Big blue-chip law firms are losing potentially lucrative assignments to smaller firms even as the industry sees a spike in lawsuits against banks stemming from the financial crisis.

The reason for the change: ethics rules that govern conflicts of interest for lawyers and their firms.

Law firms usually can't sue or investigate banks that they have represented, unless the clients take the unusual step of waiving the conflict. Thus, many small to midsize firms, which count fewer banks as defense clients, are filling a growing demand for conflict-free lawyers able to file lawsuits against banks.

Litigation against banks includes claims that they misstated the value of mortgage-related securities or reneged on financing agreements. Ambac Assurance Corp. recently sued a unit of Credit Suisse Group, alleging the securities firm made misleading representations about attributes of home-equity lines of credit backing bonds the insurer guaranteed. A Credit Suisse spokesman says the suit lacks merit. Last year, MBIA Insurance Corp. sued Countrywide Financial Corp., now owned by Bank of America Corp, claiming it misrepresented the quality of mortgage-backed securities. Bank of America declined to comment.

Consolidation in the banking business has made it only harder for law firms to handle lawsuits against banks. It is increasingly difficult, lawyers said, for firms to find a major bank they haven't represented at some point. As a result, they are bumping up against the conflict-of-interest rules formulated by the American Bar Association and state bar groups.

Senate Democrats have rejected a Republican effort to delay a hearing for a liberal appeals court nominee, making clear they are ready for a partisan fight.

A hearing for University of California-Berkeley, law professor Goodwin Liu will go on as scheduled April 16, Senate Judiciary Committee Chairman Patrick Leahy said Wednesday. He said Republicans were unwilling to "put political rancor aside" to debate the nomination, which will test President Obama's ability to fill court seats with liberals as well as moderates.

All seven committee Republicans had asked for a delay. In a letter sent Tuesday, they wrote Leahy arguing Liu's belated responses to a committee questionnaire justified a delay in the hearing for the nominee to a San Francisco-based appeals court.

But Leahy, D-Vt., wrote the panel's senior Republican, Sen. Jeff Sessions of Alabama, that he had already postponed the hearing twice — once due to a Republican request and then because of GOP stalling tactics.

The chairman said he was disappointed that "we have seen the same delays and obstructionist approach toward these nominees on the Senate floor extend to the committee's consideration."

If confirmed, Liu would serve on the 9th U.S. Circuit Court of Appeals serving California, Arizona, Nevada, Oregon, Washington, Alaska, Idaho, Hawaii and Montana.

There were eight new law firm combinations announced in the United States in the first quarter of the year, with three of them involving Philadelphia law firms, according to consultancy Altman Weil’s MergerLine Web site.

Newtown Square-based Altman Weil said data show a continuing slowdown of mergers that began in 2009.

“Although we’re seeing a lot more interest in mergers and acquisitions behind the scenes this year, it will take some time for law firms to shift gears from the internal crisis management focus of 2009 back to an outwardly facing, strategic stance,” Altman Weil principal Tom Clay said. “There will be a ramp-up period in the next few quarters before we see the pace of deal-making increase significantly.”

Of the eight law firm combinations announced this year, all involved the acquisition of firms with fewer than 50 lawyers, and five were acquisitions of firms with under 10 lawyers.

The largest acquisition of the first quarter was 245-lawyer, Morristown N.J.-based McElroy Deutsch’s acquisition of 45-lawyer Pepe & Hazard, based in Hartford, Conn. McElroy Deutsch entered the Philadelphia market in 2006 through the acquisition of Monteverde McAlee & Hurd.

A three-judge panel of the 11th Circuit Court of Appeals ruled Tuesday that the U.S. District Court for the Middle District of Florida had correctly dismissed the case brought by Linda Guinn, a former legal secretary from Palm Bay, Fla., in her early 60s.

Before that case was to go to trial, AstraZeneca successfully argued in January 2009, before District Judge Anne Conway, that Guinn's doctor did not qualify as an expert under federal court rules and so her testimony should be excluded. The drugmaker also persuaded the judge to grant a summary judgment motion in its favor, arguing that Guinn failed to establish that Seroquel caused her diabetes.

The 11th Circuit Court, based in Atlanta, upheld those decisions.

"The appeals court decision echoes earlier federal and state court opinions that found Seroquel could not be proven to be responsible for plaintiffs' alleged injuries," AstraZeneca spokesman Tony Jewell said in a statement.

The ruling by the U.S. Court of Appeals for the District of Columbia is a big victory for Comcast Corp., the nation's largest cable company. It had challenged the FCC's authority to impose so-called "net neutrality" obligations on broadband providers.

The ruling also marks a serious setback for the FCC, which is trying to officially set net neutrality regulations. FCC Chairman Julius Genachowski argues that such rules are needed to prevent phone and cable companies from using their control over Internet access to favor some online content and services over others.

The decision also has serious implications for the massive national broadband plan released by the FCC last month. The FCC needs clear authority to regulate broadband in order to push ahead with some its key recommendations, including a proposal to expand broadband by tapping the federal fund that subsidizes telephone service in poor and rural communities.

The court case centered on Comcast's challenge of a 2008 FCC order banning the company from blocking its broadband subscribers from using an online file-sharing technology known as BitTorrent. The commission, at the time headed by Republican Kevin Martin, based its order on a set of net-neutrality principles it adopted in 2005 to prevent broadband providers from becoming online gatekeepers. Those principles have guided the FCC's enforcement of communications laws on a case-by-case basis, and now Genachowski is trying to formalize those rules.

Deborah Madden pleaded not guilty Monday to a felony cocaine possession charge in San Mateo County Superior Court.

The case is due back in court May 18.

The 60-year old Madden was arrested on March 3 after authorities investigating the disappearance of drugs at the San Francisco police lab found one-tenth of a gram of cocaine and a gun at her San Mateo home.

She remains free on $10,000 bail.

Madden has not been charged in the drug lab probe.

Erlyndon Joseph "Joey" Lo, 27, of Plano, filed documents there Friday saying his religious beliefs entitled him to use deadly force to prevent an abortion. He listed the name of a clinic, its address and the time he was going to show up — noon that day.

"I plan on saving at least one human life in Dallas, Texas," Lo wrote.

FBI spokesman Mark White said he was unsure if Lo went at that time, but said agents worked with Dallas police "to make sure there wasn't going to be an issue at the clinic." Lo was arrested Saturday.