Northwestern Law School Gets Record Gift: Business of Law
By Ellen Rosen Dec 24, 2013 10:21 AM ET
The largest portion of the gift — $6 million — will be unrestricted. The remainder of the donation will support the school’s loan repayment program, clinical education at the school and other programs.
The donation is part of a $25 million gift to the university to Northwestern Medicine, the Bluhm Cardiovascular Institute at Northwestern Memorial Hospital, the Bienen School of Music and the Holocaust Educational Foundation of Northwestern University.
Bluhm said in a statement that he was “inspired by the vision of Dean Daniel Rodriguez and his goals for the law school’s mission and future,” in making the gift, which was announced Dec. 17.
Daniel Rodriguez, the dean of Northwestern Law, said in a telephone interview yesterday that Bluhm “has been very generous to the law school over a long period of time.” In 1999, he pledged almost $7 million to the Neil G. Bluhm Fund, for the school’s clinical education program. That program will receive $3 million from this gift.
The $6 million in unrestricted funds will be used to support need-based financial aid and initiatives of the school’s strategic plan, the school said in a statement. The school’s Loan Repayment Assistance Program, which helps graduates who accept lower-paying public-service and government jobs, will get $5 million. The remainder of the donation will be used over 10 years to build sustainable support from alumni through annual gifts to the Law School Fund.
Bluhm, the co-founder of JMB Realty Corp. in Chicago, is ranked 222nd on the Forbes list of the richest people in the U.S.
Swiss Banks Employ Army of Advisers to Weigh U.S. Amnesty Plan
Switzerland’s 300 banks have enlisted an army of auditors, lawyers and in-house workers as they race to meet a Dec. 31 deadline on whether to seek amnesty for helping U.S. clients evade taxes.
Banks in Switzerland, the largest cross-border financial center with $2.2 trillion of assets, are closely examining accounts before joining a disclosure program that’s the broadest assault in a five-year U.S. crackdown on offshore tax evasion.
“The hard work is getting to the right data and cutting through complex systems to get all the facts on the table,” said David Fidan, a partner in Deloitte LLP’s forensic services practice in Switzerland. “That’s very expensive and involves lawyers, forensic accountants and bank employees. It can take 20, 30 or 40 people over four or five months for bigger banks.”
Banks with “reason to believe” they violated tax laws can ask the Justice Department to forgo prosecution. In turn, banks must disclose how they helped Americans hide assets, hand over data on undeclared accounts and pay penalties. Those that don’t apply could face criminal probes like those against 14 banks, including Credit Suisse Group AG (CSGN), HSBC Holdings Plc (HSBA)and Basler Kantonalbank. (BSKP)
The Swiss government encourages banks to join the program, announced Aug. 29. Yet the Swiss Bankers Association criticizes the program’s cost and vexing questions, such as who qualifies as a U.S. client and what assets are considered untaxed. The answers could determine how much a bank pays in penalties.
At least 33 have announced they will join some form of the program, including 19 cantonal banks, or regional lenders typically owned by regional governments. They include Union Bancaire Privee, the Geneva-based bank founded by Edgar de Picciotto in 1969; Edmond de Rothschild Group, the Geneva-based wealth manager owned by Baron Benjamin de Rothschild; EFG International AG (EFGN), controlled by Greek billionaire Spiro Latsis and his family; and Bern-based Valiant Holding AG. (VATN)
Banks expressed confusion over how the Justice Department will calculate penalties and treat lenders that are less culpable in hiding assets from the Internal Revenue Service, said Joshua Milgrim, an attorney at Dechert LLP.
To gain non-prosecution deals, banks must pay 20 percent of the value of accounts not disclosed to the IRS on Aug. 1, 2008, 30 percent for such accounts opened between then and February 2009 and 50 percent for accounts opened afterward.
“The view seems to be that the penalty rates for this program came out way too high,” said Milgrim, who is advising a Swiss bank. “A lot of banks are having difficulty deciding whether to go into a program which doesn’t take into account the level of culpability and instead treats all banks the same.”
Banks are also waiting to find out whether Switzerland’s financial supervisory authority Finma will encourage them to make provisions for costs related to the program and potential fines in this year’s accounts.
Basler Kantonalbank announced a 100 million Swiss franc ($112 million) provision on Dec. 19, while Credit Suisse has set aside 295 million francs for U.S. tax matters.
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Ex-Tiffany Executive Gets Year in Prison for Jewelry Thefts
A former Tiffany & Co. (TIF) executive who stole jewelry worth more than $2.1 million from the company and sold it was sentenced to a year and a day in prison.
Ingrid Lederhaas-Okun, a former Tiffany vice president of product development and design, was sentenced yesterday in Manhattan by U.S. District Judge Paul Gardephe, who called her eight-year series of thefts “inexplicable.”
Lederhaas-Okun pleaded guilty in July to one count of interstate transportation of stolen property, admitting that she stole at least 165 pieces of jewelry, including diamond rings, bracelets and diamond earrings, and sold them to a jewelry reseller.
“I can’t express my remorse enough,” Lederhaas-Okun, weeping, told the judge.
Gardephe rejected prosecutors’ request that Lederhaas-Okun be sentenced within federal guidelines, which called for a prison term of 37 months to 46 months. Lederhaas-Okun’s lawyer, Sabrina Shroff of the Federal Defenders of New York, asked Gardephe to give her client six months, citing her history of depression, aggravated by work disappointments and an inability to conceive a child.
Lederhaas-Okun worked for Tiffany almost 25 years. Her job, as vice president of product development and design, gave her authority to check out jewelry for work-related purposes. She was fired in February “as part of an overall downsizing” at the company, according to a complaint filed against her.
After she was fired, Lederhaas-Okun gave false explanations for what had happened to the missing jewelry, including that she had left it in her office and that it was lost or damaged.
She later admitted that she first stole a pendant from Tiffany in 2005. Over the next eight years, she stole jewelry items, sold them and kept the money.
Lederhaas-Okun’s husband announced he was seeking a divorce three weeks after her arrest, Shroff said.
In addition to the prison term, Gardephe ordered Lederhaas-Okun to serve a year of supervised release. She was also ordered to forfeit $2.1 million and to pay $2.2 million in restitution.
Lederhaas-Okun is turning all her assets over to the government, including her share of the equity in a $4.4 million house in Darien, Connecticut, that she had shared with her ex-husband, her bank accounts and retirement savings, Shroff said.
Gardephe agreed to a defense request that Lederhaas-Okun serve her sentence in a minimum-security prison camp in Alderson, West Virginia. Former prisoners at the camp include Martha Stewart, the Martha Stewart Living Omnimedia Inc. (MSO) founder jailed for lying about a stock sale, and Danielle Chiesi, a former securities analyst who pleaded guilty to insider trading.
The case is U.S. v. Lederhaas-Okun, 13-cr-00560, U.S. District Court, Southern District of New York (Manhattan).
CME Sues Ex-Executive Paulhac in Breach-of-Contract Case
CME Group Inc. (CME), the owner of the world’s largest derivatives marketplace, sued former Managing Director Laurent Paulhac for breach of contract, seeking to block him for a year from becoming chief executive officer of ICAP Plc (IAP)’s swap-execution facility.
CME claims in the lawsuit, filed in state court in Chicago, that it negotiated an agreement that would let Paulhac join ICAP’s global executive management team as of Dec. 2, while barring him from day-to-day activities until April 1, 2014.
On Dec. 16, CME learned that “Paulhac was acting in violation of this agreement, as well as his underlying employment agreement, and is, in fact, directly involved in the day-to-day activities of ICAP’s SEF and strategies related thereto,” according to the complaint.
CME said Paulhac breached the letter agreement over his employment at ICAP, as well as his employment contract at the company. It asks a judge to bar his work at ICAP for 12 months and award unspecified compensatory and punitive damages.
Paulhac’s attorney, Margaret E. Murray, didn’t immediately return a call seeking comment on the suit.
The case is CME v. Paulhac, Circuit Court of Cook County, Illinois (Chicago).
Law Firm Moves
Labor-and-Employment Lawyer Joins Paris Office of Morgan Lewis
Sabine Smith-Vidal, a lawyer with more than two decades of experience handling multijurisdictional labor and employment matters, joined Morgan Lewis & Bockius LLP as a partner in its Paris office.
Smith-Vidal, most recently an employment partner at Allen & Overy LLP, has counseled clients on day-to-day human resources matters, complex restructurings and reorganizations, employee disputes, pension plans and traditional union and management matters, according to a statement from Morgan Lewis.
“Sabine’s experience across Europe will serve well our multinational clients in their labor-and-employment law counseling and dispute-resolution needs,” said Francis M. Milone, the firm’s chairman.
Greenberg Traurig Adds Three Patent Lawyers From Weil Gotshal
Three patent litigators from the Houston office of Weil, Gotshal & Manges LLP are joining the Austin, Texas, office of Greenberg Traurig LLP.
Kevin Kudlac and Amber Lee Hagy are coming in as shareholders, while Rene Anthony Trevino is joining as of counsel. The three had worked together in Weil’s Houston office. Greenberg has had offices in Texas since 2003.
According to a statement from the firm, Kudlac focuses on patent disputes involving complex electrical and computer-related technology, and has handled cases involving operating system software, telecommunications software and hardware, financial transaction software, microprocessors, PC chipsets, computer memory, semiconductor processing technology, analog-to-digital converters and video software.
Hagy also litigates patent disputes at both the trial and appellate levels concerning a wide variety of technologies. Trevino had been a software engineer at International Business Machines Corp. before going to law school.
Earlier this month, Mark G. Davis, Stephen K. Shahida and Ronald J. Pabis joined Greenberg’s intellectual property and technology practice in Washington. The three lawyers also previously worked at Weil.
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