TRUMP’S TAX RETURNS: PART 2 — FROM RUSSIA WITH LOVE

Be afraid. Be very afraid.

At an October 10 rally in Wilkes-Barre, Pennsylvania, Donald Trump held up a document. Kurt Eichenwald describes what happened next:

“He told the assembled crowd that it was an email from Blumenthal, whom he called ‘sleazy Sidney.’ ‘This just came out a little while ago,’’ Trump said. ‘I have to tell you this.’ And then he read the words from my [Kurt Eichenwald’s October 21, 2015 Newsweek] article. “‘He’s now admitting they could have done something about Benghazi,’ Trump said, dropping the document to the floor. ‘This just came out a little while ago.'”

As Eichenwald explains, the words weren’t Blumenthal’s. Trump read from a distorted summary of Eichenwald’s 10,000-word Newsweek article attached to an email to John Podesta, Clinton’s campaign chairman. It resulted from a Russian disinformation campaign tied to a recent Wikileaks release. A Russian-controlled news agency — Sputnik — reported the false story.

Eichenwald asks, “So how did Donald Trump end up advancing the same falsehood put out by Putin’s mouthpiece?”

“This is not funny,” Eichenwald continues. “This is terrifying. The Russians engage in a sloppy disinformation effort and, before the day is out, the Republican nominee for president is standing on a stage reciting the manufactured story as truth.”

Which Takes Us Back to Trump’s Income Tax Returns

Compared to Trump’s boast about being a sexual predator, his admission in the second debate that he paid no federal income taxes for years seems almost innocuous. So why does he still refuse to release his returns? Eichenwald’s latest revelation adds more evidence that the answer may be Russia. Like all things Trump, his words and deeds fit a pattern.

“He is not going into Ukraine, OK, just so you understand,” Trump declared in August. “He’s not going into Ukraine, all right? You can mark it down. You can put it down. You can take it anywhere you want.”

“Well, he’s already there, isn’t he?” ABC’s George Stephanopoulos corrected him immediately, referring to Vladimir Putin’s illegal seizure of Crimea.

“OK,” Trump answered. “Well, he’s there in a certain way.”

Worse Than Ignorance?

A month after Trump’s declaration about Putin in Ukraine, he made what Trump’s campaign later called a mistake. Trump appeared on Russian state-sponsored television to criticize America. Meanwhile, he has praised Vladimir Putin continuously: “If he says great things about me, I’m going to say great things about him.”

Never mind that Putin is a cruel dictator who crushes dissent, makes a mockery of human rights, and orders the invasion of sovereign countries. Political opponents and critical journalists disappear or get assassinated. And there’s growing evidence that he’s trying to influence the election in Trump’s favor.

During the first presidential debate, Trump reacted defensively to Hillary Clinton’s concerns about Russians hacking into the Democratic National Committee’s computers. Rejecting the U.S. law enforcement consensus that Russian intelligence agents were behind that cyberattack, Trump said:

“She keeps saying ‘Russia, Russia, Russia,’ and maybe it was. It could be Russia, but it could be China, could also be lots of other people. It could be someone sitting on their bed that weighs 400 pounds.”

And at the second debate, he persisted: “[A]nytime anything wrong happens, they like to say the Russians are — she doesn’t know if it’s the Russians doing the hacking. But they always blame Russia.”

He knows better. Back in mid-August, Trump and his team received intelligence briefings that directly contradict his recent statements. And 48 hours before the second debate, the intelligence community and the Department of Homeland Security issued a joint statement that pointed directly to the Kremlin:

“The U.S. Intelligence Community (USIC) is confident that the Russian Government directed the recent compromises of e-mails from U.S. persons and institutions, including from U.S. political organizations… We believe, based on the scope and sensitivity of these efforts, that only Russia’s senior-most officials could have authorized these activities.”

Why does Trump ignore undisputed evidence, defend Russia, and praise Putin? Here’s one possible answer: the personal financial self-interest of Trump and his top advisers.

Paul Manafort and Ukraine

When Georgetown Law School graduate Paul Manafort took over as campaign manager, the selection seemed to be the harbinger of an extreme makeover. Manafort would attempt for Trump what he’d accomplished for Ukrainian’s former president, Viktor Yanukovych, whom Manafort resurrected from disgrace to that nation’s highest office in only five years.

But Manafort’s ties to Ukraine’s pro-Putin former president led to accusations of secret cash payments to Manafort’s consulting firm. Then The Washington Post reported that the Trump campaign worked behind the scenes on a Republican convention platform plank that gutted the GOP’s longstanding support for Ukrainian resistance to the Russian-led intervention. Finally, the Associated Press reported that Manafort’s firm hired Washington, DC lobbyists to influence the American press and U.S. government officials on behalf of the pro-Putin Ukrainian Embassy. The cascading revelations of pro-Russian activity led to Manafort’s resignation.

Boris Epshteyn

After Manafort departed, another Georgetown Law graduate, Boris Epshteyn, became the most visible surrogate defending Trump’s continuing admiration for Russia’s top tyrant. Epshteyn was born in Russia and emigrated to the United States in 1993. Twenty years later, when New Jersey Senator Frank Lautenberg died in 2013, Epshteyn wrote,

“[I]t was the Lautenberg Amendment that allowed my family and me to emigrate to the United States of America in 1993. The Lautenberg Amendment, passed in 1990, loosened the restriction on refugee states and thereby allowed for tens of thousands of Jews like me from the former U.S.S.R. to come to America. The legislation was also applied to religious minorities from Iran, Vietnam and Burma, as well as other countries.”

Now that he is safely in the United States, Epshteyn supports a candidate who proposed a religious ban to keep others out. After receiving his JD in 2007, Epshteyn went to work at Milbank, Tweed, Hadley & McCoy. According to his LinkedIn website page, a Russian theme has permeated his activities:

— June 2007 to present (overlapping with his time at Milbank from October 2007 to May 2009): Principal for Strategy International, providing “consulting and liaising services for domestic and international transactions with a focus on Eastern Europe and former Soviet Union.”

— June 2009 – July 2013: Managing director of business and legal affairs for West America Securities Corp. His duties were to “originate and locate funding for diverse domestic and international transactions, including private placements, public equity/debt offerings and mergers and acquisitions transactions.”

— July 2013 to present: Managing director of business and legal affairs for TGP Securities, Inc. In that position, he moderated an October 2013 panel discussion for a conference titled, “Invest in Moscow!”

In August 2016, Epshteyn became a senior adviser to the Trump-Pence campaign on “media, communications and foreign policy.” If Epshteyn is the important foreign policy adviser that he claims to be, it explains some of Trump’s bizarre denial about Putin.

Whose Party Line?

“First of all,” Epshteyn told a CNN interviewer on July 31. “Russia did not seize Crimea. We can talk about the conflict that happened between Ukraine and the Crimea…But there was no seizure by Russia. That’s an incorrect statement, characterization, of what happened.”

That’s in line with Trump’s statement to George Stephanopoulos that Putin “is not going into Ukraine.” Observers dismissed Trump’s comment as a gaffe, but it’s the Kremlin’s position. And it’s blatantly false. The international community has condemned Putin’s invasion and annexation of Crimea. Period.

Like Trump, Epshteyn also points to Putin’s 82 percent approval rating as proof that Putin is a strong leader. But as Tom Brokaw observed on the September 11 edition of  Meet the Press, “He’s not saying the other 18 percent are on their way to a gulag somewhere.”

All Roads Lead To Trump’s Tax Returns

Trump’s tax returns should confirm what he has now admitted publicly: that he hasn’t owed any federal income tax for years. But a far more sinister explanation for his unwillingness to release the returns is that they could complete a picture of Trump’s business connections to Russia that journalists are piecing together.

David Cay Johnston’s August investigation reveals that Russians are partners with Trump in many American projects: “Trump has tried at least five times to build a Trump Tower in Moscow, including efforts he made during his 2013 trip there. His name is on a 47-story building in Georgia, formerly part of the Soviet empire… Donald Trump Jr. said in 2008 that ‘in terms of high-end product influx into the U.S., Russians make up a disproportionate cross-section of a lot of our assets. We see a lot of money pouring in from Russia.'”

Kurt Eichenwald — the same reporter who revealed Russia’s disinformation effort relating to his 2015 article — published a September analysis in Newsweek: “Hoping to start its branding business in Russia, the Trump Organization registered the Trump name in 2008 as a trademark for projects in Moscow, St. Petersburg and Sochi… If the company sold its brand in Russia while Trump was in the White House, the world could be faced with the astonishing sight of hotels and office complexes going up in downtown Moscow with the name of the American president emblazoned in gold atop the buildings.”

Legal Eagles

Richard Painter and Norman Eisen are former chief ethics attorneys for Presidents George W. Bush and Barack Obama, respectively. Their op-ed for The Washington Post listed the numerous conflicts that would make a Trump presidency “ethically compromised.” Among the most serious are his family organization’s undisclosed financial ties to Russia, China, India, South Korea, and Turkey.

Labeling Trump’s actual or apparent conflicts “as obscure, profound, and dangerous,” they conclude: “The ethics lawyer who would have President Trump as his or her client would face a far more daunting task than either of us — or any of our colleagues in recent years — has ever confronted.”

“Conflict-of-Interest Laws, You’re Fired!”

How would President Trump resolve the massive conflicts that haven’t been disclosed fully to voters? However he chose. All of those elaborate ethics laws and rules applicable to cabinet members and other high-level government officials don’t apply to the president.

As Norman Eisen elsewhere observes, “Because the President of the United States is the single most consequential decision maker on the planet, Congress has decided his hands shouldn’t be tied on any issue because of conflicts of interest over any potential financial or personal gain.”

In September, Kurt Eichenwald concluded, “Never before has an American candidate for president had so many financial ties with American allies and enemies, and never before has a business posed such a threat to the United States. If Donald Trump wins this election and his company is not immediately shut down or forever severed from the Trump family, the foreign policy of the United States of America could well be for sale.”

The Russians have chosen their candidate for president of the United States. Be afraid. Be very afraid.

BIG LAW RESISTS THE ASSAULT ON DEMOCRACY

Call them unsung heroes.

When attorneys in big law firms get things right, they deserve more attention than they receive. Recently, some of them have won important victories in the profession’s noblest pursuit: protecting our republic. And they’re not getting paid anything to do it.

Start with North Carolina. On July 29, a unanimous court of appeals threw out that state’s voter ID law. In an 83-page opinion, the court wrote that the law had targeted African Americans “with almost surgical precision.”

Behind that monumental win was an enormous investment of money and manpower — all of it pro bonoDaniel Donovan led a team of lawyers from Kirkland & Ellis LLP through two trials over a four-week period. More than fifty witnesses testified. After losing in the trial court — which issued a 479-page opinion denying relief — the plaintiffs appealed. On July 29, they won. Think of it as Kirkland & Ellis’s multi-million dollar contribution to democracy.

On, Wisconsin!

The same day that the court of appeals threw out North Carolina’s unconstitutional voter ID law, a federal judge in Madison invalidated Wisconsin’s effort to disenfranchise African Americans and Latinos. Big law firm partner Bobbie Wilson at Perkins Coie LLP was at the center of that effort. A nine-day trial and more than 45 witnesses (including six experts) culminated in Judge James B. Peterson’s 119-page ruling in favor of the plaintiffs.

On August 22, the seventh circuit court of appeals denied the request of Governor Scott Walker’s administration to stay Judge Peterson’s ruling.

North Dakota

Three days later, Richard de Bodo of Morgan, Lewis & Bockius LLP won a challenge to North Dakota’s voter ID laws. The targets of that legislation were Native Americans.

Like similar statutes enacted throughout the country since 2010, voter ID laws in North Carolina, Wisconsin, and North Dakota were products of a Republican-controlled legislature and governorship. The real motivation behind such restrictions on a fundamental right is as ugly as it is obvious.

Fighting Against the Demographic Tide of History

In 2014, the Brennan Justice Center noted that North Carolina and Wisconsin were in select company: “Of the 11 states with the highest African-American turnout in 2008, 7 have new restrictions in place: Mississippi (73.1 percent), South Carolina (72.5), Wisconsin (70.5), Ohio (70.0), Georgia (68.1), North Carolina (68.1), and Virginia (68.1).”

Of the 12 states with the largest Hispanic population growth between 2000 and 2010, North Carolina was one of nine that made it harder to vote. The others were South Carolina, Alabama, Tennessee, Arkansas, North Carolina, Mississippi, South Dakota, Georgia, and Virginia.

Rigged Elections? Yes, But in Whose Favor?

Now that the Republican nominee for President of the United States is pushing a dangerous and destructive new theme, the battle to vote has now assumed a great significance.

“I’m afraid the election is going to be rigged,” Donald Trump warned at a rally in Columbus, Ohio on August 1, right after the North Carolina federal appeals court ruled.

That evening he told an interviewer: “I’m telling you, November 8, we’d better be careful, because that election is going to be rigged. And I hope the Republicans are watching closely, or it’s going to be taken away from us.”

Dedicated attorneys — especially those in big firms willing to donate enormous resources to the cause — have worked hard to protect the right of every eligible person to vote. If they hadn’t, then the North Carolina legislature might, indeed, have rigged the election in a key swing state that President Obama had won. But that’s not what Trump meant, was it?

No, he sees a different enemy.

“[P]eople are going to walk in, they are going to vote 10 times maybe. Who knows?” he said in an August 2 interview.

He now has a website page: “Help Me Stop Crooked Hillary From Rigging This Election.” Such whining is actually much more than that. It’s a campaign tactic uniting two sinister and pervasive themes: racial division and attacks on the rule of law.

Facts Don’t Matter

Trump began stoking fear and division with a promise to build a wall to keep out Mexicans, whom he called rapists and drug dealers. He then coupled it with a “deportation force” to “round ’em up,” sending 11 million illegal immigrants “back where they came from.”

Then he professed ignorance about David Duke. (“I don’t know anything about David Duke… I know nothing about white supremacists.”) Before long, he unleashed hostility toward “Mexican” Judge Gonzalo Curiel. After scaring people, it was a short step for him to becoming their self-professed “law-and-order” savior.

Now he is wrapping his message in a long-discredited canard. Defenders of unconstitutional voter ID laws persist in fomenting “election fraud” paranoia, even though it lacks any factual basis. Professor Justin Levitt at Loyola Law School, Los Angeles tracked all claims of alleged voter ID fraud and found a grand total of 31 credible allegations – out of more than one billion ballots cast.

In the North Dakota case, Judge Daniel L. Hovland wrote, “There is a total lack of any evidence to show voter fraud has ever been a problem in North Dakota.”

Likewise, in the Wisconsin case, the judge ruled. “The Wisconsin experience demonstrates that a preoccupation with mostly phantom election fraud leads to real incidents of disenfranchisement, which undermine rather than enhance confidence in elections, particularly in minority communities. To put it bluntly, Wisconsin’s strict version of voter ID law is a cure worse than the disease.”

And in the North Carolina case, a unanimous court of appeals concluded, “The record thus makes obvious that the ‘problem’ the majority in the General Assembly sought to remedy was emerging support for the minority party.”

Mob Mentality

The cry of phantom election fraud feeds Trump’s narratives, while taking them a perilous step farther: de-legitimizing an election that polls now show Trump is losing “hugely.” As his prospects sag, his vile rhetoric escalates.

Shortly after an August 10 poll showed Trump trailing in Pennsylvania by double digits, he went to that state and told an Altoona crowd, “Go down to certain areas and watch and study and make sure other people don’t come in and vote five times… The only way we can lose, in my opinion – I really mean this, Pennsylvania – is if cheating goes on… ”

Never mind that Pennsylvania hasn’t voted for a Republican Presidential nominee since 1988. Even an incumbent, George H.W. Bush, couldn’t carry it in 1992.

Trump then continued waving his red herring: “Without voter ID there’s no way you’re going to be able to check in properly.”

Scorched Earth

The real danger to democracy isn’t election rigging or cheating. It’s Donald J. Trump. De-legitimization – the ultimate ad hominem attack on a process to undermine its outcome – is a standard tactic from his deal-making playbook. When it appeared that he might not arrive at the Republican convention with enough delegates to secure the nomination, he warned about “riots,” if someone else won.

Never mind the rules; they’re for losers. Anyone fearing that Trump will win should fear more that he won’t.

Trump knows that facts don’t matter because – true or false – the branding sticks. For example, there was never any evidence to support Trump’s wild “birther” claims about President Obama in 2011. But five years later, 20 percent of Americans still believe — today — that he was born outside the United States.

Some people will always believe anything Trump says, even as he contradicts himself from one moment to the next. His infamous line was pretty accurate: “I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn’t lose any voters.”

Perhaps he is discovering that “any” was an overstatement. But his de-legitimization strategy worked against most Republican politicians, who folded like cheap suits rather than break from the man-baby who would be king. Now the stakes are higher. His targets are the rule of law, the essence of democracy, and the peaceful transfer of Presidential power that occurs every four years.

The Real Losers

The eventual victims of Trump’s scorched earth approach will be the American people. If, as with his false “birther” claims five years ago, 20 percent of voters – about half of his current supporters – believe that Trump’s defeat results from a “rigged” election that “cheaters” won, the collateral damage to the county will be profound.

Donald Trump lives in a simple binary world of winners and losers – and he’s all about winning at any cost. He measures success in dollars. His latest tactic makes democracy itself the loser. Try putting a price on that. And thank some big law firms and their attorneys who are willing to make the investment required to stand in his way.

THE ABA’S TERRIBLE, HORRIBLE, NO GOOD, VERY BAD DAY

It’s a mere formality. Every five years, the Department of Education renews the ABA’s power to accredit law schools. The June 2016 session before a DOE advisory committee (NACIQI) was supposed to be just another step in the rubber-stamping process. The NACIQI staff had recommended approval. The committee’s three-day session contemplated action on a dozen other accrediting bodies, ranging from the American Psychological Association to the American Theological Schools. Sandwiched between acupuncture and health education, the agenda contemplated an hour for the ABA.

What could go wrong?

For starters, committee members grilled the ABA’s representatives for an entire afternoon.

Questions About Law Student Debt?

First up for the ABA was the chair of the Section of Legal Education and Admissions to the Bar, Arizona Supreme Court Justice Rebecca White Berch. A committee member asked how the ABA assessed schools based on the interrelationship between student debt, bar passage rate, and graduate placement rates. Justice Berch said the ABA was looking “for a bar passing rate of 75 percent…. [W]as that part of your question?”

Actually, that was just a proposal set for an ABA Section hearing on August 6, but it wasn’t what the NACIQI had in mind.

NACIQI Member: “Sorry, no. I think my question also went to concern related to debt that students incurred while in law school and relationship of that to placement.”

ABA Managing Director Barry Currier tried to field that one:

“With respect to debt, we have been following a disclosure model for a number of years now and a lot of information is disclosed… [W]e collect information about student borrowing, but it is currently not part of the consumer information that schools are required to post with us… [T]here is no standard about how much debt is too much debt at this point in time.”

Let the squirming begin.

“So it may be,” Currier continued, “that as evidence mounts that students don’t shop very effectively and that as uncapped student loans are available, that we need to be more paternalistic, if you will, or more — we may need to make more information required and adopt standards around how much debt is too much debt.”

Placement Rates?

NACIQI: “What would be an appropriate placement rate for a law school?”

Currier: “Well our standards do not require any specific employment…[W]e don’t have a specific standard that a school must achieve in terms of placement.”

NACIQI: “But you are the ones who identified that legal education is very expensive… And if they can’t find a job it wrecks their lives.”

NACIQI: “[Y]ou can tell a lot from some of these low performing schools. And a school that sticks out to me is Whittier Law School in California… [T]he enrollment has dropped 51 percent since 2010, yet tuition has increased 31 percent since 2008.”

He wasn’t finished.

“Over 105 million dollars of Title IV funding has gone into this school. All the while, one in four graduates of this law school has obtained a full-time attorney job within nine months… Appalachian School of Law, University of LaVerne, Golden Gate, all have abysmal placement rates… [S]o I guess my question is specifically related to these low performing institutions: what are you guys doing?”

Then he answered his own question:

“[W]hen we look at these low performing schools, you guys are doing absolutely nothing.”

Can We Talk About Something Else?

Justice Berch’s attempt to change the subject was unavailing.

NACIQI: “We are talking about student debt, right, so — I guess you are not answering my question, and so I would like for us to stay on that… I just want to make sure we are talking about what is your responsibility and your response to these lower performing schools. I mean, have they been put on probation? That’s my first question.”

Justice Berch: You make a valid point. The answer is — has anyone yet been put on probation? No…”

NACIQI: “How many institutions have you denied accreditation to for low pass rates?

Justice Berch: For low pass rates alone, none.”

NACIQI: “Over the past five years how many institutions have you withdrawn your accreditation from?”

Currier: “Zero, zero.”

You Think The ABA Can’t Do The Job?

During the NACIQI’s discussion on the motion to recommend renewal of the ABA’s accreditation power, one member put the problem bluntly:

“I am troubled that the ABA just simply isn’t independent enough for this responsibility… I find it very difficult to think that they are going to be objective enough to continue to carry out this responsibility. And I reluctantly conclude that the ABA is not the appropriate accreditor for our law schools…[T]he crushing debt load on thousands and thousands of students is too serious for us… And I think the debt load is not going to get better if we say yes to this motion.”

Another member added: “I think that objectivity is important as you go through this process, so I would think an independent body that does not have the conflict of interest that the ABA has.”

It’s Worse Than They Thought

The NACIQI didn’t consider a recent illustration of the ABA’s independence problems. Former ABA President Dennis Archer is chairman of the national policy board of Infilaw — a consortium of three for-profit law schools. At those schools — Arizona Summit, Florida Coastal, and the Charlotte School of Law — students graduate with six-figure debt and dismal prospects for a meaningful job requiring bar passage. (Full-time long-term JD-required job placement rate ten months after 2015 graduation: Arizona Summit — 40 percent; Florida Coastal — 39 percent; Charlotte — 26 percent.)

On November 18, 2013, Archer and Infilaw’s chief executive officer co-signed a seven-page tour de force warning the DOE about the perils of applying the “Gainful Employment Rule” to “proprietary law schools and first professional degree schools in general.” The letter (on Infilaw stationery) argued, among other things, that the proposed rule was unnecessary because the ABA — as an accrediting body — ensures that InfiLaw “must offer an education that will help students achieve their goals.”

Six months later, Archer became chairman of the ABA’s Task Force on the Financing Legal Education. A year later — June 2015 — the Task Force acknowledged that 25 percent of law schools obtain at least 88 percent of their revenues from tuition. But it refused to recommend an obvious remedy: financial penalties for schools where students incur massive law school debt in exchange for dismal long-term JD-required job prospects.

The Task Force’s recommendations were embarrassingly inadequate, but the ABA House of Delegates accepted them.

One More Chance?

The ABA’s culture of self-interest and insularity has now created a bigger mess. Some NACIQI members favored the “nuclear” option: recommending denial of the ABA’s accrediting authority altogether. The committee opted to send a “clear message” through less draconian means.

The final recommendation was to give the ABA a 12-month period during which it would have no power to accredit new law schools. Thereafter, the ABA would report its progress in addressing the committee’s concerns, including the massive debt that students are incurring at law schools with poor JD-required placement rates.

As one member put it, “It is great to collect data, but they don’t have any standard on placement. What’s the point of collecting data if you can’t…use the data to help the students and protect the students…”

Another member summarized the committee’s view of the ABA: “This feels like an Agency that is out of step with a crisis in its profession, out of step with the changes in higher ed, and out of step with the plight of the students that are going through the law schools.”

The day of reckoning may not be at hand, but it’s getting closer.

THE NHL, BRAINS, AND LAWYERLY DENIAL

Back in 1988, the Surgeon General of the United States issued a report about the addictive qualities of tobacco. In summary form, its “Major Conclusions” were:

“1. Cigarettes and other forms of tobacco are addicting.

2.  Nicotine is the drug in tobacco that causes addiction.

3. The pharmacologic and behavioral processes that determine tobacco addiction are similar to those that determine addiction to drugs such as heroin and cocaine.” — The Health Consequences of Smoking: Nicotine Addiction: A Report of the Surgeon General.

All of that had been obvious to many smokers who’d tried unsuccessfully to quit — and to many others who had watched their efforts. But six years later, the presidents and CEOs of the seven major tobacco companies faced a continuing avalanche of tobacco-related lawsuits. Appearing jointly before a congressional committee on the health effects of tobacco, Congressman Ron Wyden posed a question that he asked each of them to go down the line and answer:

“Do you believe nicotine is not addictive?”

With only minor variations in word choice, one-by-one they replied, “I believe nicotine is not addictive.”

It became an iconic scene of corporate denial. Three years later, the companies did an abrupt about-face and settled the largest class action and government cases against them.

Not Quite Today’s “Tobacco Moment”

The tobacco episode came to mind as I read Senator Richard Blumenthal’s first two questions to Gary Bettman, commissioner of the National Hockey League. But there’s a critical difference: The tobacco executives stood together as one against the onslaught; Bettman and the NHL are all alone.

In a March 2016 congressional hearing, Representative Jan Schakowsky asked Jeff Miller, the NFL’s senior vice-president for health and safety, whether there was a link between football and degenerative brain disorders like chronic traumatic encephalopathy (CTE).

“The answer to that is certainly, yes,” Miller said.

It seemed reasonable to ask similar questions about hockey, and Blumenthal posed these two (among others) in a letter to Bettman:

  1. Do you believe there is a link between CTE and hockey? If you do not, please explain how head trauma in hockey differs from head trauma in football.
  2. Do you dispute that the documented CTE of former NHL players, like Derek Boogaard, is linked to injuries sustained while playing in the NHL?

Bettman reframed the first question and ignored the second one.

A Lawyerly Treatment

Bettman is a graduate of NYU Law School. The league’s litigation attorneys probably drafted his 24-page response to Blumenthal. But he signed what is essentially a legal brief outlining the NHL’s defenses to former players’ pending litigation against the NHL.

Bettman’s reframing of the first question is subtle: “The core of your letter goes to the question of why the NHL has not acknowledged a ‘link’ between playing hockey and developing CTE if an NFL executive may have done so with respect to football.”

Then he recites in great detail the scientific community’s failure to reach consensus on the causation between concussions in contact sports and CTE. Scientific consensus is the way experts approach research issues. But it has never been the standard by which ordinary, everyday people decide whether to engage in an activity. For example, it takes far less than a reasonable degree of medical and scientific certainty — the legal standard implicit in Bettman’s letter — for a parent to make a decision about what is best for a child.

For starters, a scientific study requires a sufficiently large sample size. For CTE, the sample is tiny and will be for a long time. Confirmation of CTE occurs only by examination of a deceased person’s brain. To date, only 200 brains with CTE have been analyzed. As athletes die, the sample size will increase, but it’s a slow process. Even in brains found to have CTE, isolating all variables to identify the specific contribution of contact sports is a daunting task that will take years, assuming it happens at all.

Here’s another way of reframing Bettman’s position on this issue: The NFL shouldn’t have acknowledged the link, either.

And Another Thing…

Bettman then suggests that the key difference between football and hockey is the frequency of hits to the head. That’s why for years boxers were the exclusive subjects of brain injury studies. Interestingly, footnote 37 of his letter defends fighting as an essential element of hockey:

“Outside the context of ‘staged fighting,’ we note also that players (not just Club General Managers) believe that some types of fighting — though penalized — play a useful and worthwhile role in protecting ‘skilled players’ from being targeted by more aggressive opponents because any such ‘targeting’ activity is capable of being appropriately ‘policed’ by a teammate… [S]pontaneous fights — which, of course, are also penalized — provide a ‘safety valve’ that enables players to confront opposing players in a less dangerous fashion than they might otherwise engage in through dangerous ‘stick work’ or cheap shots.”

But not to worry. Bettman notes that only two of the league’s video-analyzed concussions resulted from fights. And please, let’s not discuss NHL Deputy Director Bill Daly’s 2011 email: “Fighting raises the incidence of head injuries/concussions, which raises the incidence of depression onset, which raises the incidence of personal tragedies.”

And Another Thing…

Finally, Bettman says that the NHL has educated players on the dangers of concussions. But he says it’s premature to provide a formal warning about CTE. In fact, he suggests, it could even be dangerous to do so. Players might decide they have an irreversible brain disease when they have only depression or other treatable disorders that have similar symptoms.

He concludes with an example. Rather than respond to Blumenthal’s question about Derek Boogaard, Bettman turns to another former player, Todd Ewen. After Ewen committed suicide. his autopsy showed no CTE. Because his widow said that she and Todd “were sure Todd must have had CTE,” Bettman leaps to an absurd conclusion: “This, sadly, is the type of tragedy that can result when plaintiffs’ lawyers and their media consultants jump ahead of the medical community.”

The Real Troublemakers

For Bettman, the villain in “the current public dialogue about concussions in professional sports (as well as youth sports)” seems to be “media hype driven in part by plaintiffs’ counsel.”

In December 1994, another NYU Law School graduate, NFL Commissioner Paul Tagliabue said: “On concussions, I think this is one of those pack journalism issues, frankly…The problem is a journalist issue.”

Twenty years later, what Bettman describes as the absence of medical consensus about the causal relationship between concussions and CTE didn’t stop the NFL from agreeing to a $1 billion class action settlement with 5,000 former players claiming brain injury. On the sliding scale of monetary awards to those victims, former players who died “with CTE” are in the second highest dollar recovery category — with a maximum of $4 million.

The NHL is only two decades behind.

ASSOCIATE PAY AND PARTNER MALFEASANCE

Cravath, Swaine & Moore raised first-year associate salaries from $160,000 to $180,000 — the first increase since January 2007. As most law firms followed suit, some clients pushed back.

“While we respect the firms’ judgment about what best serves their long-term competitive interests,” wrote a big bank’s global general counsel, “we are aware of no market-driven basis for such an increase and do not expect to bear the costs of the firms’ decisions.”

Corporate clients truly worried about the long-run might want to spend less time obsessing over young associates’ starting salaries and more time focusing on the behavior of older attorneys at their outside firms. In the end, clients will bear the costs of short-term thinking that pervades the ranks of big firm leaders. Some already are.

Historical Perspective

Well-paid lawyers never generate sympathy. Nor should they. All attorneys in big firms earn far more than most American workers. But justice in big law firms is a relative concept.

Back in 2007 when associate salaries first “jumped” to $160,000, average profits per equity partner for the Am Law 100 were $1.3 million. After a slight dip to $1.26 million in 2008, average partner profits rose every year thereafter — even during the Great Recession. In 2015, they were $1.6 million — a 27 percent increase from seven years earlier.

In 2007, only 19 firms had average partner profits exceeding $2 million; in 2015 that group had grown to 29. But the average doesn’t convey the real story. Throughout big law, senior partners have concentrated power and wealth at the top. As a result, the internal compensation spread within most equity partnerships has exploded.

Twenty years ago, the highest-paid equity partner earned four or five times more than those at the bottom. Today, some Am Law 200 partners are making more than 20 times their lowest paid fellow equity partners in the same firm.

It Gets Worse

Meanwhile, through the recent prolonged period of stagnant demand for sophisticated legal services, firm leaders fueled the revolution of partners’ rising profits expectations by boosting hourly rates and doubling leverage ratios. That’s another way of saying that they’ve adhered stubbornly to the billable hours model while making it twice as difficult for young attorneys to become equity partners compared to 25 years ago.

The class of victims becomes the entire next generation of attorneys. Short-term financial success is producing costly long-term casualties. But those injuries won’t land on the leaders making today’s decisions. By then, they’ll be long gone.

So What?

Why should clients concern themselves with the culture of the big firms they hire? For one answer, consider two young attorneys.

Associate A joins a big firm that pays well enough to make a dent in six-figure law school loans. But Associate A understands the billable hour regime and the concept of leverage ratios. Associate attrition after five years will exceed 80 percent. Fewer than ten percent of the starting class will survive to become equity partners. Employment at the firm is an arduous, short-term gig. In return for long-hours that overwhelm any effort to achieve a balanced life, Associate A gets decent money but no realistic opportunity for a career at the firm.

Associate B joins one of the few firms that have responded to clients demanding change away from a system that rewards inefficiency. Because billable hours aren’t the lifeblood of partner profits, the firm can afford to promote more associates to equity partner. Associate B joins with a reasonable expectation of a lengthy career at the same firm. Continuity is valued. Senior partners have a stake in mentoring. The prevailing culture encourages clients to develop confidence in younger lawyers. Intergenerational transitions become seamless.

Associate A tolerates the job as a short-term burden from which escape is the goal; Associate B is an enthusiastic participant for the long haul. If you’re a client, who would you want working on your matter?

The Same Old, Same Old

As clients have talked about refusing to pay for first-year associate time on their matters, big firms’ upward profit trends continue. But the real danger for firms and their clients is a big law business model that collapses under its own weight.

As it has for the past eight years, Altman-Weil’s recently released 2016 “Law Firms In Transition” survey confirms again the failure of leadership at the highest levels of the profession. Responses come from almost half of the largest 350 firms in the country. It’s a significant sample size that provides meaningful insight into the combination of incompetence and cognitive dissonance afflicting those at the top of many big firms.

When asked about the willingness of partners within ten years of retirement to “make long-term investments in the firm that will take five years or more to pay off,” fewer than six percent reported their partners’ “high” willingness to make such investments. But at most firms, partners within ten years of retirement are running the place, so the investments aren’t occurring.

Almost 60 percent of firm leaders reported moderate or high concern about their law firms’ “preparedness to deal with retirement and succession of Baby Boomers.” Meanwhile, they resolve to continue pulling up the ladder, observing that “fewer equity partners will be a permanent trend going forward” as “growth in lawyer headcount’ remains a “requirement for their firms’ success.”

Do law firm leaders think they are losing business to non-traditional sources and that the trend will continue? Survey says yes.

Do law firm leaders think clients will continue to demand fundamental change in the delivery of legal services? Survey says yes. (56 percent)

Do law firm leaders think firms “are serious about changing their legal service delivery model to provide greater value to clients (as opposed to simply reducing rates)”? Survey says no. (66 percent)

Do clients think law firms are responding to demands for change? Survey says most emphatically no! (86 percent)

But do law firm leaders have confidence that their firms are “fully prepared to keep pace with the challenges of the new legal marketplace”? Survey says yes! (77 percent)

If cognitive dissonance describes a person who tries to hold two contradictory thoughts simultaneously, what do you call someone who has three, four or five such irreconcilable notions?

At too many big law firms the answer is managing partner.

LAW SCHOOLS AND THE NEW YORK TIMES

On June 17, Noam Scheiber’s article, “An Expensive Law Degree and No Place to Use It,” appeared in The New York Times. He focused on individual human tragedies resulting from the legal education bubble.

Four days later, Professor Steven Davidoff Solomon countered with his Times column, “Law School Still a Solid Investment, Despite Pay Discrepancies.” Notwithstanding the title, he’s moving in Scheiber’s direction.

Learning from Mistakes

Professor Solomon’s prior ventures into legal education haven’t gone particularly well. In November 2014, he wrote “[T]he decline in enrollment could lead to a shortage of lawyers five years from now.” Highlighting Thomas Jefferson School of Law as one of the marginal schools fighting to remain alive, Solomon suggested, “It may be tempting to shut them in these difficult times, but it can cost tens of millions to open a new one. Better to invest and cut back on expenses for a while and see what happens.”

Consistent with his area of expertise — financial and securities regulation — Professor Solomon was relying on the market to work. But in legal education, it never gets a chance. Bankruptcy laws and the federal student loan program insulate law schools from accountability for their graduates’ poor employment outcomes.

Waiting to “see what happens” became a triumph of hope over reality. For the Thomas Jefferson class of 2013, the full-time long-term JD-required employment rate nine months after graduation was 29 percent. For the class of 2014, it was 30 percent. Even with an additional month for the class of 2015 to find jobs, the ten-month FTLT-JD-required employment rate was 24 percent. But the school did win that nagging fraud case brought by a recent graduate.

In April 2015, Solomon’s column on legal education and the profession was so riddled with errors that I climbed out of a hospital bed to write a responsive post culminating in this question, “Whatever happened to The New York Times fact-checker?”

Almost There

With all of that carnage in the rearview mirror, Professor Solomon’s June 21 article assumes a more moderate tone. Most importantly, he acknowledges the different legal education markets that exist for new graduates: “[I]t is clear that it is harder out there for the lower-tier law schools and their graduates.”

Noting that some big firms announced starting salary increases to $180,000 for the class of 2016, he cautions, “Only the lucky 17 percent of graduates earn salaries this high. To be in this group, you needed to go to a top 10 school or graduate in the higher ranks of the top quartile of law schools. Things are harder for every other law graduate.”

Solomon also accepts the bimodal distribution of starting salaries that results from the different markets for law graduates: “[W]hile 17 percent of graduates earned median salary of $160,000 in 2014, about half had a median starting salary of $40,000 to $65,000.”

The article could and should have ended with this: “Either way, it is clear that it is harder out there for lower-tier law schools and their graduates.”

In Defense of Fellow Professors?

Four days before Solomon’s article, Noam Scheiber’s Times piece profiled once-hopeful students at Valparaiso University School of Law. They’d incurred massive debt for a JD degree, but couldn’t find jobs requiring one. Scheiber also quoted a professor who recently headed the school’s admissions committee: “If we could go back, I think we should have erred a little more on the side of turning people down.”

Immediately after the publication of Scheiber’s article, social media took over when a law professor complained in an open letter to Scheiber: “Have you seen this line of peer-reviewed research, which estimates the boost to earning from a law degree including the substantial proportion of law graduates who do not practice law?”

The cited “line of peer-reviewed research” consisted of one study, co-authored by that professor in 2013. When Scheiber invited the professor to identify any factual errors in his article, the professor provided six alleged mistakes. For anyone interested in diving into those weeds, Scheiber posted the six items and his response on his Facebook page, including this:

“It’s not worth reviewing the controversy about your work on law graduate earnings here, since the criticisms are well-established. But suffice it to say, I think it’s strange to respond to a claim that the economic prospects of people graduating after the recession have fundamentally changed relative to those who graduated before the recession with a study that only includes people who graduated prior to 2009.”

(UPDATE: On Friday, June 24, the professor responded to Scheiber’s response.)

Among the many other criticisms to which Scheiber refers is the 2013 study’s failure to consider differences among law schools in their graduates’ incomes. In other words, it ignored the actual law school markets.

Nearing the Finish Line

Professor Solomon’s latest article centers on the importance of recognizing those different markets. But he still cites the 2013 study for the proposition that “most law students earned a premium of hundreds of thousands of dollars over what they would have earned had they not gone to law school, even taking into account the debt they accrue.”

Even so, Solomon’s slow walk away from the 2013 study improves on his April 2015 column. There, he relied on it to suggest that an “acceleration in compensation results in a premium of $1 million for lawyers over their lifetime compared with those who did not go to law school.” Now he’s down to “hundreds of thousands of dollars” for “most law students.”

Professor Solomon teaches at a top school, UC-Berkeley. He knows that plenty of students at other schools have a tough road ahead. Solomon no longer refers to an overly broad $1 million lifetime premium. He has also added a qualifier (“most law students” — meaning a mere 51 percent) — to whatever he thinks the study proves about the economic benefit of a JD. In other words, he has rendered the 2013 study meaningless to anyone considering law school today.

So why does Professor Solomon continue to cite the study at all? Better not to ask. Accept progress wherever you find it.

 

ABOUT THAT LAWYER SHORTAGE…

Facts are stubborn things — almost as stubborn as persistent academic predictions that boom times for attorneys are just around the corner.

Back in 2013, Professor Ted Seto at Loyola Law School-Los Angeles observed, “Unless something truly extraordinary has happened to non-cyclical demand, a degrees-awarded-per-capita analysis suggests that beginning in fall 2015 and intensifying into 2016 employers are likely to experience an undersupply of law grads, provided that the economic recovery continues.”

In November 2014 after the Bureau of Labor Statistics proposed a new and deeply flawed methodology for measuring attorney employment, Professor Seto weighed in again: “If the new BLS projections are accurate, we should see demand and supply in relative equilibrium in 2015 and a significant excess of demand over supply beginning in 2016.” His school’s full-time long-term bar passage employment rate for the class of 2015 was 62 percent — slightly better than the overall mean and median for all law schools, which are just under 60 percent.

Likewise in 2014, Professor Rene Reich-Graefe at Western New England University School of Law used what he described as “hard data” to argue, “[C]urrent and future law students are standing at the threshold of the most robust legal market that ever existed in this country.” The Georgetown Journal of Legal Ethics published his dubious analysis leading to that prediction. Within ten months of graduation, only 43 percent of 2015 graduates from Professor Reich-Graefe’s school found full-time long-term jobs requiring bar passage.

Fact-sayers v. Self-interested Soothsayers

To his credit, Professor Jerry Organ at the University of St. Thomas School of Law has been fearless in challenging the relentless optimism of his academic colleagues. And he does it with the most persuasive of lawyerly approaches: using facts and evidence.

Analyzing the ABA’s recently released law school employment reports for all fully-accredited law schools, Professor Organ notes that the number of graduates dropped in 2015. But for the second straight year, so did the number of full-time long-term jobs requiring bar passage.

Professor Organ offers a number of explanations for this result: declining bar passage rates; regional factors that reduced hiring in Texas and elsewhere; the impact of technology. But whatever the reasons, he suggests, “[T]his employment outcomes data provides a cautionary tale.”

Proceeding Without Caution

“The fact that the employment market for law school graduates appears to have stagnated and even declined to some extent over the last two years,” Professor Organ continues, “may mean that risk averse potential law school applicants who focus on post-graduate employment opportunities when assessing whether to invest in a legal education may remain skittish about applying, such that this year’s good news on the applicant front may be somewhat short-lived.”

The “good news on the applicant front” to which Professor Organ refers is his projection that applications for the fall 2016 entering class are on track to increase for the first time since 2010. But he offers a cautionary note there as well. Law schools at the upper end “will see more enrollment growth and profile stability in comparison with law schools further down the rankings continuum.”

Perilous Predictions

Some prognostications are safer than others. Here’s mine: Faculty and administration at weak law schools will continue using the overall decline in the number of all applicants to persist in their misleading sales pitches that now is a “Great Time to Go to Any Law School.” They will discourage inquiry into more relevant facts.

But here they are: At the 90th percentile of all 204 ABA-accredited law schools, the full-time long-term bar passage-required employment rate for 2015 graduates was just under 80 percent. At the 75th percentile, it was 67 percent. But at the 25th percentile, it was 49 percent. And at the 10th percentile, it was only 39 percent.

It will always be a great time to go to some law schools. It will never be a great time to go to others.