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Tuesday, April 30, 2013
BU School of Law’s Semester-in-Practice Program
Video Conferencing for Lawyers
Source: http://legaltalknetwork.com/podcasts/law-technology-now/2012/05/video-conferencing-for-lawyers/
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Les News, 042813
Source: http://www.pinkisthenewblog.com/2013-04-28/les-news-042813
Ashton Kutcher Involved In A Violent Fight At The Stagecoach Music Festival
Emma Heming Emma Stone Emma Watson Emmanuelle Chriqui Emmanuelle Vaugier
Privacy: Donald Trump Can't Take a Joke (to Court)
Source: http://www.law.com/jsp/nlj/PubArticleNLJ.jsp?id=1202596653079&rss=rss_nlj
Taylor Swift's Ed Sheeran Duet Will Be Her Next U.K. Red Single
'Everything Has Changed' marks the next U.K. release off her massive 2012 album.
By Jocelyn Vena
Source:
http://www.mtv.com/news/articles/1706558/taylor-swift-ed-sheeran-duet-everything-has-changed.jhtml
Dominique Swain Donna Feldman Drea de Matteo Drew Barrymore Ehrinn Cummings
2011 Intellectual Property Year in Review and Outlook for 2012 - Part II: Trademarks
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Taking Control of Your Mobile Apps
Source: http://legaltalknetwork.com/podcasts/kennedy-mighell-report/2013/02/control-your-mobile-apps/
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Bungled Burglary
If you're going to burgle a joint, wouldn't you want to make sure nobody is home? As reported by wptv.com:
Juneem Barnes was taking a nap Thursday morning, when loud noises woke him up in his Port St. Lucie home. Police said those sounds were from would-be burglars.
"They were just making a lot of noise, and I was half-asleep," Barnes recalled. "Then they came in my room."Now it's on.
Port St. Lucie police say two teenagers had broken in and started packing up items to steal. At first, Barnes thought the alleged thieves were friends of his roommate, Devon Garcia.
"I thought it was him and his friends, just chilling," said Barnes. "But when they came in my room, they started running, and I'm like, why are they running? So I got up, and obviously they were trying to steal stuff out the house."
Police said the teens did run, but not before leaving behind a cell phone in Garcia's room.Bam!
"I found their cell phone, and it wasn't locked," said Garcia. "So I started going through it to see the calls, and stuff like that."
When Garcia saw a phone number titled 'MOM,' he called the number. Port St. Lucie police spoke with one of the teen's mother, who helped lead them to make the arrests.Click here for the source.
Source: http://rss.justia.com/~r/LegalJuiceCom/~3/EN2i8rxiuXY/post_654.html
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NYC Screening with Marie Claire
There was a screening in New York last night hosted by Marie Claire magazine. Here I am:
Milly Jacket, Theory blouse, J Brand jeans, Chloe shoes, Kate Spade earrings, and the handbag was a gift from my friend Caprice!
Source: http://www.prettyinthecity.com/blog/2011/9/28/nyc-screening-with-marie-claire.html
Amanda Bynes Amanda Detmer Amanda Marcum Amanda Peet Amanda Righetti
33 Reasons to Fall in Love with Channing on His B-day!
As the actor turns 33, feast your eyes on these sizzling pics of the hard-bodied hunk.
Emma Stone Emma Watson Emmanuelle Chriqui Emmanuelle Vaugier Emmy Rossum
Brainless Blunders in E-Discovery Searches
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Yes, I Am a Woman!
Someone posted this on Facebook and I find it so annoying.
Like, what? We're all just a bunch of bumbling idiots?
Here's my response:
No, no, no.
I don't push doors that say "pull" because I can read.
I don't explain why I'm laughing because I don't have to explain myself to anyone.
I don't walk into a room and forget why I went there because I'm not an idiot.
I don't count on my fingers because I'm smart enough to do it in my head.
I don't hide my pain from anyone because my feelings are valid and if I'm hurting, you'll know it.
I say it's a long story because some things are complex and dumbing them down doesn't serve anyone.
I cry a lot because I feel both pain and joy and it's awesome.
I don't care about people who don't care about me because I am not a doormat and I have worth.
I don't try to do things before the microwave beeps because I don't rush around the kitchen like a moron EVER.
I listen to you when you don't listen to me, but I won't do it for long so you better start listening.
And, yes, a hug can be nice, but showing me some respect is even better, so quit embracing me like a child and look me in the eye because YES, I AM A WOMAN!
Source: http://www.prettyinthecity.com/blog/2013/1/21/yes-i-am-a-woman.html
Anna Faris Anna Friel Anna Kournikova Anna Paquin AnnaLynne McCord
Legal Talk Network Live at LegalTechNY 2012-LexisNexis’ Loretta Ruppert on Launch of Firm Manager
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The Firm Leader – Mastering Difficult Conversations
Jared Leto's Peaceful Parisian Outing Crashed By Paparazzi And Admirers!
Ahh, the hard life of a rockstar!!!
30 Seconds to Mars frontman Jared Leto attempted to take some time away from his promotional tour for his new album, LOVE LUST FAITH + DREAMS, to enjoy the sights of Paris.
...that is until those pesky French papz found him!
There were also SWARMS of Jordan Catalano Jared lovers, but no word yet if any of them cut off a body part to add to his peculiar accessory collection! HA!
Guess he is a HOT commodity no matter what continent he is on!
[Image via AKM-GSI.]
Source: http://perezhilton.com/2013-04-29-jared-leto-paris-outing-paparazzi-fans
Monday, April 29, 2013
Les News, 042713
Source: http://www.pinkisthenewblog.com/2013-04-27/les-news-042713
Emmanuelle Chriqui Emmanuelle Vaugier Emmy Rossum Erica Leerhsen Erika Christensen
California Supreme Court Resolves Court of Appeal Split, Holding that Section 2010 of the California Corporations Code -- California's "Survival Statute" -- Does Not Apply to Foreign Corporations
In Greb v. Diamond Int’l Corp., 2013 WL 628328 (Cal. Feb. 21, 2013), the California Supreme Court unequivocally and unanimously laid to rest the assertion that dissolved foreign corporations may be sued in California after the time of the statute of limitations provided by the laws under which the foreign corporations were incorporated. In so holding, the California Supreme Court affirmed the California Court of Appeal for the First District’s dismissal of a personal injury claim against a dissolved Delaware corporation, holding that the claim was filed more than three years after dissolution of the corporation in violation of Delaware General Corporation Law Section 278 [blog article here]. In deciding that the California survival statute did not apply to foreign corporations, the Supreme Court resolved a split among California appellate courts on the interpretation of California Corporations Code Section 2010 (“Section 2010”), which governs the winding-up and survival of dissolved corporations.
In December 2008, plaintiffs Walter Greb (now deceased) and his wife Karen Greb filed a complaint for personal injuries and loss of consortium against defendant Diamond International Corporation (“Diamond”) and several other entities. Plaintiffs’ complaint alleged injuries from exposure to asbestos. Although Diamond had been dissolved for many years, plaintiffs sought recovery from unexhausted liability insurance that covered defendant during the decades when it did business in California. Diamond demurred to plaintiffs’ complaint, alleging that more than three years earlier, in July 2005, it had obtained a corporate dissolution pursuant to the laws of Delaware, Diamond’s state of incorporation. Accordingly, Diamond argued, pursuant to Delaware’s three-year survival statute, when plaintiffs filed their complaint in December 2008 Diamond lacked the capacity to be sued. Plaintiffs opposed the motion, arguing that they were entitled to file a lawsuit in California under Section 2010, which permits lawsuits to be filed against a dissolved corporation irrespective of the date of dissolution, which they asserted took precedence over Delaware law in this setting.
The California Superior Court for the County of San Francisco held Section 2010 did not apply to foreign corporations, and hence that Delaware’s corresponding statute applied to Diamond. Accordingly, the trial court sustained the demurrer without leave to amend, and dismissed plaintiffs’ complaint with prejudice. On appeal, the Court of Appeal affirmed. It followed the interpretation of Section 2010 set out in dicta in two prior Court of Appeal decisions — North American Asbestos Corp. v. Superior Court, 128 Cal. App. 3d 138 (1982) (“North American I”), and Riley v. Fitzgerald, 178 Cal. App. 3d 871 (1986) — and disagreed with the holding concerning the statute set out in a third Court of Appeal decision, North American Asbestos Corp. v. Superior Court, 180 Cal. App. 3d 902 (1986) (“North American II”). The Supreme Court granted review to resolve the conflict.
Section 2010 provides:
A corporation which is dissolved nevertheless continues to exist for the purpose of winding up its affairs, prosecuting and defending actions by or against it and enabling it to collect and discharge obligations, dispose of and convey its property and collect and divide its assets, but not for the purpose of continuing business except so far as necessary for the winding up thereof.
The parties in Greb agreed that if Section 2010 did not apply to a dissolved foreign corporation, Diamond’s capacity to be sued would be governed solely by Delaware’s corresponding survival statute (8 Del. Code § 278), which would bar plaintiffs’ claims against Diamond. If, on the other hand, Section 2010 applied to a dissolved foreign corporation, a court would then be required to perform a choice-of-law analysis in order to determine which state’s law should apply and govern Diamond’s capacity to be sued.
The Supreme Court analyzed the conflict in the appellate decisions to determine whether Section 2010 applied to dissolved foreign corporations. The Supreme Court noted that the courts in both North American I and Riley reasoned that statutory provisions and history lead to the conclusion that Section 2010 does not apply to suits against dissolved foreign corporations. The court in North American II, however, reached a different conclusion. The majority in North American II held that “some of the history behind [Section 2010] and related provisions of corporation law” led to the conclusion “that section 2010 should not be so read under the circumstances of the case at bench, but should be read to protect the interests of California.” The majority in North American II also believed that the Legislature intended all of the various sections within the applicable code section to apply generally to both domestic and foreign business corporations.
The Supreme Court agreed with North American I and Riley, and disagreed with North American II. As the Supreme Court observed, the majority in North American II did not address Riley, which had been decided less than two months earlier. The Supreme Court also noted that the leading treatises and the majority of out-of-state decisions during the era when the code sections were enacted had held that a state’s survival statute typically does not apply to foreign corporations. “[I]n light of the national scope of the comprehensive review that preceded the legislation,” the Supreme Court reasoned, “if our Legislature had contemplated such a dramatic change from the majority approach, we would expect it to have been clear in doing so.” Thus, the Supreme Court concluded that Section 2010 did not apply to foreign corporations, and disapproved of North American II to the extent it held otherwise. Having reached that decision, the Supreme Court did not perform a choice-of-law comparative-impairment analysis in order to determine which state’s law should apply.
In deciding that the survival statute did not apply to foreign corporations, the court resolved a split among California appellate courts on the matter. The Supreme Court noted, “[t]he policy question concerning whether the provisions of California’s survival statute should apply to foreign as well as domestic corporations is properly a matter to be determined by the Legislature, not this court.” It remains to be seen whether the Legislature will enact legislation that might undo Greb.
For further information, please contact John Stigi at (310) 228-3717 or Taraneh Fard at (213) 617-5492.
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Mitch Winehouse Thinks AndrĂ© 3000′s Verse On The ‘Back To Black’ Cover Is ‘Terrible’
Diane Kruger Dido Diora Baird Dita Von Teese Dominique Swain
Are Social Media Sites Discoverable?
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Deal Averts Trial for Moody's, S&P in Suits over SIV Ratings
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One Direction Prepping Album For Christmas Release?
Louis Tomlinson says band has been in studio for a month already.
By Gil Kaufman
One Direction
Photo: Getty Images
Source:
http://www.mtv.com/news/articles/1706451/one-direction-new-album-christmas.jhtml
Daisy Fuentes Dania Ramirez Danica Patrick Daniella Alonso Danneel Harris
Emma Watson In New 'Bling Ring' Trailer: Watch Now!
'I want to rob,' the 'Harry Potter' alum says in latest preview of Sofia Coppola film.
By Terri Schwartz
Source:
http://www.mtv.com/news/articles/1706227/emma-watson-bling-ring-new-trailer.jhtml
Proactive E-Discovery Management
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Chris Brown Taking Jennifer Lopez Back To The Block For Her Next Album
J.Lo opens up about 'getting that whole "Jenny from the Block" flavor back' with Brown on their upcoming collaboration.
By Jocelyn Vena
Jennifer Lopez and Chris Brown
Photo: Getty Images
Source:
http://www.mtv.com/news/articles/1706494/chris-brown-jennifer-lopez-collaboration.jhtml
Chandra West Charisma Carpenter Charli Baltimore Charlies Angels Charlize Theron
Affirmative action ban in state constitution violates US constitution (8-7)
Michigan voters adopted a state constitutional amendment that prohibits "all sex- and race-based preferences in public education, public employment, and public contracting."
The 6th Circuit (8-7) held this provision - as it relates to education - violates the 14th amendment's equal protection clause.
Coalition to Defend Affirmative Action v. Univ of Michigan (6th Cir 11/15/2012)
(Plaintiffs limited their challenge to racial discrimination in public education.)
The court said that a black applicant could seek adoption of a constitutionally permissible race-conscious admissions policy only through the "lengthy, expensive, and arduous process" of amending the state constitution. On the other hand, someone wishing to change any other aspect of a university's admissions policy has four options - lobby the admissions committee, petition the leadership of the university, seek to influence the school's governing board, or initiate a statewide campaign to alter the state's constitution.
"The existence of such a comparative structural burden undermines the Equal Protection Clause's guarantee that all citizens ought to have equal access to the tools of political change."
Seven judges wrote five DISSENTING opinions. Six said that the majority relied on two US Supreme Court cases that "have no application here," and one said that the majority relied on "an extreme extension" of those cases. The cases are Hunter v. Erickson, 393 US 385 (1969), and Washington v. Seattle Sch Dist, 458 US 457 (1982).
Source: http://www.lawmemo.com/blog/2012/11/affirmative_act.html
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Big Pun's Capital Punishment Still Not A Sleeper, 15 Years Later
With the critical and commercial success, Pun became the first Latino rapper to go platinum.
By Rob Markman
Source:
http://www.mtv.com/news/articles/1706445/big-pun-capital-punishment-anniversary.jhtml
Jessica Biel Jessica Cauffiel Jessica Paré Jessica Simpson Zooey Deschanel
Wowza! Gwyneth Shows Major Skin in a See-Through Dress
The actress rocks a daring look at the Iron Man 3 premiere! Plus, check out more pics of your favorite stars on the scene.
Heidi Klum Heidi Montag Hilarie Burton Hilary Duff Hilary Swank
LawBiz® Legal Pad: Marketing Plan 101
Ed reveals how to define your target market and the tactics necessary to reach it.
Source: http://feeds.lexblog.com/~r/LawBizBlog/~3/3o2HK-htEOY/
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Chris Brown’s Father Has Some Sense
Hey, sometimes you have to turn to your old man for some wisdom. In this case, I doubt Chris Brown will, but maybe he should. Even his own father is admitting that it’s a terrible idea for Brown and Rihanna to get back together. I like this guy already.
If you’re like me, and you almost threw up your dinner when you read that Chris Brown and Rihanna were considering giving their relationship another try, this article is soothing.
Let’s call it Chicken Soup for the Celeb News Junkie’s Soul. That’s right, everyone online has been writing mean things about Chris Brown from the minute he was arrested for beating Rihanna. He has not been in the good favor of any news source from here to New Zealand — and for good reason!
He was found guilty, and didn’t show remorse until it was literally wrung out of him.
So why…in…the…hell would they get back together?! It’s very frustrating.
Here is what the elder Brown had to say:
“I personally really didn’t want him and Rihanna back together…You have to have a balance in a relationship. You have to have someone who is spontaneous and whimsical but you also have to have someone who is grounded and logical…I hate to use examples, but Michael Jackson, Whitney Houston and Amy Winehouse – I mean I could go on and on!”
Okay, so maybe it’s a little messed up to compare your son’s girlfriend to some of the most tragic losses in the music industry, but he is trying to make a point.
Now the only question is will Chris listen? My instincts tell me that he won’t. The real reason is because he totally blew his chances with a celebrity by beating her to a pulp. He will only be able to land the nasty groupie girls at this point, so he has to work his magic with his former flame.
That’s just my take on it. What are your thoughts?
Pictures: PR Photos
Source: http://feedproxy.google.com/~r/RightCelebrity/~3/97UdOOxJTLM/
The Fiscal Cliff: Impact of the Deal
Source: http://legaltalknetwork.com/podcasts/ringler-radio/2013/01/the-fiscal-cliff-impact-of-the-deal/
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Amanda Bynes Shaves Her Head
Source: http://www.pinkisthenewblog.com/2013-04-26/amanda-bynes-shaves-her-head
Brittany Snow Brittny Gastineau Brody Dalle Brooke Burke Brooke Burns
Robert Owen on E-Discovery Rules Changes
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Sunday, April 28, 2013
Beyonce Takes Blue Ivy to Lunch in Paris!
The superstar mom grabs lunch with her hubby and little girl! Plus, see more photos of celebs spending time with their loved ones.
Les News, 042713
Source: http://www.pinkisthenewblog.com/2013-04-27/les-news-042713
Legal Issues Created by Story World Communities and Transmedia
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Ontario judge rules woman must remove veil to testify
Source: http://jurist.org/paperchase/2013/04/ontario-judge-rules-woman-must-remove-veil-to-testify.php
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33 Reasons to Fall in Love with Channing on His B-day!
As the actor turns 33, feast your eyes on these sizzling pics of the hard-bodied hunk.
Essential iPad Apps for Lawyers
Source: http://legaltalknetwork.com/podcasts/kennedy-mighell-report/2012/06/essential-ipad-apps-for-lawyers/
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First Look: Mariah Carey Releases A Teaser For Her New Song With Miguel, Titled ‘Beautiful’
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Emma Watson In New 'Bling Ring' Trailer: Watch Now!
'I want to rob,' the 'Harry Potter' alum says in latest preview of Sofia Coppola film.
By Terri Schwartz
Source:
http://www.mtv.com/news/articles/1706227/emma-watson-bling-ring-new-trailer.jhtml
Bijou Phillips Blake Lively Blu Cantrell Bonnie Jill Laflin Bridget Moynahan
The iPad Practice
Source: http://legaltalknetwork.com/podcasts/un-billable-hour/2012/08/the-ipad-practice/
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Tom Cruise Stages Return To Box-Office #1 With 'Oblivion'
Sci-fi flick is expected to take in more than $30 million this weekend.
By Ryan J. Downey
Tom Cruise in "Oblivion"
Photo: Chernin Entertainment
Source:
http://www.mtv.com/news/articles/1706010/tom-cruise-oblivion-box-office.jhtml
Christina DaRe Christina Milian Christina Ricci Chyler Leigh Ciara
Will Lawyers Always Be Late Adopters?
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Neeraj Rajpal on MoFo's IT Overhaul
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Emma Watson In New 'Bling Ring' Trailer: Watch Now!
'I want to rob,' the 'Harry Potter' alum says in latest preview of Sofia Coppola film.
By Terri Schwartz
Source:
http://www.mtv.com/news/articles/1706227/emma-watson-bling-ring-new-trailer.jhtml
'Pain & Gain': The Reviews Are In!
Director Michael Bay tones it down for this based-on-real-life story, with mixed results.
By Amy Wilkinson
Dwayne Johnson and Mark Wahlberg in "Pain & Gain"
Photo: Paramount Pictures
Source:
http://www.mtv.com/news/articles/1706365/pain-and-gain-movie-reviews.jhtml
Gretha Cavazzoni Gwen Stefani Halle Berry Hayden Panettiere Haylie Duff
Going To The Well ... Three Times Too Often?
If this dude is a sports fan, here's guessing that his favorite cliche is the one about running a successful play over and over until the opposing team stops it. Now, It may be useful in sports, but in crime? Not so much. Especially crimes against property ... As reported in The Spectator [Hamilton, Ontario]:
Police had staked out a Subway restaurant on Lake Street Tuesday that’s been robbed three times before, when a man robbed the Esso gas bar next door at Scott Street.
The suspect was nabbed with the cash running from the gas bar. Turns out, detectives say the man is the same one who’s hit the Subway so often.
A 38-year-old St. Catharines man has been charged with four counts of robbery and was scheduled to appear in St. Catharines court Wednesday.Doh!
Source: http://rss.justia.com/~r/LegalJuiceCom/~3/Wc1hnlIh_a8/post_650.html
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Jason Aldean Splits From Wife Months After Cheating Scandal
Jason Aldean Splits From Wife Months After Cheating Scandal
Country singer Jason Aldean has split from his wife just months after he was photographed kissing “American Idol” contestant Brittany Kerr in September. There were already marital problems before the incident and the couple have lived apart since January. The 36-year-old singer and his childhood sweetheart Jessica Ussery tried to work on their marriage, despite ...
Jason Aldean Splits From Wife Months After Cheating Scandal Stupid Celebrities Gossip Stupid Celebrities Gossip News
Source: http://stupidcelebrities.net/2013/04/jason-aldean-splits-from-wife-months-after-cheating-scandal/
Daniella Alonso Danneel Harris Deanna Russo Denise Richards Desiree Dymond
Christina Aguilera's Body Transformation in 12 Photos
When she emerged onto the pop scene in the late '90s, Christina Aguilera caught the attention of the media, and she's remained in the headlines ever since. The former Mickey Mouse Club star has gone from stick-skinny to voluptuous and curvy -- and back again. But her beauty and confidence is always there, no matter what!
Erika Christensen Estella Warren Esther Cañadas Eva Green Eva Longoria
Germany top court upholds terrorism database
Source: http://jurist.org/paperchase/2013/04/germany-top-court-upholds-terrorism-database.php
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Saturday, April 27, 2013
Scarlett Johansson Considers Kicking Ass In 'Lucy'
Luc Besson has found a new butt-kicking lady to lead his next film: Scarlett Johansson. The "Don Jon's Addiction" actress is in final negotiations to play the main character in Besson's next film, "Lucy."
The action thriller is about a woman forced to become a mule for a drug that ends up transforming her into someone with superhuman powers, The Hollywood Reporter explains. According to the site, the female character can "absorb knowledge instantaneously, is able to move objects with her mind and can't feel pain and other discomforts."
Though this isn't a done deal, Johansson is definitely someone we'd love to see work with Besson. She's proved she's got the stuff of an action hero thanks to "Iron Man 2" and "The Avengers," and he showed us all how great his heroines can be in "The Fifth Element," so they definitely would work well together. Plus Besson is great with action tales in general, and we'd love to see him work the same magic for Johansson that he did for Liam Neeson in "Taken."
Besson both wrote the script and will direct "Lucy." If Johansson takes the gig, she will film "Lucy" after she's done with "Captain America: The Winter Soldier." No word yet on when the movie will hit theaters, but it will be distributed by Universal Pictures.
Do you think Johansson and Besson are a good fit? Tell us in the comments section below or on Twitter!
Source: http://moviesblog.mtv.com/2013/04/26/scarlett-johansson-lucy/
Medicare Set Aside Arrangements and Mass Torts
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Scarlett Johansson Covers The May Issue Of ‘Marie Claire’ Magazine
Source: http://www.pinkisthenewblog.com/2013-04-27/scarlett-johansson-covers-the-may-issue-of-marie-claire
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United States Supreme Court Declines to Apply the "Discovery Rule" to Extend the Five-Year Statute of Limitations for SEC Punitive Fraud Enforcement Actions
In Gabelli v. Securities & Exchange Commission, No. 11-1274, 2013 WL 691002 (U.S. Feb. 27, 2013), the United States Supreme Court, in a unanimous opinion by Chief Justice Roberts, held that the five-year statute of limitations for the Securities & Exchange Commission (“SEC”) to bring a civil suit seeking penalties for securities fraud against investment advisers, codified in 28 U.S.C. § 2462 (“Section 2462”), begins to run when the alleged fraud occurs, not when it is discovered. In so holding, the Supreme Court refused to extend to Government civil penalty enforcement actions the “discovery rule,” which starts the clock on the statute of limitations for civil fraud actions when plaintiff should have reasonably discovered the fraud. The Supreme Court’s decision thus limits the authority of the SEC to seek civil penalties with respect to conduct that occurred more than five years before investigators took action.
In April 2008, the SEC sought civil penalties from petitioners Alpert and Gabelli under the Investment Advisers Act of 1940, which provides that it is unlawful for an investment adviser “to employ any device, scheme, or artifice to defraud any client or prospective client” or “to engage in any transaction, practice, or course of business which operates as a fraud or deceit upon any client or prospective client.” 15 U.S.C. § 80b-6(1), (2). The complaint alleged that petitioners aided and abetted investment adviser fraud from 1999 until 2002. Petitioners moved to dismiss, arguing in part that the civil penalty claim was untimely. Invoking the five-year statute of limitations in Section 2462, they pointed out that the complaint alleged illegal activity up until August 2002 but was not filed until April 2008. The United States District Court for the Southern District of New York agreed and dismissed the civil penalty claim as time-barred. The United States Court of Appeals for the Second Circuit reversed, accepting the SEC’s argument that because the underlying violations sounded in fraud, the “discovery rule” applied, meaning that the statute of limitations did not begin to run until the SEC discovered or reasonably could have discovered the fraud.
The Supreme Court reversed and remanded. The Court explained that “in common parlance a right accrues when it comes into existence” and that the “standard rule” is that a claim accrues “when the plaintiff has a complete and present cause of action.” The Court reasoned that such a reading sets a fixed date when exposure to the specified Government enforcement efforts ends, advancing “the basic policies of all limitations provisions: repose, elimination of stale claims, and certainty about a plaintiff’s opportunity for recovery and a defendant’s potential liabilities.” Nonetheless, citing Merck & Co. v. Reynolds, 130 S. Ct. 1784 (2010) [see blog article here], the Court noted that “the discovery rule” doctrine is an “exception” to the standard rule, and delays accrual “until a plaintiff has actually discovered or a reasonably diligent plaintiff would have discovered the facts constituting the violation—whichever comes first.” The Supreme Court observed that this “exception” arose from the recognition that “something different was needed in the case of fraud, where a defendant’s deceptive conduct may prevent a plaintiff from even knowing that he or she has been defrauded.” Thus where a plaintiff has been injured by fraud and “remains in ignorance of it without any fault or want of diligence or care on his part, the bar of the statute does not begin to run until the fraud is discovered.”
The Court, however, drew a distinction between the former and the facts of this case. The Court noted that it has never applied the discovery rule in the context “where the plaintiff is not a defrauded victim seeking recompense, but is instead the Government bringing an enforcement action for civil penalties.” In this situation the Supreme Court noted that “there are good reasons why the fraud discovery rule has not been extended.”
First, the Supreme court noted that the discovery rule exists in part to preserve the claims of parties who have no reason to suspect fraud. The Government is a different kind of plaintiff. The SEC’s very purpose, for example, is to root out fraud, and it has many legal tools at hand to aid in that pursuit. Second, the Government in these types of cases also seeks a different type of relief. The discovery rule helps ensure that the injured receive recompense, but civil penalties go beyond compensation, are intended to punish, and label defendants as wrongdoers. Third, emphasizing the importance of time limits on penalty actions, the Supreme Court reiterated that it would be “utterly repugnant to the genius of our laws” if actions for penalties could “be brought at any distance of time.” Thus, grafting the discovery rule onto Section 2462 would raise similar concerns; it would “leave defendants exposed to Government enforcement action not only for five years after their misdeeds, but for an additional uncertain period into the future.” Finally, repose would hinge on speculation about what the Government knew, when it knew it, and when it should have known it. Deciding when the Government knew or reasonably should have known of a fraud would present particular challenges for the courts, such as determining who the relevant actor is in assessing Government knowledge, whether and how to consider agency priorities and resource constraints in deciding when the Government reasonably should have known of a fraud, and so on. Thus, the Supreme Court held that applying a discovery rule to Government penalty actions is “far more challenging” than applying the rule to suits by defrauded victims, and the Court declined to do so.
The Supreme Court’s decision effectively limits the authority of the Government’s top securities regulator to seek civil penalties over conduct that occurred more than five years before investigators took action. It is important to note that the decision only applies to cases where the SEC is seeking a fine for wrongdoing; it does not disturb the “discovery rule” for private plaintiffs, who can sue within five years of discovering they have been defrauded.
For further information, please contact John Stigi at (310) 228-3717 or Taraneh Fard at (213) 617-5492.
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