. Acting as the buyer's attorney, Kevin Bosworth signed a RESPA statement filled in with numbers he must have known were fictitious ? with the result that the seller was cut out of almost all of his share of the proceeds, and a realtor took an unauthorized large cut, the Disciplinary Review Board says. Though the district ethics committee investigating the case recommended a reprimand, in light of Bosworth's minor role in the transaction and his spotless ethics record until now, a four-member majority of the DRB called for his suspension."

DISTRICT DOCKED FOR USING ABBOTT FUNDS FOR POLITICAL ENDS
"Spending Abbott funding on advertising that was political in nature will cost the Elizabeth Board of Education a big chunk of its state education aid. The Appellate Division on Tuesday affirmed an administrative law judge's finding that during the 2005-06 school year, the board misspent $88,373 of its Abbott funding, which is equalization aid for the state's poorest districts. The board spent the money on a 20-page brochure and television advertising that advocated buying two pieces of land from NJ Transit to build a new high school and physical education complex. The brochure and ads criticized Elizabeth Mayor J. Christian Bollwage's purported attempt to steer the land to a private developer ? his political ally ? for less than market value. They prominently featured board member Carlos Cedeno, who was running for city council and who used the proposed land purchase as a talking point in his campaign."

LAW FIRMS OPPOSE SEC RULE ON SHAREHOLDER NOMINATIONS TO CORPORATE BOARDS
"Seven of Manhattan's elite law firms on Monday took the rare step of signing on to a single letter to the Securities and Exchange Commission to voice their opinion on how the agency should implement a proposal to allow shareholders to nominate company directors. The firms are Cravath, Swaine & Moore; Davis Polk & Wardwell; Latham & Watkins; Simpson Thacher & Bartlett; Skadden, Arps, Slate, Meagher & Flom; Sullivan & Cromwell; and Wachtell, Lipton, Rosen & Katz. At issue is a proposed rule that would make it easier for shareholders to nominate and elect individual directors to corporate boards. Supporters of the change argue shareholders do not have the ability to hold boards of directors accountable. The lax oversight, they say, allowed financial institutions and companies at the center of the economic crisis to pile on excess risk."

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