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Weekly Issues in the News

By Geisa Balla


Nancy Silberkleit and Jon Goldwater, the co-CEOs of the company that publishes Archie comics, ended their dispute over control of the company through a settlement (which is being challenged by other family members) on Wednesday, June 6th. "Nancy Silberkleit and Jon Goldwater are no longer in an adversarial position, and they are beginning their working relationship anew," said Silberkeit's attorney. "She's thrilled to have settled this extremely upsetting matter." Goldwater is a son of one of the company's founders, while Silberkleit is another founder's daughter-in-law. They became co-CEOs in 2009. Goldwater sought to strip Silberkleit of her role at the company, claiming that she was an erratic troublemaker who sexually harassed employees, made bad business moves and once intimidated people in the office by parading a former football player. Silberkleit claimed that Goldwater was a chauvinist who demeaned her, kept her in the dark about the company's finances, and that he invented false allegations to seize control of the company. She claimed defamation and sought $100 million in damages. Silberkleit controls 50 percent of the company and Goldwater owns 25 percent. A trust set up by Goldwater's late half brother, Richard, owns the rest. Goldwater's three nieces Lisa, Taylor and Summer Goldwater, are the trust's beneficiaries.

Initially the nieces stood on the sidelines, assuming that their uncle was acting in their best interests. However, they decided to involve themselves this winter after suspecting that their uncle was misusing company assets, and trying to keep them unaware of it. The nieces filed papers in the litigation, saying that both CEOs' "hands are dirty." Supreme Court Justice Shirley Kornreich stated that the nieces were not in a legal position to weigh in on the settlement, but they could file a suit of their own. Attorneys for the three nieces said the they "will be pursuing the requisite steps to protect the interest of the trust and its beneficiaries."



The U.S. Attorney for the Southern District of New York filed a civil forfeiture lawsuit in the Southern District of New York on April 4th against Sotheby's, claiming that a 10th Century A.D. sandstone statute was illicitly removed from Cambodia. The U.S. is seeking right, title and interest in the statue. The complaint alleges that Sotheby's plans to sell the statue, despite warnings that looters had stolen the piece from its rightful place in the Prasat Chen Temple in Koh Kewr in northern Cambodia. The statute was torn from its place in the 1960s or 1970s, during civil unrest in Cambodia. It then fell into the hands of a private collector in Belgium, whose heirs reached an agreement to sell it on consignment to Sotheby's in March 2011. Cambodian officials notified Sotheby's that the statue had been looted, and the parties had been negotiating a settlement to the dispute for the last year. "The ... statue is imbued with great meaning for the people of Cambodia and, as we allege, it was looted from the country during a period of upheaval and unrest, and found its way to the United States," Manhattan U.S. Atty. Preet Bharara said in a statement released by his office. "With today's action, we are taking an important step toward reuniting this ancient artifact with its rightful owners." Sotheby's disputed the allegations, stating that the statute "was legally imported into the United States and all relevant facts were openly declared."


Lauryn Hill

Eight-time Grammy winner Lauryn Hill has been charged with failing to file income tax returns for several years with the Internal Revenue Service (IRS). The U.S. Attorney's Office in New Jersey said that Hill earned more than $1.6 million during 2005, 2006 and 2007, the three years that she failed to file returns. Her primary source of income is royalties from the music and film industries. She also owns and operates four corporations: Creations Music Inc., Boogie Tours Inc., L.H. Productions 2001 Inc., and Studio 22, Inc. Hill is scheduled to appear before a federal magistrate on June 29th. She faces a maximum penalty of a year in prison and $100,000 in each of the three charges against her.


Alexander Wang

On June 4th, Alexander Wang Inc. answered the class action complaint filed earlier this year, denying the allegations. The complaint was filed in March 2012 by two former employees of Alexander Wang Inc., and alleged that the company essentially ran a sweatshop in Chinatown in Manhattan, where it violated labor laws by failing to provide proper compensation, denied the workers bathroom breaks, and fired them when they complained about their work conditions. The answer claimed that Alexander Wang Inc. "has complied with all applicable wage and hour and leave laws, and there is no basis whatsoever for plaintiffs' frivolous and entirely unsupportable accusations." It further claimed that plaintiffs were "properly paid all wages owed ... provided with regular and multiple breaks during their work time ... [and] eligible for and provided with paid vacation, paid sick days, paid holidays, paid personal days, medical and dental insurance and other benefits."



The determination of Apple's motion to ban the sale of Samsung Electronics's Galaxy 10.1 tablets is delayed on procedural grounds. Apple filed a lawsuit against Samsung last year in the U.S. District Court, Northern District of California, alleging that Samsung "slavishly" copied the iPhone and iPad. Samsug denied the claims and countersued. Judge Lucy Koh denied Apple's motion to ban the sale of Samsung smartphones and the Galaxy 10.1 tablet. An appeals court told Judge Koh to reconsider her decision, and Apple promptly re-applied for the ban. On June 4th, Judge Koh denied Apple's motion on procedural grounds, stating that the appeals court must formally cede jurisdiction back to her before she could consider it. In a court filing last month Apple stated: "Each day that Samsung continues to sell its infringing Tab 10.1 causes additional harm to Apple through design dilution, lost sales, lost market share, and lost future sales of tag-along products." The parties attended court ordered mediation in May, which failed to produce a settlement.


Jerry Sandusky

Jury selection ended on Wednesday, June 6th, in the Jerry Sandusky child sex abuse trial. The jury consists of seven women and five men. Sandusky has been charged with 52 counts of molesting 10 boys over a 15-year period. He has pleaded not guilty and is facing more than 500 years in prison if convicted on all counts. Prosecutors allege that Sandusky met the boys through his charity Second Mile, and some of the assaults occurred at Penn State facilities. "The trial in this case will start on Monday morning. We anticipate that it will take at most three weeks and be done by the last day of June," Judge John Cleland said on Wednesday. Many of the jurors have close ties to Penn State: one is a professor there, one is an administrative assistant, another is a dance teacher and one is a 2007 graduate of the university. Sandusky appeared upbeat and animated during the jury selection. At one point he joked with reporters, saying: "What did you guys do to deserve me? How did you guys get stuck with this? Ay yi yi." ABC News reported that intimate love letters written by Sandusky to one of his accusers, Victim 4, will be read into testimony in trial. Victim 4 is expected to be the first witness to testify, and he is expected to show gifts Sandusky gave him during the alleged relationship.


Kevin Costner and Stephen Baldwin

Jury selection began this week in a federal lawsuit between Steven Baldwin and his business partner Spyridon C. Contogouris, and Kevin Costner. Baldwin claims that Costner cheated him out of his share of a multi-million dollar deal, under which British Petroleum bought 32 oil-and-water separation devices that were developed by a Costner-owned company. The deal was struck after the Macondo well blew out in April 2010, spewing more than four million barrels of crude into the Gulf of Mexico, in the largest accidental oil spill in history. Baldwin and Contogouris claim they were not told about the deal with BP before they agreed to sell their shares in a company that had been set up to market Costner's devices. The defendants allege that they were duped out of a portion of an $18 million deposit from BP for the devices.


Social Media

The New York City Bar Association stated in an ethics opinion released Monday, June 4th that lawyers can conduct research on social media websites, so long as they do not communicate with potential or sitting jurors. "Communication, in this context, should be understood broadly, and includes not only sending a specific message, but also any notification to the person being researched that they have been the subject of an attorney's research efforts," according to the opinion. "Even if the attorney does not intend for or know that a communication will occur, the resulting inadvertent communication may still violate the rule." The opinion cautions against the risk that may arise if research is done on a social media service that alerts users when another individual has viewed their profiles. "The central question an attorney must answer before engaging in jury research using a particular site or service is whether her actions will cause the juror to learn of the research," the opinion says. The definition of "communication" was intentionally left open-ended to account for the evolution of social media sites. "It is the duty of the attorney to understand the functionality and privacy settings of any service she wishes to utilize for research, and to be aware of any changes in the platforms' settings or policies to ensure that no communication is received by a juror or venire member."


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This page contains a single entry from the blog posted on June 8, 2012 10:28 AM.

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