Introduction and summary

       Welcome and thank you for visiting. I am an attorney who used to work at O'Melveny & Myers. I was so surprised by what I saw there that I took on the role of amateur journalist and started this website. It's one of those acts that takes little time, but might do some good by shining a light. Below is a summary, which I hope you find informative.

They like to silence people

       According to the New York Times, an O'Melveny attorney used violent imagery to threaten a sexual abuse victim into silence, as her assailant watched. This led to an additional decade of sexual abuse by the assailant, and the attorney became a go-to hire for rich men accused of sexual assault (links one and two.) The above may have influenced the attorney's own son, who was arrested for violating a domestic violence restraining order. Later, Mother Jones revealed that this same attorney chose not to stop a client's racist comments about a judge. This person is chair of O'Melveny's Trial Practice Committee and vice chair of the firm.

       Threatening people into silence seems to be part of an O'Melveny lawyer's toolset. For example, the inspector general chided an O'Melveny alumnus for threatening scientists in a way that had "life and death consequences."

       In fact, O'Melveny was at the forefront of the document used to silence victims -- the mandatory arbitration and nondisclosure agreement. Although three federal courts told O'Melveny that its document was "unconscionable" (cases one, two and three) -- O’Melveny continued to force its employees to sign it until 2018, when law students pressured all law firms to abandon this practice.

       They will even contrive claims to intimidate people into silence. For example, after I published this website, they accused me of the federal crime of stealing confidential information – without any digital evidence that I even accessed the data they accused me of taking. When I reminded them that they won't have much of a case without evidence, they threatened me with a defamation lawsuit. But when I asked them to identify a specific defamatory statement so that I could retract it, they refused to do so. And that's not the first time they attacked an employee who talked about their problematic practices. According to this article, they even launched a "witch hunt" to find an employee who complained anonymously.

The quality of O'Melveny's legal work

       O'Melveny's legal services might not always be of the highest quality. For example, per ABC News's Sacramento affiliate, O'Melveny's lacking advice embarrassed the governor's office and cost California wildfire victims billions of dollars; a judge devoted a paragraph of his opinion to criticizing O'Melveny's lack of professionalism; a letter O'Melveny wrote on behalf of a client was so "absurd" that it caught the attention of reporters; and they couldn't even handle a child sexual abuse matter without being accused of serious improprieties. These items made it into the news during the period that I wrote this blog, but this has been going on for decades. For example, the city of Los Angeles sued them for malpractice back in 1999.

       The firm also has a history of conducting reportedly sham "independent investigations." For example, see this story in Corporate Counsel accusing O'Melveny partner Adam Karr of conducting a sham investigation of sexual abuse at Lions Gate. A saint of a woman returned over a million dollars to break her confidentiality agreement and reveal that information. Or see these stories about a woman who learned that her alleged sexual assaulter's personal lawyer (O'Melveny) had been hired to "independently investigate" whether he assaulted her (links one and two.) Or see this story in ESPN about a backlash that followed a suspicious independent investigation in the Portland Trailblazer organization. Or see this story about an O'Melveny alumnus who was arrested by the FBI, as he tried to negotiate his fee for an independent investigation.

Money

       The firm has a money-obsessed culture, which they called "eat what you kill." Its lawyers would constantly search the dockets for new cases, hoping that one of their clients got sued, and then rush to pitch for the work. Sometimes they might go further. For example, query whether they needlessly dragged out an alleged rape victim's case to maximize billable hours, and then bragged about the money they made off of her in a press release. Or query whether they were the only defense firm to drag out the Oklahoma opioid crisis case, damaging their client's reputation and likely resulting in thousands of avoidable deaths, to maximize billable hours.

       Naturally, O'Melveny's partners are exceedingly cheap. For example, they upset law students by cutting summer associate pay by about $10,000, and replacing it with a $10,000 loan from the partners. That financial maneuver boosted partner profits by about 0.24%. So a partner who would have made $2,000,000 in that year now made about $4,800 more, as a result of reducing summer associate pay by $10,000.

       For a numerical example of the feast or famine manner in which one O'Melveny group allocated profits among its partners, see this post. Here you will find an example of an O'Melveny partner's compensation package, and here is an example of a retired of counsel's compensation package.

They corrupt government

       Ingrained in O'Melveny's culture was the idea that a job in government isn’t accepted to serve the voters, the public, or the country – it’s taken to serve yourself, and the people who pay you. For example, an O'Melveny attorney once shared their plan to "monetize" a government position. Or see these two posts about another O'Melveny attorney who used a government position for his own personal purposes. O'Melveny has also repeatedly tried to change case law to make it harder to prosecute public officials who engage in quid pro quo corruption (cases one, two and three.) It doesn't always work out though; one of O'Melveny's friends got arrested by the FBI for trying to use his government access to benefit a client.

       An O'Melveny group leader reportedly lied to a federal court on an important issue in the nation's history. Once caught in that lie by the discovery of documents, he gave a radio interview criticizing the Geneva Convention.

Diversity

       O'Melveny claims to support diversity by following the Mansfield Rule in hiring, but their track record suggests otherwise. O'Melveny also hired two partners who were sued for discrimination, by a Latina single mother, at their prior firm. It also seems to follow the too-common practice of assigning minorities to cases where they have to fight someone of their own group.

       I also list the players in the lucrative "law firm diversity marketing" industry, how much each charges for their stamp of approval, and what their executives make per year. 

Pro bono

       O'Melveny claims to support pro bono work, but an attorney said they fired him because he spent too much time on pro bono matters. See also this post about its director of pro bono who, despite a career in legal aid and other pro bono efforts, lives in a $5 million house in Beverly Hills, which might lead to fair questions about how much money he took out of those ostensibly charitable endeavors.

Employee wellness

       The firm claims to support employee wellness, but its stinginess and environment may interfere with that goal. For example, according to this lawsuit, it provides employees with cheap medical insurance; and one of the firm's most widely publicized wellness efforts amounted to nothing more than a $13 per month Peloton plan. It's also sort of a difficult place to work. For example, an attorney made partner after derailing the careers of a half-dozen associates; and here are two other posts about the kinds of personalities that thrive there; really, every post on this blog is about the challenges of working there.

       In fact, it might not be the place to go for wellness. For example, see these messages by a woman who lost her health while working there, or this story about an O'Melveny attorney who suffered health problems to the point where she was rocking back and forth, whispering: "I have to quit O'Melveny."

Marketing

       The firm seems to put a lot of effort into public relations. For example, around 2016, it started giving itself the highest scores in Vault's self-graded rankings, so as to rise to the top of those rankings, after which it issued press releases celebrating that victory. Of course, you can't fool all of the people all of the time, and so that effort led to complaints from law students who felt misled by what they thought was an undeservedly high score. Then another firm decided to copy O'Melveny's gamesmanship, and started giving itself the highest scores too. That firm rose from a low position in the rankings to the number one spot in all of them, even ahead of O'Melveny, in only one year. 

       As a result of all this manipulation, the Vault rankings no longer meant anything. A few months after the second firm's chicanery, Vault changed its name to "Firsthand" and, based on the timing, I wonder if they did that to try and reboot their rankings' lost reputation.

       O'Melveny also tries to manipulate journalists into advertising for the firm. Here is their manager of public relations explaining how to do this on the show, "Law firm marketing catalyst." Some of the resulting articles are provably false. The firm was even lambasted in the press for trying to remove truthful information from Wikipedia, of all things.

Other random posts about O'Melveny

       The firm gives favorable treatment to some associates, especially those from prominent families. A highly respected partner joined O'Melveny with great fanfare, only to leave two months later and return to his old firm. O'Melveny tried and failed to merge with the giant multi-national firm of Allen & Overy. The firm worked on two cases against alleged Chinese torture victims. And here is a post is about O'Melveny's human resources and career development personnel.

Not the first time

       If you think this website is unusual, please note that I'm not the first person to do this. The late Judge Stephen Reinhardt expressed his public disgust with things he saw at O'Melveny back in the 1980s. A legal recruiter, whose livelihood depends on ingratiating himself to law firms, publicly shared a shocking story from O'Melveny. An O'Melveny attorney used twitter to talk about everything they lost while working there. And there's more that I haven't said, because I do not have hard evidence and don't want to be caught in a "he said, she said" defamation case (see the first section above), or because the person who shared the information asked me not to post it here. I'm largely restricted to writing about things that made it into the news, which may be the tip of the iceberg.

The legal profession in general

       Not all of the posts are about O'Melveny; some are about law in general. A few posts compare law to other professions. For example, this post explains how to "think like a lawyer," and contrasts that with approaches used by other fields. This post is about my exchange with Penn Law professor Amy Wax, after which I imagine a world where she taught tech instead of a law. This post is about the award-winning movie I Care a Lot, and how sometimes the justice system creates or prolongs injustice, until a reporter exposes and fixes the problem. 

       This post adds to the long list of articles about regulatory capture, and chronicles the careers of a handful of bank regulatory lawyers who spun the revolving door to riches. It also recalls how lawyers have been history's worst Federal Reserve chairs. Here, you'll find the story of a lawyer who tried to fight regulatory capture, and the consequences he faced.

       I spend a few posts on torture, for example this post is about Bank of America's former General Counsel David Leitch, who told me that I would never work for his organization because I criticized his friend on torture, and these two posts are about my experiences with the aforementioned friend and other related parties, such as former Fifth Circuit Judge Michael Luttig.

       I also spend some time on the opioid crisis. This post is about the best-selling book Dopesick, which recounts how captured regulators, lobbyists and lawyers put their financial interests above their country to start and perpetuate the epidemic, which has killed half a million Americans so far. It also contrasts the United States' pliable regulators and lawyers with those of Europe, who rejected efforts to expand the use of opioids, saving their continent from the same fate. This post summarizes articles accusing former Attorney General Eric Holder of covering up the opioid crisis back in 2004, when it would have been easier to stop. And this post compares the crisis to the opium epidemic that ended China's High Qing golden age and started the worst century in its history, although hopefully the United States can recover with less damage.  

       Finally, this post is about how unpleasant it was to write this blog, which is why I eventually retired it. 

Brad Butwin, Dan Petrocelli, Brian Boyle, Adam Karr, omm, omelveny, Brandon Jacobsen

Retiring this blog

       I'm going to go ahead and do something I've been wanting to do for a while, retire this blog. So this will be the last entry. If you would like more such reading material, please see the syllabus of a new course being taught at Duke Law School. 

Artifice and the failure of First Republic Bank

       A recent bank failure shows the importance of candor in the securities markets. Please let me start by providing a timeline.

• On March 10, Silicon Valley Bank failed after customers rushed to withdraw their money, causing its deposits to fall to an unsustainably low level.
• On March 12, Signature Bank failed for the same reason.
• As a result, investors became concerned about the deposits at other banks, including (a) Western Alliance Bancorporation, whose stock price fell by 63% between March 8 and March 13, (b) PacWest Bancorp, whose stock also fell 63% between those two dates, and (c) First Republic Bank, whose stock fell 73% between those two dates.
• To assuage concerns, First Republic Bank issued a statement on March 16 titled, "Reinforcing Confidence in First Republic Bank." It said the bank would receive $30 billion of deposits from a coalition of eleven large banks committed to preserving confidence in the banking system. Notably, it did not reveal how much deposits they had lost, only that $30 billion of deposits had been added.
• Based on a google search, its press releases, and its Securities and Exchange Commission filings, First Republic did not issue a single additional statement on its deposit situation in the ensuing month.
• On Monday April 24, First Republic was due to announce quarterly earnings in the afternoon. It would now have to disclose the amount of deposits it had lost. Presumably because the bank had said nothing for a month -- investors were optimistic and pushed the stock from $14.27 in the morning to $16.00 right before the earnings release, a 12% increase in one trading day.
• The earnings release shocked investors. Analysts had expected on average $145 billion in deposits, but the bank only had about $103 billion of deposits. And this was after the $30 billion injection from the large banks. In addition, deposits had fallen to $104.5 billion on March 31, so the bank was sitting on this information for almost a month. 
• During the earnings call, the bank said "deposits ha[d] stabilized" and that it had plenty of liquidity. It also announced a three-part plan to "strengthen [its] business" for the future. But having lost trust in the bank's word, investors sold their positions. That night its stock fell by about 25%, and it just kept falling until the bank had to be taken over by the FDIC a few days later.

       One wonders what would have happened if the bank had adopted a more honest communication strategy, rather than painting an overly rosy picture until it was forced to reveal everything. What would have happened if, rather than only touting the $30 billion infusion -- it also disclosed how much it had lost via deposit outflows?  

       It's possible that if the bank's messaging was more trustworthy, investors would not have run for the doors in that final perilous week. If a company is honest with you, you can assess their plan and estimate a value for their stock. But if you can't trust what they say, that adds a layer of uncertainty that makes investing unworkable. (I should be clear that there were no outright lies in First Republic's releases; they were more like half-truths, i.e. they left out what some might consider relevant and important information.) 

       You're probably wondering what any of this has to do with O'Melveny & Myers. Well, it might have nothing to do with them, but a few days go, it was revealed that O'Melveny started advising the bank in March. Per Monday's Bloomberg Law article:

Following First Republic Bank’s issues back in March, a committee of the independent directors was convened and represented by O’Melveny & Myers, led by partners Daniel Petrocelli, Jarryd Anderson, Matthew Close, and Andor Terner.

       Of course this doesn't prove that O'Melveny had anything to do with the bank's disclosure decisions. Granted, public confidence was the sole determinant of whether the bank would survive, so a lawyer advising the bank's directors might want to share a thought on that. And as you can see from the posts here, O'Melveny is not always the most trustworthy actor, so it might have had a hand in the bank's messaging. But I don't know what role O'Melveny played; maybe none; or who knows, maybe they tried to get First Republic to be more forthright and were turned down. Any comment on O'Melveny's role would be baseless speculation.

       I'll try to remember to check the regulatory reports to see if they reveal who devised the communication strategy. Regulators issued multiple reports on the failure of Silicon Valley Bank and they might issue one here as well. Whoever was responsible, it shows you how banks are the only type of business that can be celebrated one day, and impaired to the point that they have to be taken over by the government just a few days later.

Don't expect sympathy from O'Melveny's partners; they have their own problems

       According to the Wall Street Journal, law firms are conducting layoffs, some overt and some "stealth." So I guess now is a good time to do a post that's been shelved for a while. 

       One day at lunch, an O'Melveny partner shared a story about a ski trip she went on with her children. One of them had gotten into a bad accident, I think he hit something, after which he complained of dizziness. She said that she ignored his concerns and ordered him to get right back up the hill, prefacing it with something like, "you know me." 

       This woman worked on the firm's worst cases, ones where her job was to deny compensation for the most tragic and devastating of injuries. And associates complained about her, even to me, someone who had never worked in her group and had zero management authority. One said that after he turned in a brief, she would force him to sit there and watch her edit it line by line, even though he had other things he needed to get done that day. Another said that, during a trial where they stayed at a hotel and worked 80-100 hour weeks, this partner got upset when she saw attorneys taking a break around midnight at the hotel bar, and complained that they could be working on documents. 

       Based on all this, I assumed she was just a tough person and consistent about it. No concern for the injured people she faced, the associates working for her, or her child's possible concussion. Maybe that was part of it, but later I learned that she was going through a divorce,¹ and who knows what else. 

       So if you're a twenty-something associate with your life ahead of you -- please be careful about expecting sympathy or empathy from O'Melveny's partners. They may not be the happy, affable and generous people you imagined. Rather, they might be dealing with things worse than any of your concerns.

_________________________________________

¹ Like the other two divorce posts, I won't share the documents without O'Melveny's permission (although again these are public documents that anyone can download from the court's website.) But since people joining O'Melveny seem interested in money, see below for that snippet from the divorce judgment. The rest of the documents reveal the standard stuff; e.g. that she had to pay her ex alimony and child support due to her high income. 

O'Melveny allegedly tricked a surgical center into accepting its cheap medical insurance

       According to their complaint, before performing surgery on an O'Melveny employee, a prestigious Beverly Hills surgical center called the firm to confirm that its plan would pay their rate. O'Melveny allegedly responded that it would, and so the doctors took their word for it and operated the next day.

       Then after the operation was completed, O'Melveny said its plan would only pay about 10% of the $200,000 bill. The center expected to be paid based on the promise. So after almost two years, they assigned the bill to their debt collector who filed suit. O'Melveny has responded by removing the case to federal court, seemingly to try and avoid payment via an ERISA technicality. It did not hire a firm to defend the lawsuit; it's using its own internal attorneys: staff attorney James Kidder and partner Catalina Vergara.

       As I understand, unless it's an emergency, when a patient's insurance won't pay for a doctor's services, the patient simply goes to another provider. This happens all the time in the United States, which has tiers of medical providers, each with a commensurate cost. If you have really cheap insurance, many doctors will not accept you as a patient. And this doesn't seem to have been an emergency as, according to the complaint, the surgery was performed a day after the center spoke with O'Melveny. 

       I can't imagine the center would make all this up so, assuming they're telling the truth . . . O'Melveny doesn't seem to provide employees with good medical insurance. Excerpt from the complaint below:

27. On February 27, 2020, Medical Provider conducted surgery and provided services on and for patient for the benefit of Patient and DEFENDANT.

28. On February 26, 2020, Medical Provider’s representative Y.P. spoke with Defendant’s representative Shelly.

29. Defendant represented to Medical Provider that Patient’s deductible is and was $5,000.00 and that the deductible had been met and Patient’s Max Out of Pocket (“MOOP”)expense is and was $7,000.00 and that to date for the calendar year Patient had paid $257.73.

30. Defendant represented to Medical Provider that Medical Provider would be paid for medical services at one hundred (100) percent of the UCR amount.

31. DEFENDANT further represented that payment would not be made at a rate based on Medicare.

32. All of the information obtained in said conversation was documented by Medical Provider at the time of the phone conversation as part of Medical Provider’s policy and practice.

33. At no time prior to the provision of services to Patient by Medical Provider, during conversations between Medical Provider and DEFENDANT did DEFENDANT advise Medical Provider that Patient’s policy or certificate of insurance was subject to certain exclusions, limitations, or qualifications, which might result in denial of coverage, limitation of payment or any other method of payment unrelated to the UCR rate.

34. DEFENDANT did not make reference to any other portion of Patient’s plan that would put Medical Provider on notice of any reduction in the originally stated payment percentage.

35. Despite representing that payment would be made at the UCR rate, DEFENDANT knew or should have known that it would not be paying Medical Provider at the UCR rate.

36. Despite representing that payment would not be made at a Medicare rate, DEFENDANT knew or should have known that it would be paying Medical Provider at a Medicare rate.

37. Medical Provider relied and provided services solely based on DEFENDANT’s statements, promises and representations. Statements which had no relation to DEFENDANT and Patient’s plan document, as the statements may or may not have been based in the DEFENDANT or Patient’s plan documents, but that bore no consideration when Medical Provider agreed to provide medical services. Medical Provider took DEFENDANT at its word and promises and provided services based solely on those promises and representations. . . . 

40. Under either scenario, following the procedure, Medical Provider submitted to DEFENDANT any and all billing information required by DEFENDANT, including a total bill for $200,009.00.

41. DEFENDANT paid $21,573.14 to Medical Provider. The amount paid was well below the billed amount and well below a UCR amount.

42. As of the date of this complaint, DEFENDANT has still refused to make the appropriate payment to Medical Provider and Medical Provider was and now HAMOC is entitled to that payment from DEFENDANT.

O'Melveny health plan, O'Melveny medical plan, O'Melveny wellness,  healthcare,  OMM benefits

What an of counsel makes at O'Melveny

       In a prior post, I described an of counsel who had berated me because he mistakenly thought I was trying to take work that he could be doing. You'll see dozens of these of counsels at O'Melveny, almost all retired partners, and I remember associates wondering why they still came in. Well, a divorce filing might answer that question, so I should probably add it to this site to inform readers.

       As stated in the court's opinion, the divorcee began working at O'Melveny in the 1980s, became a partner in the early 1990s, retired a few years ago, and is now an of counsel at the firm. Based on the filings, he made between $1 million and $2 million per year in his later years as a partner.

       Jumping to the numbers, his income and expense declaration states that in 2021 he received:

• $375 per hour for about eight hours of work per week at O'Melveny. This would be about 8 x $375 x 52 = $156,000 per year.
• About $15,500 per month from the O'Melveny & Myers Partnership Agreement Retirement Benefit defined benefit pension plan. (A portion of this goes to his ex-wife, and they are currently litigating over that amount. The legal issue is how the "time rule" should be used to split payments from this particular pension plan. What's amusing is that this dispute over a grand or so per month could wind up affecting other retired and divorced O'Melveny partners. I assume the plan's fiduciary will inform similarly situated retirees of the case.) Any way, this would be about $15,500 x 12 or $186,000 per year.
• A distribution of $93,000 from the O'Melveny & Myers Partnership Deferred Compensation Plan. His ex-wife also received $93,000 from that plan, so if not for the divorce he would have received the sum of those two, or about $186,000 in 2021. 
• About $21,000 of "CEI Distribution" and "Tax Distro."

       Add the four above and you get $549,000 of income in 2021, of which $156,000 came from the eight hours per week that he worked, and $393,000 came from the firm's retirement plans. So there you have it. If you were wondering why so many retired of counsels continue to come into the office, it's to receive the part-time income described above, and possibly other income from their own clients unrelated to O'Melveny.

       As with the last post, I won't publish the full document without O'Melveny's permission, although again this is all publicly available information that anyone can download from the court's website. The snippets below have the key numbers. 

Attorney sues O'Melveny after being fired for "too many pro bono hours"

       This attorney did pro bono work to help satisfy his 1900 billable hours target. According to O'Melveny's website, that should have been fine. It states that "pro bono hours may be used to fulfill all firm billing expectations, including bonus consideration." But apparently that's not really true.

       Excerpt from the complaint below.

15. At all times, Plaintiff was in good standing and competently performed his job duties, such that he was promoted as “Counsel” in March 01, 2022, until he was wrongfully terminated on or about December 01, 2022.

16. As required in his employment contract, Plaintiff continuously completed and serviced over 1900 hours of billable and pro bono work for OMM every year. 

17. From the start of 2022, Plaintiff noticed he was gradually given less work such that he incessantly advised OMM and/or DOES 1 through 25 of his inability to meet his billable requirements due to the lack of billable assignments presented to Plaintiff.

18. Despite Plaintiff’s countless requests and advisory notices, he was prejudicially prevented from working on crucial billable projects and transactions on the basis of his race, gender, and sexual orientation.

19. The work environment created by OMM and/or DOEs 1 through 25 was hostile, but OMM and/or DOEs 1 through 25 did nothing to investigate or redress the prejudice and discrimination.

20. Yet, Plaintiff impressively managed to exceed his billable requirement before the end of the 2022 term because Plaintiff unilaterally sourced more work by engaging in significant pro bono projects, as authorized per OMM’s policies, which specifically “encourages and gives lawyers full billable credit for every hour recorded on pro bono matters,” ultimately qualifying Plaintiff for bonus compensation in addition to his 2022 salary.

21. On December 01, 2022, Plaintiff was wrongfully deceived into organizing, coordinating, and attending a meeting with OMM and/or DOEs 1 through 25 to discuss “staffing,” where he was unexplainably and wrongfully terminated on the basis that he billed too many pro bono hours.

       The plaintiff voluntarily dismissed his case with prejudice a few weeks after filing, which suggests that O'Melveny settled the case.

O'Melveny layoffs, stealth layoffs, OMM, discrimination, wrongful termination, pro bono, 1999 Avenue of the Stars 8th Floor,   Los Angeles, CA 90067

What an O'Melveny partner's profit distribution documents look like

       I was wondering if I should post these, which come from public filings in a divorce case. Since this website's goal is to educate about the firm, I might as well. Readers may want to know what a partner's distribution package looks like. This partner also has a backstory that touches on O'Melveny's culture. (Besides, I have jury duty next week and the profession is on my mind again, so I might as well write a post.)

       I actually met this woman and worked with her on a few matters. She was promoted to partner a few years ago. The most interesting story about her, is that she and another partner ended the careers of a group of associates. They did so after taking over a client from an attorney who had left over money issues. 

       That departing attorney had, I want to say, eight or so associates helping him. When these two women took over they made that entire team transfer their knowledge. Then they gradually stopped giving them work. I can only speculate as to the reasons. In any case, the prior team was now struggling to meet their billable hour requirements, and they slowly left. 

       Last I heard, one was coding, one was a career counselor at a law school, one stopped working for years and then took a job at a small law firm, one was doing compliance, one works for a county, and one works for a city. I think there were a few more that I don't remember; it's been a while. That was O'Melveny's culture. A group of dedicated and hard-working attorneys had their careers derailed, just because these two women decided to stop giving them work.

       Don't feel bad for the associates though. In the universe of unfairness what happened to them is trivial. This website has much worse examples, e.g. the half a million Americans and counting who have lost their lives as a result of the actions of lawyers and lobbyists, including O'Melveny.

       Getting back to the topic of this post ... I'll ask O'Melveny's public relations people if I can publish the full 99-page document, and won't until I get their permission. It's a public document that anyone can download from the court's website but I'll let them decide. 

       Maybe they'll even share this information on their own, for all partners. I mean, what is the point of keeping it secret? Are they hiding it from other O'Melveny partners, who might be upset because they make less than they feel they deserve? From employees, who might be annoyed at being nickel and dimed? From clients, who might push back on billing rates? From victims, who might see how much an O'Melveny partner makes for contriving machinations to deny them compensation for an injury? 

       For now, below is the redacted first page for 2019 and 2020, which has the key numbers. For reference, O'Melveny made $396 million in profit in 2019, and $457 million in profit in 2020, split among about 170 partners in each year. And remember that this was a junior partner, so the numbers will be bigger for more senior partners. 

       The only other interesting thing I saw in the docket was that, after her husband filed for divorce, he received not only his share of community property, but due to her high income, he also received alimony and child support.

O'Melveny, OMM, compensation, salary, income, wages, 610 Newport Center Drive17th Floor, Newport Beach, CA 92660

Judge criticizes O'Melveny's lack of professionalism

       Excerpt from the opinion below.

Before getting to the jurisdictional question, an observation about Bitmain's briefs is required. Overall, the briefs filed by Bitmain's counsel, O'Melveny & Myers LLP, fell below the standards of professionalism and quality expected of every litigant and counsel in this District. The many instances of this will be called out in the ensuing discussion, but the Court notes at the start that it has serious concerns about O'Melveny & Myers’ repeated citations to overruled cases, and legal tests that were expressly disapproved well before it filed its brief. These practices are not consonant with O'Melveny & Myers’ duty of candor, and they unduly burdened the Court and opposing counsel with frivolous arguments. Bitmain and its attorneys are advised that future conduct along these lines will be sanctioned, including but not limited to monetary sanctions, defense or evidence preclusion, and professional conduct sanctions. There is no room in our busy and resource-constrained federal courts for parties and lawyers who do not play by the rules and fight fairly on the merits.

Gevorkyan v. Bitmain Techs. Ltd., No. 18-CV-07004-JD, 2022 WL 3702093, at *1 (N.D. Cal. Aug. 26, 2022)

O'Melveny, OMM, cryptocurrency, crypto, bitcoin, DAO

The world of banking lawyers, and our current high inflation

       Last year I wrote about the career of Bimal Patel. I have been meaning to add to that post, because there are a number of other banking lawyers with interesting careers, including one who is having a huge impact on the day to day lives of Americans.

       To review Bimal's career, he had a keen desire for money. But he couldn't make it at O'Melveny because he had few or no clients. O'Melveny's "eat what you kill" culture only pays those who produce billable hours. So he devised a scheme to, in his words, "monetize" government positions into a lucrative salary. You can read the details in that prior post. 

       Now take a look at Citadel's general counsel Heath Tarbert. Before chronicling his career, I should let you know that I worked with his wife, who said good things about me (so you don't think that I don't really know these people.) Mr. Tarbert's career started at a law firm, where he worked from 2003-2005. He then pursued clerkships and government positions between 2005 and 2010, which led to his first chance to make a lot of money, as a partner at Weil, Gotshal & Manges. That didn't work out as he seemingly couldn't find clients. I say that based on this quote in the legal website Above the Law, in which someone who knew him said he had to leave Weil because the firm "didn’t support his efforts to develop" a practice. This friend may have been right. It might have been a lack of support. Regardless, he couldn't "make it rain" at Weil and so he had to leave.

       So in 2014 he went to Allen & Overy. Seeing how dead our bank regulatory practice was at O'Melveny, I wrote him in 2015 to ask how it was there. He replied that it was very slow, and that they were not looking for anyone. My boss at O'Melveny Brian Boyle confirmed this. He said I could speak with some higher-up at Allen & Overy if I wanted to see how bad they were struggling. So apparently, Mr. Tarbert hadn't learned how to bring in clients and projects at Allen & Overy either.

       So not surprisingly, he left Allen & Overy in 2017 to join the Trump administration, and he didn't return when those political appointments ended. Instead, he joined Citadel Securities, the very wealthy market maker, where he is presumably doing well for himself. That's similar to what Bimal did. He tried to monetize a government position into a lucrative and stable long-term salary, failed, and went back into government to try again until he achieved his goal. 

       Or consider Kathryn Ruemmler, the general counsel of Goldman Sachs. Her career also evidences a possible desire to monetize government, as she went from the law firm of Latham & Watkins, to government, and back to Latham, to government, and back. Then, after an interesting event, she moved from Latham to Goldman Sachs. According to this article, in July of 2019 she appeared at Jeffrey Epstein's court hearing. One source described it as "probably" "a show of support" for Mr. Epstein, with whom she had a “professional relationship." She sat behind Mr. Epstein's legal team in court. Her time at Latham ended shortly thereafter and she joined Goldman Sachs in 2020. You didn't misread that. She felt she had to take time out of her day and go into court to publicly support Mr. Epstein. A letter or phone call wasn't enough for her. She wanted to really be there for him. And this isn't the first time she supported this sort of person. That's the general counsel of Goldman Sachs.

       If you would like other examples, consider Bank of America's former general counsel David Leitch, who also cycled in and out of high-level government positions. He wrote me to tell me there was no room for me at his organization, because I had protested his friend Brian Boyle's torture advocacy, attacks on the Geneva convention and reported dishonesty in federal court. That was Bank of America's general counsel.

       Or consider Brian Brooks, who was the general counsel at Fannie Mae and Coinbase, and his attempt to convert his government job into a cryptocurrency fortune (links one and two.) He may very well have destroyed the lives of some who invested in crypto as a result of his efforts. Recently, there have been numerous articles about crypto-related suicides. 

       Or consider Ryne Miller. He parlayed years of experience at the CFTC, including as counselor to its Chair Gary Gensler, into a partnership at the law firm of Sullivan & Cromwell and then a general counsel position at decabillionaire Sam Bankman Fried's cryptocurrency exchange. [Addendum: A coworker of Mr. Miller later filed an affidavit attesting that Mr. Miller was hired by the exchange because he "emphasized his close relationship with [SEC Commissioner Gary Gensler] at every possible opportunity."] 

       I could give you other examples but I'll stop here. Hopefully by now you are starting to understand the culture of banking law. If you told lawyers in other areas that they shouldn't use a government position for their personal pecuniary benefit, they might agree with you. In banking law, they would laugh at you. 

       With that background on banking lawyers, let me move to the main topic of this post: Jerome Powell, the current Chairman of the Federal Reserve. Like the people above, Mr. Powell started his career in lower-level positions in law firms and a bank. Then in 1990, he entered the Department of Treasury. That's when the money started rolling in. He parlayed that government position into his first lucrative job, as a Managing Director of Bankers Trust, which he joined in 1993. That didn't go well. He "quit his position at Bankers Trust in 1995, after the bank became embroiled in a trading scandal that cost its clients hundreds of millions of dollars." But he was fine. He moved to other high-paying banking and investing jobs until returning to government after the 2008 financial crisis. Standard revolving door playbook.

       In 2018, the president put Mr. Powell in charge of managing the nation's inflation and employment rate. It was only the second time in history that a lawyer was picked for the position of Chairman of the Federal Reserve. Usually the position goes to an economist. The only other time a lawyer was nominated was in 1978, when Cravath, Swaine & Moore alumnus G. William Miller took the position. Hold onto that year of 1978 as we'll get back to it later. Any way, in 2020, Mr. Powell inexplicably declared a new approach to inflation called "average inflation targeting." Basically, he would be easier on inflation than were prior Fed Chairs. I'm not sure why he changed something that had worked for decades; he claimed it would be good for the country.

       It wasn't. Just two years later, inflation is the highest it's been in 40 years. And while some argue that this is temporary, we don't know what will happen. As you can see in the graph below, right now the two key metrics -- actual inflation and inflation expectations (a survey of where people think inflation will go) are where they were in 1978, before a four year period of very high inflation and two recessions. When I started working, older employees would tell me about that time, about how "PhDs had to drive taxi cabs to survive." It was a bad time economically.

       I am not making any predictions and I hope we don't repeat the late seventies. But in at least one analogous point in the past, 1978, things got much worse before they got better. So anyone guaranteeing that inflation will quickly subside and that we'll avoid a recession has one counterexample to explain away. Here is the source data if you would like to play with it. I also included the "10-2" (a number that, when it goes negative, predicts a recession, as it did in 1978, and which is currently negative) along with the federal funds rate (the interest rate that is set by the Federal Reserve and Mr. Powell, which is anomalously low in light of where it was relative to inflation historically.)

       Some commentators wonder if the Federal Reserve can even raise interest rates to lower inflation, as it did in 1980, because the government is more indebted today. Per the graph below, government debt as a percentage of GDP is four times what it was back then. They say that raising rates will raise the government's debt payment, and so is not sustainable beyond a small raise. (Others say that rate increases are sustainable in the short-term, and that a short-term raise is all that's required to lower inflation. Also, a lot of this debt is long-term debt whose interest payment doesn't change as short-term rates increase, and whose value will go down as interest rates rise.) Depending on how this dynamic plays out, the situation might be worse now than it was in 1978. 

       As you can see, Mr. Powell's decision to go soft on inflation may have been a regrettable mistake. By letting the inflation genie out of the bottle, he might have created a problem that will be painful to fix.

       Hopefully things magically resolve. Still, the president may wish to think twice before appointing another lawyer to the position of Federal Reserve Chair. As I explained here, lawyers aren't necessarily interested in the truth. Their job is to cherry pick facts and laws, and spin them to advance their client's interest. Sometimes, this means obfuscating and distracting from the truth. And yes, cherry picking and spinning, being deceptive, being intellectually dishonest . . . these can be useful skills in life. They're very effective in court, in sales, and other areas where one has to be an advocate. But they're not really useful for a Federal Reserve Chair.  

Kathy Ruemmler Goldman Sachs, Kathryn Ruemmler Latham Watkins, Kathy Ruemmler Obama attorney

Greg Jacob and his friend Michael Luttig

       As I watch Greg Jacob on television, as I hear him quoting Bible passages, I can't help but to recall my interactions with him.

       I don't want to restate the events; it's all chronicled in my original post here. You should probably read that before reading the rest of this post, as it won't make sense without that background. But I'll add one bit of color here. The mid-2015 St. Louis trial that I described in that original post was a trial for Boeing. In a conference room during that trial, Boeing's General Counsel Michael Luttig -- the person who testified alongside Greg Jacob today -- lectured us about why the United States was justified in the way it dealt with alleged enemy combatants. He sat next to Brian Boyle, praised Mr. Boyle's skills as an attorney, and then explained that when dealing with terrorists, you want them to think that you're crazier and more unpredictable than they are, and that's why the war on terror's methods are justified.

       Remember, this was an ERISA case. Why was he giving a speech on this other far off topic? Now that I know how close he was to Greg Jacob, I think I might know why. The reason I was abruptly assigned to that case was probably because Brian or Greg called their buddy Michael Luttig, explained the memo I had written, and had me assigned to the case in order to get me to drop it. It worked; I e-mailed human resources and told them to drop the matter. I didn't want to be sitting next to Brian Boyle in a small war room as they investigated my complaint against him. You can read about how that story turned out in the original post if you're interested, but it wasn't good.

       That's the impact Greg Jacob and his pal Michael Luttig had on my life. And I'm not sure I buy the hero story they are now writing about themselves. Let me start by distilling what happened in the months preceding January 6, because the facts get lost in the rhetoric. Mr. Trump thought that the election had been stolen from him. That opened the door for John Eastman to give Mr. Trump a strategy to litigate his dispute. At that time, Mr. Eastman thought he could win based, among other things, on prior statements by law professor Laurence Tribe. (According to Mr. Jacob, Mr. Eastman later retracted this prediction and acknowledged that he would lose in court.)

       Mr. Luttig, Mr. Jacob and others then argued that Mr. Eastman's position was not worthy of a resolution in the courts. Mr. Pence listened to them, and told Mr. Trump that he would not carry out the plan. That is presumably what caused Mr. Trump and others to assemble a protest, seemingly to pressure Mr. Pence, and the protesters broke into the capitol building.

       Mr. Eastman certainly should not have proffered his litigation strategy. But once he did, what would have happened if Mr. Pence had followed the plan? Everyone involved agrees that the Supreme Court would have struck it down swiftly and provided closure, rather than letting it linger for years as it has. That is all that would have happened. Democracy wouldn't have ended, and the apocalyptic things Mr. Jacob and Mr. Luttig say they prevented would not have occurred. All that would have happened is that the matter would have been dealt with authoritatively by the highest court, with closure.

       And for all his talk of respecting and honoring the law . . . Mr. Luttig doesn't respect it when it goes against him. Here he writes about a possible Supreme Court ruling on election law. He first explains why the court will likely rule against the position that he wants. He then declares that if they rule that way -- if they rule for the side that he doesn't like -- then it's tantamount to "Trump and the Republicans stealing . . . the 2024 election." The highest court in the country would be nothing more than a thief's accomplice if it disagrees with him.

       Similarly, Mr. Pence was reportedly fine with abuse of executive power, if it got him something that he wanted. According to Salon magazine, he and President Trump had concocted a scheme to bomb Iran in the final months of Trump's term. This plan "reflected Trump's seeming willingness 'to do anything to stay in power.'" The article quotes General Milley as saying Mr. Pence was "intent" on carrying out the military attack. If the article is accurate, then Mr. Pence would have let the president start a possible war to stay in power. That's who Mike Pence is. President Trump cancelled the plan only after other advisors counseled against it.

       If you want to predict how lawyers like Mr. Pence or Mr. Luttig will act, perhaps don't rely on the normative values they exhort. Lawyers were trained to say whatever will advance their client's interest. It's their job to say one thing in one setting, and say the exact opposite in another setting, depending on what they were trying to advance in each of those two settings. They'll say whatever suits them at that moment. So please don't expect Mr. Pence to not abuse executive power when it suits him, and please don't expect Mr. Luttig to respect the rule of law, including the Geneva Convention, when it goes against him.

       Ultimately, a lawyer started the mess by advancing a frivolous theory, then other lawyers exacerbated it by preventing an authoritative court from deciding the matter. And now with Joe Biden's approval rating at an all-time low -- lawyers Liz Cheney and Jamie Raskin are conducting what some call a "show trial" in an attempt to prevent Mr. Trump from running again. Things are a mess and I have no clue how this will all turn out.

       [Addendum: Apparently Mr. Jacob had been trying to leave O'Melveny. In 2018, he reportedly used O'Melveny's connections to the Trump administration to apply for a career position at the Department of Labor (a career government position is often held for decades, as opposed to a political one that ends with the president's term.) Only after that stalled did he take the job as Vice President Pence's advisor. I wouldn't be surprised if he's still looking to leave. I suspect it's unfortunate at O'Melveny at all levels.

       Mr. Luttig seems to be trying to become a social media star. Here he asks a handful of established social media lawyers for a retweet, presumably to get more likes and followers. Good luck on your next tweet Mr. Luttig.]

O'Melveny OMM