July 2006B O I E S ,S C H I L L E RNEW YORK WASHINGTON DC&F L E X N E RL L PFLORIDA CALIFORNIA NEW HAMPSHIRE NEW JERSEY NEVADAVolume 1, Issue 2GOVERNOR BLANCO PRAISES BS&F FORAIDING LOUISIANA IN KATRINA’S WAKEFirm ReportInside this issue:Summer Associates2Litigation Highlights 3Pro Bono Highlights 6Items of Interest8From September through December 2005,a team of BS&F lawyers worked hours withLouisiana Governor Kathleen Blanco on a probono basis to assist the Governor in a federalinvestigation into Louisiana’s response to Hurricane Katrina. Governor Blanco expressedher gratitude for the “tireless[]” work performed “with great skill” in a letter sent to thefirm on April 6, 2006. (Governor Blanco’sletter is reprinted inside on page 10.)Following the highly criticized response ofFEMA and its former chief, Michael Brown, toHurricane Katrina, the House and Senateturned their attention to state and local effortsto respond to the disaster. The BS&F teamorganized and reviewed thousands of documents in an expedited discovery process. Thefirm also prepared Governor Blanco for appearances before the House and Senate. Aspart of its work,“one of the mostBS&F was provided a rare, close- difficult publicup look by themanagement jobsLouisiana Nationalany governor hasGuard of Hurriever faced”cane Katrina’sdevastation.The BS&F team arrived in Baton Rougejust after Katrina had hit. The confluence oftwo storms – Katrina and the political aftermath – created, according to Paul Verkuil,“one of the most difficult public managementjobs any governor has ever faced. [We provided] constant responses to unplanned eventsin circumstances where many of the participants were stretched thin and devastated.”Paul Verkuil, Bill D’Zurilla and GibsonVerkuil led a team of the firm’s lawyers.Steve Zack: BS&F’s Person In Miami And a Leader of The ABA“I welcome theopportunity towork to strengthenthe rule of law andhuman rightsthrough the ABA”Miami Partner Steve Zack emigrated fromCuba at the age of 14 and has not slowed downsince. The first Hispanic American to serve as astate and national bar association Chairman,Steve is currently in the middle of a two yearterm as the Chair of the ABA’s House of Delegates – one of the nation’s most influential positions on matters relating to the legal profession.“Loss of liberty is not a theoretical threat tome,” Zack says. It is the reason why he takeshis responsibilities as chair of the House of theassociation – the largest voluntary professionalmembership association in the world and thevoice of the legal profession – so seriously. “Assomeone whose family had to flee the dictatorship of Cuba that abolished the rule of law, Iwelcome the opportunity to work to strengthenthe rule of law and human rights through theABA’s efforts.”Believing that the rule of law is strengthened through healthy discourse, Zack established the noted “Emerging Issues Committee,”which presents to the House a variety of opinions on hot button issues. In the wake ofheated political demands for the impeachmentof judges related to the Terry Schiavo controversy, the first topic Zack helped the committeefocus on was judicial independence, featuringSupreme Court Justice Stephen Breyer, SouthCarolina Sen. Lindsey Graham and former Solicitor General Ted Olsen.The Chairmanship is only the latest milemarker in Steve’s long and distinguished career.Among other accomplishments, Steve hasserved as chair of the Florida Ethics Committee, was appointed by Gov. Lawton Chiles tothe board responsible for re-writing the Floridaconstitution, was elected President of the Florida Bar, and was involved in the creation of theCuban-American Bar Association.

Page 2Volume 1, Issue 22006 Summer AssociatesWelcome, Summer Associates!The firm is pleased to welcome our summer associates, adiverse group representing 12 law schools. This summer’sclass includes, among others, an officer in the Merchant Marine Reserve, a three-time Indiana power-lifting champion,two Habitat for Humanity volunteers, a Maryland amateurchampion golfer, a competitive gymnast, a small-businessAlbany:Armonk:Ft. Lauderdale:Robert M. Annis (Cornell, ‘08)Christopher Cooper (Cornell, ‘08)Matthew H. Baer (Cardozo, ‘07)Quinn D. Curtis (Yale, ‘08)Sargon Daniel (Columbia, ‘07)Russell M. Franklin (Harvard, ‘07)Michael Helfand (Yale, ‘07)Marguerite Hogan (Boalt Hall, ‘07)Nicole A. Kersey (UVA, ‘07)Tzvi N. Mackson (Cardozo, ‘07)Eugene Nardelli (Yale, ‘07)James B. Orthwein (Washington,‘07)Ognjen Z. Radic (Columbia, ‘07)Lauren A. Salvati (Harvard, ‘07)Matthew J. Senatore (Harvard, ‘07)Jon Steitz (Yale, ‘07)Jacqueline Yecies (Columbia, ‘08)Andrew E. Steif (UF, ‘07)owner who began his own sports card and memorabilia business, and several fluent speakers of foreign languages, including Croatian and Aramaic. The summer associates for eachoffice are listed below.Miami:Adam E. Zeidel (NYU, ‘07)New Hampshire: Vivian R. Mills (Columbia, ‘06)New Jersey:Roshni Chaudhari (Chicago, ‘08)New York City:Bridget E. Brown (Columbia, ‘07)John LaSalle (UVA, ‘07)Grant T. Mandsager (NYU, ‘08)Benjamin J. Widlanski (Columbia, ‘07)Scott R. Wilson (Columbia, ‘07)Oakland:Laura M. Alexander* (Georgetown, ‘07)Washington, DC: Bryan J. Caforio (Yale, ‘08)James Kvaal (Harvard, ‘07)Michael S. Mitchell (Catholic, ‘07)Lisa Perez (UVA, ‘07)Joshua Riley (Harvard, ‘07)Eli S. Rosenbaum (Harvard, ‘08)Michael Thompson (Harvard, ‘08)*Ms. Alexander is splitting her summer between the Washington DC and Oakland offices.

Page 3Volume 1, Issue 2Litigation HighlightsBS&F Successfully Settles Substantial False Claims Act CaseAs featured in the July issue of The American Lawyer, lawyers from BS&F were instrumental in resolving a large FalseClaims Act case against Medco Health solutions, Inc. andothers. The case was filed in the United States District Courtfor the Eastern District of Pennsylvania. After the Government intervened, the firm’s attorneys worked closely withmembers of the United States Attorney’s Office for the Eastern District of Pennsylvania and the Department of Justice inWashington, D.C.The Complaint alleged, among other things, that Medco,a pharmacy benefits manager, systematically and intentionallyswitched patients’ prescriptions from one brand name drug toanother in an effort to increase the market share for certainpharmaceutical manufacturers. Medco was also alleged tohave destroyed prescriptions and demanded and receivedkickbacks from health plans.The settlement, reached shortly before trial was to commence, was 163 million for several related cases of which 137.5 million was allocated to the Medco litigation. It is oneof the largest False Claims Act settlements to date and willhave a lasting impact on the way Medco and other pharmacybenefit managers conduct business in the future.The BS&F team was led by David Stone, Richard Drubel, Hamish Hume, William Hurlock, Bob Magnanini andTim Cornell.BS&F Successfully Settles Zurich Financial ClaimsArising From A 100M Offshore FraudIn June 2006, BS&F negotiated a global settlement onbehalf of Zurich Financial Services’ subsidiary Zurich CapitalMarkets (ZCM). The deal ended 5 years of litigation in thefederal and state courts in Illinois, bankruptcy court in Illinois, and the Supreme Court of the Bahamas and resolvedclaims stemming from a fraudulent 100 million Bahamianbased mutual fund with Oceanic Bank & Trust Company, (aBahamian bank), the Liquidator of M.J. Select Global, Ltd., (aBahamian mutual fund), several Bermudian and Chicagobased entities and other rival claimants. ZCM sought BS&F’scounsel when it had difficulties obtaining redemptions fromfunds controlled by its counterparty in a complex derivativetransaction. ZCM had made numerous direct investments tohedge against its exposure on the transaction, including aninvestment in M.J. Select. M.J. Select’s promoters/managersdeceptively used the investors’ capital to make highly speculative investments in other offshore funds in exchange for kickbacks, effectively turning M.J. Select into a Ponzi scheme.The fraud was discerned as M.J. Select investors sought toredeem their shares in 2001.Attempting to fob their losses onto ZCM, the counterparty diverted over 7 million in ZCM’s redemption proceedsto its own investors and instructed M.J. Select and Oceanic todishonor ZCM’s redemption requests as M.J. Select spiraledinto bankruptcy. BS&F obtained a TRO and PreliminaryInjunction in the N.D. Ill. (freezing the stolen assets) andcommenced a series of actions there on behalf of ZCMagainst the counterparty, Oceanic, M.J. Select, its officers andaccountants, alleging securities and common law fraud claims.Oceanic forced M.J. Select into liquidation and convinced theBahamian court to appoint liquidators friendly to Oceanic.Despite having access to substantial funds remaining in M.J.Select’s accounts, these liquidators disbursed no funds to investors for 5 years while squandering millions of dollars resisting claims by ZCM in the Bahamas and instituting ancillary proceedings in Illinois.After initial depositions, discovery was stayed for 3 yearspursuant to the Private Securities Litigation Reform Act.Pending the resolution of multiple rounds of motions to dismiss, Oceanic filed an indemnity claim against M.J. Select inthe Bahamas in an unsuccessful attempt to obtain favorablerulings which would have been used to bar certain of ZCM’sclaims in the US. Rather than cooperate with ZCM, its singlelargest shareholder, M.J. Select’s liquidator threatened tobring actions to recapture settlements that ZCM had reachedwith the counterparty and auditor defendants on the speciousgrounds that ZCM’s claims belonged to the estate. BS&Fforced the appointment of a creditors’ committee in the Bahamas and played an active role in directing its efforts to reinin Oceanic’s liquidator and supervise the Bahamian trial ofOceanic’s indemnification claim.Upon approval of the settlement agreements by the USand Bahamian courts, ZCM will receive the lion’s share of thesettlement. This recovery will ensure that ZCM will incur noloss on beyond a modest initial reserve taken 5 years ago andwill additionally recover US millions to offset attorney’s feesand expenses.Alan Vickery, Howard Vickery, Courtney Rockett, AdamShaw, Kate Ruggieri, Andrew Harris, and others worked onthis litigation.

Volume 1, Issue 2Page 4Litigation HighlightsSmith Wholesale, et al. v. Philip Morris USA Inc.On April 21, 2006 BS&F argued in the United StatesCourt of Appeals for the Sixth Circuit on behalf of PhilipMorris USA Inc. (“PM USA”) in Smith Wholesale, Inc. v. PhilipMorris USA Inc. The appeal followed the firm’s victory atsummary judgment on the underlying antitrust action filed bythirty cigarette distributors against PM USA.The case began in June 2003, when the plaintiffs filed suitand sought preliminary injunctive relief in the United StatesDistrict Court for the Eastern District of Tennessee, allegingthat PM USA’s market share-based wholesale incentive program (called “Wholesale Leaders 2003”) amounted to pricediscrimination in violation of the Robinson-Patman Act andan attempt to monopolize in violation of Section 2 of theSherman Act. The District Court granted the plaintiffs’ request for injunctive relief, but BS&F won a stay of that orderfrom the Sixth Circuit. On August 17, 2005, while the appealof the initial preliminary injunction was still pending, the District Court determined that the injunction had been“improvidently granted” and entered summary judgment infavor of PM USA on all the plaintiffs’ claims. The appeal ofthe District Court’s entry of summary judgment followed.David Boies argued, assisted by Mike Brille, Philip Iovieno, Jack Simms and Christopher Hayes.BS&F Makes New Law in State Farm Subrogation LitigationBeginning in 2001, BS&F represented State Farm Insurance in seeking to recover over 100 million paid on homeowners claims arising from defective washing machine waterhoses. The problem was this: Rayon embedded in the waterhose would deteriorate; the hose would burst; water wouldflood the home; and State Farm would pay the insured homeowner. State Farm thus became subrogated to the claims of itsinsureds against the washing machine manufacturers – GE andWhirlpool – and the component manufacturer of the defectivehose. It was uneconomical to litigate claims “hose-by-hose” asthe defendants advocated. BS&F was approached to find acreative, efficient approach to this “hose litigation.” Severalyears earlier, State Farm had been unsuccessful in filing a con-solidated nationwide subrogation case in California over defective ignition interlocks. A further challenge was that there hadnot been a reported case in the country supporting nationwideconsolidation of subrogation claims in a single action.A BS&F team of Stuart Singer, Bill Isaacson, GeorgeCarpinello, Carl Goldfarb, Martin Deptula, Thomas Higgs,Teresa Monroe, Bob Tietjen and Gera Peoples worked withState Farm’s outside subrogation counsel. The case recovereda substantial eight-figure sum for State Farm, and in an appealargued by George Carpinello, obtained the first appellate decision upholding the consolidation of nationwide claims in a single action.BS&F Wins In The Wine CountryIn February and March, BS&F won a three-week civilcating our client, and the judge recently ordered that we arejury trial in Napa County Superior Court. In the lawsuit, the entitled to 1.1 million in costs and attorneys’ fees.plaintiff claimed breach of contract and fraud in connectionDavid Shapiro and Fred Norton (with the help of paralewith the sale of a business. The jury returned a verdict vindi- gal Christina Seki) worked on this matter.

Page 5Volume 1, Issue 2Litigation HighlightsBS&F Argues Appeal In Pebble Beach Company v. CaddyOn April 5, BS&F argued an appeal in the U.S. Court ofAppeals for the Ninth Circuit on behalf of the firm’s client,Michael Caddy. Mr. Caddy runs a three-room bed-andbreakfast and café in Barton-on-Sea, England named “PebbleBeach.” He was sued for trademark infringement by PebbleBeach Company, owners of the famed California golfcourse. (No jokes, please.)Pebble Beach appealed the district court’s order grantingMr. Caddy’s motion to dismiss for lack of personal jurisdiction, arguing that jurisdiction was established over Mr. Caddybased on Mr. Caddy’s website ( the fact that Mr. Caddy is a U.S.-U.K. citizen.Mikal Condon of the Oakland office argued for the firm.BS&F Initiates LaSalle v. Incapital LLCIn April, Incapital LLC, a global investment bank thatfocuses on fixed income securities and structured products,retained BS&F to defend against a trade secret case filedagainst it by LaSalle Financial Services and LaSalle Bank. LaSalle brought the action in state court in West Palm Beach,Florida, seeking an immediate preliminary injunction and ajury trial on the merits of its damages claims.The preliminary injunction sought by LaSalle would haveenjoined Incapital from trading with its largest customers.We removed the case to federal court. Following removal,BS&F succeeded in forcing LaSalle to submit its damagesclaims to NASD arbitration. To date, Incapital’s operationshave not been affected by LaSalle’s preliminary injunctionmotion.Alfred Levitt, Todd Thomas, Paul Kunz and CourtneyClixby are representing Incapital for BS&F.Firm Obtains Dismissal of 16 Million Suit against Philip MorrisBS&F successfully defended PM and two of its employees against a suit brought against it by third-party vendorLawrence H. Flynn, Inc. The claims arose out of PM’s termination of Flynn as a provider for third-party installation services. After prolonged procedural skirmishing, Judge Anderson of the Northern District of Illinois dismissed the actionagainst the two employees for lack of personal jurisdictionand dismissed the complaint against Philip Morris with preju-dice. On April 12, 2006, the court also denied Flynn’s belatedmotion to amend its complaint and noted that plaintiff failedto timely move to reconsider the dismissal or timely appealthe dismissal.Mark Heise and Jorge Schmidt of the Miami officeworked on this matter.

Page 6Volume 1, Issue 2Pro Bono HighlightsBS&F Assistance Crucial to Supreme Court Ruling ReversingDeath Sentence In Successful Innocence Project CaseOn June 12, 2006, the U.S. Supreme Court issued itsdecision in House v. Bell, ruling 5-3 that Tennessee death rowinmate Paul House is entitled to a new federal hearing.BS&F provided significant pro bono assistance to the NewYork-based Innocence Project as an amicus curiae in supportof Mr. House. The case hinged on whether Mr. Housemade a showing of actual innocence sufficient to entitle himto a hearing on his procedurally defaulted habeas claims.That DNA test results exclude him as the source of criticalforensic evidence in the case was undisputed. In its rulingthe Court noted that the central forensic proof connectingMr. House is in question and concluded that “this is the rarecase where – had the jury heard all the conflicting testimony– it is more likely than not that no reasonable juror viewingthe record as a whole would lack reasonable doubt.”BS&F’s involvement began when the Innocence Projectcontacted Ian Dumain and Brian Kohn (two Armonk associates and former members of the Innocence Project), andasked for assistance with its amicus brief. Ian, Brian and agroup of summer associates reviewed over 2000 cases anddrafted over 200 memos during the summer of 2005. Thisresearch provided the legal foundation for the Project’samicus brief, and also informed Mr. House's argument.After this initial work, we received a thank you letterfrom the Innocence Pro- “these memos will notject, which stated “wewere truly wowed by the only be useful to us onfinal work product of the the House case, but willentire Boies, Schillerteam. The memos they prove invaluable to usprepared . . . cut to theand our colleagues inchase of the issue that welitigating countlesswere most concernedother innocence casesabout in this very largeresearch assignment . . . . around the country”remarkably, they wereable to do it on extremely short notice, and to enlist an entireteam to help them at a time (in August) when scarce resources are at a premium . . . . these memos will not only beuseful to us on the House case, but will prove invaluable to usand our colleagues in litigating countless other innocencecases around the country.” The Innocence Project concludes noting BS&F “[is] at the top of our pro bono referrallist, given the impressive results from this round.” (The letter we received is reprinted inside on page 11.)Brian and Ian led the BS&F team.Florida Children’s Healthcare LitigationBS&F has undertaken a major pro bono case on behalfof Florida's Medicaid enrolled children. More than 1.6 million Florida children are enrolled in Medicaid, and approximately. 500,000 of them do not receive the EPSDT (EarlyPeriodic Screening Diagnosis & Treatment) benefits they aregiven as a matter of right by federal law. The reason is Floridadoes not pay doctors sufficiently to incentivize their participation in Medicaid, relies unduly on HMOs, and creates administrative roadblocks for recipients – all in violation of provisions of the Medicaid statute.That is the principal contention in a lawsuit BS&F hasfiled on behalf of a class of children on Medicaid, the American Academy of Pediatricians, and the Florida Academy ofPediatric Dentists. The state officials who are in charge ofMedicaid are the defendants. The State of Florida AttorneyGeneral's office is representing the defendants, and has filed amotion to dismiss claiming there are no private rights inMedicaid that can be enforced by individual recipients. Themotion has been briefed, and BS&F has argued the motion on behalf of the plaintiff class. The motion remainspending before Judge Adalberto Jordan of the US DistrictCourt for the Southern District of Florida.BS&F was asked to undertake the case by the Public Interest Law Center of Philadelphia, which has spearheadedsuch litigation in several states, and is co-counsel with BS&F.Stuart Singer argued the opposition to the motion to dismiss and the BS&F team on the case includes Sashi BachBoruchow, William D'Zurilla, Carl Goldfarb, Damien Marshall, and Gera Peoples, all based in Fort Lauderdale.

Volume 1, Issue 2Page 7Pro Bono HighlightsTrejo v. Broadway Plaza HotelBS&F is co-counsel with the ACLU for five immigrantwomen who were subjected to sexual harassment and wageexploitation by a New York City hotel and its management.Plaintiffs seek declaration that the Defendants violated federal and state minimum wage and overtime laws, the Victimsof trafficking and Violence Protection Act of 2000, state childlabor law provisions, and other important claims.Plaintiffs are seeking compensatory and punitive damagesand injunctive relief for Defendant’s violation of federal, stateand city anti-discrimination laws. So far BS&F has takencontentious depositions with very positive outcomes for theupcoming trial and expects to overcome defendant’s motionfor summary judgment.Lawyers from the New York City and Armonk offices,led by Eric Brenner, are representing the plaintiffs.NRDC v. United States Dep’t of AgricultureBS&F represents the Natural Resources Defense Council (NRDC) in litigation brought against the U.S. Department of Agriculture (USDA) and four states. The suit involves a rule that requires international shippers to kill pestsby fumigating raw wood packaging using either heat treatment or the ozone-depleting substance methyl bromideThe action was filed on September 15, 2005 in federalcourt in New York. The NRDC alleges that USDA failed tocomply with the National Environmental Policy Act by notfully studying less environmentally harmful alternatives, andfailed to comply with the Plant Protection Act, which setsstandards for how the USDA’s Animal & Plant Health Inspection Service (APHIS) protects the United States frominvasive species. The complaint argues that the rule couldincrease the use of the pesticide, which is at odds with theUnited States’s participation in an international treaty tophase it out.The matter is ongoing under the direction of New YorkCity partner George Frampton.BS&F Pro Bono Representation of Political Asylum ClaimantBS&F is representing Pauline Tshiyamba Moembo, acitizen of the Democratic Republic of Congo, in her effort toobtain political asylum for herself and her children here in theU.S. She was seized from her home in the Congo by soldiers,unlawfully detained, and tortured, as punishment for askingquestions about her husband's seizure. After her release andmonths of medical attention, she was again seized and unlawfully detained--this time with two of her children – by soldierswho accused her of being a conspirator against the govern-ment. Upon their release, she fled the country and came tonorthern Virginia, where her sister lives.BS&F submitted her asylum application to U.S. Citizenship and Immigration Services in mid-September. The Government granted asylum, pending her background and identity check. Upon final approval, she will be able to apply forasylum for her children, who were unable to leave the Congowith her.Philippa Scarlett of the DC office is handling the matter.

Page 8Volume 1, Issue 2Items of InterestMiami Office:Tax partner Mike Kosnitzky authored two recent articles published in Tax Analysts' publication Tax Notes: “Protective Filings for Hedge Funds After the Jobs Act” and “The Uncertain Repeal of the Straddle Stock Exception”. Mike was also anoutside contributor in the recent CCH publication: Katrina Emergency Tax Relief Act of 2005/Gulf Opportunity Zone Actof 2005 Law, Explanation and Analysis. He and tax partner Keith Blum also co-authored the chapter on Antenuptial Agreements in the Florida Bar publication “Drafting Marriage Contracts in Florida” (Seventh Edition).Oakland Office:The California State Bar Board of Governors recently re-appointed Steve Tidrick to the board of directors of the Foundationof the State Bar of California. Steve also recently moderated the first debate between the Democratic candidates for California Attorney General, Los Angeles City Attorney Rocky Delgadillo and Oakland Mayor Jerry Brown.In April, David Shapiro and Steve Tidrick attended the annual Judicial Conference of the Northern District of California, aconference for the federal district court judges and about 50 lawyers. David is a lawyer representative to the 9th Circuit Judicial Conference.Washington, DC Office:In June, Louis Smith attended the Judicial Conference for the D.C. Circuit, a biannual event for the judges of the Circuit andDistrict Courts of the District of Columbia, the judges of the D.C. Superior Court and Court of Appeals, and about eightylawyers.Scott Gant co-authored an op-ed article published in the June 13, 2006 edition of the Christian Science Monitor analyzingwhether there is any constitutional impediment to Bill Clinton serving as Vice President. Relying on analysis set out in hispreviously published law review article on the 22nd Amendment (see 83 Minn. L. Rev. 565 (1999)), Scott argued in the CSMthat neither the 12th Amendment nor the 22nd Amendment preclude Mr. Clinton from being elected Vice President. Thearticle was the most popular item on the CSM’s widely read website the day of its publication, and has been the subject ofdiscussion throughout the blogosphere. The full article is available at .

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Nicole A. Kersey (UVA, ‘07) Tzvi N. Mackson (Cardozo, ‘07) . members of the United States Attorney’s Office for the East-ern District of Pennsylvania and the Department of Justice in Washington, D.C. . Shaw, Kate Ruggieri, Andrew Harris, and others worked on this litigati