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Same-sex marriage on court docket
Practice Focuses | 2008/03/03 08:57

As gay-rights groups call for marital equality and opponents warn of a public backlash, societal decay and religious conflict, the California Supreme Court is prepared for an epic three-hour hearing Tuesday on the constitutionality of the state law defining marriage as the union of a man and a woman. It shapes up as the most momentous case the court has heard in decades - comparable to the 1981 ruling that guaranteed Medi-Cal abortions for poor women, the 1972 ruling that briefly overturned the state's death penalty law, and the 1948 decision, cited repeatedly in the voluminous filings before the court, that struck down California's ban on interracial marriage. The arguments on both sides are weighty.

Supporters of same-sex marriage invoke the state's commitment to equality regardless of gender or sexual orientation, the needs of the children of gay and lesbian couples, the persistence of societal discrimination, and legal rights such as freedom of expression, association and privacy.

In defense of its law, the state cites a cultural tradition far older than statehood, the will of the people as expressed in a 2000 initiative, the steps California has already taken toward equal rights for gays and lesbians, and the power of lawmakers and voters to determine state policy.

Beyond those arguments, groups opposing same-sex marriage want the court to justify the state law on moral or scientific grounds, as an affirmation that limiting matrimony to a man and a woman is best for children and society.

A ruling is due within 90 days. The case combines four lawsuits - three by nearly two dozen couples who want to marry and the fourth by the city of San Francisco, which entered the dispute after the court overturned Mayor Gavin Newsom's order that cleared the way for nearly 4,000 same-sex weddings in February and March 2004.

The suits rely on the California Constitution, which state courts have long interpreted as more protective of individual rights than the U.S. Constitution. The plaintiffs invoke a passage in the 1948 ruling on interracial marriage - the first of its kind by any state's high court - in which the justices recognized a "right to join in marriage with the person of one's choice."

Judge Richard Kramer of San Francisco Superior Court echoed that language in March 2005, when he ruled that the state's ban on same-sex marriage violated "the basic human right to marry a person of one's choice." He also said the marriage law constitutes sex discrimination - prohibited by another groundbreaking California Supreme Court ruling in 1971 - because it is based on the gender of one's partner.

But a state appeals court upheld the law in October 2006. In a 2-1 decision, the court rejected Kramer's findings of discrimination and said California was entitled to preserve the historic definition of marriage while taking steps to protect the rights of same-sex couples who register as domestic partners.

Advocates crowd in

As the case reached the state's high court, the participants and the arguments multiplied. Conservative religious organizations, including sponsors of the 2000 ballot measure that reinforced the opposite-sex-only marriage law, accused the state of making a half-hearted defense of its law and sought to justify it as a pro-family measure. Marriage is for procreation, and children fare best with married fathers and mothers, they argued. They also said the definition of marriage is so deeply engrained in the law that judges have no power to change it.

The coalition of conservative religious groups warned that a ruling against the state law would "fracture the centuries-old consensus about the meaning of marriage."

An opposing assortment of liberal denominations counseled the court against a state endorsement of "the religious orthodoxy of some sects concerning who may marry."

The court also heard from hundreds of organizations representing psychologists, anthropologists and other professions, city and county governments, law professors, businesses, civil rights advocates and social institutions.

Judges and limits

Underlying all the arguments is a debate about the proper role of courts in a democracy, particularly on contentious social and political issues. It's the same question - how far, and how fast, judges should move to correct injustices they perceive in the actions of elected officials - that has confronted jurists pondering such issues as segregation, school prayer and abortion.

The subject was raised with unusual frankness in written arguments by Attorney General Jerry Brown's office, which is leading the defense of the marriage law that Brown signed as governor in 1977.

"One unintended and unfortunate consequence of too radical a change is the possibility of backlash," said Deputy Attorney General Christopher Krueger. Same-sex marriage may someday be legalized in California, he said, "but such a change should appropriately come from the people rather than the judiciary as long as constitutional rights are protected."

Brown said last week he wasn't asking the court to sacrifice principles to politics, only observing that rulings that "ride roughshod over the deeply held judgments of society" can have unintended consequences.

He noted that the court majority swung from liberal to conservative after three of his appointees, including Chief Justice Rose Bird, were unseated in a 1986 election that centered on their votes to overturn death sentences.



Ballmer Says Yahoo Takeover Makes Sense
Mergers & Acquisitions | 2008/03/03 07:18
Microsoft chief executive Steve Ballmer said Monday it was the right time for the company to put out a bid for Yahoo Inc.

"The deal makes sense with the price and structure we announced. We hope it becomes reality," he told reporters at the annual CeBIT technology fair in Hanover. "There is a lot of merit for Microsoft and Yahoo, for Yahoo shareholders and for Microsoft shareholders, for advertisers and for consumers."

Analysts have debated whether Redmond, Washington-based Microsoft Corp.'s proposed $40 billion acquisition of Yahoo is worth it, given its two-year earnings slump.

Yahoo contends it is worth even more money given the reach and breadth of its sprawling Internet franchise.

Ballmer said his company's original offer is good, adding that "there is a range of dialogue" for both companies about the proposed takeover.



Legal Tender: Grandpa the Lawyer
Legal Spotlight | 2008/03/03 04:09

Two days after D.C. super-lawyer Bob Bennett released his new memoir, yet another VIP client landed in trouble -- John McCain, with the New York Times' controversial story about his friendship with lobbyist Vicki Iseman-- and suddenly Bennett was on every TV channel holding forth.

Fortunate timing for a new author? Actually, the opposite: The well-connected Bennett said he had already scored the airtime to flack his book; he then used his moments on camera to defend the GOP front-runner and shift the debate to media ethics.

"I've always said: It's better to be lucky than good," he said with a laugh at a party in his honor Friday night at the Hay-Adams.

He's the Other Bennett: Big brother to conservative pundit Bill and a former federal prosecutor turned go-to guy for bigwigs in peril -- Bill Clinton in the Paula Jones case, Paul Wolfowitz in the World Bank ethics scandal, Judy Miller in the CIA leak investigation. In "In the Ring: The Trials of a Washington Lawyer," he writes: "I have often felt that being born in Brooklyn and having a few hundred street fights under my belt was better preparation for practicing law here than receiving law degrees from Georgetown and Harvard."

But he was a big softy Friday night, doting on wife Ellen, his daughters and new grandchild, greeting a crowd heavier on friends and neighbors ( Esther Coopersmith, Steve Trachtenberg, Mac McLarty, a whole lotta lawyers) than former clients. He told us that all trial lawyers are deeply superstitious (in court, he always makes a point of mentioning his girls and their favorite storybook character, Alice in Wonderland) and that he was reluctant to write about his childhood. But then he realized how much his parents' divorce, his mother's drinking and his role as a big brother molded him as a lawyer: "What really turns me on in the law is when I have an individual to protect."



Florida health providers refunded $125M
Legal Business | 2008/03/03 03:13

The first fully implemented year of Medicare's recovery audit contractors in Florida was a costly one for health care providers.

They returned nearly $125 million to the government last year, a report by the Centers for Medicare and Medicaid showed.

The pilot program in Florida, New York and California ends on March 27. Then, CMS will select four regional auditing companies to run the national program starting later this year.

Of the $371 million in improper Medicare payments the RAC program identified in fiscal 2007, which ended Sept. 30, they found $128.7 million in Florida. Statewide, the auditors collected $124.6 million in overpayment from health care providers and paid them back $4.1 million for Medicare underpayments.

Florida inpatient hospitals returned $115.1 million in overpayment, outpatient hospitals returned $3.4 million and physicians returned $5.1 million. All of the money returned went to inpatient hospitals.

According to CMS, almost half of the improper payments were the result of incorrect billing coding. One-third were ruled medically unnecessary -- a category that has frustrated Florida hospitals because of the auditors second-guessing decisions of clinical staff. Starting last summer, CMS required the RAC programs to have medical directors to review claims.

Heart failure and shock was the most common type of claim where RAC found overpayment in Florida, with $9.5 million collected.

In the state, 14 percent of RAC overpayment claims were appealed, with 8.9 percent of all claims being overturned on appeal.

Many Florida hospitals executives said the RAC filed too many baseless cases because the auditors receive their fee even after the claim is overturned by an administrative law judge. In the national program, the auditors will lose their fee if the claim is overturned on appeal.



Casinos: Poker winners must do tax form
Tax | 2008/03/02 09:11
Starting Tuesday, it's going to get harder for poker tournament winners to bluff the tax man.

Casinos will be required to report winnings of $5,000 or more to the Internal Revenue Service, and will hand gamblers a tax form to record the payout.

It's actually a compromise from an original IRS proposal that would have made casinos withhold 25 percent of tournament winnings for tax purposes.

“There was such an outrage and outcry from the community, to suck all that money out” that the government changed its mind, Marissa Chien, a gambling tax expert in Las Vegas, told The Press of Atlantic City for Monday's newspapers.

“It allows the IRS to keep track of poker players, because poker is real big now,” said Chien, who is co-author of the book “Tax Help For Gamblers.”

Kevin Lillo, a shift manager at the Trump Taj Mahal Casino Resort, said the new rule will be little more than “a slight inconvenience.”

“It's always been the law” to report winnings, he said. “All they're doing is making the casino enforce it. They're seeing money that's falling through the cracks.”

Bruce Kramer of Voorhees has never won $5,000 in a single tournament, but he could see how it would be a problem for serious players.

Gamblers across the country are already required to report all their winnings, whether it's from tournaments, slot machines or table games.

“If you're already reporting your income and being truthful and honest, this shouldn't affect you one bit,” Chien said. “But for those who try to stay off the radar, this is going to make it that much harder.”



Court upholds whale protection in Navy exercises
Law Center | 2008/03/02 09:00
A federal appeals court has ruled that the Navy must protect endangered whales from the potentially lethal effects of underwater sonar during anti-submarine training off the Southern California coast, rejecting President Bush's attempt to exempt the exercises from environmental laws.

In a Friday night ruling rushed into print ahead of the next scheduled exercise on Monday, the Ninth U.S. Circuit Court of Appeals in San Francisco upheld a federal judge's decision that no emergency existed that would justify Bush's intervention.

The Navy is engaged in "long-planned, routine training exercises" and has had ample time to take the steps that the law requires - conduct a thorough review of the environmental consequences and propose effective measures to minimize the harm to whales and other marine mammals, the three-judge panel said.

The court noted that the Navy has been conducting similar exercises for years, has agreed in the past to restrictions like the ones it is now challenging, and was sued by environmental groups in the current case nearly a year ago. The lower-court judge reviewed the evidence and found nothing to support the Navy's claim that the protective measures would interfere with vital training or hamper national security, the court said.

Past rulings have established that "there is no 'national defense exception' " to the National Environmental Policy Act, the court said. That law requires government agencies to review projects that might harm the environment and propose reasonable protective measures.



A glance at the top players in Enron saga
Business | 2008/03/02 00:45

KENNETH L. LAY

Birth date: April 15, 1942.

Career: Former chairman and CEO. Founded Enron in 1985 when his Houston Natural Gas merged with InterNorth in Omaha, Neb., and became chairman and CEO the next year. Stepped down as CEO in February 2001 when Jeffrey Skilling took over; resumed the role when Skilling abruptly resigned on Aug. 14, 2001. Resigned as chairman and CEO Jan. 23, 2002; resigned from board Feb. 4, 2002. Appeared before Congress in 2002 and invoked the Fifth Amendment. Alleged to have sold more than 4 million shares of stock for $184 million from 1996-2001. Received bonuses of $18.1 million in 1997-2000. Lives in a $7.4 million penthouse near downtown Houston.

JEFFREY K. SKILLING

Birth date: Nov. 25, 1953.

Career: Former CEO and director. Holds an MBA from Harvard and worked for McKinsey & Co. before joining Enron in 1990. Became president and chief operating officer in 1996, then succeeded Lay as CEO in February 2001. Resigned on Aug. 14, 2001, citing personal reasons. Testified twice before Congress in February 2002. Claimed no knowledge of intimate details of Enron's financial dealings. Sold 1.3 million shares of stock for $70.6 million and transferred 2 million shares back to Enron from June 1996 to November 2001. Received $13.2 million in bonuses 1997-2000. He remains a defendant in a lawsuit alleging he knowingly endorsed deceptive and misleading financial statements. An indictment was unsealed Feb. 19 charging him with 35 counts of fraud, conspiracy, filing false statements to auditors and insider trading. He has pleaded not guilty.

ANDREW S. FASTOW

Birth date: Dec. 22, 1961.

Career: Former chief financial officer who pleaded guilty Jan. 14, 2004, to conspiracy in a deal that called for a 10-year sentence and for him to help prosecutors in the investigation. Free on bond. One of Skilling's first hires in 1990. Indicted Oct. 31, 2002, on 78 counts of wire and securities fraud, money laundering, conspiracy and obstruction for running various financial schemes designed to enrich him, his family and friends. Counts later increased to 98. Earned at least $45 million from LJM partnerships, investment vehicles named after his wife and two children. Pushed out of Enron on Oct. 24, 2001, the day after Lay expressed confidence in him to analysts. Alleged to have sold more than 687,000 shares of Enron stock for $33.7 million from June 1996 to November 2001. Pleaded guilty in January 2004 to two counts of conspiracy; agrees to cooperate with prosecutors and serve 10 years in prison when his help is no longer needed.

RICHARD A. CAUSEY

Birth date: Jan. 9, 1960.

Career: Former chief accounting officer. Handled Enron audits for Arthur Andersen LLP before joining Enron. When the LJM investments were proposed to Enron's board of directors in 1999, he and chief risk officer Rick Buy were assigned to review all Enron transactions with LJM. Fired Feb. 14, 2002, after release of an in-house report noting his failure to review the deals. Mentioned repeatedly by title in Fastow indictment as having a secret agreement with Fastow that LJMs would never lose money on deals with Enron. Told David Duncan, the top Enron auditor at Arthur Andersen, that Enron didn't like another Andersen auditor's objections to grouping investment vehicles known as Raptors to hide that two of the four that were bleeding cash. Alleged to have sold about 209,000 Enron shares for $13.3 million. Also received bonus payments of more than $1.5 million from 1997-2000 when Enron was inflating profits and hiding debt based largely on the partnerships he was supposed to police. Indictment charging him with conspiracy and fraud unsealed Jan. 22, 2004. Expanded indictment unsealed Feb. 19 to include new charges against Skilling and increased charges against Causey; 35 counts for Skilling, 31 counts for Causey. Has pleaded not guilty.

OTHERS:

Michael Kopper: Former Fastow lieutenant who pleaded guilty Aug. 21, 2002 to federal conspiracy and money laundering charges related to Enron's fall and agreed to give up $12 million in illegal profits. Kopper admitted he ran or helped create several partnerships that earned him and others millions of dollars, including kickbacks he funneled to Fastow, while hiding debt and inflating profits at Enron. Has not yet been sentenced and is cooperating with prosecutors. Declined to testify before Congress.

Lea Fastow: Wife of Andrew Fastow and former assistant treasurer at Enron. Pleaded guilty May 6, 2004, to a federal misdemeanor tax crime for helping her husband hide ill-gotten income from the government. She originally pleaded guilty to a felony tax crime in January, but withdrew that plea in April. She was sentenced to the maximum of a year in prison and ordered to surrender there July 12.

Ben Glisan Jr.: Added to an expanded Fastow indictment unsealed in May 2003. Glisan became Enron treasurer in March 2000, and earned $1 million in May of that year on a March investment of $5,826 in Fastow's Southampton Place partnership. Also negotiated for Enron in some of its transactions with Raptor. Worked with Fastow and Kopper in creating and running LJM2. Fired from Enron in November 2001. Indicted in April 2003 on charges of wire fraud, money laundering and conspiracy to commit wire fraud, falsify books and commit securities and wire fraud. He tried to cut a deal with prosecutors, but ended up pleading guilty to one count of conspiracy in September 2003. He was immediately sentenced to prison for five years and became the first former Enron executive to serve time. He later began cooperating with prosecutors.

Dan Boyle: Also added to an expanded Fastow indictment. Charged with conspiracy to falsify books and commit wire fraud related to Enron's deal to have Merrill Lynch buy three electricity-generating power barges. Boyle's lawyer says he had no authority to sign off on anything. Fastow promised Merrill that Enron would buy back the barges in 2000, which it did, booking a $12 million profit that was really a loan. Trial set to begin Aug. 18.



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