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LOAN-MODIFICATION WORK MAY FLOUT ETHICS RULES
"Attorneys who represent customers of mortgage-modification companies ? increasingly attractive work these days ? are at risk of losing their law licenses if they split fees with the financiers, two Supreme Court committees say. In a joint opinion issued June 26, the Advisory Committee on Professional Ethics and the Committee on the Unauthorized Practice of Law find that acceptance of legal fees from such a company, or dividing with the company a fee paid by a homeowner, constitutes impermissible fee-sharing, and an attorney who engages in such practices "imperils his or her license to practice law." The decision stems from a growing number of inquiries to the ACPE's ethics hotline about the propriety of performing loan-modification services under the auspices of such companies, some of which are aggressively courting lawyers."

LEGISLATURE ACTS ON FORECLOSURE, DEBT COLLECTION REFORMS
"In the closing days of their session, New Jersey legislators pushed forward bills that would put greater restrictions on foreclosure and debt collection, partially to help borrowers cope with the current recession. The Assembly passed the state Fair Debt Collection Practices Act, which allows aggrieved debtors to sue for actual damages or statutory damages of $1,000, punitive damages in some cases, plus legal fees and costs. Unlike its federal counterpart, the N.J. bill defines 'debt collector' to include attorneys and people working for them. The Assembly also passed measures requiring more expansive notice to homeowners facing disclosure."

SUPREME COURT RULES FOR WHITE FIREFIGHTERS IN TITLE VII CASE
In a dramatic ending to its term, the U.S. Supreme Court on Monday ruled, 5-4, that the city of New Haven, Conn., violated the civil rights of white and Hispanic firefighters when it tossed out the results of a promotion exam after no African-Americans had passed it. The Court ruled in Ricci v. DeStefano that the city's justification ? that it feared it would be sued by the African-American applicants for violating Title VII by relying on a test that had "disparate impact" on minorities ? did not constitute the "strong basis in evidence" that is needed for an employer to make employment decisions based on fear of liability. The Court said instead that the city's action was based on race and amounted to a "disparate treatment."

HIGH COURT RULES STATES CAN ENFORCE FAIR LENDING LAWS
State attorneys general won a major turf war in the U.S. Supreme Court on Monday as the justices held that states may enforce their anti-discrimination and consumer protection laws against national banks. The high court, in a 5-4 ruling, struck down a regulation issued by the chief federal regulator of national banks that pre-empted the states' power to enforce those laws. Justice Antonin Scalia, writing for the majority, said the regulation was an unreasonable interpretation of the National Bank Act. The case, Cuomo v. Clearing House Association, was followed closely by the banking industry groups. One, the Financial Services Roundtable, says the ruling will create "a patchwork of 50 state laws."

CHIEF JUSTICE ADVOCATES FOR SHORTER BRIEFS, FEWER QUESTIONS
"Speaking at the conference of the Fourth U.S. Circuit Court of Appeals on Saturday, Chief Justice John Roberts Jr. said briefs before the high court are running too long, while the justices themselves are asking too many questions at oral argument. With amicus filings growing, Roberts said there's no reason why a party's brief could not shed some of the subisidary points that can be handled by amicus groups. As for oral argument, Roberts said "I think we're getting carried away" with questioning. He even suggested giving justices timers as in speed chess, so they can see how much time they are eating up with their questions."

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