Keep your finger on the legal world's pulse
4th October 2024
 
THE HOT STORY
Jones Day parental leave bias claims must go to jury
Jones Day will have to defend its family leave policy at trial against claims from married ex-associates who say it is discriminatory and violates District of Columbia law, a federal court has said. The U.S. District Court for the District of Columbia modified the docket in the suit by Mark Savignac and Julia Sheketoff. It said that Jones Day’s bid for summary judgment was denied on the husband's interference claim under D.C.'s Family and Medical Leave Act. The original order issued last month, and a related docket entry for the court's temporarily sealed opinion, had indicated that the leave interference claim couldn't advance to trial. Savignac and Sheketoff sued Jones Day in 2019, alleging that the firm's parental leave policy for newborns discriminated against biological fathers by affording male employees eight weeks less time off for the birth of a child than female employees could use. They couple also said Jones Day retaliated for complaining about the gender inequity, including by dismissing Savignac two weeks after the birth of their son and three business days after the couple emailed the firm to  complain about its policy.
FIRMS
Law firms move to respond to anti-DEI backlash
Employers have been left wondering whether their affinity group or hiring initiative will see them end up in court after the Supreme Court issued its June 2023 ruling in Students for Fair Admissions v. President and Fellows of Harvard College, and law firms are now mobilizing to advise clients who are worried about litigation risk. "[Conservative activists] been highly organized and very effective so far in their litigation. But I also think that the story has yet to be written. The law is still very much in flux. They filed their early cases in jurisdictions where they thought they would be more successful. This law is going to develop in courts throughout the country, and so I think it's important for folks not to overreact to it," says Jason Schwartz, co-chair of the labor and employment group at Gibson, Dunn & Crutcher
Despite DEI challenges, record number of law firms achieve Mansfield Certification
Over 360 law firms achieved the Mansfield Certification for 2023-24, reflecting a 13% increase from the previous year, according to Diversity Lab. The program, which promotes leadership diversity in law firms, welcomed 45 new firms, including Cadwalader, Wickersham & Taft, Goodwin Procter (U.K.), and Withersworldwide (U.S. and U.K.). Despite challenges to diversity, equity, and inclusion (DEI) efforts, such as legal actions following the U.S. Supreme Court's affirmative action ruling, many firms remained committed to diversity. "These firms have blocked out the noise and remained quietly committed," said Alyssa Jarvis, director of Mansfield at Diversity Lab. The Mansfield Certification, launched in 2017, ensures all legal talent at participating firms have equal opportunities for leadership roles. Notably, firms that have been certified for five years or more have seen faster diversification in leadership, lateral hires, and client pitch teams. More than 110 firms will participate in the Next Gen Pilot, adding new parameters like relationship partner succession planning to the certification process.
Law firm mergers steady in 2024, with more expected in 2025
Despite a recent surge in law firm merger announcements, a report from Fairfax Associates shows that completed mergers in 2024 remain consistent with last year. The third quarter saw 11 completed combinations, totaling 41 for the year so far, matching 2023’s pace. Several high-profile mergers, including deals involving Troutman Pepper, Locke Lord, and others, are set for 2025, indicating a rise in activity next year. Fairfax noted that while recent mergers involved smaller firms, client pressure for practice depth and geographic expansion is driving more firms, especially larger ones, to explore mergers.  
STRATEGY
Law firms race for AI talent
As the legal profession undergoes an artificial intelligence (AI) revolution, firms are increasingly appointing dedicated executives to spearhead their AI initiatives. Notable recent hires include Jeff Westcott at Akin Gump as director of practice technology and AI innovation, and Christopher Cyrus at McDermott Will & Emery as director of AI innovation. Westcott emphasized the importance of "careful assessment to identify which tools best serve specific practice groups," highlighting the need for strategic integration of AI in legal services. The trend follows a broader industry shift towards embracing AI technologies to enhance efficiency and meet client expectations. Many firms, including Covington & Burling and DLA Piper, have established AI leadership roles since the launch of OpenAI's ChatGPT in late 2022, navigating both the opportunities and ethical implications of AI in legal practice.
APPOINTMENTS
Bowmans absorbs eight-partner A&O Shearman team in Johannesburg
Bowmans is set to absorb a team of eight partners from A&O Shearman in Johannesburg as the firm prepares to close its office in the city due to post-merger restructuring. Among those joining Bowmans is Gerhard Rudolph, the South Africa managing partner. Bowmans chair Ezra Davids said: “The team’s strengths in the banking, energy, mining and infrastructure sectors . . . will bolster our offering in these areas.” The partners, including Alessandra Pardini and Alexandra Clüver, will transition to Bowmans in January 2025, enhancing the firm's capabilities in complex legal matters across Africa. A&O Shearman's Johannesburg office was established in 2014.
Hunton Andrews Kurth adds energy partner
Kristian Bradshaw has joined Hunton Andrews Kurth as an energy and infrastructure partner in Tokyo, focusing on areas such as LNG, hydrogen, ammonia, and clean fuels. His expertise extends to solar, wind, geothermal, carbon capture, and cleantech matters. Previously, he was with White & Case.
DEALS
Clifford Chance faces scrutiny in Deutsche Bahn mega-deal
In a €14bn mega-deal, Deutsche Bahn sold its logistics arm, DB Schenker, to Danish transport group DSV to reduce its €34bn debt. While the transaction involved a typical array of bidders and legal advisers—such as Freshfields, A&O Shearman, Clifford Chance, and Milbank—a closer look revealed concerns about legal conflicts of interest. Clifford Chance represented multiple clients, including Saudi logistics firm Bahri, Abu Dhabi sovereign wealth fund ADQ, and the lenders backing DSV. This raised ethical questions, despite assurances that client consent and regulatory standards were upheld. The case reignited debate about the risks of law firms advising multiple parties in the same deal, highlighting potential conflicts and the challenges of maintaining "Chinese walls" between teams. Legal professionals remain divided, with some acknowledging the practice as commercially viable in competitive markets, while others see it as ethically precarious. The issue, long discussed in legal circles, continues to be a point of contention in the world of high-stakes M&A.

 
Law
EMPLOYMENT LAW
Amazon faces labor board complaint over 'joint employment' of drivers
Amazon.com has been accused by the National Labor Relations Board (NLRB) of illegally refusing to negotiate with a union representing drivers employed by Battle Tested Strategies (BTS). The NLRB's complaint asserts that Amazon is a "joint employer" of these drivers and employed illegal tactics to suppress union activities at a facility in Palmdale, California. Following their unionization last year, BTS drivers became the first Amazon delivery contractors to join the International Brotherhood of Teamsters. Teamsters President Sean O'Brien said: “This decision brings us one step closer to getting Amazon workers the pay, working conditions, and contracts they deserve." The case will be heard by an administrative judge in Los Angeles.
CYBERSECURITY
No chance a foreign adversary can change U.S. election results, cybersecurity chief says
Jen Easterly, director of the U.S. Cybersecurity and Infrastructure Security Agency, has said that the security of America's election systems is assured, observing that “Malicious actors, even if they tried, could not have an impact at scale such that there would be a material effect on the outcome of the election.” Despite warnings of foreign attempts to influence the upcoming presidential race, particularly from Russia and Iran, Easterly emphasized that no specific cyber activity targeting election infrastructure has been detected. The Biden administration has taken steps to counter these threats, including seizing fake Kremlin-run websites and charging individuals involved in disinformation campaigns.
CASES
Nike's trademark troubles deepen
A federal court has ruled that Nike knowingly infringed on the trademark rights of Lontex Corp., a smaller company based in Norristown, Pennsylvania, which specializes in knit garments for athletes. The court found that “Nike knew” it was violating Lontex's rights but “just did not care.” Lontex, founded by Efraim Nathan in 1989, previously won a jury verdict against Nike for trademark infringement in 2021. However, Nike has appealed the decision regarding the legal fees owed to Lontex's defence team. Nathan's company has been recognized for its innovative compression technology, which Nike was found to have copied in its cheaper designs.

 

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