Keep your finger on the legal world's pulse

Latham & Watkins and A&O Shearman have become go-to advisors for Saudi Arabia’s Public Investment Fund (PIF) as Riyadh looks to make good on its $1 trillion U.S. investment pledge, Bloomberg Law reports. The firms were among four that struck a deal with U.S. President Donald Trump last month, pledging $500m in free legal services on causes shared with the White House. The PIF is said to be among Latham & Watkins’ five largest clients, and A&O Shearman lawyers also have been frequent advisers to the $940bn fund. “One of the few things that is unambiguous about these law firm deals is what firms he views as being in his favor,” Walter Olson, a Cato Institute constitutional law fellow, observed of Trump. “Would Middle Eastern governments weigh that as an additional factor? I think they might.”

 

Bloomberg Law

Legal tech start-up Harvey AI is in advanced discussions to raise over $250m at a valuation of $5bn, a significant increase from its previous $3bn valuation just months ago. The company's annualized revenue reached $75m in April, driven by partnerships with major consulting firms and direct sales to large corporations, reflecting a growing interest in AI within the legal sector. Founded in 2022, Harvey AI uses machine learning to assist legal professionals with tasks including document review and contract drafting, and it has expanded its offerings by incorporating models from Anthropic and Google.

 

Reuters

A federal judge has temporarily blocked the Trump administration from removing collective bargaining rights for Foreign Service employees. U.S. District Judge Paul Friedman granted a preliminary injunction requested by the American Foreign Service Association, which represents over 18,000 members. The union argued that Trump's March 27 executive order “upended decades of stable labor-management relations” in stripping employees at the State Department and U.S. Agency for International Development of their rights to organize. Government lawyers claimed the order was necessary for national security, saying that “agencies with a primary national security focus are being hamstrung.” However, plaintiffs' attorneys said the order was issued to retaliate against labor unions and not to achieve any national security goals.

 

U.S. News

The Los Angeles Police Department (LAPD) is grappling with a significant financial burden due to officer-driven lawsuits. Police Chief Jim McDonnell claims that some officers are “weaponizing” the disciplinary system to settle grievances in costly legal battles. Recent settlements include $11.5m awarded to a former K-9 officer following discrimination claims. The city faces a $1bn budget deficit which is partly attributed to these legal payouts. Attorney Matthew McNicholas observes that the city attorney's aggressive defense strategy is costing taxpayers, and many cases could be settled for less. Joanna Schwartz, a UCLA law professor, emphasized the need for policy changes to address recurring lawsuits.

 

Los Angeles Times

Nike has requested a federal judge to dismiss a class action securities lawsuit, asserting that the claims are based on a “baseless theory” regarding the company's business strategy. The lawsuit alleges that former chief executive John Donahoe and other executives misled investors about the effectiveness of the Consumer Direct Acceleration (CDA) strategy, which aimed to boost direct sales. Despite acknowledging challenges, Nike's legal team argued that executives disclosed issues and adapted accordingly, saying: “Every major business strategy encounters challenges.” The lawsuit follows a significant drop in Nike's stock value in 2024, and plaintiffs must demonstrate that specific statements misled investors. Nike's lawyers contend that the lawsuit fails to meet this standard, emphasizing that the direct-sales strategy had previously driven revenues to record highs, nearly doubling to $21.3bn from 2020 to 2023.

 

The Oregonian

The U.S. Justice Department is set to meet with families of the victims from two Boeing 737 MAX crashes that resulted in 346 fatalities, as the company faces a trial related to alleged fraud in its dealings with regulators. Boeing's CEO, Kelly Ortberg, has indicated that the company is negotiating a revised plea agreement following a previous guilty plea for a criminal fraud conspiracy charge linked to the crashes. The upcoming meeting will allow victims' relatives to discuss the case with the Justice Department, although no updates on the investigation were provided in the communication.

 

Reuters

A jury in Arkansas federal court has found that Walmart owes technology start-up Zest Labs more than $222m following a retrial on claims that the retailer stole its trade secrets for reducing food waste. Zest said the jury awarded the company $72.7m in compensatory damages and $150m in punitive damages, finding that Walmart had misused its trade secrets after Zest shared its technology for improving food preservation with the retail giant. Walmart said in a statement on Wednesday that it would appeal the new verdict and that Zest's "unethical behavior has compromised the integrity of this case from the start."

 

Reuters

Goldman Sachs will pay a $1.45m fine to settle claims by FINRA over inaccurate trade reporting. Coding and tech errors led to incorrect data for billions of trades and supervisory failures. The issues affected order memoranda, trade reports, and confirmations. Goldman Sachs neither admitted nor denied wrongdoing in the settlement, which relates to reporting to the Consolidated Audit Trail (CAT).

 

Reuters

Victoria Salem has joined Clifford Chance as a partner in its global financial markets team based in Houston. Salem brings expertise in complex commercial and financing transactions, particularly in the energy and infrastructure sectors, with a focus on LNG. Previously, she served as assistant general counsel for finance and tax at Cheniere Energy.

 

Bloomberg Law

Megan Gaffney Painter has joined Squire Patton Boggs as a partner in its government investigations and white-collar practice. Previously, she served as an assistant U.S. attorney for both the Southern District of Ohio and the Southern District of New York, where she handled cases involving cybercrime, public corruption, and fraud. Notably, she prosecuted Larry Householder, the former Speaker of the Ohio House of Representatives.

 

Bloomberg Law

Austrian advocacy group NOYB has announced plans to seek an injunction against Meta Platforms, potentially leading to significant damages claims if the company proceeds with using European users' personal data for AI training. NOYB's founder, Max Schrems, has challenged Meta's justification for this data use, arguing that it contradicts previous rulings by the European Court of Justice regarding user consent and privacy rights.

 

Reuters

The North American Electric Reliability Corporation has issued a warning about the potential for blackouts this summer due to soaring electricity demand and extreme weather conditions. Its forecast indicates that regions from the Upper Midwest to Texas may struggle to meet customer needs during prolonged high temperatures. The regulatory authority cautions that the aging power grid is under significant strain, warning: "a large swath of the United States is facing a heightened risk of blackouts."

 

Washingtonpost.com