Author: Newsdesk

Deloitte won its lawsuit against former Chicago partner Thomas Flanagan, who was accused of violating the firm’s rules against stock ownership in companies the accounting firm audits.

Here’s my story about the case.

There’s also an interesting sidebar about the judge’s opinion, which was released on Dec. 29. Flanagan’s lawyers tried to keep the opinion confidential.

When I tried to look up the case on the Delaware court’s Web site Tuesday, the case was not available for some reason. I called the court and learned that the judge presiding over the case had sealed his opinion but wasn’t given any explanation.

I talked to another source who told me that the decision was originally public but the judge later sealed it because it contained references to affidavits and other discovery materials that had been filed under seal.

But the cat was already out of the bag. A Delaware blogger had a link to the opinion on his blog and the Reuters news service had written a story about the decision.

Yet Flanagan’s lawyers filed a request with the court on Monday to keep the court’s opinion confidential. It also proposed a heavily redacted version of the decision be made public. Deloitte opposed the continued sealing of the court’s opinion.

Judge John Noble lifted the seal Tuesday, saying that the opinion did not impair any privacy interests that Flanagan may have. The judge also said the redacted version left out materials that were essential for an understanding of the court’s decision and analysis.

Thank you, judge. The redacted version deleted huge chunks of the decision, including some of the unauthorized trades that Flanagan made.

Take a look for yourself. Here’s the redacted version and the full opinion.

Chicago’s law firms are promoting new leaders in the new year.

I’ve written about Kirkland & Ellis’ new chairman, Jeffrey Hammes, and in Tuesday’s paper I highlighted the change in Skadden Arps, where Wayne Whalen is stepping down after 25 years at the helm of the Chicago office. The full post will follow.

After I wrote about Whalen, I received word that Chapman & Cutler also has a new top partner. Timothy Mohan succeeds Richard Cosgrove as chief executive partner. Cosgrove served the firm’s maximum of two four-year terms.

Mohan has been with Chapman since 1985, practicing in the firm’s structured finance and banking department.

Here’s my story on the leadership change at Skadden Arps:

‘Tis the season for leadership changes at Chicago law firms, and one of the biggest involves Wayne Whalen.

Whalen, 70, stepped aside Friday as head of the Chicago office of Skadden, Arps, Slate, Meagher & Flom in favor of Brian Duwe, a 49-year-old specialist in mergers and acquisitions.Whalen, who groomed his successor, has been the heart of Skadden’s robust Chicago operation since its inception in 1984. Whalen was one of six partners at Mayer Brown who decamped to set up a branch office of the New York firm. The move sent shock waves through Chicago’s legal community at the time because partners rarely left such prestigious firms.

Since then, Whalen has helped Skadden become a legal powerhouse in Chicago. In the late ’80s, the Chicago office was Skadden’s busiest operation, including New York. Whalen oversaw a broad diversification into mutual funds, public finance and litigation.

Yet it remains on the short list of firms Midwestern companies turn to for big deals, from friendly mergers to hostile takeovers. In 2008, the Chicago office worked on three of the five largest mergers and acquisitions involving local companies, including Wm. Wrigley Jr. Co.’s $23 billion sale to Mars Inc.

Like other big firms, Skadden’s volume of legal business in the Chicago office slowed in the middle of last year, Whalen said.

Duwe remained busy. He represents Deerfield-based CF Industries Holdings Inc. in its proposed unsolicited takeover of rival fertilizer manufacturer Terra Industries Inc. At the same time, Duwe is helping his client fend off a hostile bid from Agrium Inc.

Whalen recruited Duwe to the firm out of University of Chicago Law School in 1986. Duwe understands he has big shoes to fill.

"Wayne has done an incredible job," Duwe said. "It’s hard to think about following him because it seems almost an impossible task."

Whalen still commands a corner office in Skadden’s new office at 155 N. Wacker Drive and intends to keep practicing. The northwest view of the Chicago River outside his windows has not changed much since the office moved last summer from 333 W. Wacker Drive.

He said the timing was right to pass the torch after 25 years because of the new office location as well as leadership changes at Skadden’s headquarters in Manhattan.

Personal injury firm loses partner: Michael Mahoney has left the firm of Burke, Mahoney & Wise to set up his own shop with another lawyer.

Mahoney’s departure was unexpected to practitioners in Chicago’s personal-injury arena. His former firm was successful for a boutique operation of four lawyers, recovering more than $53 million in settlements from nine cases between July 1, 2008, and June 30, 2009, according to Chicago Lawyer magazine.

Kevin Burke said he does not expect Mahoney’s move to have a financial impact on the firm.

"The remaining members of the firm were happy he made the decision to go elsewhere," Burke said. "He’s developed a style of practice different from ours. We want to practice with a sense of urgency."

Mahoney responded that many of his cases are contentious and take longer to resolve. "I have no control over that," he said.

He and fellow personal injury lawyer Lisa Damico have started their own practice.

I caught up with Mark Herrmann, a Chicago lawyer who specializes in product liability, on Monday after I learned that he was going stop writing his blog because of a new job he took at Aon Corp.

Herrman was the first blogger at Jones Day and his blog, Drug and Device Law, is well regarded in legal circles.

Here’s my Chicago Law column about his blogging experience:

Blogging has become an acceptable marketing tool for lawyers, but don’t expect it to lead to hundreds of new billable hours.

That’s a lesson Mark Herrmann has learned after more than 1,000 posts, an average of one per business day."The business we received doesn’t come close to the hours we invested in it," said Herrmann, a litigation partner with Jones Day in Chicago who specializes in product liability.

In his last post Wednesday, Herrmann announced he was quitting the blog he co-wrote for the last three years, "Drug and Device Law."

But his motivation for putting down his pen is not what you think.

Herrmann is resigning from the firm’s partnership at the end of the year to join Aon Corp.’s legal department as its chief counsel in charge of litigation. A blog about lawsuits involving drugs and medical devices does not fit with his new career in the insurance brokerage industry, Herrmann said.

The blog will live on through co-author James Beck, a lawyer in Philadelphia.

Chicago Law interviewed Herrmann on Monday to ask him about his blogging experience.

Q. Why did you start your blog?

A. I got the idea out of an experience I had with the Wall Street Journal Law Blog. The blog ran a review of a book I had written. The book went from something like 47,000 in Amazon’s sales rankings to No. 434 in 36 hours. I started blogging that day.

Q. Did you have to get approval from Jones Day?

A. I did it as a personal blog, and it has nothing to do with Jones Day. We put the world’s most ungodly disclaimer on it to spell out that the blog does not necessarily represent the views of our law firms. I was the first blogger at my firm.

Q. When would you have time to write your blog?

A. Sunday mornings. I would get most of a post pre-written over the weekend, and during the course of the week I might tweak it. If you’re in meetings, trials and depositions, you don’t have time to write a comprehensive blog during the workday. The blog might look as if I’m home blogging, but it was just a bluff.

Q. Where did you get your ideas?

A. We looked at press reports, legal decisions and briefs people were filing. You try to keep your ears close to ground. By the end many people were sending in ideas. Some people confused us with other journalists. We got press releases from some people.

Q. Did you get any financial benefits from the blog?

A. The financial benefits are a little hard to figure. Both Beck and I received some small amounts of business from the blog. But no sane person would say there was a return on our investment. It was a mind-numbingly relentless and grueling effort. There were many Sunday mornings I would be sitting there trying to figure out what I was going to say. It was something that I didn’t like doing, but I liked having done it.

Q. Looking back, was it worth it?

A. Yes. It raised my personal profile and the firm’s. It really plugs you into a network. You’re way ahead of what others were thinking because you’re the center of the universe. We saw one idea that we posted on our blog that was later enacted as law by the FDA (Food and Drug Administration).

Two Chicago law firms are in war for talent in Silicon Valley.

McDermott Will & Emery won the latest round over Sonnenschein Nath & Rosenthal by hiring Yar Chaikovsky away from Sonnenschein’s Palo Alto, Calif., office.

Chaikovsky’s departure from Sonnenschein did not go so smoothly, according to this story in The Recorder.

Sonnenschein recruited him Weil Gotshal & Manges in 2007 to open its Silicon Valley office. Chaikovsky focuses his practice on patent litigation, according to McDermott’s news release.

Lawyers at Kirkland & Ellis and Sidley Austin charge some of the highest rates in the city. But when it comes bankruptcy, their median billing rates still don’t come close to their peers at New York firms.

That’s one of the interesting facts that emerge from American Lawyer’s analysis of bankruptcy billing rates submitted by law firms in the nation’s two busiest courts, Delaware and the southern district of New York. Click here for the magazine’s online story that appeared Wednesday.

Some other interesting details:

* Kirkland’s Jamie Sprayregen billed $965 an hour for work on the bankruptcies of Lear Corp. and The Reader’s Digest Association.

* Sidley’s median rate of $700 an hour is hardly a bargain but it was nearly 30 percent less the $980 that Simpson Thacher & Bartlett charges.

* Several lawyers charge more than $1,000 an hour, but the article did not mention anyone from Chicago.

The article made me curious to see what lawyers in the the bankruptcies of two media companies that I’m familiar with, Tribune Co., which owns the Chicago Tribune, and Sun-Times Media Group, are charging. Both cases are in Delaware.

Kirkland represents the Sun-Times. In its most recent fee application, restructuring partner James Stempel topped the rate chart with an hourly fee of $860 an hour. Since March 31 when the company filed for bankruptcy, the law firm has requested fees totaling more than $2 million.

Sidley represents Tribune Co. In its most recent fee application, restructuring partner James Conlan topped the rate chart with an hourly fee of $925 an hour.