Legal Pad

State Lawyers: Assuming You Only Win, You Still Lose

No pressure, state lawyers. But if you could win all those lawsuits challenging California policies on furloughs, the prison population, redevelopment funding and social services cuts, the bean counters in Sacramento would be really grateful.

That’s because the Legislative Analyst’s Office, in a report issued today, says its projection of a staggering $21 billion budget deficit through 2011 assumes the state will prevail in every pending legal challenge tied to the state’s budget. If that assumption is wrong, unfavorable court decisions could put California several billion dollars more in the hole.

After the jump:  Hey, we practice law for love, not a fair wage, right?  Hello?

Jerry Brown's Secret Tapes Nowhere Near as Cool as Nixon's

Legal Pad isn’t sure whether to be offended or pleased not to have been among the reporters that AG Jerry Brown’s ex-flak, Scott Gerber, surreptitiously recorded.

Either way, the transcripts (.pdf) of those conversations between Brown and reporters, five of which have been made public by the attorney general’s office, make for some entertaining reading.

At times defensive, more often philosophical, Brown touches on his well-known family’s history, analyzes the governor’s race that he’s still not officially a part of, and mocks Hillary Clinton’s political resume.

"Didn't work with Mother Teresa," after the jump ...

“She didn’t work with Mother Theresa (sic),” a transcript of an April interview between Brown and an AP reporter reads. “She didn’t spend six months working in a Zen Buddhism. She didn’t take Linda Ronstandt (sic) to Africa. She didn’t have her own astronaut. I had Rusty Triker, an astronaut. I put him on the state energy commission.”

Later, he bristles at a reporter’s suggestion that soliciting thousands of dollars in charitable donations from businesses regulated by his office could pose the appearance of a conflict.

“The AG is enforcing environmental, labor, banking education … so you could say we regulate the entire state,” Brown says to a Los Angeles Times reporter. “… So by your logic, then, everyone is a question because the AG can sue anybody, and in fact does.”

A report (.pdf) released Monday night by the attorney general’s office concludes that Gerber acted alone when he recorded reporters’ conversations without their knowledge. Chief Assistant Attorney General Dane Gillette wrote that Gerber had been told in late 2008 by Chief Deputy Attorney General James Humes not to tape phone calls — Gillette doesn’t say what led Humes to issue the directive — but the press secretary did so anyway.

Gillette concludes, however, that Gerber didn’t break any laws because the reporters’ conversations did not constitute “confidential communications” that require a participant’s consent to recording.

Gerber, a former communications director for U.S. Sen. Dianne Feinstein, was Brown’s third press secretary in as many years.

— Cheryl Miller
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Judges, Cop-Types and Such Complain More About The A.O.C.

Early today — and less than 24 hours before a planned legislative hearing on the budgeting process of the state’s courts — a group of judges, court workers, law enforcement officials and children’s advocates held a telephone press conference to air their gripes about the state’s Administrative Office of the Courts.

While upset about an alleged lack of budget transparency, a growth in staff and a controversial computer system under development, the speakers mostly focused their complaints on the AOC’s decision to close courts one day a month.

“Our priorities have always been that the courts remain open under all circumstances,” Justice Thomas Hollenhorst, of Riverside’s Fourth District Court of Appeal, said. “But recently in our budget crisis, we’ve decided that accessibility is not as important as other issues.”

“That,” he added, “has a terrible effect on the court system.”

Erecting Taj Mahals amid the rapid financial decline, after the jump …

Gov to Federal Judges: You're With Me or You're Ruining California

If you’re a federal judge, don’t expect a Christmas card from the Schwarzenegger administration this year.

You see, he’s not happy about recent decisions that blocked budget cuts to in-home health care, required billions in new spending on prison hospitals and curbed water deliveries to the Central Valley.

“They are going absolutely crazy,” Schwarzenegger said at a press conference Wednesday. “So we have to have a very serious conversation with the federal government, because they’ve got to let us run our state.”

How can it be illegal if my lawyers are telling me it’s not illegal? Huh? … After the jump …

Lawyers Will Feel No Tension Over Pension Disclosure Law

Businesses that hire placement agents to secure investments from public pension funds will have to disclose how much they’re paying for the service under a new law signed by Gov. Arnold Schwarzenegger.

But the new rules won’t apply to law firms. They can continue retaining well-placed middlemen to press for lucrative securities class action work with the retirement funds, and they usually won’t have to report it.

An aide to the new law’s author, Assemblyman Ed Hernandez, D-West Covina, said the issue of law firms using placement agents never came up during the legislation’s development.

Well, that's convenient. Where the practice has been noticed, after the jump.

Governor vetoes State Bar dues bill

Channeling Pete Wilson, Gov. Arnold Schwarznegger late Sunday vetoed the State Bar’s annual dues bill, accusing the organization that represents 165,000 active lawyers of inefficiency and promoting a “political agenda.”

Schwarzenegger cited a July state auditor report that criticized significant increases in staff salaries and escalating disciplinary system costs despite a drop in cases. The governor also noted the discovery that a former Bar employee had embezzled $675,000 over eight years.

“As the organization charged with regulating the professional conduct of its members, the conduct of the State Bar itself must be beyond reproach,” Schwarzenegger wrote in an unusually lengthy veto message. “Regrettably, it is not.”

The governor takes on JNE, after the jump.

In Brown's Opinion, Governor Can Play Hardball

Legal opinions issued by the attorney general’s office are usually dishwater dull. But not the one Jerry Brown sent out today.

Brown was responding to lawmakers angered with Gov. Arnold Schwarzenegger’s threats to veto hundreds of bills by Sunday’s deadline if they don’t produce a water bill. Such a threat, they suggested in a letter to Brown, must surely amount to extortion.

Nope, Brown replied in his own letter today (.pdf). The governor’s veto is a long-recognized and powerful executive tool, the state’s top lawyer wrote. The separation of powers doctrine “counsels against” questioning the legality of the governor’s threats.

Brown goes on to cite several scholars and even quotes 19th century German President Otto van Bismark: “There are two things you don’t want to see being made – sausage and legislation.”

Brown’s closing line is the kicker, however. “Compromise in the rough-and-tumble legislative process is not achieved by doilies and tea.”

Spoken like a former, and would-be again, governor.

—  Cheryl Miller

How Silicon Valley Execs Do in Political Races

“If you can make it there, you can make it anywhere” was not written about Palo Alto or Menlo Park or Redwood City.

And that is because even if you’re a rich tech executive, it doesn’t mean you can get people to vote for you. As we take a look at Facebook lawyer Chris Kelly’s campaign (yes, it’s a campaign) for attorney general, let’s remind ourselves of all the other political wannabes from Silicon Valley.

Steve Westly: Former eBay exec funded his campaign for state treasurer — and won! Not so lucky when it came to the governor’s race.

Steve Poizner: High-tech exec couldn’t buy himself an assembly seat, but later won insurance commish and is now considered a threat in the governor’s race, according to the S.F. Chron.

Meg Whitman: Former eBay CEO never liked to vote — or register, for that matter. Now that she’s rich and all washed up in business, she’s discovered a passion for politics and is running for governor.

Carly Fiorina: Former CEO of HP has what everyone calls the worst campaign Web site ever. She’s going for Barbara Boxer’s senate seat or some edgy marketing award.

So you’re in good company Mr. Kelly. Or at least really wealthy company.

— Zusha Elinson

Panel's Tax Plan Would Lay Levy on Lawyers

A sweeping tax restructuring plan unveiled by a state panel today offered potentially good and bad news for lawyers.

The good news? The majority proposal (.pdf) by the Commission on the 21st Century Economy would scrap the 8.84 percent corporate tax as well as the state’s 5 percent sales tax.

The bad news? The plan would replace those taxes with the controversial business net receipts tax, a 4 percent levy on companies selling goods or services. Yes, lawyers, that means you.

Gov's Prison Plan Falls Short, Yet is 'Appropriate,' Says Corrections Chief

Matthew Cate isn’t donning contempt-able jail garb yet, but the state corrections secretary confirmed this afternoon that the governor’s prison plan won’t exactly comply with a three-judge panel’s order to reduce the inmate population by 40,000 over two years.

Instead, Cate told reporters, the state will reach that goal “eventually” — perhaps in five or six years.

“We think that we’ve done in our plan that we’re submitting today everything that we can legally do under state law that is both consistent with good corrections practice for a prison system and is consistent with public safety on the street,” Cate said. “I think we’ve done everything that’s appropriate.”

And if the three-judge panel doesn’t see it that way? Does Cate, a former prosecutor, fear being held in contempt by a court that has expressed frustration at the state’s slow approach to changing prison conditions?