Legal News for Thurs 11/14 - Gaetz for AG (LOL), Menendez Trial Error, Wang's Fraud Detection Tool, NY Ivory Law and Law Firm Revenue

Minimum Competence

This Day in Legal History: Guiteau Stands Trial for Assassination

On November 14, 1881, Charles Guiteau stood trial for assassinating President James A. Garfield. Garfield had been shot by Guiteau in July of that year but succumbed to his injuries months later, largely due to medical mismanagement. At the time, sterilization practices were not widely understood or practiced, and Garfield’s doctors repeatedly probed his wound with unwashed instruments and hands, leading to a fatal infection. Despite the role of inadequate medical care, Guiteau was held fully responsible for the president’s death, setting a notable precedent in criminal law.

Guiteau’s defense centered on claims of insanity, arguing that he believed he was acting on divine command to remove Garfield. His erratic behavior in court, which included singing, reciting poetry, and accusing his defense attorneys of incompetence, underscored his unstable mental state. However, nineteenth-century legal standards for insanity were narrow and rarely accepted by courts. The prosecution argued that Guiteau understood the wrongfulness of his act, and he was ultimately found guilty and sentenced to death.

The case spotlighted serious deficiencies in the legal system’s treatment of mental illness and brought attention to the need for clearer guidelines on the insanity defense. It also ignited a broader conversation on the role of medical practices in causation, as some questioned whether Guiteau could be solely responsible for Garfield’s death. Guiteau’s trial and conviction marked one of the first high-profile uses of the insanity defense in the United States and influenced subsequent legal reforms regarding both mental health assessments and standards of criminal responsibility.

President-elect Donald Trump has named Matt Gaetz, a firebrand Republican congressman with a face that might terrify even the devil himself, as his nominee for attorney general. Gaetz, who has previously faced scrutiny from the Justice Department over sex trafficking allegations, will replace current leadership to help Trump “end Weaponized Government” and enact an aggressive conservative agenda. Gaetz, who resigned from Congress immediately, is known for his unconventional political moves, including his role in ousting former House Speaker Kevin McCarthy, and for his call to dismantle federal agencies like the FBI. His appointment has already triggered controversy, with Senate Republicans like Lisa Murkowski expressing skepticism about his qualifications and intentions. Gaetz’s background has raised security clearance concerns, given the history of investigations into his conduct.

The nomination aligns with Trump’s stated intentions to reshape the Justice Department, positioning the attorney general as crucial to plans for mass deportations, pardons of January 6 rioters, and prosecutorial retribution. Gaetz’s legal experience consists mainly of work at a Florida law firm before he entered politics, though he has recently championed populist stances on antitrust enforcement, supporting the Federal Trade Commission’s fight against noncompete clauses and cheering the Justice Department’s antitrust case against Google. Gaetz's nomination fuels concern among former Justice Department officials, who fear that he could further politicize an institution traditionally independent from White House influence.

Trump taps firebrand congressman Matt Gaetz for attorney general | Reuters

In the corruption trial of former U.S. Senator Robert Menendez, prosecutors revealed that jurors were mistakenly shown unredacted evidence during deliberations. However, they argued this error does not warrant overturning the conviction, asserting that the evidence against Menendez was overwhelming. Menendez, a former New Jersey senator, was convicted in August of corruption charges that included accepting bribes like gold bars and cash, allegedly in exchange for political favors. He has maintained his innocence and plans to appeal.

The Manhattan U.S. Attorney’s Office indicated that both the defense and prosecution missed the unredacted material during trial, emphasizing that it likely did not affect the jury's guilty verdict on all 16 counts, including wire fraud, obstruction of justice, and illegal foreign agency activities. Menendez, once a senior figure in the Senate as the chair of the foreign relations committee, now faces sentencing in January with a potential for decades in prison.

Bob Menendez jury was mistakenly shown improper evidence, prosecutors say | Reuters

Gary Wang, former chief technology officer of FTX, is assisting federal prosecutors by developing software to detect fraud in both stock and cryptocurrency markets. Wang, who previously wrote the code allowing ex-FTX CEO Sam Bankman-Fried to siphon billions from FTX customers, has been cooperating with the government since FTX’s collapse.

Prosecutors are asking for leniency in Wang’s upcoming sentencing, highlighting his proactive efforts to prevent similar crimes. His new tool, details of which remain confidential to protect its effectiveness, is valued by prosecutors for its potential in identifying financial crimes. This cooperation follows Bankman-Fried’s recent 25-year prison sentence for fraud and misuse of $8 billion in customer funds, while other former FTX associates, like Caroline Ellison and Nishad Singh, received lighter sentences due to their cooperation.

Wang, the last of Bankman-Fried’s close associates awaiting sentencing, was instrumental in exposing the scheme by testifying that Bankman-Fried directed him to alter FTX’s code to grant Alameda Research unauthorized access to customer funds.

Bankman-Fried lieutenant builds fraud detection tool for prosecutors | Reuters

A federal appeals court has struck down a New York law that heavily restricted antiques dealers from selling or displaying ivory and rhinoceros horn items, ruling it unconstitutional. The 2nd U.S. Circuit Court of Appeals found that the law, which limited ivory content in antiques to less than 20%, overstepped by restricting dealers’ First Amendment commercial speech rights.

Judges argued that the law prevented dealers from communicating important details about legally marketable items, deeming this an excessive speech restriction. While federal law already restricts ivory sales under the Endangered Species Act, it allows for goods with up to 50% ivory, whereas New York’s stricter limit of 20% was intended to curb poaching of endangered species. However, the court ruled that New York’s law also blocked the sale of items permitted in interstate and international trade, making it too broad. The decision was a setback for animal rights groups that supported the law to protect vulnerable wildlife, although the Humane Society noted that New York could still enforce the law against local buyers.

New York ivory ban for antiques dealers voided by US appeals court | Reuters

Law firm revenue surged nearly 12% in the first three quarters of the year, driven by increased demand for legal services and higher productivity, according to Citi’s law firm banking group. The top 50 law firms saw especially notable gains, with revenues up 14%, demand growth at 3.6%, and productivity rising by 2.9%. Gretta Rusanow from Citi’s Law Firm Group highlighted 2023 as potentially one of the strongest years for the industry, citing steady demand momentum quarter by quarter.

Industry-wide demand rose by 3.2%, with lawyer productivity improving as headcount growth slowed to 1.3%, returning to historical norms. Expense growth was 7.5%, with overhead costs increasing by 8.2% and compensation expenses by 6.7%.

Legal services demand spanned diverse practice areas, notably in litigation, regulatory issues, investment management, and bankruptcy. Although transactional demand has been quiet, Rusanow anticipates a rebound in mergers and acquisitions activity. Law firms also invested in technology upgrades, including new practice management tools and generative AI, which contributed to higher expenses.

Law Firm Revenue Soars 12% as Lawyers Get Back to Being Busy

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