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Dear Friends,

I struck a strong note with many of you in my piece on TransPerfect workers, sadly and unjustly, being railroaded for another $5 million by what I see as a fraudulent contempt motion in Chancery Court Chancellor Kathaleen McCormick’s corruption-filled Chancery Court.

“This ad really shows the arrogance of the Chancery Court and those in power there.
How this has been allowed to go unchecked is a crime!”
– Thomas S.

“Legacy, power and dominance is all these legal people are good at, Judson.
Thanks for calling them out on this.”
-Donald R.

“How Pincus got away with allegations of misconduct and overbilling is a sin.
Maybe it finally caught up with him?”
– Dimitre L.

“You can write every day about this corrupt court, Jud. It’s not going to change a damn thing.”
– Dave M.

“Clever headline.”
– Paul S.  

“Carney has to go. Delaware will get a better Governor in the next election.
Anyone would be an improvement.”
– Bill C.

Keep the feedback coming, folks.  Your comments are always welcome and appreciated.

Respectfully Yours,

JUDSON Bennett–Coastal Network


P.S.: Please follow me on LinkedIn:

https://www.linkedin.com/in/captainjudsonbennett/

OPINION

Dear Friends,

Delaware is being abandoned again and again, folks. DraftKings and Twitter join TransPerfect in leaving Delaware based on possible Chancery Court corruption? Check out this piece below in Nevada’s newspaper. As always, please send me your feedback.


Respectfully Yours,
JUDSON Bennett–Coastal Network

DExit to the desert: Why I left Delaware for Nevada

Phil Shawe

Phil Shawe

September 15th, 2023 at 2:00 AM

Opinion

Some 80 years ago, visionaries saw a dusty military outpost in the middle of the Nevada desert, and imagined an entertainment mecca. Since then, Las Vegas has erupted into a thriving, world-famous tourist destination. Now, the innovative foresight that unleashed this legendary Nevada boom stands poised to open the next frontier of the Silver State’s economic expansion: as the future home of business incorporation.

Nevada is well-positioned to wrestle this position away from the current incorporation capital, Delaware, because the Silver State offers all the factors needed for certainty and success. These include low legal expenses; a fair and reasonable tax climate; a culture of protecting the personal privacy of shareholders and company officers; a consistent and impartial judicial system and — critically — confidence that the rules of the road will facilitate commonsense settlements and just outcomes.

This all stands in stark contrast to the failed status quo in Delaware. Like most major companies, I initially incorporated TransPerfect in Delaware, only to quickly learn its outmoded approach to the law was not in the best interests of my company or employees.  Instead, benches like the Delaware Chancery foster ugly, protracted court clashes solely to enrich the state’s legal class.

The decay of Delaware’s courts into murky, self-dealing institutions is driving executives like me to seek a better place for legal stability and legitimacy. And I’m not alone. Companies such as Twitter and DraftKings have also abandoned Delaware. And thankfully, Nevada is providing that refuge for companies seeking fairness and reliability in state business courts.

Now, Nevada has an enormous opportunity to supplant Delaware as the premier location for job-creating companies to incorporate. Elected and civic leaders should aggressively pitch Nevada all over the globe, and continue to smartly refine its legislative and regulatory framework to lure more companies to incorporate in Nevada.

The benefits to the state would be significant: more investment, more jobs, and higher tax revenue to fund key priorities such as roads, school, fire and police services, and needed social programs.

Because even though shifting where your company is incorporated is no easy decision, businesses want a home that provides legal and operational stability. The Delaware status quo is no longer tenable.

As the founder and CEO of TransPerfect, the world’s largest provider of language services and technology for global businesses, I initially incorporated in Delaware, only to quickly learn that the corruption there is a feature, not a bug.

The Delaware Court of Chancery is the most important judicial bench in America that you’ve never heard of. Thanks to the state of Delaware’s unique laws, the Chancery is where the most significant business cases are heard. Fortune 500 companies — with their hundreds of thousands of employees, millions of customers and billions of dollars in profits — routinely find themselves before this court to resolve a wide range of commercial lawsuits and corporate cases.

The Chancery court is a vestige of the patronage court system that ran rampant in an earlier era — a 19th century institution in a 21st century world. Insiders trade on law firm connections and personal pedigree to land appointments to the court. Given this sweetheart arrangement for Delaware’s legal upper class, it’s no surprise that the Chancery is shrouded in secrecy and exempted from meaningful ethics oversight or reporting requirements. Those pesky protections would just hinder the ability of judges and lawyers to extort the legal process to line their pockets and expand their influence.

Decades ago, the entrepreneurial spirit of Nevada catalyzed one of the greatest economic explosions in human history. That same energy and vision can be applied once again to cement Nevada as the next incorporation capital of the world and reap staggering financial rewards. It would be a smashing success for the Silver State — and for all of the companies burned by the corruption that runs rampant in Delaware’s courts.

Phil Shawe is the CEO of TransPerfect. He resides in Puerto Rico.

OPINION 


Dear Friends,

I’m glad that after years of covering this horrid crime story, so many of you get it! The current CITGO auction and the TransPerfect auction, both in the Chancery Court, reek of corruption and trail back to Andre Bouchard taking over the Chancery Court and continues with fellow Skadden-crony Robert Pincus furthering the greed.

Bouchard, Leo Strine, and Pincus have taken this court for a ride and Pincus has kept it going. It all stems from Bouchard’s reign. That’s what began this entire crooked mess and that’s when I started covering the court, and Bouchard in-depth, to expose the deterioration of the court at the hands of Andre, the Ogre.

Give the story below another read in that light and I think you’ll more fully understand what is at stake here for the Chancery Court and for the bread-and-butter revenue stream for America’s First State and greatest state in our union, Delaware.

The fraud continues and I’ll remain steadfast in my coverage on my Coastal Network until our elected officials take action to make it stop. I appreciate all of the feedback that you’ve sent in this month. It shows me that you get this and that our Coastal Network coverage is putting a valuable spotlight on this criminal activity.

Keep your feedback coming in on this, folks. Thank you! Your comments are welcome and appreciated.

Respectfully Yours,
JUDSON Bennett–Coastal Network


https://venezuelanalysis.com/news/15758

Venezuela Denounces ‘Theft of the Century’ as US Endorses Citgo Sale

Caracas warned that the OFAC license violates Venezuelan and international law and that no country’s assets are safe on US territory.


Caracas, May 4, 2023 (venezuelanalysis.com) – The US government will not block the sale of CITGO, the US-based subsidiary of Venezuelan state oil company PDVSA and the country’s most important asset abroad.

In a letter filed on Friday in the US District Court in Delaware, the US Department of Justice said that the Treasury’s Office of Foreign Assets Control (OFAC) “will not take enforcement action against individuals or entities” involved in a court-ordered auction process of CITGO shares set in motion last year.

The statement added that once a winning bidder emerges, OFAC will implement a “favorable licensing policy” for the execution of CITGO’s sale procedure “or the negotiation of a settlement agreement among the relevant parties.”

The April 7 Justice Department letter was released following the issuing on Friday of OFAC General License 42, which authorizes transactions conducted by the defunct opposition-controlled 2015-2020 Venezuelan National Assembly (AN) for “the negotiation of settlement agreements” involving any debt of the Venezuelan government, PDVSA, or any entity where PDVSA owns 50 percent in shares or more.

According to Robert B. Pincus, the Delaware court-appointed “Special Master” tasked with securing the US government greenlight for CITGO’s sale, the auction process could begin in September with the highest bid reviewed in June 2024. Earlier this year, Pincus met with Justice and Treasury officials and asked OFAC for guidance on the auction of shares from CITGO’s parent company, PDV Holding.

Pincus likewise urged the court to move quickly “to take advantage of CITGO’s recent financial and operational performance and the current state of the refining industry,” according Reuters. Creditors and analysts have suggested the possibility of off-court settlements as well.

With three refineries and a network of over four thousand gas stations stateside, the Houston-based oil subsidiary reportedly registered a $2.8 billion profit last year and could be valued at $13 billion. However, no revenue has been perceived by Caracas since 2019 after Washington recognized Juan Guaidó’s self-proclamation as “Interim President” and handed CITGO’s management to an opposition ad hoc board.

As a result of its seizure, the company was left vulnerable to a number of threats as several foreign corporations and bondholders looked to claim shares as compensation for arbitration awards and the defaulted PDVSA 2020 bond for which 50.1 percent of CITGO shares were pledged as collateral.

In 2020, the US Treasury Department stepped in and began issuing six month or year-long licenses to block any attempt to seize the company. The latest was general license 5K released on April 19 for only a three-month period.

The current auction process was brought forward to the Delaware court by Canadian miner company Crystallex in order to collect $970 million of outstanding debt from a $1.4 billion international arbitration award granted by the World Bank’s International Center for Settlement of Investment Disputes (ICSID) in 2016 in compensation for the 2008 nationalization of Las Cristinas gold mine in eastern Venezuela.

Other creditors looking to collect awards via CITGO shares are glass firm Owens-Illinois, Huntington Ingalls Industries, ACL1 Investments, and Rusoro Mining owed a combined $1.6 billion plus accrued interest as well as Koch Minerals and Koch Nitrogen ($387 million) and ConocoPhillips ($1.3 billion). They have received conditional approvals to tag their claims potential CITGO auction. Additionally, in August 2022 ConocoPhillips won a default ruling to enforce a separate $8.5 billion ICSID compensation for three oil projects nationalized by Chávez in 2007.

On Wednesday, Venezuelan Vice President Delcy Rodríguez accused Washington of committing “the theft of the century” by authorizing the subsidiary’s auction process in order to benefit Western economic interests represented by corporations.

“This is organized crime in the most sophisticated way, directed by the Government of the United States,” she said during a televised press conference alongside Foreign Minister Yván Gil and Oil Minister Pedro Tellechea.

Rodríguez added that the OFAC general license “violates not only Venezuelan laws but all international law,” and warned that no country can be assured that its assets on US territory will be safe “if a plot to seize and sell them can be set up overnight.”

The Vice President likewise stated that the Maduro government would not recognize “any type of deal” with foreign creditors unless done directly with the Venezuelan state. She recalled that the 2015 opposition-controlled National Assembly recognized by OFAC as the Venezuelan negotiator “no longer exists.” The parliamentary elections in December 2020 saw the legislative body renewed with a Chavista majority.

The Venezuelan official said that the members of the defunct parliament who are responsible for the loss of CITGO will face asset seizures under the newly-approved “Domain Extinction” law. Rodríguez also singled out José Ignacio Hernández, who served as Guaidó’s “special prosecutor”, for his role in CITGO’s looming breakup.

“Crystallex had Hernández as one of their experts. Later he called himself Venezuela’s prosecutor not to defend our patrimony but the interests of the company he had already represented,” Rodríguez explained.

Guaidó, who was ousted as “interim president” earlier this year, and his associates have been accused of compromising assets such as CITGO by not showing up in court, having conflicts of interest, and striking under-the-table deals with corporations. He recently fled to the United States.

For its part, the Foreign Ministry issued a communique stating that CITGO’s theft “represents a blow” to the dialogue process in Mexico and to the international conference held in Bogotá “where almost unanimously the participating countries demanded the US government lift the criminal sanctions against Venezuela.”

Finally, National Assembly deputy and Chavista leader Diosdado Cabello accused Guaidó of being behind this last blow against CITGO. “A week before [the OFAC license approving the sale] one of the greatest traitors that this homeland has ever seen fled to the United States. That is no coincidence.”

Edited by Ricardo Vaz from Caracas.

OPINION

Dear Friends,

Folks, you’ve been hearing from me, now hear it from Keandra McDole and her spot-on piece in the Delaware News Journal. Chancery court corruption is threatening Delaware’s economic future, she says in her story. $3 billion a year is at stake in Delaware. She explains how vital that money is to our state’s future! 


Delaware is facing a crisis. We should all be concerned. It’s vital we solve this now. This is key to the survival of America’s First State.

Please send your feedback on this. It’s always welcome and appreciated! Read her story in the News Journal below and let me know your thoughts. 

Respectfully Yours, 

JUDSON Bennett–Coastal Network 

This is how chancery court corruption threatens Delaware’s economic future | Opinion

 Keandra McDole

Special to the USA TODAY Network

As every native Delawarean knows, our state is the business incorporation capital of the world. Fortune 500 companies want to incorporate in our state for tax reasons and to take advantage of Delaware courts created to handle their specific cases. And, of course, Delaware’s economy benefits financially from these special business laws.

In fact, 20% of our state’s entire budget relies on the incorporation industry and LLC fees. This means that of $14.5 billion of our state’s spending plan, $3 billion comes directly from the incorporation industry and LLC fees. Our schools, roads, police and fire services, and public assistance for those in need — from Wilmington to Dover to Millsboro — rely on this 20%.

Right now, Delaware is facing a crisis that we should all be concerned about. Major corporations like Twitter, TransPerfect — which is a leader in the world of translation services — and many more companies have announced they are leaving Delaware for Nevada. With their departures, these corporations are taking major revenue away from us.

The answer is very simple if you are wondering why these companies are leaving — corruption throughout the Delaware Court of Chancery. The court has made a name for itself in not being transparent or impartial in its structure and its rulings. That is enough for companies to look elsewhere to resolve their disputes fairly.

The chancery court ordered the forced sale of TransPerfect, although the company’s founders and employees objected. Imagine being a respected business owner, and a court tells you that you have no choice but to sell the company you built and founded and have no voice in the matter. The Delaware Court of Chancery does not try to find a middle ground; instead, they use their authority to bring big bucks to the lawyers and systems in front of them. The TransPerfect case mirrors Twitter’s situation — that is why one of the biggest social media platform companies left Delaware for Nevada. Nevada doesn’t have conflict of interests or an entrenched “old boys’ club,” and is consistent and fair in their court rulings on business disputes.

If more businesses decide to follow TransPerfect and Twitter’s lead, Delaware will lose significant tax revenue, which affects all of us who live here in Delaware. And the services that will feel the most loss fall within affordable housing, healthcare, and education — crucial services needed for our most vulnerable neighbors.

As a Black Wilmington native and racial justice advocate, I know personally that loss of tax revenue will disproportionately punish people who need those investments the most. Historically, low-income communities, Black and Latino residents have always been left out, and will be even more left out if tax revenue dwindles. Today in Delaware, Black and Latino people are each more than twice as likely to live in poverty than white people. And while white unemployment in Delaware is 3.4%, it is higher for Latinos at 5% and 7% for Black individuals. I’m not sure the all-white chancery court recognizes the impact their decisions have on the communities of color.

Delaware has a long way to go to reverse the chancery court’s reputation, and it requires acknowledging the unethical ways of the court system. We need a judicial code that incorporates reforms and demands transparent oversight, accountability, diversity and fair rulings to restore faith in Delaware’s position as the “incorporation capital of the world.”

We have seen Nevada take our companies, and more companies will follow suit if we remain silent rather than fighting for change. Further, bold changes are needed to make Delaware a vibrant, prosperous and safe state for our most vulnerable communities for generations after us. We need to look forward to that change but to accomplish it, we need to make our elected leaders hear our voices.

Keandra McDole is a Wilmington activist.

OPINION Dear friends, Folks, in the famous TransPerfect case in our home state of Delaware, the two founders have settled all of their differences, according to a Law.com/Delaware Business Insider story put out Wednesday. Now it’s time for Andre Bouchard and his Chancery Court to sever all ties with the company. He’s still collecting money through his court-appointed Custodian Robert Pincus, YEARS after the case was settled and now that the founders have settled all disputes, there’s no reason for him to keep his hand out. Hundreds of millions of dollars could have been saved, INSTEAD of hundreds of millions of dollars being spent on Bouchard’s buddies and former co-workers at law firm Skadden Arps. Summed up in the Law.com story (see the story below), even better than I could say it, by an attorney representing the company, “If Bouchard, instead of ordering the sale of the company, had done what the New York judge, Judge (Melvin Schweitzer) did, and just said, ‘Nope, neither one of you is entitled to this relief. Go solve your problem yourselves,’ there would have been hundreds of millions of dollars in fees saved.” The depths of Bouchard’s corruption are apparent to me in how he abused his power in this case. I was all over Bouchard even before TransPerfect came along for him to start ringing the court’s cash register as he seemingly likes to! I’ve covered the Delaware Chancery Court and Chancellor Andre Bouchard from day 1 of his regime, because of injustices and poor planning by Bouchard at the Register of Wills office in Sussex County, which my friend Cindy Green had to endure as the elected Register of Wills under his arrogant authority. Folks, this can’t go on or our state is doomed with this guy in charge of our vaunted Chancery Court. At least now it should stop for TransPerfect. The question is, will it? Or will Bouchard’s abuse of power continue?! Scroll down for the Delaware Business Insider/Law.com story: TransPerfect CEO Settles 6-Year Legal Battle With Co-Founder, His Lawyer Says While the custodianship case between Philip R. Shawe and Elizabeth Elting has been sorted out through mediation, TransPerfect’s legal saga in Delaware isn’t over, as Shawe and TransPerfect continue to contest attorney fees charged by Skadden, Arps, Slate, Meagher & Flom as custodian in the case during the company’s 2015 sale for $770 million. By Ellen Bardash | September 30, 2020 A dispute between the founders of TransPerfect Global Inc. has been resolved with a settlement agreement, ending a battle that began in the Delaware Court of Chancery nearly six years ago. But while the custodianship case between Philip R. Shawe and Elizabeth Elting has been sorted out through mediation, TransPerfect’s legal saga in Delaware isn’t over. Shawe and TransPerfect continue to contest attorney fees charged by Skadden, Arps, Slate, Meagher & Flom as custodian in the case during the company’s 2015 sale. That sale was for $770 million, TransPerfect is also mid-discovery in a case in the Southern District of New York. TransPerfect is also mid-discovery in a case in the Southern District of New York. “We don’t think there’s anything left to the custodianship at all,” said Martin Russo, an attorney representing Shawe and TransPerfect, on Wednesday. “Of course, we have this very big hurdle, which is the Lionbridge H.I.G. case where we’re trying to remedy the damage that was done by the court-ordered custodianship; the disadvantages that TransPerfect has now based on having been forced to hand all this sensitive data and trade secrets to a competitor.” A letter to Chancellor Andre Bouchard (https://drive.google.com/le/d/1kF-FAMjCS4Ln 8zSkahrWehaTodsoeNn/view?usp=sharing) written by Jeremy D. Eicher on Shawe’s behalf Wednesday indicated the settlement agreement frees Elting from any liability or financial responsibility in two multi-million dollar settlements which Shawe and TransPerfect entered into in December 2019. “If Mr. Shawe’s good faith efforts produced an agreed Settlement with Ms. Elting, a feat this Court once deemed so impossible as to require the novel extraordinary remedy of a forced sale of an extremely profitable, privately-owned enterprise, a similar result must certainly be achievable with a Court-appointed Custodian bound to act in good faith,” Eicher wrote. Attorneys with Skadden and with Potter Anderson & Corroon, which represented Elting in the case, did not immediately respond for comment Wednesday. In exchange for the releases, according to that letter, Elting will not claim that Shawe and what is now TransPerfect Holdings LLC owe her more than $210,000 in legal fees—a claim she brought before the court previously and that Bouchard said would require another motion by Elting to continue. Elting’s ownership interest in two real estate properties—one in New York and the other in California—is also being transferred to Shawe. Russo said he could not disclose dollar amounts Shawe is expected to pay Elting in the settlement. The agreement, according to Russo and the letter to Bouchard, resolves a conflict involving WordFast, a separate company that created the code behind much of TransPerfect. Prior to the sale of TransPerfect, Russo said, WordFast was treated as though it were part of TransPerfect and was also for sale, with Skadden partner Robert Pincus, along with Elting, asking the court to rule that WordFast had granted TransPerfect a license to use its software royalty-free. As part of the settlement, Shawe is to purchase Elting’s 50% interest in WordFast. Russo said the agreement is significant in that after years in the Court of Chancery, it was reached in mediation without court intervention. “If Bouchard, instead of ordering the sale of the company, had done what the New York judge, Judge (Melvin) Schweitzer, did, and just said, ‘Nope, neither one of you is entitled to this relief. Go solve your problem yourselves,’ there would have been hundreds of millions of dollars in fees saved,” Russo said. If you’ve been following the winding trail of the TransPerfect case, you’re probably wondering: where does this path lead us? Certainly no one could’ve expected the case, originally a custody-battle, to turn into a fight for survival for the incredibly successful company. 

A Delaware Chancery Court-Approved Shake-Down

While there seems to be a light at the end of the tunnel with recent TransPerfect victories, there is much more work that must be done in order to have true justice in Delaware again. How could Robert Pincus get away with such shady billing practices right under the nose of the Delaware Chancery? The events leading up to the current TransPerfect case reveal a history of choosing money over truth, and the “Old Boys Club” that paved the road. 

The Beginning of Corruption 

Robert Pincus, of Skadden Arps, was appointed custodian of the TransPerfect case in 2015 when the global translation company faced a battle for ownership between the two co-CEOs. Since then, the case has escalated into an expensive and time-consuming controversy that showcases the Delaware Chancery Court’s corruption. In August of 2018, TransPerfect filed a lawsuit against Custodian Pincus in Nevada for the exorbitant amount of money he had billed the company.

Massive and Unexplained Billing

As soon as Pincus was appointed custodian over TransPerfect, the custodian sent massive and unexplained bills to the company. When CEO Phil Shawe noticed the bills and began questioning Pincus, he was brushed aside. Though Pincus seemed to think the amounts he was charging were reasonable, the breakdown of the numbers prove otherwise. 

Billing Amounts

In his role as custodian, Pincus charged a $1,425 an hour personal fee—yet did not provide receipts or a breakdown of the charges. At times, he charged TransPerfect between $60,000 and $140,000 per month, totaling at least $14 million today in undisclosed fees. Even after Pincus’ retirement in 2018, the unexplained bills kept coming. After the company raised red flags, Chancellor Andre Bouchard finally ordered Skadden Arps and Pincus to provide receipts and disclosure, yet the law firm continued to provide redacted and vague information. 

Today: Correcting the Wrongs of the Court

Things seem to be looking up for TransPerfect. As knowledge spread of the mishandling of the case, many groups called for transparency in the Delaware courts. Chancellor Bouchard has ordered Pincus and Skadden Arps to provide unredacted receipts to the company, which is the first victory in the TransPerfect saga. 

Coastal Network

The Coastal Network is an outlet committed to providing a voice against corruption and advocating for transparency in the Delaware court system, business world and beyond. For more on corruption in the United States, including the Delaware Court system, visit www.coastalnetwork.com The Delaware Court of Chancery is known as one of the oldest and most prestigious courts in all the United States. On the surface, their reputation seems impeccable. Which begs the question, “Who watches the watchmen?” Who ultimately provides the Delaware Chancery with oversight?

Establishing Oversight of the Delaware Chancery Court

While Delaware’s governor appoints judges to the Delaware Court of Chancery, and the senate confirms them, the Delaware Chancery works with a high level of autonomy in their day-to-day business. The senate and governor would only intervene in the case of serious criminality.  Fortunately for the state, Citizens for a Pro-business Delaware, in conjunction with the Better Business Bureau, have taken it upon themselves to carry the torch of accountability on behalf of the people of Delaware. More than 1/3 of Delaware’s economy is contingent upon the businesses that the Delaware Chancery serves. Among Delaware Pro-business’ many platform points are three key point of oversight: Delaware Pro-business has made it a mission to enforce accountability, which has become a necessity given the events of the TransPerfect case

Conflicts Of Interest in the Chancery Court of Delaware

At the heart of Delaware Pro-business’s push for oversight is the behavior of the Delaware Chancery’s chancellor, Andre Bouchard and his former associate at Skadden Arps, Robert Pincus. The two men had previously worked together at the prestigious law firm, so when Bouchard appointed his former colleague as the court-ordered custodian of the forced sale of TransPerfect, Citizens for a Pro-business Delaware responded with a fair amount of justifiable skepticism. 

Requiring Law Firms and Custodians to Provide Financial Receipts when Billing

It wasn’t just the blatant nepotism involved in the appointment; it was the fact that Robert Pincus engaged in deceptive billing practices while serving as custodian. Pincus billed TransPerfect almost $1,500 an hour for nondescript services. When taken to task regarding the inappropriate charges, Pincus’ associate, Bouchard, had no choice but to back pedal and side against Skadden Arps. The resulting decision was not only a legal fiasco, it also weakened the reputation and prestige of the Delaware Court of Chancery. 

Ensure Chancery Court Chancellors Cannot Select Cases Based on Self-Interest

As a result, Citizens for a Pro-business Delaware has called for more oversight on the Delaware Chancery, including pushing for formal legislation forcing the Chancery to abstain from choosing cases that result in a conflict of interest, or worse yet, outright promote their own self-interests.  There’s a hard road ahead, and Delaware Pro-business is just getting started, but through their efforts, and the involvement of Delaware’s citizens, the Delaware Chancery will get the formal oversight it so desperately needs. 

COASTAL NETWORK

The Coastal Network is an outlet committed to providing a voice against corruption and advocating for transparency in the Delaware court system, business world and beyond. For more on corruption in the United States, including the Delaware Court system, visit www.coastalnetwork.com 

A Brief History of the Delaware Chancery

The Delaware Chancery Court is one of the oldest legal institutions in the United States. Its history can be traced back to the Revolutionary war. The Delaware Court of Chancery bills itself as one of the most prestigious courts in the modern world, but even a court with such a long and distinguished history is not immune to corruption and nepotism.

What is the Delaware Court of Chancery?

A chancery court differs in concept from a criminal court, circuit court, or court of appeals. The Delaware Chancery deals in cases of equity. The equity issues that result in Delaware Chancery Court decisions rely solely on a judge’s jurisprudence in applying fairness and common sense rather than legality, rules, and strictures in order to resolve disputes. Chancery courts, like the system found in Delaware, deal with civil cases rather than criminal cases. Delaware Chancery Court decisions revolve around contract disputes and business law. Other types of cases that you might see in a chancery court include: The Delaware Chancery Court mainly deals with business law due to the sheer number of businesses that are incorporated in Delaware.

History of the Chancery

The Delaware Chancery’s long and storied history stretches all the way back to 1792. Delaware’s Chancery Court is a product of historical English law coupled with concepts derived directly from the first Constitutional Convention. Among the most notable figures in the court’s 230-year history include:

History of the Chancery’s Membership

The Delaware Chancery derives much of its power and prestige from its public image as one of the fairest, most experienced legal institutions in America, with profound expertise in business law. Just below the public facade, however, the Chancery has a deep history of being an “old boys club.” There has always been an air of nepotism and political manipulation when naming each successive chancellor, but scandal came to the forefront in 1916 when Josia Wolcott was named chancellor in what came to be known as the “Dirty Deal.” At the time, it was alleged that Wolcott was promoted to the position by a Republican governor despite Wolcott’s Democratic status in order to maneuver one of the governor’s allies into congress. The scandal passed quickly, but the court’s reputation has been stained with favoritism since.

Andre Bouchard: Current Delaware Chancellor

Andre Bouchard was named chancellor in 2014. One of his most controversial Delaware Chancery Court decisions involved TransPerfect, a case in which the chancellor eschewed the court’s historically business-friendly modus operandi, instead using his new platform to attack the company while making political contacts. Since his tenure began, Bouchard has done everything in his power to reinforce the public perception that the Delaware Chancery Court is merely an old boys club. 

Coastal Network

The Coastal Network is an outlet committed to providing a voice against corruption and advocating for transparency in the Delaware court system, business world and beyond. For more on corruption in the United States, including the Delaware Court system, visit www.coastalnetwork.com  OPINION My Readers Respond! And they Don’t Like the Stench Coming From Delaware’s Chancery Court Dear friends, As you can see from the responses below, informed Delawareans don’t want what they’re seeing, and what I believe is happening: It apparently seems that a corrupt, Chancery Court Chancellor is single-handedly dismantling our State’s reputation. I sincerely thank you for your feedback on this amazing story that continues to draw national media attention. With over $250 million of company and shareholder money unaccounted for, much of it ordered to Bouchard’s former law firm Skadden Arps, this is in my view, perhaps the largest case of court corruption in United States history. TransPerfect has not been permitted access to the bills that have been ordered by Bouchard to be paid. Want an example of how corrupt I believe Pincus and Skadden are? Nearly two years after the case has been closed, TransPerfect is still paying millions annually to Skadden Arps. I know this is hard to believe, but this is the information I am receiving from my reliable sources in the company. To receive a “litigation hold notice” — which I am told is a one-page standard letter — telling parties in law suits to preserve evidence – Skadden Arps charged TransPerfect a whopping $140,000. It is insane that Bouchard thinks he’s powerful enough and untouchable enough that he can just seem to rub corruption right in the face of the public by condoning what I see clearly as court-sanctioned theft. Below are a few of your recent responses that I have cut and pasted directly into this article. I have removed the last names to protect the individuals from possible reprisals by Bouchard, Pincus, Shannon, Strine and their powerful network of cronies: Here is how Delawareans feel about these recent events: 1) From Pete: For Bouchard to hold TransPerfect, et al in contempt only looks like a cover-up. This is corruption and it looks like these boys have a nice little act going. Skadden Arps is notorious for their iffy operation! Bouchard and Pincus are part of it! Thanks for your great work. -PETE 2) From Sarah: Thank you for your wonderful coverage of this. Bouchard must be investigated! Sarah 3) From Alfred: Judson, I believe there has to be an investigation by the Delaware Senate? Alfred 4) From Chris: This Judge Andre Bouchard has got to go! Thanks for keeping us informed! Chris 5) From Paul: Interesting commentary. I wonder if the Nevada Courts will come into conflict with the Delaware Courts and will the Chancery’s attempt at a Contempt charge be valid now that TransPerfect has moved its corporate headquarters? Regardless, the system is layered with back-covering throughout. 6) From John: Dear Jud, They apparently are all in it together. Nobody has ever addressed the Chancery Court’s operation like you have. We in Delaware always prided ourselves on a pristine state with positive economics and honest courts. These appearances of impropriety are shocking. Keep up the great work. JOHN 7) From Tom: Judson, It seems in life, if there are loopholes people always find them. If there are flaws in the law, they find a way to be corrupt. The integrity of the justice system must be upheld at all costs. This stuff is outrageous and very disturbing. Thanks for writing this. TOM 8) From Patty: Jud, Your great work is the talk of the town. This is amazing — you can’t make this stuff up. How does this guy Robert Pincus think he can get away with this? Bouchard must be so arrogant and comfortable in his position to operate the way he does. Who has the guts to do what is necessary??? Jud you are something else. LOL. All the best to you and keep it up. PATTY 9) From Dennis: VERY INTERESTING! 10) From Laurence: Hey Judson, How can this happen? It seems logical that TransPerfect’s lawyers need to start talking to the AG’s office?? 11) From Richard: Remember the old saying, you can’t beat city hall. It is such a shame that we now have to be suspicious of an institution that was once so respected. I feel sorry for Mr. Shawe to have to go through this BS. Thanks for all you do. All the best, Dick 12) From Doug: Judson, This is scary stuff when the people we have to go to receive justice, could be corrupt. I won’t incorporate in Delaware anymore. Doug 13) From Laurie: An amazing and thorough expose of something that needs to be exposed. What a story—there is a movie in this for sure. We wait for the outcome. Keep up the great work. Laurie 14) From Sally: Judson, My first time responding to you in quite a while. This is heavy stuff. It seems that Bouchard is attempting to use every angle to maintain control and cover his tracks. The only way change will be made in the judicial system is for Delaware to make political change. You have done an excellent job bringing this to light. Keep up the good work. I ask you, folks, who are seeing what’s happening here, could Andre Bouchard actually be attempting a cover-up? Will the Nevada courts rule in favor of TransPerfect? Can Chancellor Andre Bouchard actually and legally withhold evidence on the un-itemized and unexplained invoices in the amounts of millions of dollars submitted by the law firm of Skadden Arps? The appearances of impropriety are mounting and you the citizens of Delaware are demanding action! I appreciate your interesting feedback; please keep your responses coming! We are making a difference! Respectfully Yours, JUDSON Bennett-Coastal Network

OPINION

Dear Friends,

Folks, more developments are happening with the Skadden Arp’s law firm and Chancery Court Chancellor Andre Bouchard, who in my view, are working collaboratively to continuously bilk TransPerfect, nearly two years after the case!

What happens when you demand to see Skadden Arps’ bills after being Court-Ordered to pay the Chancellor’s friends millions blindly? Well, if you demand it in a fair forum like Nevada, what happens? Suddenly Skadden Arps — seemingly to hide their bills and deflect from allegations of massive over-billing — runs to their “never-lose-a-motion” buddy Bouchard, in what I see as a home-court advantage, that in my book violates every principle on which United States Justice is based.

Skadden Arps, Bob Pincus, and Andre Bouchard appear to be desperately trying to deflect attention from what I’ve seen as the real issue all along: Skadden Arps, show your bills!!! To the public, to the payor TransPerfect, to someone, anyone?

If you did the work you say you did, why engage in a deception and deflection, “Contempt” motion? Just show your ordered and itemized bills. It’s obvious to this journalist and my confirmed opinion, that your buddy Bouchard gave you a blank check and you possibly misused it!

In my opinion, TransPerfect should not have to defend a “Contempt” motion, being made so Skadden and Bouchard can divert attention from the real issue: Ordering TransPerfect to pay Skadden Arps millions after the Custodian retired, with apparently no explanation whatsoever.

Folks, it is my belief that Bouchard’s Chancery Court reeks of rampant appearances of impropriety with disconcerting suspicions of collusion and corruption.

Something must be done and I see from the onslaught of feedback you’ve been generously sending, it’s resonating with you as well. I’ll share the excellent feedback with you soon. Keep it coming! Together we can do something important here and bring about change in Delaware’s Court of Chancery.

Please stay tuned because yours truly will keep investigating and sharing with you frequently.

Respectfully yours,

JUDSON Bennett-Coastal Network

OPINION Dear Friends, My sources have told me that after taking only 15 minutes to examine the motion, Bouchard has now granted a new motion clearly encouraging the Infamous Skadden Arps law firm, who I believe is acting in coordination and on behalf of the Chancery Court, to further retaliate against TransPerfect (now a Nevada Corp), Philip Shawe, and Shirley Shawe (79-year-old senior citizen). How? Through a “Contempt of Court” motion? Outrageous and Absurd! Why? Because after still being looted by Pincus and Skadden Arps more than 1-year after the case, TransPerfect was forced to seek the protection of the Nevada Courts. Can you blame TransPerfect for wanting to litigate in a fair forum?! For years Bouchard has made his buddies rich and now that TransPerfect is in Nevada, he needs a way to keep TransPerfect under his control and to keep the gravy train going. This comes after the world’s longest series of arbitrary and capacious rulings, all coincidentally against TransPerfect and the Shawes and ALL FOR THE BENEFIT of his former law partners (Pincus, Lamb) and his best friend for 20 years, Kevin Shannon. $250 million was spent with lawyers and Bouchard’s friends, and sealed documents prevent the public from knowing why? Want more proof that they are in cahoots? My understanding from folks I’ve talked to about this is that Pincus is contractually bound NOT to say bad things publicly about TransPerfect and Shawe — that’s one of the things Shawe paid for with his $385 million in Bouchard’s rigged auction — but now Bouchard has granted an extra-long motion for Pincus to basically do an end-run around his contractual guarantees not to talk negatively about TransPerfect or Philip Shawe. Mark my words, Bouchard granted this unusually large extension motion, purposefully so he could aid and abet Pincus’ continued, and in my view, illegal, disparaging, defaming and looting of TransPerfect. In my opinion folks, Delaware’s Skadden office and their thinly-veiled coordination with Bouchard are a form of incestuous, organized crime. How else does it look, I ask? Watch for what I think will happen based on conversations with a few of my attorney friends: Former appointed Custodian Robert Pincus writes a nasty motion with false claims and then illegally leaks it to the press — so that the Chancery Court can further retaliate against TransPerfect, Phil Shawe, and Shirley Shawe. OUTRAGEOUS FOLKS ! This is exclusive coverage brought to you by the Coastal Network! I have worked hard to cultivate sources inside the organization, who spoke with me under the strict condition of anonymity — out of fear of reprisal from Bouchard. Sound American? Not to this journalist! Stay tuned! Your comments are welcome and appreciated. Yours truly, JUDSON Bennett-Coastal NetworkDear Friends, Finally, a lawsuit has been brought against Robert Pincus of Skadden Arps! The case has been brought by TransPerfect Global, which has spent over a million dollars in fees since the completion of the company’s sale, and yet they still don’t know what they’re spending all of that money on. The bills, as you may recall, are under seal by Andre Bouchard, Chancellor of Delaware’s Chancery Court. Pincus was appointed as a custodian at TransPerfect Global, in essence, to break all ties between the company’s founders as they battled in court. Meanwhile folks, a referee is no longer needed! The case has long been solved and Pincus is still sending up to $90,000 in monthly invoices for undisclosed work to a company that no longer requires his services and has since moved its headquarters 2,500 miles across the country. How absolutely ludicrous this man apparently is, thinking that he has the right to still be drawing funds from this company! What gives, Chancellor Bouchard?! If money is still being siphoned out of the company coffers, at least Mr. Bouchard, please have the leadership to let this company, which is no longer under your jurisdiction, know exactly what it’s paying for! Folks, TransPerfect is apparently still paying bills (all unexplained or un-itemized and hidden) which have been imposed by Delaware’s Chancery Court even after the company has officially moved to Nevada, even after the sale is over, and even after I have been beating this drum and telling this heinous story for years now! Frankly, all this is significant and amazing to this investigative reporter! Would Andre Bouchard keep paying a car payment for his Bentley to the car dealership, long after he had sold the car to his neighbor? I think not. Would he continue to pay for landscapers to cut the acres and acres of land at his estate if he had sold the place? You bet he would not! The apparent audacity and arrogance of Andre Bouchard is simply astounding. As I see it, not only are the rules of the Chancery Court ancient and outdated, but this man presides over his court with personal and subjective decisions not based on previous law or logic. Well guess what folks, TransPerfect Global has filed suit against Robert Pincus and frankly, in my humble opinion, it is about time. I see it as refreshing to see some light finally shining on the situation and hopefully Robert Pincus’ and Chancellor Bouchard’s suspicious ways will be exposed by this lawsuit. Read the story below and let me know what you think! As always your comments are welcome and appreciated. Respectfully yours, JUDSON Bennett-Coastal Network

Skadden Partner Who Ran Transperfect Sale Hit With Fee Dispute

Mike Leonard – Bloomberg Law Aug. 15, 2019 A former partner at Skadden, Arps, Slate, Meagher & Flom was hit with a lawsuit challenging the fees he wants for serving as tiebreaking director of Transperfect Global Inc. and running its forced sale after a controversial court ruling. A Delaware judge in 2015 appointed Robert B. Pincus custodian of the translation company and ordered it sold at auction, finding that co-founders Liz Elting and Phil Shawe were incapable of running it after breaking off their romantic relationship. A divided Delaware Supreme Court upheld the appointment in a 2017 ruling, rejecting the argument that the judge exceeded his authority by ordering a profitable company sold based solely on a leadership deadlock. The case attracted widespread attention, both for its tabloid-ready details and for the novel legal issues it raised. Shawe subsequently bought out Elting at a “modified auction” and moved the company’s headquarters from Delaware to Nevada. Pincus’s bills for his work in the matter came to between $58,000 and $90,000 each month from May to July this year, according to the partly redacted complaint Transperfect filed in Nevada’s Clark County District Court. Those bills contained misrepresentations, including a request covering time spent as a witness that’s “not properly chargeable to the custodianship,” Transperfect says. The judge “unwittingly” granted Pincus’s fee requests without realizing Transperfect hadn’t seen them, the suit says. Because those reports were filed under seal, Transperfect doesn’t have specific information about what work was done, who did it, how long it took, or what the hourly rate was, the Aug. 12 complaint claims. Absent that information, the company can’t “assess the reasonableness of the amount of fees,” it says. Skadden has demanded the money from Transperfect rather than taking it from an escrow fund established to pay Pincus’s fees, and has responded to questions by citing sealed court documents Transperfect can’t access, according to the complaint. Skadden and Pincus didn’t immediately respond to Aug. 15 requests for comment. Transperfect is represented by Brownstein Hyatt Farber Schreck LLP and Kruzhokov Russo PLLC. The case is Transperfect Global Inc. v. Pincus, Nev. Dist. Ct., No. A-19-800185-B, complaint filed 8/12/19.

I have sensed for years that something was rotten in the state of Delaware’s Court of Chancery, in general, but also specifically as it relates to the TransPerfect case and the missing $250 million in legal, custodian and consultant related fees. I promised my loyal readers that I would find and pull on every loose thread of this case until my perceived web of corruption that belongs to Andre Bouchard becomes totally unraveled for all to see.

This new discovery is going to floor you, and what I believe is the attempted cover up will floor you even more!

Three law firms, from my view, made out like bandits when Bouchard started ordering TransPerfect Global and CEO Phil Shawe’s personal money be paid around to his friends and former law partners like a feudal lord in mid-evil times — and remember folks, no witnesses testified against either Shawe or TransPerfect. These three firms benefited to the tune of millions of dollars whose uncanny “coincidences” and connections to Bouchard warrant a State and Federal investigation of Bouchard and his Cronies:

1. Skadden Arps – The former partner at Skadden, custodian Bob Pincus, whose personal friendship I recall Bouchard bragged about when appointing him. Also, this is where outgoing Chief Justice Strine started in law, as Bouchard’s intern.

2. Potter Anderson – Perhaps, who I believe is the dirtiest attorney in Delaware, Kevin Shannon, who seems to win cases without providing evidence by attending tax-payer financed boondoggles with Strine and Bouchard (who I hear from reliable sources that he golfed with and additionally, traveled to New Orleans with, during critical points in the case!!!)

3. Kramer Levin – Whose seemingly outrageous lies to the Delaware Supreme Court were called out in a nationally televised advertisement. What was their penalty for all of this? A victory. What’s the Bouchard connection? Kramer, Bouchard, and Kevin Shannon all worked together on the infamous Walt Disney case years ago, where they argued against shareholder interests. I have heard from reliable sources, that Gary Naftalis is a named partner at Kramer Levin who comes down to hob nob with Strine and Bouchard; sometimes he’s the only non-Delaware lawyer in attendance at a Delaware conference?

4. Paul Weiss – The fourth firm who made out like John Dillinger — and had no apparent connection to Bouchard…UNTIL NOW!!!

The Fourth Firm—HERE IS THE RUB FOLKS :

This firm, which no one has spoken about until now, in August of 2016, as reported in the New York Law Journal, Chancellor Bouchard ordered Shawe to pay Elting’s lawyers an outrageous and unconstitutional fine of $7.1 million — an order un-related to any “harm” or “compensation” in the case, as the law requires — and the largest such sanction ever in U.S. history. Bear in mind: Shawe denies all claims and has maintained his innocence at all times. All witnesses testified for Shawe–clearly stating that there was no wrong-doing of any kind. How did Paul Weiss win? Keep reading.

Paul Weiss benefits immensely — and no one made the connection before now. Why? Perhaps an orchestrated cover-up on a grand scale?

Who was the most Senior Paul Weiss lawyer in Delaware at the time? Who gained the most in the Paul Weiss DE office? You won’t believe it when I tell you: Former Chancellor Steven Lamb. Bouchard’s first firm, when he left Skadden Arps (if he ever really left – it appears to me he still might have a financial interest in their success), take a seat before reading the next line: Bouchard’s very first firm of his own was: BOUCHARD AND LAMB!!!!

You may not believe me that this is the truth, because it boggles honest minds. Folks, I have done hours of digging and digging to establish the only remaining connection of Bouchard to all the law firm benefactors of the crazy decisions in the TransPerfect case. Irrefutable proof of the Bouchard-Lamb connection is in the link:

http://www.delawaretoday.com/Delaware-Today/November-2015/The-Business-of-Law-Meet-the-New-Leader-of-the-Court-of-Chancery/

So many dots are connected here. Andre Bouchard has, in my opinion, hit for the proverbial “corruption” cycle ( a baseball term for those of you who don’t know) by helping 4 different law firms, all of which he is intimately connected to! He helped them make millions upon millions of dollars by his seemingly biased decisions from the TransPerfect Global case.

The Cover-Up!!!

Chancellor Bouchard prior to his appointment to the Chancery Court was partners with Stephen Lamb! Stephen Lamb after serving on the Chancery Court himself then moved back into private practice with the law firm of Paul Weiss. Fast forward to the TransPerfect case in 2016 and Kramer Levin hires the Paul Weiss firm to work on the case representing Shawe’s former partner at TransPerfect– Liz Elitng. Specifically, they were hired to work on the allegation that Shawe spoliated evidence which, according to the testifying employees, were NOT able to prove in any way, shape, or form. The bottom line is that nobody needs proof if Bouchard’s court is corrupt and rigged for his cronies to win?

Yet when all the papers were served on behalf of Elting by Paul Weiss, absolutely no mention was made of former Chancellor Lamb’s name. It wasn’t until I was doing some research and saw an article where Paul Weiss was claiming victory, did I notice that one of the attorneys taking credit for the victory was Stephen Lamb! No other public document I can find anywhere even lists LAMB on the TransPerfect case!!! Another coincidence?? In Bouchard’s court, there seems to be a lot of coincidences. Yet, we know from this evidence he was on the team taking Shawe’s and TransPerfect’s money with Bouchard’s help.

HELLO — They brag about his specific role on the Paul Weiss website!?!?!

I will issue a challenge to all those mentioned, who have never denied these inferences: To Chancellor Bouchard, Former Chancellor Lamb, Kevin Shannon, various Kramer Levin attorneys, who in my opinion, boldly lied to the Delaware Supreme Court with no repercussions!

COASTAL NETWORK’S CHALLENGE: Prove to me there was no cover-up and no hidden agenda. Indeed, this is the appearance of impropriety. Show me one official court document other than the Paul Weiss Web Site, that mentions LAMB’s involvement in the TransPerfect case — and I will discontinue this line of inquiry. In my opinion, Bouchard had a legal duty to inform Shawe that he was formerly in business with Chancellor Lamb, He should have recused himself, but he did not! Folks, any reasonable man would see this as a serious conflict of interest.

This is the most damning evidence of corruption, in my opinion, an investigative reporter could find, as it proves to me that this coordinated group had the intent to hide their wrong-doing. There is no other explanation from my educated perspective. How long will we let this infamous boy’s club of incestuous characters operate by sucking the life out of Delaware’s corporations, Delaware citizens, and Delaware’s reputation?! On behalf of the Coastal Network and my 6,000 readers, I again call for a bi-partisan investigation of Chancellor Andre Bouchard by the General Assembly!

Would love to hear your thoughts on this stunning discovery. Your feedback is always welcome.

As I see it, TransPerfect & Shawe never had a chance at fair trial with this what I call “murder’s row” of Bouchard’s cronies…

Scroll down to read this article:

HTTPS://WWW.PAULWEISS.COM/PRACTICES/LITIGATION/LITIGATION/NEWS/DELAWARE-SUPREME-COURT-AFFIRMS-71-MILLION-SANCTIONS-AWARD-IN-FAVOR-OF-ELIZABETH-ELTING?ID=23702


FEBRUARY 13, 2017

Delaware Supreme Court Affirms $7.1 Million Sanctions Award in Favor of Elizabeth Elting

“The Delaware Supreme Court upheld the court-ordered sale of TransPerfect Global, Inc. and unanimously affirmed the $7.1 million sanctions award in favor of Paul, Weiss client Elizabeth Elting. Elting and Phillip Shawe are the co-founders and co-CEOs of Transperfect, one of the world’s largest document-translation and discovery-services companies. Since 2014, they have been in litigation in Delaware and New York over the control of the company. Elting is represented by Kramer, Levin, Naftalis & Frankel and Potter, Anderson & Corroon in the corporate-control battle.

In late 2014, Elting tapped Paul Weiss when Shawe revealed that he had secretly accessed Elting’s lawyer-client communications. Paul Weiss then uncovered that Shawe had attempted to destroy files on his laptop, had failed to safeguard and produce text messages on his cell phone, which he claimed was destroyed when it fell in a cup of Diet Coke, and had repeatedly lied under oath about his conduct. Paul, Weiss tried the two-day sanctions hearing and represented Elting in her successful post-hearing briefs and in defending against Shawe’s sanctions appeal.

The Paul, Weiss team included litigation partners Eric Stone, Robert Atkins and Stephen Lamb, of counsel Gerard Harper and counsel Robert Kravitz.”

OPINION Dear friends, Yet again, just in case anyone thinks the damage Chancery Court, Chancellor Andre Bouchard has done to Delaware’s reputation is confined to just Delaware or just the United States of America, you’d be incorrect. Here is yet another article from a Spanish newspaper. The article highlights and underscores exactly what I’ve said for months, if not years. There are many changes that need to be made to fix our Chancery Court. I hope we have the courage and conviction to take on the “good old boy’s club” who, in my view, could easily be profiting from corruption under the current system — of course those who might be profiting will resist change with every bit of wealth and power and close-door favors they can muster. The Super Bowl for court and government transparency in Delaware is about to begin. The battle lines are drawn and it’s almost kick-off time for the Citizens vs. Bouchard and his cronies. The Coastal Network promises to give my readers a front row seat on the 50-yard line. Please stay tuned and keep your feedback coming, it is always welcome. Respectfully yours, JUDSON Bennett-Coastal Network PLEASE SCROLL DOWN TO READ THE SPANISH ARTICLE https://cronicaglobal.elespanol.com/business/transperfect-lucha-sistema_265299_102.html

TransPerfect employees lead the fight against system bias

Citizens for a Pro-Business Delaware was born as a result of the multinational’s case to defend workers’ interests against the possible sale of the company to vulture funds 30.07.2019 12:39 h . When many believed that the TransPerfect case was over, it seems that the struggle of the workers and former workers of the translation multinational has only just begun. Citizens for a Pro-Business Delaware citizen platform has presented in Wilmington a proposal for legal reforms that aim to restore the prestige and neutrality of the Delaware judicial system. These were questioned following some controversial decisions by Delaware Supreme Court judge Andre Bouchard . Citizens for a Pro-Business Delaware was born as a result of the TransPerfect case to defend the interests of workers against the possible sale of the company to vulture funds . It is currently made up of employees and former employees of the company, Delaware residents and people from the state’s business sector. All of them total more than 2,700 people. Once the shareholder conflict is resolved, the platform has now expanded its struggle and, beyond focusing on the TransPerfect case, wants to restore the neutrality and good practices of the Delaware judicial system. The organization is chaired by Miranda Wessinger, former director of global events at TransPerfect in Atlanta. The TransPerfect case The TransPerfect litigation that endangered more than 5,000 jobs worldwide, 500 of them in Barcelona, ended when Phil Shawe, current CEO and founder of the company, bought 50% of the shareholding . Until then it was in the hands of his ex-wife Elisabeth Elting . Shawe stayed that way with the entire company and regained its business strategy . However, the judicial process in which the company was involved called into question the reputation of the State of Delaware, where TransPerfect had the administrative headquarters before transferring it to Nevada for its disagreement with the state judicial system. During the judicial conflict, the State of Delaware led by Bouchard made decisions that cast doubt on its impartiality and hinted that several law firms could have made a profit with the consent of Judge Bouchard. This same judge made the decision to hide from the public the judicial file of the case once it had been concluded, thus incurring in an absolutely unusual decision and that left the judicial law according to several experts. Today, the file remains inaccessible to the public, something that has fueled suspicions about the judicial management of the case . Loss of neutrality In this context of disappointment and frustration on the part of the citizens of Delaware, the US Chamber of Commerce published a ranking of neutrality of the judicial systems of the country where Delaware dropped from first position to eleventh, leaving in evidence the latest decisions taken by the state. Despite adverse circumstances, Phil Shawe’s company continues to grow exponentially and the first three months of 2019 recorded revenues of more than 140 million euros, which implies an increase of more than 8% over the same period from the previous year.
OPINION
Dear Friends,
Here are some predictions from Citizens for Pro-Business Delaware “OVER THREE YEARS AGO” in Reuters. This was back when Delaware’s business rating was still number #1. We are now not even in the Top 10 any more?!?
If legislators had stepped in to limit the Chancellor’s power and addressed what I, and thousands of others, view as corruption in the Chancery Court, perhaps Delaware wouldn’t be #11. We can’t change the past, but we can sure as hell change the future.
Former Delaware, Chief Supreme Court Justice, Leo Strine has stepped down. The Puerto Rican Governor is stepping down. Perhaps it’s time for Andre Bouchard to step down and let the Chancery Court modernize, move forward, and return to its former glory?!
As always your comments are welcome and appreciated.
Sincerely yours,
JUDSON Bennett-Coastal Network
https://www.reuters.com/article/delaware-court-media-idUSL1N18Y28P
JUNE 6, 2016 / 6:51 PM / 3 YEARS AGO (Reuters)

Unusual Media Blitz Rips Top Judge of Delaware’s Corporate Court

Tom Hals
(Reuters) – A bitter boardroom battle has prompted an unusual media blitz in Delaware that warns residents that the state’s nationally renowned corporate court is on the cusp of destroying Delaware’s pro-business reputation.
The ads by employees of TransPerfect Global Inc stem from a ruling in August that was aimed at breaking years of deadlock between the translation services company’s co-owners, Elizabeth Elting and Philip Shawe.
Elting convinced the Court of Chancery to order the company sold, a move opposed by Shawe. Last month, employees of New York-based TransPerfect wrote to the judge, Chancellor Andre Bouchard, saying they feared for the survival of TransPerfect, which despite years of dysfunction, had grown to have $500 million in annual sales and 4,000 staff.
As Bouchard prepares to issue a final order any day detailing the sale process, radio and print ads, a website and 20,000 flyers have been sent to Delaware residents blasting the judge for his “stunning act of governmental overreach.”
“Tell Chancellor Bouchard to leave our company alone and our business is our business,” said the flyers, which included the direct phone number for Bouchard’s chambers. “Chancellor Bouchard is turning Delaware into a bad place for business.”
The state prides itself for being friendly for business, and the U.S. Chamber of Commerce has named the Court of Chancery as the nation’s best for more than a dozen years.

SEE VIDEO LINK BELOW…

My onsite coverage of the “Citizens for Pro Business Delaware” 100+ person press conference has paid off for Coastal Network readers. From an anonymous source, I have obtained a video of the entire July 10 event held right in front of Bouchard’s Chancery Court in Wilmington, Delaware.

It was an energetic and well-attended press conference, presided over by anti-corruption activist Chris Coffey, the campaign manager of “Citizens for Pro Business Delaware.” Others spoke too, including Donna White, an African-American woman who was terminated from her job at the Chancery Court for sending an email asking if Mark Zuckerburg would look at her App!!?? Meanwhile Kevin Shannon and Chancellor Andre Bouchard golf together during the case, travel to New Orleans together during the case, and I believe decided this case at the Country Club. It certainly wasn’t decided in the court room with no witnesses appearing for Shannon’s side, folks. That’s how I clearly see it.

As Coffey puts it, Bouchard and his cronies in the Delaware Old Boys Club “get away with murder” each and every day compared to what Donna White did, yet she was escorted out of the building and treated like a criminal–given only 10 minutes to collect her belongings and to say goodbye to co-workers of 7 years!?!

The double standard, hypocrisy, and potential racism here only rivals the ageism, sexism and contempt that Chancellor Bouchard and 4 out of 5 justices on the Supreme Court (all the male judges) showed litigant Shirley Shawe in the TransPerfect debacle. How could it be that female, senior citizen, Shirley Shawe’s only victory in the first 5 years of this entire case was from a woman jurist, Delaware Supreme Court Justice Valihura? It’s mathematically impossible that this is a coincidence, as the Good Ole Boy cronies would have us believe. They are making millions off innocent shareholders with their back-room Country Club deal, scratching each other’s backs, and trading favors with their rich and powerful friends. And what happens to Chancery’s real life victims like Donna White? She has been denied health insurance and unemployment benefits! I’m telling you folks, I believe Andre Bouchard is not only corrupt, but also sadistic–and, in any case, lacks any shred of the ethical fiber required to fill the Chancellor position. The great state of Delaware deserves better. Listen to the press conference, where Donna takes the podium and tells her story here…

https://videopress.com/v/xHHMEsRd?preloadContent=metadata

I asked a question of Coffey during the press conference, which I wrote about in my last column. You will see that here, as well as other suggested anti-corruption reforms that appear like common sense to this journalist. The Delaware Citizens group now fighting for reform has 2,700 members which includes TransPerfect employees who were negatively impacted by Bouchard’s decisions along with other concerned Delawareans.

By the way, I commend the Delaware Business Times for covering the major events of July 10th, and I wonder which Ole Boys Club member or creepy Skadden Arps friend of Bouchard called the News Journal to get them to kill the story? Brent Celek from the Philadelphia Eagles and Colin Jost from Saturday Night Live came to Wilmington and joined those calling for Chancery reform at the Hotel DuPont. How is it you can Google the News Journal’s entire site, and read nothing about this important day at the Chancery Court? Mark my words, Bouchard and the “Limousine Liberals” who run this state and prey on its citizens are powerful, so powerful, they are dangerous to Delaware, to anyone who incorporates here. But fear not, the Coastal Network cannot be intimidated into killing stories or masking the truth–stay tuned here folks, for coverage on Chancery actions and other injustices in Delaware.

As of press time, I know of no other media outlet who has obtained this tape. Enjoy watching the coverage and share it with folks who may want to see it.

https://videopress.com/v/xHHMEsRd?preloadContent=metadata

I had the unique experience of covering an unusual day for Delaware and the Coastal Network, on Wednesday, July 10, in Wilmington, Delaware. It involved a rousing and heavily attended press conference, a fascinating hearing in the Court of Chancery with Andre Bouchard presiding, and a fabulous party and TransPerfect summer celebration at the Hotel DuPont later that night. The activities began about 12:30 PM with a Press Conference — in 90 degree heat that felt like 105 degrees with unbelievable humidity — in front of the Delaware Court of Chancery which was organized by the “Citizens for Pro Business Delaware.” This group, led by articulate activist Chris Coffey, has 2,700 members, made up of TransPerfect employees who were negatively impacted by Bouchard’s decisions along with other concerned Delaware citizens. The group now appears to be dedicated to making changes to modernize the controversial rules governing Delaware’s Chancery Court. Having covered the TransPerfect case for years, and Andre Bouchard for even longer, I was pleased to take the opportunity to observe all these players face off live and in person. During the press conference on the front lawn of the Chancery Court, yours truly, like a dummy, chose to wear a dark suit — and the Delaware establishment almost had their wish for my complete demise, as I was about to pass out from the heat. Weather and wardrobe aside, I was extremely impressed with Coffey’s platform and passion. It is unquestionable that this group shares my desire for increased transparency in the Court of Chancery, as they are proposing much needed common sense reforms. In my opinion, the legislature cannot act quickly enough to decrease perceived (or actual) corruption surrounding the Court’s activities. The obscene and disgraceful court-ordered looting of TransPerfect continues!!! Skadden Arps gets paid more in a month for secretive and undisclosed “legal services” than normal people make in a year. It appears to me that Skadden and the judges are truly modern day Pharaohs, living extravagantly off the sweat of the thousands of innocents. I believe without a doubt that these (potentially, colluding, former law partners, “Bouchard and Strine”, both Skadden alumni) are truly a biblical plague on Delaware’s reputation. During Bouchard’s tenure, our once-great state has dropped to a dismal 48th out of our 50 U.S. states in overall business confidence, and after 15 years as the undisputed #1 in business litigation, we fell to #11. I challenged Coffey with the following direct question, “Sir, do you think the fact that Chancellor Bouchard engaged in “boondoggle”, travel excursions with one-side’s attorney during the decision-making phase of the TransPerfect case actually created a conflict of interest and an appearance of an impropriety?” Coffey’s answer was firm and unequivocal, “Absolutely-YES!” Folks, for those of you that couldn’t hear Chris Coffey’s speech live, I am telling you his answer and his entire speech sounded statesman-like and remarkably credible. I believe this group represents the best chance Delaware has for reform, positive change, and a fresh start — but, they must defeat a well- off Bouchard and his establishment, “good old boys” club to get it done. Make no mistake, there will be a significant battle for Delaware’s; future playing out in the 2020 election! Buckle up!!! I then observed the Chancery Court argument. Former TransPerfect co-CEO Elizabeth Elting’s attorneys (after Bouchard handed them a $400 million check) are arguing for another $200,000. With each side lawyered up, according to the TransPerfect employees I interviewed at the Court House, this hearing will cost over $500,000 for each litigant. What judge allows $1 million to be spent to argue over $200,000??? So again, I expect payola is responsible for why this Chancellor would even have this hearing at all. In my view, it might be because his lawyer buddies could bank yet another payday on the backs of the dedicated, TransPerfect employees. It’s shameful and disgraceful!!! In a packed courtroom, with many TransPerfect employees who believe they are all victims of Bouchard’s corruption staring at the Chancellor, I had two observations worth mentioning that won’t be found in any other transcript: 1) Bouchard appeared judicial and didn’t even resort to his biased name-calling. 2) His best pal Kevin Shannon of Potter Anderson said ABSOLUTELY NOTHING and left via a secret exit to avoid my questioning. If someone hadn’t seen Bouchard in action before this hearing, they may have mistaken him for actually being an ethical judge on this specific day. I guess when there are a courtroom full of antagonistic folks staring you down, it must engender self-reflection. Like the many TransPerfect employees, I will wait for the ruling — but having seen Bouchard’s judicial antics for years, I’m not sure this subjective Judge will ever rule against his best buddy, Kevin Shannon, no matter what facts are presented. Then the fun began with a huge TransPerfect party with a fancy sit-down dinner at the Hotel DuPont. At least 300 people packed the place to celebrate that TransPerfect had survived Bouchard’s “DISSOLUTION” order, and despite these trials and tribulations, is still doing quite well as a company. (Never did their revenue slow, not even during the case.) Besides TransPerfect employees, participants included concerned Delaware citizens, a great band, the winning legal team ( including Alan Dershowitz), Villanova basketball star Kris Jenkins, Super Bowl Champion Philadelphia Eagles tight end Brent Celek, Cindy Green – Registrar of Wills office in Sussex County, Delaware Senator Colin Bonini, Sam Waltz of The Delaware Business Times, and to top it all off, a great show by Saturday Night Live star Colin Jost. TransPerfect CEO Philip Shawe gave a gracious speech, praising all of his employees for their dedication and loyalty. Without a doubt, this man has earned the love and respect of an army of people over his 27 years in business. No one should spend their whole life building a company, and have court corruption seize it and try to auction it off to a competitor. These employees were great, happy, and thankful to still have jobs. During the evening, it really hit home to me how much Bouchard’s obvious lies and defamatory name-calling must have hurt these families over the Chancery’s 5-year occupation of TransPerfect. Bouchard called these hard-working normal folks “Dysfunctional” — In my view, this grotesque misrepresentation, was made so he could take over the company and enrich his friends. Its just unacceptable!!! Make no mistake folks, what happened to TransPerfect in Delaware wouldn’t even happen in Russia — it’s disgusting. Regardless, I saw a company on Wednesday night that had overcome perceived corruption, while keeping the American Dream alive for themselves, and hopefully for entrepreneurs all over the world. Delaware’s business future however, will be in the hands of our Elected Officials. Lastly and on a personal note, it was gratifying for me, as I was actively acknowledged by the employees — many who felt they were silenced and oppressed by Chancellor Bouchard and Skadden Arps Custodian Bob Pincus. They felt that I have helped give them a voice through my reporting. I told them I am honored to shine a light on injustice and corruption, and that I will continue to do so for my readers. As always your comments are welcome and appreciated. Yours truly, JUDSON Bennett-Coastal NetworkOPINION Dear Friends, Wow, Leo Strine, Chief Justice of the Delaware Supreme Court, protégé, intern, and protector of Chancellor Andre Bouchard and law partner with him at Skadden Arps (the infamous law firm, which has been fined by the U.S. government for illegal lobbying), is stepping down with half his term unfinished! I wonder if the shame and disgrace of the perceived TransPerfect heist happening under his watch had played a role? Could he have been forced out based on Delaware’s plummeting rating for business and also possibly because of allegations of serious irregularities?? Could a scandal be coming that Strine knows about??? Strine, in a nonsensical majority opinion, upheld Bouchard’s ridiculous rulings on appeal because as I see it folks, he’s Bouchard’s pal in fleecing TransPerfect under the guise of “deadlock” at a wildly successful corporation. Remember, the only female jurist, Justice Valihura (a non-member of the old boys club) wrote a brilliant dissenting opinion establishing the illegality of Bouchard’s ruling under Delaware law and the U.S. Constitution. While he may have political ambitions, in my opinion, these are a pipe-dream based on the many skeletons in Strine’s closet. Further, in my view, TransPerfect has defined his and Bouchard’s administrations. As I have been saying for the past few years, their handling of this case from my perspective has been a disgrace, a farce, and the shame of Delaware. Make no mistake, in my mind, TransPerfect is huge part of the reason Strine is stepping down. Could Strine know something is amiss? He and Bouchard, very plainly in my view, usurped and engineered the outcome of the TransPerfect case to enrich their former law partners and good ole boy cronies. To me, Bouchard is clearly the puppet master, and still in charge of his former underling, Strine. Delaware would be a thousand times better off if Bouchard would agree to step down as well. Regardless, they both reek of improprieties in my opinion. Good riddance Strine! Please feel free to take, what I consider, your “Bonnie & Clyde” partner, Andre Bouchard with you! Let’s make room for Karen Valihura as Chief Justice!!! She makes her decisions based on respect for the Constitution and the rule of law. She is the polar opposite of Strine and Bouchard, honest and dedicated. Valihura has the endorsement of the Coastal Network, that is for sure. To my way of thinking, Strine and Bouchard are a disgrace. I will continue to share that opinion. One down, folks. One to go! The Delaware Judiciary needs a fresh start! Please read the breaking news article below from the “Delaware News Journal” and Sam Waltz’s article in the “Delaware Business Times” (written in May!) just below it. As always your comments are welcome and appreciated. Sincerely yours, JUDSON Bennett-Coastal Network https://www.delawareonline.com/story/news/2019/07/08/leo-strine-delaware-supreme-courts-chief-justice-steps-down/1672795001/

Leo Strine, Delaware Supreme Court’s chief justice, to step down

Delaware News Journal Published 3:43 p.m. ET July 8, 2019 | Updated 4:08 p.m. ET July 8, 2019 Leo E. Strine Jr., Delaware’s witty and sometimes controversial Supreme Court chief justice, is stepping down from the bench with about half of his term remaining. Strine delivered his resignation letter to Gov. John Carney on Monday, stating that he plans to retire in the fall. The press release from the governor’s office did not detail why Strine plans to step down. Strine’s spokesman said the chief justice is on vacation and not available for comment. “I can say to you with confidence that the judiciary of this state is strong, that we are addressing our challenging and diverse caseloads with diligence, skill and dispatch and that we are continually looking for new ways to serve the people of Delaware even more effectively,” Strine wrote in his resignation letter. He was nominated to a 12-year-term by former Gov. Jack Markell in 2014, replacing former Chief Justice Myron Steele. During his tenure, the court invalidated the state’s death penalty and ruled on controversial land use issues including the development of Barley Mill Plaza in Greenville and weighed in on billion-dollar business disputes. Delaware Chief Justice Leo Strine in March 2015. (Photo: The News Journal) Before his appointment to the state’s highest court, Strine served as a judge and chancellor on Delaware’s Court of Chancery from 1998 where he developed a reputation as a huge personality in the world of corporate law. Delaware Supreme Court Chief Justice Leo Strine questions an appellant before the court. (Photo: XERXES WILSON/THE NEWS JOURNAL) Strine grew up in Hockessin and, in the private sector, was a corporate litigator for Skadden, Arps, Slate, Meagher & Flom, one of the largest law firms in the country. Prior to his time on Chancery, he was counsel to former Gov. Tom Carper, who is now a longtime Delaware U.S. senator. Rumors of his potential departure have been circulating for months, partially fueled by him not hiring legal clerks for the upcoming court calendar. His stepping down begins a process in which current Gov. John Carney will nominate his successor, a dance that will be watched closely by legal and corporate circles around the world given Delaware’s prominence in business. NEXT ARTICLE BY SAM WALTZ:
Sam Waltz: Strine to Retire Soon?

Sam Waltz: Strine to Retire Soon? May 13, 2019 on Hon. Leo Strine Jr.,

By Sam Waltz (Founding Publisher) in Delaware Business Times The widely anticipated early retirement of Delaware Supreme Court Chief Justice Leo E. Strine Jr. seems to be the state’s “worst-kept secret,” rivaling Joe Biden’s 2020 presidential hopes, and is being discussed openly in some of the state’s loftiest circles. I’ve reached out to the Chief Justice for comment. I’ve not heard back from him, and frankly I didn’t expect to. He’ll make his announcement on his own schedule, and he deserves to. He’s accomplished a lot for a mid-career legal counselor, just 55, even more than prestigious jurists 20 years older. But failing to recognize and perhaps even memorialize the rampant speculation would be journalistic malpractice. So, at the risk of preempting His Honor, here we are. (I’ve known Leo’s mother and father, a banker and a wealth manager respectively, for years, even longer than I’ve known Leo, but I’d never put them in the awkward position of asking them about it.) Buttressing this massive speculation — which I first heard two months ago — is the fact that he has not hired any clerks for the court’s next calendar year, which begins in September . Ordinarily that occurs before the end of the previous year, when such clerks are interviewed and hired. They are prestigious positions, and, in Delaware, it’s not unusual for former clerks themselves to ultimately ascend to the bench. So far, I’ve chatted about this with some of the state’s highest officials and former officials, about a dozen of them, in the judiciary, in Legislative Hall and even in the lobbying corps and prominent members of Delaware’s bar. Everyone seems to have had heard it, but each asked for anonymity — no one wants to get caught spilling the Chief Justice’s secrets — and then went on to discuss it openly. Chief Justice Leo Strine assumed office on Feb. 28, 2014, succeeding retiring Chief Justice Myron T. Steele. Previously, he’d served on the Court of Chancery since 1998, appointed there by Gov. Tom Carper, whom he had served as legal counsel. He ascended to head the court as Chancellor in 2011, before he was moved to the Supreme Court in 2014 by Gov. Jack Markell. (Note, too, that in Delaware, even going on the Bench requires significant ambition. Attorneys must apply to the Judicial Nominating Commission, be interviewed, and be recommended to the governor for the position. It’s not a process for the reticent or modest!) He earned a bachelor’s degree from the University of Delaware, and his law degree from the University of Pennsylvania. He grew up in Hockessin, where his parents and his family still live, and he graduated A.I. du Pont High School in Greenville. He served in some prestigious legal clerkships himself and worked for the prestigious Skadden Arps firm before joining Gov. Carper. The two big questions on all minds now seem to be … • When will he announce his retirement? • What will he do next? Dealing with the second question first, two things are mentioned. First, people with his background and accomplishments make a huge personal financial sacrifice in serving on the bench, although it does advance their billing rates when they re-enter private practice. It’s not out of the realm of the expected to anticipate that Chief Justice Strine could and would pull in $1 million a year, perhaps even more, in private practice. And part of the speculative reason is that he’s at the stage with young adults heading off to college, so his family would benefit from the change. Beyond that, though, one or two speculated that he really wants to be governor one day, and a lucrative legal career would secure his family’s future for a return to public service in an elected role. Certainly, he’ll have some competition if he runs in 2024 when the Democrat establishment thinks Gov. Carney will complete his second term. Lt. Gov. Bethany Hall-Long, U.S. Rep. Lisa Blunt Rochester, Insurance Commissioner Trinidad Navarro and Rep. Bryan Townsend are among the dozen or so names prominently mentioned as prospective Carney successors. As to the question of when he’ll announce, well… Speculation centers on the Delaware Bar Association’s annual Bench & Bar Conference, convened at the direction of the Chief Justice himself, this year at 8:30 am on June 14 at the Chase Center on the Riverfront. Interestingly, theme of this year’s conference is “Pathways and Reflections: Adventures in Law.” “All of us think it will be there, at the Bench & Bar conference,” said one of the state’s highest-placed officials. “Many of us will already be standing, so Leo will automatically have a standing ovation when he announces.” Historically, that conference had an afternoon-evening component, and that would have taken place later in the day. This year, it starts in the morning, so we’ll see what works out.
OPINION
Dear Friends,
Eventually folks, potential corruption or systems that help to make corruption tempting — especially in an Equity Court System where the Judge is omnipotent under the law — people rise up and demand change. Such is the case in Delaware’s Court of Chancery under the leadership of Andre Bouchard, who orchestrated in my educated opinion, the largest legal rip-off in U.S. history. Or at best, condoned and facilitated the fleecing of $250 million from TransPerfect Global, which benefited his former business partners.
The rub here is that, in my view, the former business partner, Robert Pincus of the notorious Skadden Arps law firm, over-billed millions of dollars that have not been itemized or reconciled, but were approved by Andre Bouchard, who refuses to let anybody see the bills.
Combined with his previous ridiculous rulings, sanctioning CEO Philip Shawe to the tune of $7.1 million while allowing the Plaintiff’s attorney, Kevin Shannon to bill an additional $1.7 million in unitemized fees, which Bouchard slammed onto Shawe as well.
The pathetic and obvious bias by Bouchard, the unorthodox operation by the hand-picked Custodian (Robert Pincus), and the arbitrary and capricious acts of avaricious behavior by these judicial entities has awakened again a sleeping tiger, known as the “Citizens for a Pro-Business Delaware”!
The group, made up of 2,700, is pushing legislation that would create transparency and fairness in Delaware’s Chancery Court. You can count on the incestuous Delaware judicial-swamp to fight the “Citizens for a Pro-Business Delaware”.
Please read the press release below, which tells about the proposed legislation that would bring a needed, and now demanded, transparency to the Delaware Court of Chancery.
As always your comments are welcome and appreciated.
Sincerely yours,
JUDSON Bennett-Coastal Network
https://www.prnewswire.com/news-releases/new-delaware-bill-seeks-to-shine-a-light-on-archaic-chancery-court-300878721.html?tc=eml_cleartime
New Delaware Bill Seeks to Shine a Light on Archaic Chancery Court
Legislation backed by Citizens for a Pro-Business Delaware
NEWS PROVIDED BY
Citizens for a Pro-Business Delaware
 
Jul 01, 2019, 13:31 ET
DOVER, Del., July 1, 2019 /PRNewswire/ — Todaylegislation was introduced to the Delaware State Legislature that would bring much-need transparency to the nation’s most opaque court: The Delaware Court of Chancery.
The new legislation would require that custodians appointed by the Chancery Court must itemize and publicly disclose a complete accounting of the costs they’ve passed on to the companies under their control so that the public, and the companies themselves, know how their money is being spent.
The bill is a response to Delaware Chancery Court Chancellor Bouchard’s abuse of court rules, as he appointed a court custodian and ruled that TransPerfect – which is incorporated in Delaware and has nearly 4,000 employees globally – should be sold as a result of an internal dispute between the company’s ownership.
Over eighteen months after the historic TransPerfect case was settled in 2015, the custodian in the case, Robert Pincus, has continued to bill the company every month for undisclosed services, including his own $1,475 an hour fee. His responsibilities remain unclear, and any efforts to ascertain the substance of his work on behalf of TransPerfect have been met with silence. The Chancery Court has kept all invoices and description of services under seal – allegedly to protect the sale process, which ended in 2017.
The law firm of Skadden, Arps, Slate, Meagher and Flom — Chief Justice Andre Bouchard’s last employer before joining the Chancery Court — has received a significant amount of the $250 million that was spent on the case.
“This is simple, common-sense legislation, and a necessary step towards a more transparent and fairer Chancery Court,” said Miranda Wessinger, president of Citizens for a Pro-Business Delaware. “When you eat a meal at a restaurant, you get a receipt with a breakdown of the charges. Why shouldn’t the Chancery Court be required to do the same for companies they’re forcing to pay millions in legal fees? When court-appointed lawyers are able to charge thousands of dollars an hour for “undisclosed services,” corruption runs rampant.”
Citizens for a Pro-Business Delaware is a group of more than 2,700 members including employees of the global translation services company TransPerfect, as well as concerned Delaware residents, and business executives. While their primary goal of saving TransPerfect has been accomplished, they continue their efforts to defend the company’s employees and fight for transparency in the Delaware Chancery Court. For more information on Citizens for a Pro-Business Delaware or to join the cause, visit DelawareforBusiness.org

Why have evidence or witnesses to make your case in Delaware’s $250 million TransPerfect fiasco? When your name is Kevin Shannon, and your friends are wearing the robes, in my opinion, you don’t need evidence or witnesses — cause you have the game rigged in your favor.

If this isn’t illegal, it surely ought to be. Frankly, I see this as a disgusting and disturbing view into how our Chancery Court apparently now works?

After following Andre Bouchard’s first couple of years, which I viewed as suspect, followed by his mismanagement of the TransPerfect Global case, I decided to Google the names of the folks involved in the case to see if my suspicions were correct. Were there actual conflicts of interest and personal connections?

Folks, please look at the boondoggling schedule I was able to come up with by doing that digging on Google: Kevin Shannon of Potter Anderson, with Andre Bouchard (well-documented BFF) and Leo Strine, in and around the 5 years of shame related to the TransPerfect case.

I could write a serious diatribe about how corrupt this appears to be, just by referencing the Delaware Judicial Cannons, which are clear and on point, but I will let the dates and facts speak for themselves. How dumb these people must think the Delaware public is??!

Potter AndersonFolks, after looking at the facts, it is hard to fathom for me — and should be for any reasonable person — when seeing the incestuous relationships between these individuals and their conflicts of interest, that this judicial arrangement, which apparently is condoned by the Delaware Legislature, is just plain wrong!!! 

To add insult to injury, for Bouchard and Strine, this boondoggling is on the tax- payers’ dime.

Look for yourself:

Shannon / Bouchard / Strine Boondoggle Calendar

(and these are just the one’s we know about from Google?!?)

 


 

Berkley Boondoggle – Sept. 18, 2018

Shannon, Strine, and Bouchard

 


 

New Orleans Boonboggle – March 15, 2018

Shannon, Strine, and Bouchard

 


 

Berkley Boondoggle – Oct. 26, 2017

Shannon and Strine

 


 

New Orleans Boondoggle – March 17, 2016

Shannon, Strine, and Bouchard

 


 

Chicago Boondoggle – April 29, 2016

Shannon and Strine (and only 2 others)

 


 

Delaware Dinner – Dec. 5, 2014

Shannon, Strine, and Voss (works with Pincus at Skadden)

 


 

Boston Boondoggle – Nov. 13, 2013

Shannon and Strine

 


 

Re-living the Disney Case – May 16, 2018

Bouchard and Shannon’s Co-Counsel on the TransPerfect Case, Kramer Levin (Gary P. Naftalis) – The only non-Delaware person – Wonder why he was so motivated to come down?

 


 

There you have it folks — clear evidence of these incestuous connections and when you put these relationships together with the actions of the same players combined with the rulings from Bouchard and Strine and then add the former business partner from Skadden Arps, Robert Pincus, into the mix as the appointed Custodian in the TransPerfect case, all working in unison to seemingly profit from the case. I cringe at the obvious appearances of impropriety and the possible corruption. There should be no doubt about the integrity of these Courts. Unfortunately, they are suspect and it is right in our faces!

I urge you to contact your legislators and tell them about your concerns! This will be an issue in the 2020 election.

Breaking news on TransPerfect Global: Just 1-year after the company was “dissolved” and auctioned off by Chancery Court Chancellor Andre Bouchard in what I see as the most radical and corrupt decision in American business law history, TransPerfect is now the darling of Wall Street.

How is it possible that a company deemed the most “dysfunctional” in the world, requiring a 3-year government occupation ordered by our own Andre Bouchard’s Chancery Court, $250 million spent (much of which remains still undisclosed, Mr. Bouchard), and then dissolved and auctioned off — is now so successful that the world’s leading banks are happily lending money to it?

It’s clear to me that the whole thing was a LIE. Read the Slator story below about Bank of America, JPMorgan and Citigroup lending TransPerfect hundreds of millions and reflect back on how the Chancery Court treated this company and draw your own conclusions.

As always, your comments are welcome and appreciated. Especially upon reading this news.


TransPerfect Refinances USD 445m Loan Used in 2017 Buyout, Gears Up for M&A

By Florian Faes (20 June 2019)

TransPerfect is cutting its interest expense. The world’s largest language service provider by revenue is refinancing a USD 445m credit facility used to buy out the company’s co-founder Liz Elting after a years-long legal battle ended in late 2017.

In a process that saw him compete against H.I.G. Capital, private equity owner of arch rival Lionbridge, TransPerfect CEO Phil Shawe eventually succeeded in gaining sole control of the company he co-founded.

According to a press statement, the new USD 450m credit facility (consisting of a USD 400m term loan and a USD 50m revolving credit line) will replace and terminate the previous USD 445m credit facility.The relatively quick refinancing of a higher-interest loan can be seen as a vote of confidence in a business that generated USD 705m in revenue and USD 92.3m in EBITDA in 2018. The new loan will shave off around USD 15m from TransPerfect’s annual interest expense and was provided by a syndicate arranged by Bank of America, JP Morgan, and Citibank with Bank of America acting as the sole administrative agent.

Asked how he is planning to reinvest the funds freed up by the refinancing, Shawe told Slator that “one of the reasons I was able to put together a compelling bid for the company, was because I was not interested in pulling money off the table, so to speak. This USD 15m in savings per year will be used to finance growth through any or all of the following: M&A, Technology R&D, Talent Acquisition, Geographic Expansion, and General Corporate Purposes.”

“We have sufficient ‘dry powder’ to complete a major acquisition”—Phil Shawe, CEO, TransPerfect. 

To maintain its current growth trajectory TransPerfect will have to diversify into new verticals and offerings. Shawe confirmed that while he sees continued growth in the company’s traditional business lines, he expects areas such as “Media, Gaming, AI training and several other areas of focus for us in 2019/2020” to outperform.

So far TransPerfect has largely stayed on the sidelines while competitors have been busy doing deals over the past two years. But this may be about to change. “One of the advantages of this current financing is the opportunity it has given TransPerfect to forge deeper relationships with several of the world’s leading banks,” Shawe said. “Given our current leverage position, we feel very comfortable that we have sufficient ‘dry powder’ to complete a major acquisition should the right opportunity arise. Fortunately, because of the investments we’ve made over the years, such in our sales force and in our technology products, we are not dependent on M&A to drive growth.”

Folks, the USA Today story below (national news!) is a prime example of why the Coastal Network is your watchdog on all things Delaware and Andre Bouchard’s Chancery Court. You can trust me to keep an eye out for those things that matter most.

There was a victory for property owners in the United States Supreme Court this past week, indeed a victory for those who don’t want their property to be “Taken” by State shenanigans.

As is well-documented, in my educated view and in my previous articles, It appears Chancellor Bouchard threw out the rule of law and the U.S. Constitution in his bizarre, illogical rulings on the TransPerfect case and replaced them with an episode of, “How to Make my Cronies Rich, on the Backs of 5,000 Employees.”

This is the Federal Government finally changing 30 YEARS of precedent to give those in the Shawe’s position (citizens facing a State government “taking” of private property), a better chance to fight those in Bouchard’s omnipotent and arbitrary position.  Now, if someone like Bouchard is taking your property, you can go right into federal court — you no longer have to wait until the state court proceedings are finalized.

It’s difficult to say if this is in direct response to the TransPerfect case or not and my extensive expose of it, but nonetheless, Bouchard and (Chief Justice / Former Bouchard Intern) Leo Strine, were able to avoid Federal review of their actions in the TransPerfect fiasco — by legal “mumbo jumbo.” Well folks, it just got much harder for them and other State government actors attempting to seize property, and do so without facing a Federal challenge. 

Please see the USA Today article below. Your comments are welcome and appreciated.

Respectfully Submitted,

JUDSON Bennett-Coastal Network

Conservative victory: Supreme Court gives property owners fast track to challenge government takings

Richard Wolf, USA TODAY

Published 10:27 a.m. ET June 21, 2019 | Updated 12:08 p.m. ET June 21, 2019

WASHINGTON – Landowners won a closely watched property rights victory at the Supreme Court Friday in a case that centered on a cemetery.

After holding two oral arguments over four months, the justices ruled that a Pennsylvania woman whose land was used for access to an old burial ground can seek compensation in federal court. The 5-4 opinion was written by Chief Justice John Roberts, with conservative justices behind him and liberal justices opposed.

“A property owner has a claim for a violation of the Takings Clause as soon as a government takes his property for public use without paying for it,” Roberts said. “The property owner may sue the government at that time in federal court.”

The decision overrules a portion of a Supreme Court precedent that in turn was based on other cases dating to the late 1800s, which Associate Justice Elena Kagan noted in her dissent.”Under cover of overruling ‘only’ a single decision, today’s opinion smashes a hundred-plus years of legal rulings to smithereens,” she said.

Noting that Associate Justice Stephen Breyer earlier this term criticized the court’s conservatives for overturning precedent by wondering “which cases the court will overrule next,” Kagan added: “Well, that didn’t take long. Now one may wonder yet again.”

The decision represents a victory for conservative and libertarian groups opposed to government takings. During the second oral argument in January, Associate Justice Samuel Alito had accused the local government of seeking “home-court advantage” in state court.

The ruling partially overrules a Supreme Court precedent dating back more than 30 years – something the court generally tries to avoid, but which some conservative justices have been more willing to do in recent years.

The challenge was brought by Rose Mary Knick, who sought damages for the 2013 invasion of her property by Scott Township, Pennsylvania. Under local rules, property owners must allow access to private cemeteries discovered on their land.

The dispute focused on when a taking is effective: When the government stakes its claim, or only later when financial compensation is denied in state court.

Breaking news folks, in a recent survey released by Slingshot Strategies LLC, confirms what I have been reporting on for years. There are a large number of Delaware voters who are dissatisfied with Andre Bouchard’s Chancery Court. Importantly, 79% of Delawareans believe Andre Bouchard should have been forced to disclose his pre-existing, 20-year BFF friendship with TransPerfect Global co-founder, Elting’s counsel, Kevin Shannon of Potter Anderson.

Additionally, the Delaware citizenry apparently agrees that conflicts of interest clearly exposed, not sealed up by a judge who could be abusing his power, in regard to the appointments of custodians. Bottom line folks, the Delaware people, in my opinion and in my assessment of these poll results, are not happy with Andre Bouchard and the rampant cronyism that has defined his tenure.

Recently, folks demanding greater transparency from Bouchard in his Chancery Court at a Bar Association Brunch were forced to leave by security, not only the event itself, but the parking lot as well. Is this the Chancellor’s latest bid to thwart activities protected by the United States Constitution?

Frankly, these poll results are unfortunately gratifying in a way because, in my opinion, a vast majority of Delawareans believe that Bouchard’s shady, illogical rulings in the TransPerfect case — supported by his former intern Leo Strine — in a nonsensical majority opinion — are improper. Our once-renowned Chancery Court is now infamous for corruption in my opinion.

Delaware, having dissipated from #1 to #11 for judicial equity in a national survey conducted last year by the United States Chamber of Commerce — is losing corporations to Nevada because many business people are concerned about potential subjective rulings coming out of Delaware’s Chancery Court these days?

Yes folks, having watched Chancellor Bouchard very closely from the time he was appointing various people to the Deputy of the Register of Wills job (before he found one that could actually do the job), having read all the transcripts from the TransPerfect case, and having interviewed many people, I am convinced beyond a shadow of doubt, the longer Bouchard holds office, the worse off Delaware will be.

Please read the article below published by Yahoo Finance, citing “widespread dissatisfaction” with Bouchard’s Chancery Court.

Survey Reveals Widespread Dissatisfaction With The Delaware Chancery Court

A recent poll shows that Delaware voters align with Citizens for a Pro-Business Delaware in their crusade for transparency in the Delaware Chancery Court

DOVER, Del., June 24, 2019 /PRNewswire/ — A staggering amount of Delaware citizens have expressed dissatisfaction with the Chancery Court’s proposed reforms and the state government’s transparency, according to a recent survey.

The survey, released in April by Slingshot Strategies, LLC., noted 79% of Delawarevoters and 77% of registered Democrats demand judges to disclose relationships with lawyers. In addition, about 70% of both Delaware voters and registered Democrats propose custodians to disclose conflicts of interests to the general public. The sweeping support for additional disclosure from the Chancery Court is heavily linked to the overwhelming frustration citizens have for the state government.

According to the survey, 92% of voters agree that the state government is dishonest and 58% believe it is nearly impossible to hold local politicians accountable for their actions. Almost 50% feel helpless in the fight for their voices and concerns to be addressed, due to political bias and nepotism in Delaware politics.

Citizens for a Pro-Business Delaware have demanded more transparency, equity, accountability and freedom of speech from the Chancery Court, only to be denied such basic Constitutional rights. On June 14, 2019, Citizens for a Pro-Business Delaware volunteers were forcibly removed from the Delaware Chancery Court after using their First Amendment rights to request transparency. While the group was denied the right to distribute information to those most closely associated with the Court system, Citizens for a Pro-Business Delaware will continue to bring their push for accountability to the residents of Delaware through media advertisements in the News Journal, as well as other local media.

Influential leaders such as Chancellor Bouchard halt Delaware Chancery Court reform and Delaware’s reputation as a hub for headquarters and businesses are being negatively affected. Citizens for a Pro-Business Delaware is committed to exposing the clandestine processes of Delaware’s Chancery Court. “The long-standing corruption and white washing of justice in the Delaware Chancery Court is abhorrent and unethical,” said Miranda Wessinger, president of the Citizens for a Pro-Business Delaware. “The citizens of Delaware deserve transparency and accountability from local political leaders. Our efforts to serve the Delaware people will not be impeded, regardless of the bureaucratic push back. We are determined to keep Delaware’s reputation as a thriving and profitable business state.”

Citizens for a Pro-Business Delaware is a group made up of more than 2,700 members including employees of the global translation services company TransPerfect, as well as concerned Delaware residents, business executives and others. They formed in April of 2016 to focus on raising awareness with Delaware residents, elected officials, and other stakeholders about the issue.

While their primary goal of saving the company has been accomplished, they continue their efforts to fight for more transparency in the Delaware Chancery Court. For more information on Citizens for a Pro-Business Delaware or to join the cause, visit DelawareForBusiness.org.

The wave of public opinion demanding that Chancellor Bouchard be held accountable, for what I and many others view as illicit activity, is transforming into a full-blown tsunami. Below, I have chosen 10 recent responses to share with you, but I could be sharing 100.

As you will read below, the groundswell of Delaware citizens who are writing to me about being fed up with Bouchard seemingly feathering the nest of his former law partners at Skadden Arps and other cronies, have reached a fever pitch. What seems to be bothering them most is the perception that his personal patriarchy has profited for too long at the expense of Delaware corporations, Delaware taxpayers, and Delaware’s now tarnished image. Chancellor Bouchard’s actions have convinced me (and many of my readers) that he seems to lack the ethical character required for the job, to put it mildly.

My readers are expressing outrage in droves, and are all Delaware voters. I wonder how long the elected members of our General Assembly can continue to turn a blind eye to the public’s demand for anti-corruption and transparency controls to be placed on the Chancery Court?!?

Recently, Delaware’s “Judge Evil” (as I like to call him), the Chancellor, ordered yet another successful company dissolved for “dysfunction”. In laymen’s terms this appears to simply be executives fighting on email. So Delaware corporations likely should worry if they happen to write an email the Chancellor may find concerning. Heck, he could decide to take out a company, dissolve it, or sell it off subjectively any time he feels the urge! Funny how much Skadden and/or his other cronies seem to profit when this happens??

Bouchard’s pattern of illogical and unprecedented decisions, enriching his “Good Old Boy” network of elites, now includes Inspirion Delivery Services, LLC. In my recent article titled “Delaware Chancellor Bouchard Orders Another Delaware Corporation Dissolved-Bad for Business”, I pointed out Bouchard’s most recent act of judicial over-reach, further inequities of his seemingly capricious decision-making, and his seemingly blatant hubris resulting in grotesque appearances of what appears to be impropriety.

As it turned out, this piece resonated deeply with you, my dear readers. The TransPerfect case — where millions of dollars in invoices are still being hidden by Bouchard’s apparent abuse of power, now has Delaware citizens fervently demanding reform.

I appreciate your feedback so much, and the only thing I appreciate more, is your zeal in calling for legislative reform. The people have spoken: They are saying in so many words: “The unchecked power of Bouchard’s Chancery Court is unconstitutional and bad for Delaware business.” Now, they must be heard in Dover!

Again, I have received countless responses; here are 10 samples, but they are reflective of a greater anti-corruption and transparency movement by my readers. I have removed my readers’ last names for their protection because in my opinion the “Good Old Boy” patriarchy that runs Delaware is a powerful and vengeful bunch.

Thank you for your feedback! Keep ’em coming.

Here are the latest responses:

1) From Abner

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Judson, This guy sounds worse than the rotten deep state that has attacked our country and tried to overthrow the government. Typical Democrat move by an incompetent JUDGE! Keep up the great work exposing this bastard! ABNER


2) From Linda

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

My God, does this guy ever stop with his corruption — right in the face of all of us. So much arrogance, so much hubris.

Thanks for keeping us updated. Linda


3) From Brian

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Jud,

How the hell can the State Legislature close their eyes to this?? It seems as if Chancellor Bouchard hurts companies instead of helping them. Certainly not good for Delaware’s business or future. So terribly absurd! Keep up the good work. Love your articles. Best regards, Brian


4) From Archibald

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Hey Judson, The corruption in the Delaware Judiciary has been going on for years. The Democrats have become so blatant with it, it is apparent for all to see. Unless we get rid of this Status Quo Legislature, nothing will change. Another Delaware incorporated company will bite the dust at the hands of Bouchard. He has got to go! Keep up the good work you do. Archie


5) From Bob

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Judson: When a judge withholds public documents that the people have a right to see, all kinds of red flags go up? When a Judge colludes with an attorney involved in a case he is presiding over, it is criminal. I can remember being so proud of being a Delawarean, but no more. It is hard to believe that our state has become so business unfriendly! It used to be there was compromise, and reason, and yes justice. The likes of these Skadden Arps former lawyers and their collusion with each other is outrageous! “Inspirion Delivery Services, LLC” looks like another bad decision by this crazy Chancellor. This is simply outrageous. Keep the articles coming, maybe the boys in Dover will blink when they realize their jobs are in trouble. Keep up the pressure! BOB


6) From Jack

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

IMPEACH BOUCHARD! VOTE REPUBLICAN!


7) From Charles

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Judson, you are really shaking things up and the people are talking. Subjective rulings without logic or standing on decided matters is bad business and is basically creating new law-“legislating from the bench.” Why haven’t the Philip Shawe people filed for FOYA Requests to get the records? It will be interesting to see if Bouchard continues to feather his cronies’ nests? Keep up the good work. Charlie


8) From Carol

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Wow, more of the same. This business with TransPerfect and now another fiasco in the Chancery Court. I can’t believe what a blind eye these liberal jerks in our state house have. Unfortunately, if the people in Washington think there is a Swamp-check out Delaware—IT IS PURE QUICK SAND ! Thanks for your efforts JUD. Keep the bastards thinking. Great work! Best regards, Carol


9) From Ed

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Why would anybody want to incorporate in Delaware, when the Chancellor can sell your company out from under you? Seems like things are going from bad to worse. If Delaware loses its franchise taxes, the red hole will be so deep, “Hades” will be a cool place in comparison. Keep exposing this jerk Judson. We love your articles. ED


10) From Adrian

Subject: Delaware’s Chancellor Bouchard Orders Another Delaware Corporation Dissolved-BAD FOR BUSINESS?

Dear Mr. Bennett,

As a small business owner incorporated in Delaware I am extremely concerned. It is beyond me why the legislature which is controlled by the Democrats is so business unfriendly. Eventually, the bottom is going to fall out if Chancellor Bouchard keeps creating these untenable situations. You don’t force the sale of a company because of stock holder or director disagreements.. Might have to reorganize in Nevada! I appreciate your great writing and your guts. Thank you! -Adrian


I thank you for your many responses. Please keep them coming.

Chancellor Andre Bouchard is now the subject of a Federal “Department of Justice” Investigation, according to an article published in a Spanish Newspaper.

All this writer can say at the moment is, “Wow… I hope this is true, because it is about time!”

If you’ll remember, TransPerfect has over 500 employees in Spain, where unemployment is very high. As I see it, Bouchard, by using his position improperly, tried to engineer a hostile takeover of TransPerfect by its largest competitor, HIG/Lionbridge. As a result, it seems since Chancellor Bouchard put so many Spanish jobs at risk, the international media there has been fervently following the case.

I called the U.S. Office of Public Affairs, which handles press inquiries for the U.S. Department of Justice, to find out more about this investigation and confirm that it’s ongoing. No comments were provided by press time.

As to the TransPerfect case, it is my understanding and in my personal view, it is now commonly accepted in business circles that Bouchard might have abused his power, and made absurd rulings that feathered the nests of Skadden Arps, his lawyer friends, and their combined cronies to the tune of $250 million in TransPerfect funds. Folks, in my opinion, there are truly the appearances of impropriety here and they must be investigated.

Please see the article below and ask yourself: Does Delaware need a judiciary that looks crooked enough to even make the Department of Justice consider launching an investigation? If this is true, what will that do to our reputation?

As always your comments are welcome and I will continue to follow the largest corporate case, and in my view, the largest heist by a judge, in American history — the public deserves answers, transparency, and accountability.


The TransPerfect case, investigated by the United States Department of Justice

The management of the TransPerfect case, led by the Supreme Court Justice of Delaware, André Bouchard, is being investigated by the US Department of Justice, according to a statement issued by the highest court in the United States.

BARCELONA, 29 (EUROPE PRESS)

The management of the TransPerfect case, led by the Supreme Court Justice of Delaware, André Bouchard, is being investigated by the US Department of Justice, according to a statement issued by the highest court in the United States.

The forced sale of this multinational, which has 600 jobs in its offices in Barcelona, ended in the courts of Delaware and now the US justice investigates the judicial team that managed the sale process of the company for alleged discrimination during 2017, when the company was under your control.

Associations of Delaware citizens say that as the investigation progresses it may also address other irregularities such as the $ 250 million that allegedly disappeared from the TransPerfect bank accounts while representatives of the Delaware Supreme Court controlled the company.

They emphasize “the opacity” with which Judge Bouchard has taken the case, arriving at not making public the judicial file months after the resolution, something contrary to the current US legislative framework.

They also denounce that one of the law firms that has benefited the most in the conflict has been a law firm of which one of its partners, Robert Pincus, was appointed judicial administrator of the company during the conflict.

However, the management of the case has called into question the neutrality of the judicial system of Delaware, according to a report by the US Chamber of Commerce.

TransPerfect closed the year 2018 with revenues of more than 600 million euros, 14.7% more than the previous year, and has offices in Barcelona, Madrid and Palma de Mallorca, Spain being the second country in the world where the multinational It has more employees, only behind the United States.

Is this America? You have to wonder… when your Chief Chancellor Andre Bouchard is once again making a Stalin-like decision to dissolve a solvent company, rather than letting the private sector solve its own problem — which it would do, if the Court would stay out of it.

Equity-only courts, like the Chancery Court in Delaware, have been officially outlawed in 48 of 50 States! Only Delaware and Tennessee allow judges such unfettered power without the checks and balances of a jury.

It’s a court run by a man who appears to be absorbed by making companies spend and spend to solve simple problems. You appear to have deadlock here. Why not do what Delaware Supreme Court Justice Valihura demanded in the TransPerfect Global case, and expand the Board? In my view, the answer to “why not?” is because these decisions do not allow for Chancellor Bouchard to enrich his so called, elite, Delaware, lawyer friends and Skadden Arps buddies!!

Why would Bouchard do the equivalent of dropping a nuclear bomb on employees, their families, the U.S. Constitution and all business law precedence in America before his regime? The fly-swatter of an expanded Board can solve any deadlock, but where is the money for greedy Bouchard in something so simple? Bouchard’s pals would not profit from such simple American logic if it were applied here.

Simply put folks: Bouchard’s court, in my opinion, has turned into a money-making machine for his friends and cronies. How much money will be spent in the process? How much money could get funneled to all of his pals in the court-system?

We must rise up and stop this nefarious trend by a self- serving Judge who seems to be using the system for his own advantage? The Bar Association always has to go in front of him and plead their cases for his entire 12-year term, so they are beholden to obey Bouchard’s will. Folks, “the fox is guarding the hen house”! From my perspective, our elected General Assembly must step up for the people, reign in this-what I call-“business-terrorist jurist”, and restore the balance of power in our State before it is too late.

Instead, Bouchard’s solutions are un-American and insanely expensive. Bouchard has yet to explain any of the details or unseal the case where he ordered $250 million of TransPerfect’s money to be spent. The solution should be that Bouchard expands a company’s Board and lets the private sector make these decisions.

Instead, it is obvious to me and many others, he chooses to make the company “government controlled” — where he can make his cronies and good old boys richer and richer. He can pay back those who supported him to become Chancellor with no bench experience.

To me folks–It’s a crime, I see it plain as day, and it has to stop.

I pledge to talk to the employees of this recent company fiasco in Bouchard’s Court as well — just like TransPerfect — and give you honest reporting of any atrocities that Bouchard’s lackeys commit when he puts them in charge. According to employees, one woman at TransPerfect is still in therapy from the intimidation of Bouchard’s appointed Custodian and the fear of losing her job.

Folks, it is my absolute opinion, If the hubris of this inexperienced, petulant, greed-ridden, all-powerful Chancellor is not reigned in, Delaware’s image as once the #1 place for corporations — whatever is left of it and what’s left of Delaware’s economy — will be gone.

I implore you, my readers: Please call your elected state legislators, and tell them you will not stand, for what I consider, this corrupt behavior in our judiciary! IT IS GOING TO BE AN ISSUE IN THE 2020 ELECTION !

Please read the article below and any feedback you send me will be appreciated.

Here is the Law360 story:


Dysfunction Leads Del. Chancery To Dissolve Pharma Co.

By Vince Sullivan

Law360 (May 17, 2019, 7:03 PM EDT) — A Delaware Chancellor ordered the liquidation and dissolution of a pharmaceutical development company Friday, saying disagreements among the company’s three managers have created a deadlock that has frozen operations and doomed its future prospects.

Chancellor Andre G. Bouchard said Inspirion Delivery Sciences LLC cannot move forward because its operating agreement doesn’t provide a mechanism to resolve the differences facing members Stefan Aigner, Raymond DiFalco and Manish Shah, and there is no practical way for the business to continue.

“Underlying the rupture in their relationship, Aigner, DiFalco and Shah have been at loggerheads over issues of fundamental importance to the company and its future … ,” Chancellor Bouchard said in his opinion. “In sum, the current state of play at the company is that the board consists of three managers, two of whom disagree vehemently on issues critical to the company’s management and business strategy.”

The fissures began to show about two years ago, the opinion said, when Aigner, on one hand, and DiFalco and Shah, on the other, disagreed on supply contracts for the production of the company’s opioid abuse-prevention drug technology. The unique corporate governance structure required that Aigner and either DiFalco or Shah agree on corporate actions, but a dispute over DiFalco and Shah’s ownership of the company Inspirion contracted with to manufacture its drug led to the deadlock.

A series of acrimonious actions and reactions followed, with Aigner accused of trying to eliminate DiFalco’s veto rights using the conflict-of-interest provisions in the operating agreements, the opinion said.

Aigner filed suit in late 2018 seeking declarations that would cement his control of the company while limiting DiFalco’s management role, and DiFalco filed counterclaims seeking a dissolution of the company.

The agreement allows for the appointment of an independent representative to vote in DiFalco’s place when issues arise with supply contracts that implicate DiFalco’s other businesses, Chancellor Bouchard said. But DiFalco’s independent representative resigned in the fall of 2018, followed by Shah’s resignation, leaving just Aigner and DiFalco as voting members.

The opinion said the independent representative mechanism could work to resolve the differences between the two, but the chancellor determined it was highly likely the remaining managers would deadlock on the appointment of a replacement representative.

Even if there were a new representative selected or appointed by the court, the opinion said the mechanism is fatally flawed due to the ambiguous language in the operating agreement that gives no concrete definition of a conflict or when a manager would be required to disclose a conflict that would call the independent representative to the table to vote.

The deadlock has prevented Inspirion from selecting a contractor to manufacture its opioid abuse-prevention drug technology and has made it nearly impossible to monetize its valuable intellectual property, Chancellor Bouchard said.

“Under these circumstances, the court concludes that dissolution of the company is the best and only realistic option to force the parties to find a resolution where they have failed before, or if they cannot, to yield value for them by selling the company’s assets,” the opinion said.

William T. Reid IV of Reid Collins & Tsai, representing DiFalco, told Law360 Friday that the court’s decision will hopefully help in the development of new drugs to combat the opioid epidemic.

“This is an important victory for our client that will hopefully free up the technology so desperately needed to help those affected by the opioid epidemic,” Reid said. “We’re grateful that this court took the rare step of ordering a dissolution of the dysfunctional company.”

Representatives for Aigner did not immediately respond Friday to a request for comment.

Inspirion was formed in 2008 to develop drugs that would prevent the abuse of opioids by maintaining the time-release properties of opiate-based medications even after the pills were crushed and ingested, according to the opinion. It brought one such drug, MorphaBond, to market, and received regulatory approvals for a second drug, RoxyBond.

Aigner is represented by Peter B. Ladig and Brett M. McCartney of Bayard PA, and David H. Wollmuth and Michael C. Ledley of Wollmuth Maher & Deutsch LLP.

DiFalco is represented by Norman H. Monhait and Carmela P. Keener of Rosenthal Monhait & Goddess PA, and William T. Reid IV, Michael Yoder, Jordan L. Vimont and Ryan M. Goldstein of Reid Collins & Tsai LLP.

The case is Acela Investments LLC et al. v. Raymond DiFalco et al., case number 2018-0558, in the Court of Chancery of the State of Delaware.

–Editing by Jack Karp.

Can you Guess Who Will Evade Justice? That’s Right, Delaware Good Old Boys Club: Bouchard, Pincus, Skadden, and the Chancery Court!

Once again folks, we have the U.S. Department of Justice chiming in on Skadden Arps and our Chancery Court. And, it ain’t pretty! The mess Bouchard and Pincus made while emptying TransPerfect’s corporate coffers, in my opinion, to benefit themselves and it keeps getting worse. Please remember who has been telling you that the many awful black-eyes will keep coming and coming for our state, and for our Chancery Court, under the inauspicious leadership of Andre Bouchard.

The latest headline: The DOJ just accused TransPerfect of discriminating against dual citizens and non-U.S. citizens when helping Clifford Chance’s staff organize a project in 2017.

NEWSFLASH folks: TransPerfect Management wasn’t in charge in 2017, our Delaware Chancery Court was. And it is plain-as day to me that Skadden was so busy fleecing and mismanaging the company as I see it with its illegal 3-year $1,475-per-hour occupation of the company that apparently it supervised conduct that the DOJ believes is absolutely illegal.

THIS IS OUTRIGHT CRAZY!! WHEN WILL WE STAND UP TO THIS PERCEIVED CORRUPTION IN THE DELAWARE CHANCERY? WHEN, I ASK?!

For more on how Chancellor Bouchard, Custodian Robert Pincus, and repeat DOJ offender — Skadden Arps — used the Chancery Court’s power to direct what the DOJ calls a “pattern of discriminatory and illegal behavior” — Please read the story below.

Folks, It’s only going to get worse and worse for the Chancery Court, who still will not, despite repeated requests, unseal the documents in the case.

MORE THAN EVER, I would love to hear your thoughts on this situation, and any comments on how honest on-lookers can bring these Delaware elites to justice.


Originally published by Law360:

TransPerfect Aided Clifford Chance’s Biased Hiring, DOJ Says

By Dani Kass

Law360 (May 9, 2019, 11:36 PM EDT) — The U.S. Department of Justice has accused TransPerfect of discriminating against dual citizens and non-U.S. citizens when helping Clifford Chance staff up a project in 2017.

The DOJ’s complaint, filed Wednesday in the Office of the Chief Administrative Hearing Officer, claims the staffing company violated the Immigration and Nationality Act when it honored the firm’s request to only recruit and hire people who were citizens of the U.S. exclusively. Clifford Chance LLP ended the DOJ’s probe into it in August by paying a $132,000 penalty, without admitting liability.

TransPerfect’s attorney, Martin P. Russo of Kruzhkov Russo PLLC, told Law360 that the alleged misconduct took place while the company was under a court-ordered custodianship. As part of a high-profile fight between TransPerfect’s founders, Philip Shawe and Elizabeth Elting, for control of the company, a Delaware Chancery Court in 2015 placed Skadden Arps Slate Meagher & Flom LLP’s Robert B. Pincus as custodian, namely to sell the business. Shawe ended up buying Elting out in a deal the court approved in February 2018, effectively ending Pincus’ custodianship.

The DOJ says the firm — which it does not identify in the complaint — used TransPerfect to staff up on attorneys for a temporary document review project. For several months in 2017, TransPerfect only recruited and hired U.S. citizens, and for most of the time only hired citizens who didn’t hold a second passport, the government claims.

The INA bars employers from intentionally discriminating against U.S. citizens or nationals, lawful permanent residents, asylees, and refugees during the hiring process, unless it falls under a legal carve out, the DOJ said.

“TransPerfect maintains that it did not violate the statutes alleged or engage in any conduct that was outside the bounds of the law,” Russo said.

In August, the DOJ said the U.S. arm of Clifford Chance violated anti-discrimination provisions of the INA by terminating three employees and refusing to consider eligible job candidates for 36 document-review roles because of their citizenship status from March to July 2017.

Clifford Chance had told investigators that it placed a citizenship-based staffing restriction on a specific document-review project because it believed it was required by the International Traffic in Arms Regulations, or ITAR, which in certain circumstances requires only a “U.S. person” to review highly sensitive materials.

But the DOJ said the firm misunderstood its obligations under the ITAR and that the regulations did not excuse discrimination on the basis of immigration status or nationality.

The new suit is against Chancery Staffing Solutions LLC, which is the successor to TransPerfect Staffing Solutions LLC. The company does business now as TransPerfect Staffing Solutions and TransPerfect Legal Solutions, the DOJ said. The government is hoping to get civil penalties, back pay on behalf of the workers who faced alleged discrimination, and other relief to “correct and prevent discrimination.”

“Staffing agencies must be diligent in satisfying their obligation under the INA to avoid citizenship status discrimination against U.S. citizens and protected non-citizens, even when that discrimination is requested by a client,” Eric Dreiband of the DOJ’s Civil Rights Division said in a statement. “The Department of Justice is committed to challenging such unlawful and discriminatory hiring practices.”

Skadden and Clifford Chance didn’t immediately respond to requests for comment late Thursday.

The government is represented by Gloria Yi, Julia Heming Segal and Sejal Jhaveri of the DOJ’s Civil Rights Division.

TransPerfect is represented by Martin P. Russo of Kruzhkov Russo PLLC.

The case is U.S. v. Chancery Staffing Solutions LLC et al., case number unknown, in the Office of the Chief Administrative Hearing Officer.

-Additional reporting by Sam Reisman. Editing by Adam LoBelia.

When it comes to corruption in Delaware’s Chancery Court, the public must now assume: where there is smoke, there is fire!

According to a recent complaint in Federal Court, TransPerfect’s #1 competitor was invited to participate in the “auction” — but instead the competitor seems to have used the Chancery’s “airtight” auction process as a massive platform to steal TransPerfect’s trade secrets. So much for the public expectation of Delaware’s Chancellor Bouchard to comply with his sworn duty to protect Delaware companies– APPARENTLY NOT!

Some conspiracies fly under the radar because they are too complicated to garner the appropriate attention, but remember folks, these judges, lawyers, and good old boy Delaware elitists are sophisticated actors — it’s no coincidence that $250 million was spent on lawyers and custodial fees.

Behold the following facts:

1. HIG/Lionbridge is TransPerfect’s #1 competitor.

2. Custodian Pincus of Skadden Arps allowed HIG/Lionbridge unfettered access to hundreds of thousands of corporate documents, including the most guarded secrets of TransPerfect.

3. HIG/Lionbridge is a client of the Skadden law firm.

4. HIG/Lionbridge is a client of Credit Suisse (but abruptly switched sides to “represent” TransPerfect for Pincus).

5. HIG had a loan with Credit Suisse, so IF Credit Suisse could have swung the auction results to HIG/Lionbridge, it would have helped Credit Suisse. They call this a “conflict of interest.”

6. The “conflict of interest” would normally have called for Credit Suisse to resign, but something made them feel protected enough not to resign.

7. Skadden Arps alumni include none other than: Chancellor Andre Bouchard, Custodian Robert Pincus, and Chief Justice Leo Strine (Bouchard’s former intern).

The above information is gleaned from my two years of research in following all the details of this case. If you think I may have the facts wrong, then please read the following link below: publicly available in a New York Supreme Court filing:

https://iapps.courts.state.ny.us/nyscef/ViewDocument?docIndex=qvdJYpXr7_PLUS_7tMrkT9_PLUS_oWMg==

Is all this just coincidence? But folks, we must ask ourselves is the $250 million dollars spent and distributed among Bouchard’s cronies and former business partners (Skadden Arps Law firm) a legitimate situation?

Credit Suisse is also more likely to be paid back on their HIG/Lionbridge debt, if HIG/Lionbridge got a leg up in the competitive market for translation by getting its hands on all of TransPerfect’s trade secrets, including detailed client information, and including decision-makers and price lists.

Perhaps the alleged trade secret theft happened with HIG/Lionbridge acting on their own, but given all these connections, perhaps not. You decide!  Please read the article below and send me your feedback. Your comments are welcome and appreciated.


TransPerfect Hits Rival Lionbridge With $300M Secrets Suit

By Pete Brush

Law360, New York (April 15, 2019, 5:47 PM EDT) — TransPerfect Global has sued rival translation company Lionbridge Technologies and private equity firm H.I.G. Capital for $300 million, claiming in Manhattan federal court that they exploited a court-ordered sale of TransPerfect equity to lift trade secrets.

The Thursday lawsuit, pending before U.S. District Judge Denise L. Cote, claims that a unit of Miami-based H.I.G., H.I.G. Middle Market LLC, engaged in “fake bidding” during the $770 million sale of a 50% stake in New York-based TransPerfect to help Massachusetts-headquartered Lionbridge gain an unfair advantage.




“For H.I.G., losing the auction was not a defeat because it was able to accomplish its refocused goal to gain an unfair competitive advantage over [TransPerfect],” the suit says.


H.I.G. and Lionbridge had discussed a go-private deal in 2016 that could have seen the private equity firm take control of both companies and permitted Lionbridge to “solidify its position as the dominant translations services provider worldwide,” the suit says.


H.I.G. completed its acquisition of Lionbridge in early 2017. But, according to the suit, even though TransPerfect co-founder Philip R. Shawe later that year won the auction for the TransPerfect stake, H.I.G. and Lionbridge still profited by gaining access to secrets that were pilfered from what should have been an airtight process mandated by a Delaware business court.


Credit Suisse, which handled the auction and is not a party to the lawsuit, “failed to take meaningful steps to protect the company’s confidential information, and defendants were permitted to freely interview


[TransPerfect’s] management and downloaded [its] top client lists, pricing information, commission schedules, employee files, and sales strategies,” the suit says. The suit adds that Credit Suisse owns Lionbridge debt and was “incentivized” to help H.I.G. shore up that debt.


H.I.G.’s conduct also delayed completion of the sale to Shawe and disrupted the plaintiff’s business, the suit says.


The sale of TransPerfect assets stemmed from a dispute between Shawe and company co-founder Elizabeth Elting over how to run the company that dates to 2014. H.I.G. improperly contacted Elting during the asset auction and assisted her in objecting to the sale to Shawe, the lawsuit says.


Lionbridge continues to use TransPerfect’s proprietary information to compete unfairly, according to the suit. TransPerfect seeks injunctive relief as well as damages, including punitive damages, in excess of $300 million.


Requests for comment from Lionbridge and H.I.G. were not returned. A lawyer representing TransPerfect declined comment. Credit Suisse declined comment.


TransPerfect is represented by Andrew Goodman of Garvey Schubert Barer and Martin Russo and Sarah Khurana of Kruzhkov Russo PLLC.


The case is TransPerfect v. Lionbridge et al., case number 1:19-cv-03283, in the U.S. District Court for the Southern District of New York.


–Editing by Amy Rowe.

After Chancellor Andre Bouchard’s capricious and subjective rulings in the TransPerfect case, causing in my opinion, Delaware to drop from #1 in perceived equity and justice to #11 in a national survey, it is obvious to any true businessman and indeed many intimidated lawyers, that the Delaware law allows the judges in this court to exercise omnipotent rights to adjudicate any way they see fit — contrary to existing law or policy.   The bottom line is that the Delaware Court of Chancery has become way too powerful because of the incestuous relationships within the system, which allow it to operate accordingly. In the TransPerfect case where Chancellor Bouchard was so obviously biased and improper, in levying unprecedented sanctions on CEO Philip Shawe to the tune of $7.1 million dollars and ruling that the company had to be sold contrary to the “Takings” law of the 5th Amendment, was simply outrageous.   His actions and suspicious connections with the plaintiff’s attorney and former business partners at the infamous law firm of Skadden Arps (fined $4.6 million by the federal government for illicit lobbying activities), especially with his former associate Robert Pincus, who he appointed as TransPerfect’s custodian. Bouchard approved millions of dollars of unsubstantiated and un-itemized bills by Pincus, which made he and many of his cronies rich beyond anybody’s wildest dreams.   I consider this the Rip-Off of The Century, all tied up in a nice little package that was approved by the Supreme Court under Bouchard’s former intern and Skadden Arps partner- Chief Justice Leo Strine! This, along with the power given the Chancery Court and its Chancellors, makes the perceived equity in this once respected institution, now extremely suspect.   Bouchard has gone beyond the pale creating appearances of impropriety that are not acceptable! The court he oversees is way too powerful, which gives license to possible corruption and arbitrary decisions. Unfortunately it is all condoned by the legislature and the closely knit members of the Delaware Bar Association.   Invitation for Cronyism   Folks, there are simple ways we can begin fixing this broken system. First of all, we can have judges’ cases picked in a random method, as is done in the rest of the country, instead of the current system in Delaware, which allows the judges to look over the docket of cases and pick the ones that they wish to pick for whatever reasons they wish to pick a case. If that isn’t an invitation for cronyism, I don’t know what is.   Next, when a candidate is recommended by the Governor for any judicial position, complete vetting by the State Senate should be done instead of it being a rubber stamp. Bouchard’s Senate confirmation took only 15 minutes and no questions were asked.   Third, there have got to be some law changes. One was attempted, forcing a Chancellor to provide a cooling-off period before ordering a dissolution of a company. Unfortunately, there was no political motivation to make it happen and the incestuous Bar Association opposed it.   Limitation of Power   There has to be some limitation on the Chancellor’s power where true equity and justice is provided. Change is indeed necessary, however I am not optimistic. Delaware is moving into extreme territory with open late trimester abortion, socialism, eliminating voters rights, and even the idea of making Delaware a sanctuary state. Why would it want to change its method of operation when everything is controlled by the Democrats who for all intents and purposes seem to be anti-business.   Corporations are fleeing to Nevada and others are searching for any venue to incorporate other than Delaware! When Delaware completely loses its lucrative franchise taxes (which make up one-third of the state’s income) due to a lack of trust in the Chancery Court, then perhaps the State Legislature will implement change to inspire businesses to continue to incorporate in Delaware.   Famous attorney and law professor and Constitutional scholar Alan Dershowitz, stated after dealing with Supreme Court Justice Leo Strine in an appeal in the TransPerfect case where Bouchard’s decisions were wrongly upheld, “Any lawyer that recommends to his client to incorporate in Delaware would be tantamount to legal malpractice.” That folks is a serious statement by a true expert and should be recognized for the concern it clearly states.   There is something wrong with the Delaware Chancery Court and it should be fixed, but will it? Probably not is my educated opinion.   As always, your comments are welcome and appreciated. I would love to hear what you think of reforming the Chancery Court.  As I’m seeing fines and other crazy headlines roll in against law firm Skadden Arps, I can’t help but reflect on some of the injustices that happened in the TransPerfect Global case. The injustice jumps right out at me when I think about it in light of these new Skadden Arps developments. Let me tell you the latest and let’s see if it jumps out at you too! Delaware Chancery Court Chancellor Andre Bouchard, a former lawyer from Skadden Arps, an international law firm accused of criminal activity, AND recently fined $4.6 million, ruled subjectively and totally against TransPerfect CEO Philip Shawe in favor of his buddy Kevin Shannon, who represented the plaintiff, Elizabeth Elting, Shawe’s former partner. During the trial, and without evidence, Bouchard wrongly fined Shawe $7.1 million and awarded $1.4 million in legal fees, which were un-substantiated, to his good friend Kevin Shannon who I believe he potentially colluded with during the decision making period of the trial while in a forum together in New Orleans. Bouchard also appointed his former partner Robert Pincus (another Skadden Arps attorney) as the Custodian of TransPerfect, who then, in my view, ripped off the company to the tune of over $25 million — an unprecedented amount of money, again without substantiation or itemized consideration — all approved by Chancellor Bouchard. Then of course we have the appeal upheld by Delaware Chief Supreme Court Justice, Leo Strine, despite the fact the whole deal was an illegal “TAKING” under the 5th Amendment of the U.S. Constitution! Guess what? Leo Strine is another former Skadden Arps attorney! Chancellor Bouchard refuses to release the billings to the Public because, in my opinion, he is afraid of what might be established and perceived. As another aside, Paul Manafort, former Trump campaign manager, could probably get 19 years in prison for unrelated, process crimes created by the fact that a false document was filed, yet Skadden Arps only receives a $4.6 million dollar fine and a slap on the wrist to boot, for what I consider an outrageous illegal activity! There’s a HUGE INEQUITY here, folks! Skadden Arps could be corrupt in my opinion, and as I see it, possibly all of these Delaware attorneys (former Skadden Arps guys) could be corrupt as well. Could there be huge kickbacks to all concerned here?? It is all far too cute and convenient, and yes incestuous, for my comfort. Folks if there was ever the appearance of an impropriety, this is definitely one! And it needs to be investigated! I call for the FBI and the Department of Justice to start an immediate investigation, as federal crimes could have been purloined here? It looks to me as if the State of Delaware is protecting its own, so the feds need to get involved! How is it that Manafort goes to jail, while Skadden Arps escapes with a fine that is a drop in the bucket of their billions in revenue?! All while Bouchard, Pincus, and Strine — along with Kevin Shannon — could possibly be laughing all the way to an offshore-island bank ? WHERE IS JUSTICE, WHERE IS EQUITY? In my view there is no justice anymore in the State of Delaware! Shame! TIME FOR THE FEDS TO GET INVOLVED?! Please look over excerpts from the articles below to glean this nefarious information and background.  
   

New York Times — January 17, 2019

“WASHINGTON — A global New York-based law firm has agreed to pay $4.6 million to settle a Justice Department investigation into whether its work for a Russia-aligned Ukrainian government violated lobbying laws.

The investigation stems from work that the firm, Skadden, Arps, Slate, Meagher & Flom, did with Paul Manafort, President Trump’s former campaign chairman. The case overlaps with the investigation of the special counsel, Robert S. Mueller III, into Russian interference in the 2016 election.

As part of the settlement, the law firm agreed to register retroactively as a foreign agent for Ukraine in addition to paying the government $4.6 million, representing the money it earned from its work in Ukraine.

The settlement between the firm and the Justice Department, which was made public on Thursday, is the latest indication that Mr. Mueller’s inquiry and related investigations are fundamentally challenging the lucrative but shadowy foreign-lobbying industry that has thrived in Washington.

 
 

AXIOS — February 15,2019

 

Prosecutors for special counsel Robert Mueller said in a new court filing that President Trump’s former campaign manager Paul Manafort should serve between 19.5 and 24.5 years in prison for the financial crimes for which he was convicted in a Virginia court last August.

“In the end, Manafort acted for more than a decade as if he were above the law, and deprived the federal government and various financial institutions of millions of dollars. The sentence here should reflect the seriousness of these crimes, and serve to both deter Manafort and others from engaging in such conduct.”

Why it matters: This would essentially be a life sentence for the 69-year-old Manafort. He is also facing a separate case in D.C., where a judge recently ruled that he had violated his plea agreement with Mueller and could therefore lose out on any potential leniency he might be offered.

 
 

NEW YORK TIMES — February 2, 2018

“Mr. Mueller’s inquiry threatens the delicate balance that Skadden has struck between lucrative sources of revenue. The firm has made huge profits from corporate work for image-conscious United States companies, while also representing riskier international clients, such as Russian oligarchs and companies with close ties to President Vladimir V. Putin and former Soviet states.

Skadden’s work advising controversial foreign clients was probably prompted by the same aggressive risk-taking that fueled the firm’s rise from scrappy upstart to top-grossing legal giant with a range of practice areas, said Lincoln Caplan, a research scholar at Yale Law School and the author of “Skadden: Power, Money, and the Rise of a Legal Empire.”

“The mentality is that Skadden wouldn’t be afraid of doing something like this, if there was a chance to utilize their skills and status to take advantage of what sounds like a very lucrative business, and they saw no legal or ethical proscription against their taking on the matter,” he said.

Skadden’s work is part of a trend in recent years of lobbyists and lawyers earning increasingly larger paydays by marketing their connections in Washington to foreign politicians, countries and companies willing to pay hefty fees to burnish their reputations in the United States and on the international stage

The recent article I posted concerning the law firm “Skadden Arps” getting fined by the feds a staggering $4.6 million dollars for illegally acting as a foreign agent (in my view, Skadden was aiding treason!) in relation to the Delaware’s Chancellor Andre Bouchard, Delaware’s Chief Justice of the Supreme Court Leo Strine, and the appointed (by Bouchard) Custodian at TransPerfect, Robert Pincus — who are all ex-Skadden lawyers.   It’s so incestuous, it stinks to high heaven! The rulings in favor of Kevin Shannon by Bouchard, when Shannon could not call a single fact witness, the upholding by Strine on appeal of the main case (and the largest individual sanction in the U.S. was affirmed on appeal without even a hearing!!!), and the billing by Pincus of TransPerfect to the tune of over $25 million, which is simply outrageous, brings this judicial outrage to another level entirely. TransPerfect Global CEO Philip Shawe was ordered to make TransPerfect pay $25 million in fees, but not Shawe, nor the public, nor anyone else gets to examine the bills. Neither the public, nor the payer (TransPerfect) gets to know what was paid for, or if this $25 million was legitimately billed… absolute insanity folks!   To go from the ridiculous to the obscene, we then have Kevin Shannon, Bouchard’s best buddy — who Bouchard hand-picked to join the St. Francis Hospital Board after he vacated his board seat. because he became the Chief Chancellor (without 1 day of bench experience, by the way) — got awarded $1.4 million in legal fees, also without any documentation, nor disclosure to the public!   Why wouldn’t a law firm, fined $4.6 million by the Feds for serious crimes, pad their bills to the moon??! Since there was no disclosure by Bouchard and no way to check if the bills were valid, just pay, pay, pay to Bouchard’s Delaware cronies whatever they ask. They scratched his back to become the Chancellor, now I think he is scratching theirs? Folks, is that how this is supposed to work? In my opinion, it reeks of corruption.   Again, I received an overwhelming response from the public about my last story of a 4-year injustice that would not have been tolerated in any third-world country, and damn sure should not be tolerated here. I say to you absurd cronies in the judiciary: You can fool people only so long, and then they start screaming from the tops of mountains! You are being exposed for suspicious activities, and if my readership has its way, you’ll be held accountable for these apparent improprieties.   Bouchard holds half the documents in the entire case, and ALL of his friend’s $26.4 million in non-itemized bills wrapped up tight as a drum, and he refuses to release them to the public. Why? Because they could possibly incriminate him or his cronies? There is a high price to pay if you line your pockets with court-ordered money from private citizens. I wonder why Bouchard and Skadden Arps appear in my opinion to act above the law in Delaware and apparently continue to get away with it? Or are they?? Based on your feedback, it’s clear this cabal is finally being exposed and the folks are beginning to understand this disconcerting reality??   Bouchard’s continued actions and failure to disclose documents to the public have cast a doubt on Delaware’s credibility, while destroying our business-friendly image — and negatively impacting our economy, plus casting a darker shadow over the First State’s once-honorable and respected institution, our Chancery Court.   As I often do when a story generates such significant outrage that something must be done, I have cut-and-pasted a sampling below from the many responses I have received. (The last names have been removed to protect these citizens from possible reprisals.)   Please enjoy the comments and please keep them coming! I appreciate your feedback.  
 

1) From Dawn

Thanks for expanding my mind and understanding of Delaware politics through the TransPerfect debacle… eye-opening. Keep up the good work!

2) From Allen

IMPEACH BOUCHARD!

3) From John

Jud, It is extremely disconcerting to realize the incestuous connections between the Skadden Arps law firm, Justice Strine, Chancellor Bouchard, Robert Pincus — then the cute relationship between Kevin Shannon and our Chancellor. I wouldn’t put anything past these rotten bastards. Skadden Arps is corrupt and it sure makes me wonder about Bouchard’s integrity. The records must be released. How come Shawe has not sued to have then released through a “Freedom of Information Request”? Thanks for your outstanding work in bringing all of this to light. You should get a Pulitzer award! All the best!

 

4) From Linda

OUTRAGEOUS!!!! Where there is smoke there is fire. Bouchard is a disgrace to judicial integrity. Love your articles, Judson.

 

5) From Peter

JUDSON — This is an extraordinary situation and most disturbing. Nobody should ever have to worry that our Chancery Court could be corrupt.

6) From Carol

Hi Jud, This is beyond an impropriety. Here we have a corrupt law firm (Skadden Arps) and then Strine, Bouchard, Pincus all from the same law firm. They should make a movie about this crazy situation. Everybody is way too cozy in the Delaware Judiciary. I know we have a small state, but come on. Wow — is all I can say!

7) From Don

Hey JUDSON, Read your article and this one really is impactful. You made your point big time. Corrupt law firm, fined $4.6 million by the Justice department and the head of the Delaware Supreme Court and the head of the Chancery are from the same law firm? Bouchard’s handling of the TransPerfect case has been terrible and now he is preventing documents from being given out to the public? This guy at the best should be removed as Chancellor and at the worst should not be reappointed. Hope you will be around to testify when that time comes ! Keep up the great work. Your political articles are amazing, but this TransPerfect stuff is sensational.

 

8) From Erin

Great stuff JUD. What an excellent article and expose of Andre Bouchard. He has got to go. Keep up the great work!

 

9) From John C.

JUDSON, It’s a Simple answer: Absolute arrogance and greed!

 

10) From Eric R.

You are a loose cannon stirring the pot! As your wife Maria used to say as you stomped your feet up the stairs to your office, “Who are you gonna piss off now, Judson?” Keep it up, we know you are right and appreciate your guts. Love you, brother!

11) From Eric B.

I really enjoyed your article. Thanks for continuing to peel off the layers of deceit manufactured by Bouchard. I feel sorry for Mr. Shawe and anyone else that has to come before Bouchard’s kangaroo court.

You won’t be surprised to learn that Delaware’s Chancellor Andre Bouchard’s former employer, who Bouchard himself ordered to be paid $25 million from TransPerfect Global, is the infamous law firm of “Skadden Arps.” This firm, in my opinion, makes the law firm in John Grisham’s book “The Firm” look like a kindergarten summer camp. Skadden Arps is the subject of innumerable investigations, and I’m shaking my head imagining if it isn’t just a legal front for organized crime? Who else is an alumni (and Bouchard’s former intern) from Skadden Arps? Of course, Leo Strine, now Chief Justice of the Delaware Supreme Court. Who else worked at Skadden Arps and got rich off of TransPerfect by the Court-Ordered rates of $1,475 per hour (in Delaware) for over 3 years? You guessed it, another Skadden Arps lawyer, custodian Robert Pincus. For those of you that think I’m too harsh on Bouchard’s former law firm, know this, they were just fined $4.6 MILLION by the US DOJ for aiding what could be considered serious federal crimes-illegally operating as an agent for a foreign government. Compare Skadden Arps illegally operating as an agent for a foreign government to Chancellor Bouchard fining Philip Shawe $7.1 million for insignificant findings like “failing to safeguard an old cell phone” — all trumped up charges by Bouchard — not proven in front of a jury as Shawe demanded. The difference in the amount of the fines is in no way justifiable. It seems that some of the Chancellor’s evidence was a ridiculous example of subjective adjudication, which is not what justice is supposed to be about. Bouchard in fact, from what I understand, used a “smiley face” text message 🙂 as part of what I consider this absurd justification for dissolving a 4,000-person industry leader and putting his friends in charge of TransPerfect for 3 years of what should be recognized as an unprecedented, court-ordered fleecing. Again folks, please take a moment, and digest, just how crazy this whole scenario is. In my view, Bouchard’s and Strine’s former employer, as I understand it, actively violated laws against the United States and then apparently lied to federal investigators about it, and then were slapped with a $4.6 million fine as a result. Shawe, an individual who from what I’ve heard and read is unquestionably one of American’s greatest entrepreneurs with a spotless record, got a $7.1 million fine by the Chancery Court! How convenient that $1.4 million of Shawe’s fine is ordered to go directly to Bouchard’s best friend, Kevin Shannon (and his law firm, Potter Anderson)… Shameful on its face, don’t you think? Yes, this is the very person Bouchard traveled to New Orleans with and made a public appearance with during the decision- making period of the case. Yes, this is the sole lawyer in the trial, who Bouchard has clearly created huge benefits for by his suspicious actions, and allowed him to get outrageous sums of money without providing to my knowledge, not one detailed invoice — or substantiation of the work that was supposed to be provided. No other lawyer got treated this way, with the exception of one: Bouchard’s other long-term and former co-worker, Skadden’s (appointed by Bouchard) — Custodian, Bob Pincus who collected outrageous and undocumented fees from TransPerfect !   I’m told Pincus and Skadden are still billing TransPerfect TODAY — And with the case NOW OVER — Bouchard is still ordering his friends to be paid. No wonder the records remain unlawfully sealed by Bouchard. These facts are obscene!!! I urge the Delaware Legislature to make the Delaware Court of Chancery accountable and to force it to cease and desist from these suspicious activities and appearances of impropriety!! By doing nothing and putting their heads in the sand, our elected lawmakers become indirect accomplices in this horrible injustice. Congress orders investigations for much less at a Federal level. YOU folks in the General Assembly are Delaware’s Congress; it is your job to start a needed inquiry!!!   The apple doesn’t fall far from the tree, as Bouchard began learning his, in my opinion, shady dealing techniques young in his career, from his former employer Skadden Arps, who I, and apparently the DOJ, view as a den of thieves. Think about it — if they got caught for federal violations and had to pay $4.6 million in fines, which is a lot of money folks! It makes you wonder… what else have they done? What else could their Wilmington office have been involved in? Perhaps violation of federal laws (perhaps a form of treason?) and the TransPerfect case may just scratch the surface of Skadden’s possible nefarious affairs, for all we know? According to the story pasted below, there are some pretty sordid details on Skadden’s troubles with the U.S. government — requiring them “to retroactively register as a foreign agent and review its policies for responding to inquiries from the government.” Just Google Skadden Arps and DOJ! The more you read, the more you’ll see why I believe that the stench coming from our Chief Chancellor’s office, seemingly and in my view, probably started early in his career. Folks, you simply can’t make these facts up, which is why I will continue to report on it and continue to fight for the records and the bills to be unsealed. If nothing is wrong — why does this irregular “cover up” continue? I again ask for an investigation into Bouchard and his cronies and if these appearances of impropriety are found to be actual improprieties, then these people must be brought to justice and held accountable for harming TransPerfect employees, harming Delaware citizens, and creating the long-term devastation of Delaware’s business reputation, which is now nationally and internationally synonymous with the disconcerting term called “corruption.” Please read the story below, I know it’s long, but this is important stuff, as these are the good ole boys that we’ve entrusted to run our judiciary in Delaware! As always, your comments are welcome.  

Skadden Began Ukraine Work With Caution, Ended It In Lies

By Jimmy Hoover

Law360 (January 18, 2019, 11:57 PM EST) — Skadden Arps Slate Meagher & Flom LLP has agreed to pay a $4.6 million settlement with the U.S. Department of Justice for failing to register as a foreign agent. Here, we look at how the firm got to this point.

Law360, Washington (January 18, 2019, 10:06 PM EST) — Emails released by the U.S. Department of Justice show how Skadden Arps Slate Meagher & Flom LLP lawyers slowly abandoned caution toward a foreign lobbying law and began openly lying to federal investigators during their engagement with the Ukrainian government from 2012 to 2013.

Excerpts of the emails were released Thursday by the DOJ after it announced a $4.6 million settlement with Skadden for alleged violations of the Foreign Agents Registration Act, a law requiring people to register any U.S. political lobbying on behalf of a foreign government.

The emails show how lawyers at the high-priced firm were initially cautious about doing anything that would require them to register as foreign agents under the law, and wanted to limit their work to preparing an independent report on the prosecution of Ukrainian opposition leader Yulia Tymoshenko, the former prime minister.

But over the course of their work, the Skadden lawyers, including the politically connected former White House counsel Greg Craig, slowly abandoned that caution and found themselves involved in the country’s public relations campaign to win over Western media amid a backlash over Tymoshenko’s treatment.

Here, Law360 chronicles the shift in the firm’s work as revealed by the newly disclosed emails, and how it ultimately led to the multimillion-dollar settlement.

Blurring Lines Between Legal Work, PR

Skadden was retained by the Ukrainian Ministry of Justice in the spring of 2012, receiving a $4 million advance provided by an unnamed businessperson with whom Craig had earlier met in Kiev. Shortly after the retainer, a Skadden lawyer identified as “Partner-2” in the DOJ appendix cautioned Craig that someone else should manage the country’s public relations effort because the firm was hired “as lawyers, not spin doctors.”

“Good advice,” Craig responded.

But it was advice that Craig and other Skadden lawyers would loosely follow, as they danced on the line between legal work and public relations in the ensuing months.

Between late April and early May 2012, Craig advised lobbyist Paul Manafort about which public relations firm the Ukrainian government should hire to execute the country’s messaging strategy once the report became public.

After one particularly strong recommendation for a firm that could help its outreach strategy in Europe, Ukraine accepted Craig’s advice.

Still, Skadden and the PR firm kept a watchful eye on their potential FARA obligations. An executive of the PR firm was careful to tell Craig that “i[f] at a future date our brief is expanded and requires U.S.-headquartered personnel and activities, we will then take appropriate steps.”

Skadden lawyers kept an eye on their potential FARA obligations throughout the spring of 2012 but nevertheless continued communicating with Manafort, his associate Rick Gates and members of the PR firm about their work. In July, for instance, the PR firm shared its “communication strategy” with Gates, who forwarded the document to an unnamed Skadden associate.

Media Strategy Heats Up

As the release date for the report approached, Craig and other Skadden lawyers were included in additional discussions about the PR firm’s media plans for the report, such as the list of media and government personnel to be contacted once it was made public.

In one strategy document shared with Craig, the PR firm proposed leaking the report to a specific U.S. journalist at a major media outlet on the night before the report’s release.

In late September 2012, the PR firm scheduled a meeting in New York City with Craig, Manafort, Gates and an unnamed Skadden associate to discuss the upcoming media campaign. Documents circulated by the firm ahead of the meeting indicated that they had chosen to leak to a different news outlet than the one originally planned, in light of Craig’s prior relationship with the newly selected journalist.

On Sept. 24, Craig told Manafort in an email that he didn’t think Skadden lawyers should be providing background to journalists after the release of the report, suggesting it would undermine the integrity of the report. Craig ultimately acceded to Manafort’s request to respond to media requests run through the firm’s communications professionals.

Craig Reaches Out to New York Times

On Oct. 2, 2012, Craig reached out to a reporter for The New York Times he knew and connected him with a lobbyist on the topic of the upcoming Ukrainian report. The reporter could be identified as the Times’ Washington correspondent, David Sanger, by details shared by the DOJ appendix.

Craig followed up with Sanger on Dec. 11, offering to provide exclusive access to the report before it was slated to be released publicly. After receiving a response, Craig sent Sanger an electronic copy and indicated he would “hand-deliver a hard copy of this report to your home tonight.” Craig shared the exchange with the unnamed Partner-2 at Skadden and updated the PR firm.

On Dec. 12, Sanger told Craig via email that he’d read the report and was “ready to talk,” indicating an unnamed Moscow-based colleague would take the lead on the story. The colleague could be identified as David Herszenhorn by details contained in the DOJ appendix. Herszenhorn sent a list of questions to Craig and suggested a conference call.

Following the call, Craig sent Sanger a quote for their story: “We leave to others the question of whether this prosecution was politically motivated. We say nothing about that. Our assignment was to look at the evidence in the record and determine whether the trial was fair.”

The New York Times published Sanger and Herszenhorn’s story — headlined “Failings Found In Trial of Ukrainian Ex-Premier” — that day, just hours before the report was made public on the Ukrainian government’s website. The article used a slightly shortened version of the quote Craig sent Sanger.

Skadden Attracts Attention from FARA Unit

Just a few days after the report was released, finding no evidence of political motivation to the Tymoshenko trial, the DOJ’s FARA Unit sent a letter to Skadden seeking information about its representation of Ukraine, including a copy of their agreement and the services it has provided the country.

The DOJ’s letter bounced around the firm until Craig finally sent his official response nearly two months later in February 2013. In it, the lawyer described the firm’s representation as involving “rule of law issues” and “advice” about Ukraine’s criminal justice system, according to the DOJ. The response did not mention discussions with public relations consultants, lobbyists or reporters.

Craig’s response was wanting, the DOJ apparently thought, and demanded more information in April 2013, specifically homing in on the firm’s contacts with media outlets, as well as how much it made for the work; the initial response made no mention of the $4 million advance.

‘False and Misleading’ Answers

Craig responded to the DOJ’s follow-up with a June 2013 letter that the DOJ now says contained “false and misleading statements.” Specifically, the letter dated Craig’s contacts with The New York Times to Dec. 12, 2012, omitting that he had actually shared an early copy of the report with Sanger the day before. Further, Craig described his contacts as “brief clarifying statements.”

Craig also told the DOJ at the time that Skadden had turned in the final version of the report to Ukraine in September 2012, when in fact it made limited changes in response to input from Manafort through November. Finally, the letter said Skadden didn’t have to share the identity of the anonymous business person who funded the legal work as it had no obligation to register.

“The FARA Unit relied to its detriment on false and misleading statements in this letter,” the DOJ now says. “As a result, the FARA Unit was deprived of the complete information that the FARA Unit expected to receive in response to its inquiry.”

The exchanges between the FARA Unit and Skadden continued through the fall of 2013 and culminated in an in-person meeting in Washington, D.C., to discuss the firm’s registration obligations. At the meeting, Craig once again conveyed “false and misleading” information, the DOJ now says.

After a follow-up letter — in which Craig said he only distributed copies of the report “in response to requests from the media” — the FARA Unit finally gave the firm the all-clear and said it had “no present obligation to register under FARA.”

Three years later — well after Skadden had concluded its work in the country and the Ukrainian revolution of 2014 had driven President Viktor Yanukovych to exile in Russia — the DOJ’s National Security Division, which houses the FARA Unit, began beefing up its enforcement of the lobbying law after an inspector general report found widespread noncompliance.

In October 2017, Manafort and Gates were among the first to be ensnared by that effort in connection with Special Counsel Robert Mueller’s investigation into the 2016 presidential election. The pair had worked on then-Republican candidate Donald Trump’s campaign.

Indictments returned by a federal grand jury focused extensively on Manafort’s work for Ukraine’s pro-Russia Party of Regions, bringing the attention of federal investigators uncomfortably close to Skadden’s report for the Ministry of Justice.

At Skadden’s Doorstep

Skadden’s legal troubles spilled directly into public view with the February 2018 guilty plea of former Skadden associate Alex van der Zwaan, a member of the report team who admitted to lying to Mueller’s investigators about his communications with Gates regarding the 2012 report. Skadden said in a statement that it terminated Van der Zwaan in 2017 and “has been cooperating with authorities in connection with this matter.”

Days later, the firm released a statement saying, “Greg Craig did not engage in any activity that required him or the firm to register.”

Van der Zwaan was sentenced to 30 days in prison in April 2018 and ordered to pay a $20,000 fine, the first prison sentence to arise from the Mueller investigation. Later that month, the firm confirmed that Craig had left the firm amid increasing scrutiny over the report, although a Skadden spokesperson did not respond to questions about the circumstances or timing of Craig’s departure.

Manafort pled guilty to two counts of conspiracy and obstruction of justice in a September deal requiring him to cooperate with the Mueller investigation. Craig’s lawyers, meanwhile, defended the ex-Skadden partner in the court of public opinion, insisting the “few” media contacts about the 2012 report “were not part of an effort to promote the report on behalf of a foreign government,” and that “as a result, he was not required to register under” FARA.

The DOJ’s $4.6 million settlement with Skadden on Thursday requires the firm to retroactively register as a foreign agent and review its policies for responding to inquiries from the government.

A lawyer for Craig declined to comment Friday.

Chancellor Bouchard, what are you hiding? The law requires you to unseal these documents and let the public examine the court’s activities. If you aren’t covering your tracks and are not guilty of an impropriety, come clean and follow the law?   Sad to say, my loyal readers, that the black eye on Delaware is no longer confined to a local or national phenomenon, it has now gone global! Frankly, it is embarrassing for Delaware and it will further denigrate Delaware’s falling, former reputation as the best place for business justice.   Bouchard’s unlawful sealing of TransPerfect Global documents are indeed potentially damning to him and his Skadden Arps cronies (who I have been told were just fined $4.6 million by the DOJ for illegal activity that constitutes treason in my view) recently captures headlines in Barcelona, Spain’s second largest city, where I understand that TransPerfect has 500 employees.   Transparency is without a doubt required by the Courts.  Bouchard, you and your cronies cannot mask illicit activities in the dark of night — by ordering mass sealing of public documents! Who do you think you are? You sir are not above the law!   Where did the $250 million go Bouchard? I know repairs on your Bentley are expensive, but don’t you think this is a little overboard?? If you have done nothing wrong, you certainly have nothing to hide. So prove me wrong, unseal the case, and expose the documents for all to see.   Right now you are creating an acute appearance of an impropriety. Under no circumstances should the public ever have to even suspect irregularities in the Court of Chancery. As I see it, the Court’s reputation just a couple of years ago was beyond reproach and now it is not!   You are now under the global microscope of investigative reports from as far away as Spain! Chancellor Bouchard, you owe the good citizens of Delaware a specific accounting of exactly where your appropriation of these funds, by your orders, to whom they were paid and for exactly what?   These TransPerfect documents must be released to the public if the Delaware Court of Chancery is to have any credibility at all.   I will not stop investigating, and writing about this until Chancellor Bouchard gives the public the transparency the law requires.   Please see the article below.  
   

The details of the ‘Transperfect case’ are still hidden by order of the judge

Contrary to what US law dictates, Judge Bouchard has decided to prevent the public from accessing the records of the conflict that put 5,000 workers at risk, 500 of them in BCN

Delaware TransPerfect

The American justice dictates a resolution on the company Transperfect / FOTOMONTAJE CG

By IRENE BENAVENT

01.31.2019 00:00 h.

Nine months have passed since Phil Shawe took over 100% of the translation multinational Transperfect , which has one of its main international headquarters in Barcelona and a workforce of nearly a thousand companies. The takeover took place after one of the most mediatic business conflicts in the United States in the last four years. However, despite the resolution of the dispute, the judicial file of the case remains hidden from the public by decision of the Supreme Court Justice of Delaware, André Bouchard .

This new movement of the judge – the same that decreed the forced sale of the company founded in 1992 by Shawe and his ex-partner, Liz Elting – contributes to adding more opacity, if possible, to a shareholder conflict characterized by its lack of transparency and neutrality The dispute put at risk the future of more than 5,000 workers, 500 of whom are in the company’s offices in Barcelona, its most important international headquarters .

Opacity and obscurantism

The business conflict represented for the company an expense of 250 million dollars –214 million euros – in more than 30 law firms , global investment banks and entities specialized in M & A for the alleged resolution of the conflict. All these expenses had the approval of Judge Bouchard, who in turn, has maintained a long friendship with the leading law firms that have profited most from the forced sale of the multinational.

These benefited firms have been Potter Anderson and Skadden Arps , through the fees of their lawyers Kevin Shannon and Robert Pincus respectively. Sources close to Transperfect say that a large part of the money charged to the translation and dubbing company by these companies comes from invoices approved by Judge Bouchard that do not present details or justifications.

Out of the law

The decision of Judge André Bouchard goes against the current US legislative framework, which requires to make public the detailed information of the cases resolved.

In this sense, several civic associations of Delaware request that the works commissioned by Bouchard be investigated by the law firms, while they reject the judge’s decision to hide the details of the case, contrary to the provisions of the law. prevent the public and the media from accessing their records.

Delaware, exposed

The ‘TransPerfect Case’ has seriously damaged the prestige and neutrality of the State of Delaware, recognized in the world for its flexible and impartial judicial system. The imposition of a forced sale to a private company with positive results, the refusal to include in the bid strategic offers for the company or the opacity of the case demonstrated recently, have been some elements that have undermined the reputation of which it was one of the more attractive places for the American business ecosystem.

According to a survey prepared by the United States Chamber of Commerce, Delaware has fallen from the first to the eleventh position of the judicial neutrality ranking, after canvassing more than 1,300 general counsel, lawyers and senior managers. In turn, it is not surprising the decision of many companies to move their corporate headquarters to more competitive and neutral environments. This is what TransPerfect did to the state of Nevada at the end of 2018, as one of the first actions of Phil Shawe to restore stability to the company and its workers.

Sustained growth

Despite the fact that co-founder Phil Shawe had initially been removed from the sale of his company, in May 2018 the businessman put an end to the conflict by buying 50% of his partner and ex-partner for a value of 385 million dollars (330 million euros) thus doing so with 100% of the multinational.

Despite the grueling struggle for custody, TransPerfect closed 2018 with revenues of 705 million dollars – 621 million euros – 15% more than the previous year . This figure has remained positive for 26 years, which marks a clear upward trend in the sector , despite the fact that competitive threats such as Google and Microsoft are already approaching, which already offer translation services, where the results are often repeated awkward and errors in the translation of idioms or phrases.

Increase in employees

At the beginning of 2019, Transperfect hired its 5,000th employee. The company has more than 90 offices in cities around the world such as London or Sâo Paulo, however, its second most important headquarters – the first is in New York – is Barcelona, which has doubled its staff every three years.

In this sense, Phil Shawe predicts that the company could reach a thousand jobs in the Catalan capital by 2020.

Breaking News, folks: Elizabeth Elting’s attorney Kevin Shannon of Potter Anderson has made a new filing in the TransPerfect Global case. The filing allows his best buddy (you guessed it), Chancellor Andre Bouchard, to sink his tentacles into TransPerfect’s company coffers and possibly get the payola flowing out, once again! If the love of money is the root of all evil, Shannon and Bouchard are in my opinion its richest fertilizer. This story truly seems to have no end!    If you want to understand what I personally consider the colluding crooks of the Delaware Court system (Shannon & Bouchard) are up to now, stay tuned to the Coastal Network. I believe I am uniquely positioned, having earned the trust of more sources on the inside than any other commentator.   From what I have been told, I believe their latest scam to enrich themselves and their friends will shock your consciousness. First, I ask, why after having closed the case and after TransPerfect having fled our jurisdiction to Nevada to escape perceived corruption, is the Chancellor so eager to rip open old wounds and get TransPerfect back in his cross hairs? As they say on Wall Street, it’s about money and greed for certain corrupt Delaware elites.   I will explain Shannon’s apparent scam in a nutshell, as verified by multiple sources within the company. As part of the deal (or more accurately, what I see as state-sponsored blackmail), in order to keep the company he built, my understanding is that Bouchard made Shawe provide legal protection (known as “indemnity”) to Elting for wrongdoing related to lawsuits against her by former employees. Because of this, Elting’s team now seems to have no downside, so she (or more accurately, her bill-happy lawyers: Kramer Levin in New York, Potter Anderson in Delaware) appear to be working to sabotage the cases for which they are co-defendants with Shawe and TransPerfect.    Shawe and TransPerfect will have to be responsible by order of Chancellor Bouchard. Based on the contract with the Chancery Court, Shawe and his company TransPerfect Global has to handle Elting’s defense. Rather than sit back and enjoy their $385 million and 100% protection and “indemnity” that Bouchard forced Shawe to provide, Elting’s lawyers seem to be trying to make a mockery of theses cases and drive up their own legal bills (which will have to be paid by TransPerfect!), and keep on fighting in front of Bouchard. As I see it, because of Shannon’s perceived special relationship with Bouchard, they must feel they have no downside in sabotaging other litigations for which Shawe is paying the bill?   If you think I’m off base about how excited Bouchard was to get this wildly-successful company to start subsidizing legal time-meters all over the world once again, wait until you hear this: From what I heard, Shannon made a motion asking for permission to keep the case going, with extra pages (more pages equals more money for Shannon, less money for TransPerfect employees), and hold on to your hats, as I have heard from multiple reliable sources… Bouchard GRANTED Shannon’s motion to keep the fight going in the Chancery Court within 3 hours!!! (Chancellor, you could have at least pretended to be objective and not given the appearance that you and Shannon are colluding and coordinating behind the scenes. Perception is key, especially in this case. You couldn’t have possibly even READ the motion as fast as you granted it?!)   Now what’s worse than Bouchard having his clerks (who I have heard lie in wait for cushy Skadden jobs) standing ready to auto-approve Kevin Shannon’s every request, as he did for nearly 4 years? What’s worse than our Chancellor, who by his suspicious actions, could be betraying his sworn oaths and duties as a judge? What’s worse than a judge granting such windfalls to the side with zero witnesses to purposefully make settlement impossible? And what is worse than having, in my view, a Chancellor destroy Delaware’s business image and rankings (Dropping from #1 to #11) just to enrich his cronies? What’s worse? Watching Bouchard and his cronies gear up to seemingly milk it all over again??   Lawmakers, wake up and smell what I believe is the corruption in the Delaware Chancery! How pungent must the stench of Bouchard’s crazy operation be before you act, I ask? In my view, and in the view of countless other Delawareans who have written into my Coastal Network, Bouchard’s Chancery Court has morphed from a once widely respected institution, to what seems to me to be a corrupt third-world Kangaroo Court. TransPerfect would have gotten a fairer shake by suing Putin in Moscow. Wake up and pass reforms that will oust or limit the power of what I think is a Manchurian Candidate of a Chancellor, drunk with power.   In my view, this man is a menace to what the Delaware Court of Chancery is supposed to be about, which is equity and fairness! I believe no judiciary purporting to be honorable and running a clean shop would, could, or should allow him a seat at the table, much less, at the head of the table. It looks to me that Bouchard views the Chancery Court as a place not to ensure that justice is done, or to maintain Delaware’s reputation for business fairness, vested in him by the legislature, but as a personal play-thing, where he can make crazy, unprecedented, and unpredictable rulings that hurt 4,000 working families, just to enrich a few of his cronies, and the Chancellor apparently has no cozier crony, than his old, dear friend Kevin Shannon of Potter Anderson.   Stay tuned for more coverage. It seems at the moment that I’m the only correspondent with the inside scoop here. Either way, I promise to bring the citizens of Delaware the truth that no one else will.    Please click on the link below to read the article from “Crain’s”:   https://www.crainsnewyork.com/features/despite-bitter-battle-ownership-control-transperfect-remains-countrys-top-translation-firmThe responses I have received from so many of you concerning the TransPerfect Case and my recent articles about how things went down in this case are appreciated. However, the outpouring of outrage about Bouchard closing the records from the public almost brought my servers down, and broke a new record for the Coastal Network. I will reiterate a few things as I see them before proceeding: Founders, Business Partners and co-CEOs of TransPerfect Global, Philip Shawe and Elizabeth Elting, after bringing this company from a dorm room idea to a $650 million dollar a year company, Ms. Elting wanted out and did not want Mr. Shawe to have it either. After Elting was thrown out of New York Supreme Court in one hearing lasting an afternoon, she then filed her same suit here, in the Delaware Court of Chancery, seeking a forced public auction of this successful company. This litigated outcome has never happened in the history of the United States. Unfortunately for TransPerfect, Elting’s local counsel in Delaware was Kevin Shannon of Potter Anderson, longtime best buddy of Chancellor Bouchard. Shawe on the other hand did not want the company sold. Newbie Court Chancellor, Andre Bouchard (who insanely gets first right of refusal on all cases) sees his lifelong friend Kevin Shannon on the masthead of the case, and lo-and-behold, assigns it to himself, setting off years of litigation and what I view as the largest legal theft with the appearance of corruption in American History, to the tune of $250 million to lawyers and Delaware elites. Much of this money was charged, using millions upon millions of unchecked and un-itemized bills that were approved by Chancellor Bouchard, amidst widespread employee accusations of billing fraud and fabricated hours by Skadden Arps, among others. From this point on, (besides other appearances of impropriety), it is my view that Bouchard brazenly misused his personal power by ordering the documents to be sealed — documents that, by law, should be available to the public. I think the Chancellor must think he IS the law, because he just seems to make it all up— as he goes along. Here are the Top 10 comments I received from my readers. The last names and e-mail addresses have been removed to protect these good folks from any possible retaliation by the Chancery cronies. Thank you for writing in and following this case and continuing to follow it! The first comment comes from Dave Stevenson of the Caesar Rodney institute (a conservative Delaware think tank) who would like to publicly share his opinion: “Jud, I just wanted to second your concerns about Delaware losing its advantage as the place to incorporate. Combining franchise fees and abandoned property payments, this franchise is the largest revenue source for the state. I’m sure you saw Bill Freeborn’s recent article on killing the golden goose. As past Director of the Division of Corporations, he knows what he is talking about when he says a friend recently was”feeling that the recent uncertainty of the courts, the departure from established precedent, and the more “progressive” approach of Delaware’s judiciary make Delaware far less attractive for any of his global M&A clients”. I have written several pieces about the state’s frequent fee increases, and aggressive collection of abandoned property fees. We’ve been acting like pirates! Keep up the good work!”   David T. Stevenson, Policy Director Caesar Rodney Institute   Here are 10 more from the many I received: From Alice: “Wow, your latest article is really INTERESTING! Can Bouchard actually seal these public records? If it is proven that these funds were wrongfully billed, the Chancellor’s ass might be grass.. This is an angle that is a possible way to expose this possible corruption.” From Bob: “Judson, You are sure throwing some heavy stuff out there. The Democrats at Leg Hall are squirming big time. LOL Keep it up, you are making a difference !!!!” From Adam: “Jud, Isn’t there a FOIA REQUEST you could do to get those documents unsealed or some court action???” From Abner: “Judson, This is brutal. Unfortunately the boys and girls in the Delaware Legislature won’t ever remove Bouchard. However he might not get reappointed. Your articles are fun reading and the people are talking. Keep the pressure on. Best Regards.” From Lawrence: “Judson, Thank you for all the information you provide us. I believe Delaware is in horrific shape. If this f…ing Judge is half as bad as you surmise, we are in huge trouble. Love your articles.” From Erin: “Dear Judson, Great stuff. This work you are doing is really stirring the pot. Delaware has tremendous economic problems already. WHEN THE Franchise taxes disappear, God help us!” From Roy: “Hey Judson, Those documents should be open to the public. This Chancellor is a disgrace. Thanks for all you do keeping us informed.” From Kelly: “That corrupt bastard. Get him Jud. If anybody can do it you can! LOL” From Bill: “General Reid Beveridge’s recent letter to the editor regarding the demise of Republicans in Delaware and the list of three possibilities that might return Republicans to relevance in our state caught my attention. Of particular interest was his third point – the potential destruction of Delaware’s corporations franchise. It is no secret, to those who understand the corporations business, that the state’s proprietary revenue source is facing attacks from multiple fronts, including from within Delaware. I sincerely hope that the new crop of junior legislators take the time to truly understand what this business means to our state’s financial well being. “ From Eric: “Jud, Thanks for continuing to chip away at Chancellor Bouchard‘s armor! A recent Caesar Rodney institute email acknowledges that Delaware’s proprietary revenue source is facing attacks. Bouchard and his cronies are going to ruin it for us! What You are doing is important to all Delawareans. Please keep it up! ”     Folks, these comments from folks across Delaware from both sides of the political isle reflect a genuine concern about the integrity of the Chancery Court under Bouchard’s regime. Delaware’s sterling reputation as the best locale for businesses, with best equity court in the country, has plummeted. I again ask for justice on behalf of not only the thousands of TransPerfect employees that saw Custodian Bob Pincus cut their benefits and loot their company, but also justice for the citizens of Delaware! Someone must answer and be held accountable for the financial tragedy of the TransPerfect case — or our reputation will continue to sink more and more into the abyss. Lawmakers, it is time for these documents to be open for public scrutiny and an investigation of who the Chancery Court made rich with TransPerfect’s money. The law gives the public transparency on the courts. Make Bouchard follow the law and unseal the documents!  If you are one of my 6,000 Delawarean subscribers, you likely have a lot to be thankful for this holiday season. We live in the greatest democracy in the world. For the most part, threats to that democracy and freedom are taken head on. While it happens all over, there are now relatively few cases where the rich, the powerful, the politically connected get to prey on hard working men and women of our society. In Delaware, the only place where too much unchecked power has led to what I perceive as utter corruption is in the leaders of our judiciary. Chancellor Bouchard, bolstered by having his former intern as Chief Justice (Leo Strine), has in my view, created an environment where possible corruption and mismanagement is more than tolerated, it is both feared and exalted.   The combination of these two factors leads to a situation where no Delawarean will take action to even investigate Chancellor Bouchard, who in my opinion and in the opinion of hundreds of TransPerfect employees and perhaps thousands of onlookers, indirectly allowed $250 million to be moved out of a successful company to what appears to be the enrichment of those who the Chancellor has admitted having and established as long term friendships: Kevin Shannon of Potter Anderson and Bob Pincus of Skadden Arps, among others. While hundreds of members of the public scream for Bouchard to be at minimum, investigated, why does our legislature do nothing?!   From what I’ve heard, the Bouchard’s have Bentleys, Porsches, huge mansions in fancy neighborhoods, their kids fly around in private jets, and for this I hope they are grateful this holiday season. I demand justice for the countless employees, shareholders, officers of corporations and members of society that all pay a small “tax” to support Bouchard’s disgraceful operation, and because we do so without realizing it, the tables of every Delawarean are not as bountiful. Perhaps those who can do something about Bouchard apparently turn a blind-eye because they are making money as well? Or perhaps because they are too afraid to speak out against the Chancellor for fear of reprisal? All we read is nonsensical platitudes, no matter how crazy and unpredictable his actions. Believe me, it’s not because people in Delaware don’t know or suspect Bouchard has created appearances of impropriety!   Perhaps the most frustrating thing I have learned through my investigation and coverage of the TransPerfect case, is that many citizens feel the Chancellor is somehow operating in a suspicious and wrongful manner, but yet just shrug; “That’s the Delaware Way.” In my educated opinion, some cases could be decided while drinking expensive scotch in the country club conservatory. Indeed it’s enough to dishearten any patriotic American!   To the legislature; to the voters; and to members of the Delaware Bar Association who I see as acting as the front group supporting the Chancellor blindly, I think George Orwell may have said it best: “A people that elect corrupt politicians, imposters, thieves and traitors are not victims… but accomplices.” Orwell is right to an extent. If we want what I consider the Chancery Court corruption to stop, Delaware has to be willing to scrutinize the powerful. The cost of not doing so will be our reputation (which has already been compromised), our incorporation business, and our overall economy. I will have a simple plea I will make to our legislature: If you won’t begin an investigation, then, at minimum, make Bouchard unseal the case and make him show the public his friend’s bills he nefariously ordered paid with no examination.   There are literally thousands of employees who were irreparably harmed by Chancellor Bouchard seizing a situation — applying a corrupt and non-nonsensical remedy without precedent in the U.S. (maybe Russia?) — and engaging in the largest, single, I believe illegal wealth transfer in business history from honest hardworking TransPerfect employees into the pockets of the Chancellor’s elite country club friends. The case remains under a court-ordered seal. Hundreds, maybe into the thousands, of hours were billed that accounting employees claim were never worked! Apparently there is no itemization whatsoever?   My sources tell me that mainstream media sources have requested the sealed bills and files be opened, yet Bouchard refuses?! I say to our Chief Chancellor directly: “Unseal the records and let the public see what you and your friends have been up to. If you have done no wrong, you should have nothing to hide, no tracks to continue to cover. Open up the documents and invoices for scrutiny.”   Guess what your honor, the sale process is over, yet you still refuse to unseal the records?! Why??   The law supports unsealing the case when over, yet it seems that you continue to believe you are above the law, that you can play not only judge, but also jury and executioner — to thousands of employees at one of American’s most successful companies — and you and your cohorts think you can operate without full disclosure. It’s enough to make me, and any red-blooded American that cares about capitalism, property rights, and justice, sick.   If there is the slightest hint of corruption or even the appearance of corruption in the judiciary — it cannot stand. It cannot become the new norm. The cost to society, our children and our children’s children is too high. I believe you are not the man for this job, but while you are still in office, consider this the official request of the Coastal Network on behalf of my loyal readers. We formally request that you open the entire TransPerfect file. Why not clear the air Chancellor Bouchard and restore the public faith in your position, because the people of Delaware are skeptical?? Please prove my concerns wrong and show us these forced payments by TransPerfect under your authority and direction were justified and legitimate.   Again, while everyone is enjoying their holiday season, do not forget these many TransPerfect employees, many of whom make less than $50,000 per year, who are the ongoing victims of what I consider a possible $250 million fleecing!   It is the working employees and their families that are the true victims here. Folks, they scream for justice this holiday season. Unsealing and carefully scrutinizing these, definitive, court documents, that are public record by law anyway, is the least the Chancery Court can do. After 4 years of what I and many view as serious misappropriations and improprieties at the hands of a Delaware Chancellor, we owe these employees, and the public at large, complete transparency and closure.

The Wilmington History Society Hosts “A Deep Dive into the TransPerfect Case” and Welcomes TransPerfect CEO as a Surprise Guest Speaker

  On Wednesday, October 17th, The Wilmington History Society convened for an evening discussion with the purpose of taking “A Deep Dive into the TransPerfect Case.” The event would begin with Jacob Jeifa of the University of Delaware, giving society members an overview of the case. Following Mr. Jeifa’s presentation, the floor was open for questions, and an unlikely guest, Philip Shawe, CEO of TransPerfect Global, made an appearance to help aid the discussion.   At least one news outlet reported this was Mr. Shawe’s first foray south into Delaware since he wrested control of his successful company back from the Delaware Chancery Court. The court, in my view, has spent the last few years fleecing the pants off this successful company by forcing Shawe, with court orders, to pay $1,475 an hour for years to the Chancellor’s friend, Bob Pincus of Skadden Arps, not to mention an army of Pincus’ friends. From what I can see, given the amount of money Bouchard passed to engineer a $250 million wealth-transfer out of the company coffers (which ultimately came from the employees) and into the pockets of Bob Pincus, and other lawyers and Delaware elites, it is fair to say that Shawe could have been entering enemy territory going to this meeting in Wilmington. Many believe Shawe and TransPerfect to be the biggest victim of government corruption in modern history, courtesy of Chancellor Andre Bouchard.   I had the opportunity to interview Nathan Field, President of the Wilmington History Society, about how the evening’s events unfolded. While one might have expected a showdown at the OK Corral, I’m told it was a pleasant and informative evening with good questions and a lively debate.   “To hear so directly from a primary source, who was willing to answer any questions directly, was unusually informative,” Field said of Shawe being at the meeting. “It’s not often you get people like that in a bar, willing to answer any question you ask, so that part of the discussion was highly informative as well.”   I wish I could have been there — this man and his company are arguably the greatest victims of judicial corruption in our lifetime — and yet he’s willing to come down to help Delaware understand the case and it’s far reaching implications. I placed a call to Mr. Shawe’s New York offices, but did not hear back before press time.   Still, I commend both Shawe and the Wilmington History Society for their interest in fostering discussion aimed at educating the Delaware public on the case. In my view, the people of Delaware will be paying for the Bouchard-TransPerfect corruption in lost state income, lost jobs, and lower wages for long long time. Our incorporation rankings have definitely taken a beating like never before, and this is our state’s main source of income.   The study of history is largely premised in the notion that by society examining the mistakes of the past, it can avoid them for the future. I can only hope that history will not repeat itself. Shawe had to move his company out of Delaware to escape corruption– with Bouchard’s tentacles no longer siphoning TransPerfect’s bank accounts, it seems Shawe has little to gain by traveling to Delaware and sharing his view and his experiences, so I commend him for doing so.   I’m told a good deal of discussion centered around Justice Karin Valihura’s courageous Dissenting Opinion, in which at great personal peril, she took on Chief Justice Strine and Chancellor’s Bouchard’s ” Good Old Boy Network” — Declaring that Chancellor Bouchard as a neophyte judge had gone “Too far, too fast.” If anyone in Delaware would like to understand the Constitutional Issues at stake with Bouchard stealing Shawe’s stock and putting it up for auction, I encourage you to read Justice Valihura’s decision. It makes it fairly clear that Bouchard putting Shawe’s stock up for sale to benefit his former partner (and not-so-coincidentally, Bouchard’s bosom-buddy Kevin Shannon) was not only unconstitutional, but illegal under Delaware law.   What is the one huge mistake history will judge Delaware by? When faced with obvious abuse of power, abuse of process, and corruption, our legislature did very little. We can take solace in this from Election Day results: The righteous Senators Bonini and Richardson — who tried to stand up against the rich elites, the lawyers, and the “Judges Gone Wild” — got re-elected. Conversely, sell-outs like Greg Lavelle who ran Bouchard’s ZERO-QUESTION confirmation hearings, and stood by his side as if he was paid to do so — was handed walking papers in the form of an election defeat.   Please read the article below. While the title seems sensationalized based on the positive reports I’ve heard about the Wilmington History Society meeting, the article is solid. The establishment has some funny comments, basically: Yes, our Chancellors are unpredictable, but others are more unpredictable; and the Corporate Bar has lined up behind the Chancellor — shocker — given those folks have to go in front of him to argue for 9 more years (less, if there is any justice in this world!).   Finally, while the election didn’t go the way I’d envisioned for Republicans in Delaware, what’s most important is seeing Democracy thriving. No matter which party you side with, a sincere thank you to everyone who got out the vote on Tuesday!    Please click on the link below and read the article which is right on point.    

In Parting Shot, Shawe Hits Actions of Del. Courts as Reason for TransPerfect’s Nev. Move

By Tom McParland | October 23, 2018 at 05:45 PM

Explaining his decision to reincorporate his business in Nevada, TransPerfect co-founder and CEO Philip R. Shawe returned to Delaware last week to deliver a parting shot to the state’s legal establishment, saying the Delaware Court of Chancery was too quick to order the profitable translation software company to the auction block.

Despite ultimately prevailing in what came to be known as one of the most vexing and contentious cases in the recent history of the Chancery Court, Shawe said last week that the 2015 decision to force the sale of the deadlocked, but profitable, translation software company could have wide-ranging ramifications for Delaware, which sells itself to the corporate and startup communities as a stable, predictable court system.

“If that’s the standard, you could dissolve any company in America,”

Shawe said at an Oct. 17 event hosted by the Wilmington History Society.

The critique has gained some traction, including with one state Supreme Court justice, who said Chancellor Andre Bouchard had gone “too far too fast” in appointing a custodian to oversee a public auction. However, the bulk of the state’s corporate bar has lined up behind the chancellor, arguing that he followed the proper blueprint for resolving corporate deadlock under Delaware law.

The dispute centers on a rarely used provision of Delaware law, which grants the Chancery Court authority to breakup firms when their directors have reached a point of permanent impasse. Under the statute, codified in Section 226 of the Delaware General Corporation Law, a custodian is required to continue the business of a corporation, “except when the court shall otherwise order.”

Shawe, who initially opposed TransPerfect co-founder Elizabeth Elting’s petition to dissolve the company, argued that Bouchard opted to impose an “unpredictable application of Delaware law,” when other, less-intrusive steps could have been taken to resolve TransPerfect’s corporate deadlock.

Earlier this year, Shawe won his bid to purchase Elting’s 50 percent stake for $385 million, finally putting to rest a four-year legal saga between the former business partners and one-time finances over control of the company that they had started together out of a college dorm room. An outspoken critic of the Delaware judiciary, Shawe in late summer changed TransPerfect’s state of incorporation to Nevada, in part so that he would never have to litigate its internal corporate disputes in Delaware again.

“I think there’s a lot Delaware can learn from this case, if it wants to be a hospitable home for entrepreneurs,” he said in an interview.

Shawe said in an interview that Bouchard’s sale order had stretched the company’s resources and shaken the confidence of his senior management team. Instead, Shawe argued, Bouchard should have allowed the custodian to expand the company’s board in order to reach an internal resolution.

Last February, Delaware Supreme Court Justice Karen L. Valihura had recommended the appointment of a custodian in her lone dissent to a 4-1 opinion of the high court upholding the sale. In her opinion, Valihura said that Section 226 had never before been used to sell stock over a shareholder’s objection.

“The absence of authority grounded in the statute, the conceded absence of any similar cases under Section 226, and our common law’s strong preference for the least intrusive remedies in cases involving court-appointed custodians suggest that the chancellor went too far too fast in ordering the modified auction,” she wrote.

Shawe has since seized on Valihura’s dissent to argue that Bouchard’s decision had upset the stability that Delaware corporate law is known for.

But Francis G.X. Pileggi, vice chair of Eckert Seamans Cherin & Mellott’s commercial litigation practice, said Section 226 had functioned as it should in a case of corporate deadlock. Pileggi acknowledged that Valihura’s dissent had a “substantial amount of merit,” but he said that Section 226 cases are, by their nature, “almost inherently unpredictable.”

“Whenever there’s discretion involved, one vice chancellor may reach a different conclusion than another vice chancellor,” he said. “The predictability is that 226 is available to break the deadlock. The unpredictability is how the court decides to break the deadlock.”

Section 226, Pileggi said, only applies to a small group of tightly held companies that incorporate in Delaware, and its application in one case would not have much affect on the broader business community.

It is hard to predict the outcome of any lawsuit, he said, but Delaware has a history of applying the statute on a case-by-case basis and would be better equipped to handle the cases than its counterparts.

“If you don’t know how the Delaware court is going to rule,” he said, “it’s even more difficult to predict how another court is going to rule outside of Delaware.”

One of my readers sent me a note pointing out a comment that I missed made at the bottom of a Washington Post article. While the year-old article itself is the usual establishment rhetoric, the thorough comment under the article, which I’ve included below is spot on. I’m focusing on this public Washington Post link because I want Delawareans to know that people outside of our humble state are also seeing that there’s something rotten in our state’s judiciary. Even folks in our nation’s capitol are seeing that our suspect judiciary under Andre Bouchard (and his former intern at Skadden, Leo Stine) are the ones that are causing our incorporation and business confidence stats to plummet. There appears to be plenty of people out there who get it. If you want to know who benefited from destroying Delaware’s business-friendly image, and in turn, Delaware’s economic prosperity, one needn’t follow the complex money trail — that in my view, would eventually lead to Bouchard’s luxorious Bentley — we can look no further in my opinion. I would say just look at Skadden Arps’ and Potter Anderson’s bank accounts. Chancery Court favoritism and corruption has bled our state’s reputation dry, while seemingly to me simply feathering the retirement nests of Bouchard’s unscrupulous henchmen, Robert Pincus and Kevin Shannon. And just so you think I’m not the only one who is seeing things this way; this Washington Post piece has been up for a year — capturing the nation’s frustration with Bouchard’s nefarious actions in America’s First State.   I’ve written about the handling of the TransPerfect Global case, which has dragged down the reputation of our fine state — remember TransPerfect didn’t need “saving” — it was the largest, fastest-growing, and most profitable company of it’s kind.   Bouchard — with his clerk and now cushy Skadden job holder Mary Toscana ( possible payola!) – wrote what I believe are 105-pages of unsupported lies to justify the government take over of this company — and bleed it dry. The Chancery Court still seeks to mask the money trail from the public – One prominent lawyer mentioned to me this case has the most sealed documents in Delaware history. Make no mistake, there’s no reason for these court records to be sealed; they are simply evidence of how much cash was siphoned from the TransPerfect company coffers by those firms which I believe Bouchard empowered to run the company while he guaranteed them judicial immunity (no matter how corrupt). Again, the Chancellor is not above the law, and the public has a right to know.  
  Washington Post Letter writer, nearly one year ago today:  

“Stephen Gandel failed miserably in writing this garbage article. The courts in Delaware aren’t the saviors of this company – they’re actually a corrupt group of attorneys stealing a company from an owner and employees who want to keep it alive. Please report how the judge, Bouchard, handed the case to his friend and plaintiff’s attorney, Kevin Shannon. Report on how Bouchard appointed his former colleague, Robert Pincus, as the custodian to force the sale of the company. Report how the Delaware Supreme Court Chief Justice, Leo Strine, who affirmed Bouchard’s forced sale of the company, is a former colleague of Bouchard. Report how Bouchard, Pincus and Strine all worked/work for law firm Skadden Arps, and now Pincus bills TransPerfect $1,400 per hour to hire his firm’s friends to fleece the company. Report how Skadden’s clients, HIG who owns Lionbridge – TransPerfect’s largest competitor, is “bidding” on the company. Report how Credit Suisse, who owns the debt for Lionbridge/HIG, is consulting for Skadden on this forced sale. Report how Bouchard rubber stamps Bouchard’s bills to TransPerfect for millions of dollars, without letting the public see those bills – while cutting benefits for the TransPerfect employees, which has caused dozens of high-level execs to leave the company in the last two weeks. The “story” is that the court decided to force the sale of the company to “save” the company from the two owners’ bickering. The reality is that the court’s forced sale will ultimately dismantle the company and move thousands of american jobs offshore, so Skadden’s client, HIG/Lionbridge, will be able to service the debt owed to Credit Suisse when HIG “bought” Lionbridge. This is a scam perpetuated by shady lawyers, and the Delaware legislature is doing nothing. Delaware may be the smallest state in the union, but it is making NJ and IL look small time when it comes to corruption and cronyism. Where is the DOJ? Here’s your career case! Just look.”

-John Bruce Dont

  As the letter writer stated, he sees this as a scam put forth by sophisticated and dishonest lawyers – how long can our elected leaders sit by and do nothing, as hardworking Delawareans, certainly seem from my perspective, to lie on a bed of Bouchard’s corrupt weeds growing up to choke us. When will the Chancellor have to answer for his actions? The establishment protecting men in robes from their obvious improprieties didn’t work out so well for the Catholic Church — I’m not sure why legislators believe the Chancery Court is any different.   Check out the old, fallacious, and misleading article that the Washington Post letter writer went after.      One might believe the legislature needn’t pass SB 53, because it already did such incredible vetting of Andre Bouchard before placing an attorney from private practice, with zero bench experience, into one of the most powerful jobs in the world; way too powerful in my opinion. Except, they’d be wrong. After watching Senator Elizabeth Warren’s endless ripping up of Supreme Court Justice Gorsuch before his confirmation, I thought it would be interesting to see what diligence the Delaware legislature did in confirming Bouchard as Delaware’s Chancellor?? Why should TransPefect Global owners and employees have been worried about how Bouchard would legislate this case? They assumed this judge would rule fairly because he was supposed to be well-versed in the law, judicial ethics, the Constitution, and his Chancery Court powers?? Ahead of his approval to the bench, was Bouchard asked the following questions?: Would you apply the law fair and impartially? No he was not asked! Will you govern your decision by U.S. Constitution? No he was not asked! Was he asked whether he was familiar with the Constitution? No, he was not! Did anyone even ask him if he read the Constitution?! No! Was he asked how he would apply what he knew about the Constitution? 
No! Was he asked about his politics and if he would remain impartial? No! Was he asked about how he saw his role as head of Delaware’s Court of Equity? No! Did anyone ask him ANY tough questions at all? Not a single question! Was he asked what he knew about being a judge? No. How do I know the answer is no to all these questions? Folks, there were Zero questions in his 13 minute hearing — I can prove it. Now is the chance to make this right, by contacting your Delaware State Senators! Please get involved and help pass SB 53! Mistakes and mis-judgements like this only matter if we don’t take action in the present. I’m appealing to our lawmakers in Delaware… now is the time to help! There have been hundreds of articles in the U.S. and around the globe about how this case has been mishandled and may hurt jobs at TransPerfect and hurt Delaware too! Plea with your legislators to help now. Folks, now is the time where we can make this right! It took just 13 minutes for Chancellor Bouchard to get rubber-stamped by the Senate’s Executive Committee in 2014. Unanimous vote. Can you see the cronyism that exists at a high-degree in America’s First State. Buying a new pair of shoes has been known to take longer! Please look at this story below from just two years ago by Celia Cohen about our esteemed Chancellor of Delaware’s equity court, the Court of Chancery, which is famous for its fair decisions, which is one of the reasons Delaware is the nation’s incorporation leader. Read about Bouchard’s 13-mintues below, and see for yourself my friends:  

SPEED-VOTING FOR CHANCELLOR

By Celia Cohen

Posted: April 10, 2014

Grapevine Political Writer

 

“Thirteen minutes were all it took for Delaware to get a new chancellor.

Seven minutes for a confirmation hearing by the Senate’s Executive Committee, another six minutes for consideration by the full Senate for a unanimous 21-0 vote on Wednesday in Legislative Hall in Dover, and that was that.

It put Andy Bouchard a swearing-in ceremony away from the most storied judgeship in the state as the chief of the Court of Chancery, the famed forum for corporate law.

Buying a new pair of shoes has been known to take longer. A lot longer.

It went so fast that Greg Lavelle, the Republican minority whip, felt compelled to explain the rapid roll call, almost sheepishly, to a visiting delegation of lawmakers from Kenya.

“For our guests, sometimes this is worth repeating, there’s a nominating process for all these positions, a lot of vetting, a lot of interviews and discussions. While there are not any questions here today, the questions have been asked on the front side of these proceedings,” Lavelle said.

Without the words to the Kenyans, Bouchard could have been out of there in twelve minutes.

Still, Lavelle had something there. This is the way it goes in a small state, where everybody knows everybody else or at least they like to think they do. Even the official nominating channels — with candidates passing from the Judicial Nominating Commission to the governor to the Senate — seem to hold less sway than the informal evaluation that goes on.

Bouchard, who will be leaving behind a corporate practice at Bouchard Margules & Friedlander, is a well-regarded presence in legal circles. If he was not a unanimous choice for chancellor among the bench and bar — and who would be? — there was certainly a consensus he was up to it.

The downside to the small-state familiarity that makes a known quantity out of its judicial candidates is the coziness that goes with it.

Ever since Myron Steele announced shortly after Labor Day he would be stepping down as chief justice, it was regarded as a foregone conclusion that Leo Strine Jr. would be elevated from chancellor to chief justice with Bouchard in line to take over in Chancery.

While there was nevertheless a robust pool of applicants for chief justice, the sense of inevitability prevailed by the time it came to choose a chancellor, and the Judicial Nominating Commission was left to beg for candidates not named Bouchard.

Bouchard has 30 days from his confirmation to take his judicial oath for a 12-year term.

He is a graduate of Salesianum, Boston College and Harvard Law, and he chaired the Judicial Nominating Commission until he left it to apply himself. He was a regular contributor to Democratic campaigns, although those contributions have to stop now, with checks going to Jack Markell, the governor who appointed him, as well as the vice president and the congressional delegation.

Another reason for the speed-voting on Bouchard may well be judgeship fatigue.

The Senate had to plow through nine confirmations for judges last year, and it has handled the nominations for chief justice and chancellor, the state’s premier judicial assignments, this year.

Nor is it done yet. Not only is there a Superior Court opening, but Jack Jacobs, a Supreme Court justice, unexpectedly announced his retirement as of July 4.

Since Jacobs is departing four days after the legislature’s regular session ends on June 30, the Senate will have to return for a special session, probably in August or September, just as the campaign season is coming on.

If Jacobs’ replacement is drawn from a lower court, it would mean yet another special session.

At least Bouchard comes from private practice, so nobody has to be nominated to replace him.”

There was a great novel, among others, written by legal mystery author John Grisham, called “The Firm”. A movie was also made of it where Tom Cruise played a blossoming young lawyer in a law firm that worked exclusively for organized crime and would go to unlimited lengths to protect its secrets. Many of you probably have read the book and seen the movie, as indeed I have as well. The book and the box office smash hit movie “The Firm” have some significance in its plot in relation to the TransPerfect story, except this is real life. Hold that thought.   You might remember the outrageous situation that happened during the TransPerfect saga where Chancellor Andre Bouchard appointed his former colleague from Skadden Arps, Robert Pincus, as a Custodian with unlimited power to potentially bilk this successful company. Pincus billed a whopping $25 million for himself and his firm for attending a once per month board meeting, and court-ordered over $250 million in legal Billings — all a reward for him for failing as mediator and allowing the case to drag on for years — and also drag Delaware’s name through the dirt. He and his cronies, as I understand it from my reliable resources, are a virtual who’s-who of suspected “over billers” including Alvarez & Marsal, Grant Thorton, Houlian Lokey and Credit Suisse. They seemingly, from all the vast sums of actual capital removed, set up a virtual cottage industry around emptying TransPerfect’s once-full coffers to feather their own nests?   One reason this case went on for 4 YEARS, and left this industry leader virtually penniless, from my perspective, is simply because these “prestigious firms” lined up to stuff their faces full with unchecked billing. A New York judge recently called behavior, not nearly as God-awful as the TransPerfect case, “Highway robbery without the six-gun,” for an amount involving 1/100th of what TransPerfect lost.   Further exacerbating the appearances of improprieties is the Skadden Arps $25 million, and much of the other $250 million spent that were ordered by the Court, yet were conveniently unverifiable, because in yet another shady and unprecedented move, Chancellor Bouchard allowed these bills to be paid without demanding checks or itemization. Folks, this unbelievable and unethical action really did happen, and is a matter of public record. Legitimate bills or state sanctioned theft — which is it? You can’t decide because Bouchard’s crew masked public transparency by billing only line items such as “$2 million for legal services” (and that’s for ONE month) and by getting the court to seal documents. I heard from one Chancery Court insider that the TransPerfect case has the most sealed documents in the history of Delaware and we are obviously not dealing with national security issues — just an embarrassed judiciary looking to cover their tracks.   According to my reliable sources within the company, none of what actually transpired at TransPerfect was actually necessary. And folks, a lot of people got filthy rich at the rate of $1,450 per hour because of Bouchard hooking them up. Interestingly, Pincus has now retired, and another source has confirmed that Skadden’s pension is based on a partners’ last 3 years of billing — How convenient! The good ole boy backscratching never stops and continues even in the face of scrutiny with today’s news.   There is a woman, named Mary Toscano, who was Chancellor Bouchard’s law clerk on the TransPerfect case. My research indicates that Ms. Toscano is widely believed, within TransPerfect, to be responsible for helping Bouchard in many ways and indirectly creating many of these problems. These actions in my opinion helped to justify Bouchard’s first-ever government takeover of a private profitable company — and this in turn apparently resulted in over $250 million in corporate waste that enriched Bouchard’s friends, and his friend’s friends, beyond belief.   She is also thought to be chiefly responsible for getting the custodian’s unchecked and unitemized bills in the TransPerfect Case approved by the court to be paid. The custodian, Robert Pincus, who was appointed by Bouchard had his bills approved, I’ll make this point once more — without itemization! Millions and millions of dollars went to Pincus. In exchange for rubber stamping bills often in the millions for one month’s “work” — using the term loosely, my opinion is that she is now being given a cushy job at Skadden as payback, and this presents yet another appearance of impropriety that should be investigated and stopped. Perhaps this job buys her silence?   Could this be a clever move for Skadden to lock up Mary Toscano with a higher-paying attorney job, which will probably result in shielding her from ever having to testify against Bouchard? Who knows what really happened, regarding Ms. Toscano’s employment with Bouchard’s friends?   Only in Delaware folks and just when our Chamber of Commerce rankings of Delaware’s top economic driver, the incorporation business, has plummeted based on the Chancellor’s perceived improper renderings and directives. Without legislative reform curbing their unchecked power, Skadden and Bouchard can easily use Delaware to possibly and continually to take advantage of companies to enrich themselves and their friends. Let’s not forget, Bouchard was a plaintiff attorney that sought to sue companies after every merger, saying the price was too low regardless of how it was priced — for those of you that aren’t in this circle it is my opinion: Bouchard was the corporate lawyer equivalent to an ambulance chaser.   And let’s not forget Skadden Arps — Reminiscent of the movie “The Firm”, with so much possible connection with wrongdoing attributed to this law firm by the media, is it really a stretch to believe this seemingly-suspect organization’s tentacles extend to the Wilmington office? Or perhaps they even originate there?    Famous law professor and trial lawyer Alan Dershowitz said of the Strine-Bouchard duo, “Any attorney who advises his client to incorporate in the State of Delaware is tantamount to legal malpractice!” Delaware has now dropped from 2nd place to 27th place nationally for being business friendly according to the “Thumbtact Small Business Survey.” Folks this is extremely detrimental for the future of Delaware’s economy. One third of all of Delaware’s revenue comes from corporate franchise fees. This comes after Delaware dropped from a significant #1 to a pathetic #11 for Judicial fairness from the National Chamber of Commerce survey. Delaware’s formerly esteemed Chancery Court has lost its great reputation which is why Delaware was the incorporation capital of the world in the first place. It is obvious that Bouchard’s actions in the TransPerfect case were part of the reason. These are two, separate, gigantic drops, folks and Delaware will definitely feel the pain.    It’s no coincidence that the large drops for Delaware have come as the TransPerfect Global case was making headlines over the past couple of years! The Chancery Court and its assigned players operating the TransPerfect Global case under the auspices of Delaware’s Chancellor has seemingly turned out to be terribly detrimental for the state of Delaware.    The TransPerfect adjudication by Chancellor Andre Bouchard was completely outrageous and unprecedented. The way it was handled should be totally unacceptable to any reasonable litigator. Millions of dollars were wrongfully forced to be spent by a Chancellor who legislated from the bench while making unprecedented and inequitable rulings. Equity is what is supposed to happen in the Delaware Court of Chancery, not the incessant and apparent feathering of nests for the benefit of the Chancellor’s good buddies and his former law partners?   Consider that in a 4-year TrasnPerfect litigation, Co-CEO Elizabeth Elting called zero fact witnesses, and had zero affidavits, which is the least evidence in a Delaware civil trial that I am aware of ever being offered by the Plaintiff? Co-CEO Philip Shawe called all 10 witnesses in the case, all testifying on his behalf. He had 43 more waiting to testify and had over 120 affidavits. Then, in front of a hundred employees per day that traveled down to Wilmington to support Shawe, Bouchard found for Elting in 2015 and ordered the company dissolved and sold. This crazy ruling shocked the TransPerfect employees beyond belief, and that’s when the wave of Delaware corruption rumors began circulating like wildfire.   In my opinion, Elting got the auction result she asked for in 2015; not because it was the right solution, indeed it was certainly without precedent, but because this allowed a vehicle, for what now appears, the moving of large sums of capital from TransPerfect’s coffers to that of a Court appointed Custodian who was a former business partner and friend of Delaware’s Chancellor. Folks, I am talking about over $25 million billed dollars that were not itemized and were approved for payment anyway by Chancellor Andre Bouchard. If there ever was the appearance of an impropriety, in my opinion this was it !   Elting’s lawyer, Kevin Shannon, is a life-long friend of Chancellor Bouchard’s. Bouchard has admitted he was friends with his appointed Custodian Robert Pincus and folks– Pincus comes from Bouchard’s old law firm. Bouchard traveled to New Orleans, and made a public appearance with Shannon, during the decision-making phase of the trial. Beyond any doubt, this is an appearance of an impropriety. Every other lawyer was made to itemize their fees, making them subject to challenge. Which lawyers didn’t have to? You guessed it.    Shawe won in the end. His winning “auction bid” was $385 million, but he’d offered $300 million publicly half-way through the litigation, 2 years ago. $250 million has been the widely reported estimated legal cost (I estimate higher), this means that roughly, the Chancery Court spent an extra $125 million of shareholder money (and took an extra two years of employees lives), only to get an $85 million dollar increase in value. This was not really “value maximizing” to the shareholders was it Chancellor Andre Bouchard? Whose value did you maximize, I wonder? Another Appearance of an Impropriety ?   There is no doubt in my mind, that Delaware has recently dropped from #1 to #11 in Judicial fairness, and a devastating drop from #2 to #27 for Delaware being friendly to small businesses, has happened in my view, because of the shady way the TransPerfect case was handled. At least when Delaware economics sinks further and further into the red, we’ll know who to point our fingers at. I guess that’s something, but it’s not enough, there should be an investigation.    Most importantly, I feel it is time for the General Assembly to act by responding to these significant drops in national recognition with necessary changes in the law — changes that will restore faith in Delaware’s judiciary so that businesses will continue to incorporate in Delaware and prosper accordingly. Please read the article below.        

Delaware slips from second to 27th in Thumbtack small business survey

By Delaware Business Now

August 16, 2018

Delaware saw its No. 2 ranking head south in the Thumbtack 2018 small business survey.Small business owners surveyed by Thumbtack, gave Delaware a B- this year, ranking 27th in a survey of business friendliness in all 50 states.Thumbtack is a website and app that finds local professionals.

That’s 25 spots lower than last year when the state ranked second and received an A+. Delaware scored higher than New Jersey (D+), but lower than Maryland (B+).

State leaders had been taking note of the positive 2017 findings from Thumbtack as surveys from CNBC and others gave Delaware low business rankings.“The biggest slip this year for Delaware was in its training and networking programs. In 2017, it received an A grade, with 27 pecent of our respondents saying that they or their business had benefited from a training or networking program,” Thumbtack economist Lucas Puente, stated in an Email message. “However, this year, only 10 percent of the small business owners we heard from had used such a program. This drop in usage led the state to get an F for its training and networking programs this year.”

Another noticeable decline came in tax regulations Puente noted Last year, 45 percent said that tax-based regulations were friendly towards small businesses; this year, only 34 percent did.

Its 2018 Small Business Friendliness Survey, ranked all 50 states and 57 cities based on factors that included licensing requirements, tax regulations, and labor and hiring regulations. With over 7,500 small business owners surveyed, it’s the largest continuous study of small business perceptions of local government policy in the U.S, according to a release.

Based on the evaluations in surveys, Thumbtack also assigned eight policy-specific grades to evaluate how easy local governments make it to start, operate, and grow a small business. For more details about the report and the full set of results for Delaware, please visit Thumbtack.com/DE.

It pains me to say this: But having covered the TransPerfect Global case closer than anyone for the last couple of years and talking to many employees who had their lives turned upside down by the Delaware Courts, I am happy to see the American success story known as TransPerfect finally being able to escape the tentacles of our Chancery Court and Chief Chancellor Bouchard. Thankfully, it wasn’t sold to a private equity shop, which may have laid off thousands of workers with the intention of trimming the company and flipping it a few years later. Ultimately, the employees won, and jobs were not lost.   But at what price? Did the Court of Chancery really do equity here by causing the litigants to incur $250 million in fees to resolve ownership of a company that does $600+ million in revenue? It would take years for the company to recoup those costs! It’s obscene, it’s outrageous and in my opinion — nothing less than a money grab by the Delaware Bar and what amounts to State sanctioned theft.   Why would corporations want to incorporate here when they start to realize that their biggest business losses can occur when they try and get something done in Delaware. Let’s be clear folks: The greed of the Delaware judiciary and its lawyers have made Delaware a “business unfriendly” state. The only people who won here were lawyers, Delaware elites, and those hired by them. The legislature should form a special committee to investigate the whole TransPerfect case so that the Delaware attorneys and Chancellor Bouchard can explain their actions and open their books to the public (which they have shockingly refused to do to date ). In order to survive, Delaware needs transparency, now!   When litigants come to Delaware and see Chancellor Bouchard pulling up in his Bentley, they will probably be thinking about the TransPerfect case.    Reading the piece below about TransPerfect moving its corporate headquarters from Delaware to Nevada, I thought, bravo TransPerfect! Very smart for those guys to get out of the state where we have no checks and balances on the judiciary’s power. I mean, the Chief Justice of Supreme Court was Bouchard’s summer intern! I am erxtremely sad for Delaware, but overjoyed for TransPerfect.    TransPerfect employees and shareholders weren’t the only losers here. What Delaware lost and is losing in our reputation and our image is priceless. Frankly, in my view, it is lost at the hands of a greedy bunch of powerful cronies who have the ability to bleed companies and their shareholders dry. Judges who legislate from the bench and have relationships with attorneys, creates the appearance of an impropriety and all the while, it seems our elected officials just stand by and do nothing. If you followed the recent Facebook case in Delaware, the fees requested in that case were $129 million! We have reached a seminal moment for the Delaware judiciary and for the people of this great State! Can the corruption run any deeper?    Under the leadership of Chief Chancellor Bouchard, our state fell from #1 to #11 after 15 years of dominating the corporate confidence survey and I’m worried that the Delaware Bar Association and Delaware’s Supreme Court will continue to turn a blind eye as more and more corporations question the reliability and impartiality of the Delaware Chancery.   The story below says that TransPerfect Global and 7 of its operating subsidiaries have moved to Nevada. The move has been called “Dexit”, as in Delaware-exit.   Some of TransPerfect’s employees in my 6,000+ readership-base think I’ve been their only voice, yet now I ask them to be my voice: To the employees and to TransPerfect CEO Phil Shawe, I say this:   I understand why you’re leaving — if someone took a quarter-billion from me, I’d leave too — but stay! Please don’t turn tail and run now that you’ve won. Delaware is a good state with good people. You are the only business people who are bold and dogged enough to challenge the cronyism that is rampant in Delaware, and to possibly get legislation passed that will reform a judiciary gone amok. With you leaving, what about the rest of us? You have the means and the motivation to make a real difference here — to save Delaware from itself. How will you feel when the next $100 million in legal fees is awarded? Beyond Delaware, think about how many future management teams and shareholders you can save from the heinous, legal crap that befell you at a cost of millions of dollars.   Speaking for Delawareans as a whole, we don’t want more private jets for plaintiffs attorneys and Bentleys for judges. We want change and we want our reputation back. Consider coming back to Delaware and being part of the solution? Now that you have nothing to gain or lose, perhaps our legislators will listen. Please read the article below.  

Industry News

TransPerfect Moves Corporate Headquarters to Nevada

by Andrew Smart on August 13, 2018

TransPerfect wasted no time in moving its corporate domicile from Delaware to Nevada once the deadline for Co-founder Liz Elting to file an appeal with the U.S. Supreme Court passed on August 1, 2018, without incident.

The move puts closure and distance between the world’s largest language service provider (LSP) and the Delaware Court of Chancery, which had appointed Custodian Robert Pincus to auction the company.

TransPerfect Co-founder Phil Shawe eventually won the competitive auction process and completed the buyout in May 2018, enabling the company to restart acquisitions and relocate to Nevada.

Expensive Litigation

For four years beginning 2014, the legal battles for control of TransPerfect were amongst the most acrimonious seen in American corporate history. While Shawe declined to comment on the legal and custodian costs for this story, Crain’s reported that USD 250m in legal fees were spent by all parties on at least 20 lawsuits involving 30 law firms.

The Court of Chancery in Delaware, where TransPerfect was domiciled, would take center stage in these battles. In June 2016, it ruled that the company would be sold in an auction in which Shawe would be forced to participate while he contested its legality at the same time.

The auction began with 97 potential participants, ran four bidding rounds and ended with Shawe securing the bid for USD 770m in a neck-and-neck finish with H.I.G. Capital, the private equity owner of Lionbridge.

In an email statement to Slator in May 2018, Shawe said “Personally, I feel both pleased and vindicated to have won the auction and to now be in a position to ensure that TransPerfect’s successful business model will be maintained into the foreseeable future.”

Debt Financing

Shawe purchased all of Elting’s shares for USD 385m in cash, yielding her about USD 287m in after-tax net proceeds. “TransPerfect and I used Owl Rock’s debt financing to buy out my former partner,” Shawe confirmed to Slator for this story. He declined to provide the type and amount of debt raised.

Shawe added that “Property rights advocates should perhaps be happy to know that TransPerfect’s third shareholder, Shirley Shawe, was, in the end, able to keep her (1%) stake in the company – private property which she feared could have been taken by the government, against her will, and sold to a third-party – a litigation outcome unprecedented in U.S. history for a private, profitable firm.”

With the purchase approved by the Delaware Supreme Court and completed in May 2018, Liz Elting had until August 1, 2018 to file an appeal with the United States Supreme Court. The deadline passed and TransPerfect wasted no time moving its corporate domicile to Nevada.

TransPerfect’s Dexit

Shawe confirmed to Slator that “as of August 6th, our parent company, TransPerfect Global, Inc. and all seven of its operating subsidiaries which were domiciled in Delaware, have moved to Nevada.” The move has been called “Dexit” by insiders.

“For years, most companies – including ours – considered Delaware the default option for incorporation” Shawe told Slator. “But times and circumstances have changed and other states, Nevada chiefly among them, now represent a compelling alternative.”

He added that “Nevada has a reputation for low taxes, privacy, lower litigation costs, a rational and predictable judiciary, as well as for protecting officers, directors, managers, employees and stockholders. It is an extremely business friendly locale.”

A Return to M&A

TransPerfect has emerged as a formidable player in the language industry, with revenues up 12% to USD 615m in 2017. Even more remarkably, the company managed to organically grow revenue by nearly 20% to USD 337m in the first half of 2018.

The growth, according to Shawe, is broad based across “every industry vertical we service. We’re also seeing significant growth in both our services and technology revenue streams. Geographically, it’s the same story, the Americas, Europe, and Asia are all up compared to last year.”

“If we had an extremely compelling use of funds, we’d raise the capital necessary, either in the private or public markets”

When asked if M&A would also be part of its growth strategy going forward, Shawe replied “Yes. We are looking for M&A candidates in the services space (…). In the technology space, we are looking for strategic software purchases that would fit well in our existing technology stack.”

Less certain is whether TransPerfect will go public and use its shares as a source of capital in acquisitions as RWS, Keywords Studios and SDL have done.

“We’re more apt to view ‘going public’ as we would any other means of raising capital” said Shawe. “If we had an extremely compelling use of funds, we’d raise the capital necessary, either in the private or public markets.”

Dear Friends,   Thank you for your support and feedback on my investigative journalism with the TransPerfect case. We shed light where it needed to be brightest and in doing so we wanted to be sure other successful companies don’t get dragged through the potential government takeover that TransPerfect experienced over the past three years. With your support I was able to help protect Delaware’s business reputation, which drives our state economy here in Delaware.    Rather than recap the case, which I did in a recent column, let’s get right to the feedback from you good folks, the real stars of this column and all 6,000 of you, who are the true force behind my voice and whatever impact we made in Delaware and the TransPerfect case.   Here are the top remarks I received. There were so many, I decided to narrow it to a baker’s dozen!   Enjoy:   1) From Sarah B:    Why do I feel like the dam is only beginning to crack in Delaware? Keep letting us know what is going on!   2) From Rick:     There are layers and layers to this case. This is truly bad for our state. How could this happen and how can we stop it from happening again?    3) From Grant:    Great Job — Delawareans are really in tune with the problems in our Judiciary because of you. You have been an inspiration over the years.    4) From Phil D:    Thank you for the work you have done. The TransPerfect case which you brought to us has been fascinating. Once we became hooked, we couldn’t hear enough about it. Really happy that CEO Shawe won the bid.   5) From Corinnia:   “Great news, Judson!”    6) From Claire:   “Amazing, Amazing, Amazing — AMEN”   7) From Gene:   “A lot like Mueller’s collusion case”   8) From Sebastian:    “Thank goodness Delaware was not responsible for one of the worst cases I’ve seen in my many years following the Chancery Court.”    9) From John:   “Outstanding effort on your part Jud!”   10) From Gail:   “Yay, Jud ! Congratulations to you for all your hard work on this!”   11) From Elizabeth:    “I couldn’t hear enough about this case. I was so worried for those employees. I really thought those jobs were going to be lost!”    12) From Bryant:   “Thank you for keeping us up to date on this Court Case.”   13) From Sam:   “Jud, the people of Delaware now know that there is corruption in the judicial system. I am so happy Shawe prevailed. Good job on your reporting.”     These are the top comments from you good folks. Keep them coming, I truly appreciate it. Let’s keep Delaware honest for all of the nation to see! We have to keep those in power in Delaware in check to restore Delaware’s credibility.   Thank you for your continued input.   JUDSON Bennett-Coastal Network  For those of you who run in loftier circles than I, and perhaps have an Ivy League education or a law degree, here’s a look at the TransPerfect Global case from a legal perspective. I have been shouting for years about the gravity and prevalence of legal “errors” and the repercussions for the Delaware economy, but here is a Law Review Article that will help lay out some of the many legal issues. Unfortunately, this is probably the first of many.   So again, for those thinking I was droning on about the Chancery Court destroying the American Dream for employees and business owners throughout the country with the TransPerfect case, without the proper background, please take a look at this Law Review Article.   As we climb back from our current crisis, and the carnage the Chancery Court (Andre Bouchard) and the Supreme Court (Leo Strine) did to our state, which plummeted Delaware down to #11 in incorporation confidence (after a 15-year run in first place), it is imperative that we understand the dangerous precedents and events that occurred around the $300 million TransPerfect fiasco.   To reverse the crisis our elites created, we must, at a minimum take steps to ensure this never happens to another successful American business again!   Stay tuned and see below.  I’ve pulled some relevant and interesting quotes that focus on the Chancery Courts missteps from the Law Review piece:  
    “The Delaware Supreme Court erred in two respects. First, the court affirmed the Court of Chancery’s expansive reasoning with respect to the ‘irreparable harm’ requirement …and instead accepted the Court of Chancery’s proposition that irreparable harm may encompass things like severely diminished employee morale, client skepticism, and failure to benefit from proposed acquisitions. The court focused on this erroneous interpretation of irreparable harm expansively…”   “Second, the court improperly affirmed the Court of Chancery’s grant of expansive custodial authority… the court accepted a custodial sale as the only means of appropriate relief without first implementing viable alternative remedies.”   “Also highlighted in this Law Review: “it is unlikely that the Delaware General Assembly intended to permit the Court of Chancery to order the whole sale of a company to a third party.”   An especially relevant quote regarding Justice Valihura:   “In her dissent, Justice Valihura pointed to two main principles undermining the majority’s decision. In her analysis… Justice Valihura concluded that stockholders’personal property rights are not meant to be abridged by mere implication.”   Some of the relevant quotes that focus on the Delaware Supreme Courts missteps:   “In affirming the Court of Chancery’s decision, the Delaware SupremeCourt erred in two ways. First, the court affirmed the Court of Chancery’s incorrect reasoning with respect to the “irreparable harm” requirement of Section 226… It ignored longstanding jurisprudence requiring a demonstration of imminent insolvency or loss of revenue, and instead accepted the Court of Chancery’s expansive proposition that irreparable harm may be deemed to encompass severely diminished employee morale, client skepticism, and failure to benefit from proposed acquisitions.”   “Second, the court improperly affirmed the Court of Chancery’s massive grant of custodial authority in that it did not consider less intrusive alternatives and ordered a sale despite shareholder objections—an unprecedented judicial act.”   “The court summarily accepted a custodial sale as the only means of appropriate relief, without considering that its equitable power—though significantly broad—may have some limit.”  

    For anyone who truly doesn’t understand the ramifications of this case, please see this link:   http://digitalcommons.law.umaryland.edu/cgi/viewcontent.cgi?article=3796&context=mlr  

Maryland Law Review 

Shawe v. Elting: The Imperfect Sale of TransPerfect Global, Inc.

by Sarah M. Samaha

INTRODUCTION

In Shawe v. Elting, 1 the Delaware Supreme Court held that the Court of Chancery properly exercised its equitable powers under Delaware’s custodian statute when, upon finding the presence of shareholder and director deadlock, it appointed a custodian to sell a massively profitable corporation to a third party.

Phillip Shawe and Elizabeth Elting were the co-founders, co-CEOs, and the only two directors of TransPerfect Global, Inc. The closely held corporation was structured such that Shawe and Elting behaved as fifty-fifty owners of the company. In the absence of a written agreement governing the rights of stockholders, the personal and business relationships between Shawe and Elting devolved into irresolvable dysfunction, and the parties were left with no intra-corporate recourse.

In the litigation that ensued, the Court of Chancery found that the deadlock between Shawe and Elting satisfied the threshold requirements of Section 226 of the Delaware General Corporation Law and appointed a custodian to force a sale of the multi-million dollar corporation to a third party, despite Shawe’s objections.

The Delaware Supreme Court affirmed the decision, holding that the custodian statute’s grant of power was broad enough to authorize the Court of Chancery to issue such a remedy. The Delaware Supreme Court erred in two respects. First, the court affirmed the Court of Chancery’s expansive reasoning with respect to the “irreparable harm” requirement of Section 226. In doing so, it ignored longstanding jurisprudence requiring a demonstration of imminent insolvency or loss of revenue to the corporation in question, and instead accepted the Court of Chancery’s proposition that irreparable harm may encompass things like severely diminished employee morale, client skepticism, and failure to benefit from proposed acquisitions.

The court focused on this erroneous interpretation of irreparable harm expansively, despite the fact that custodianship was warranted regardless under Section 226. This Note argues that this nonessential dictum seems to have been used to illustrate some degree of proportionality between the alleged harm to the corporation and the extremity of the remedy ordered. Second, the court improperly affirmed the Court of Chancery’s grant of expansive custodial authority. Section 226 jurisprudence indicates the reluctance with which Delaware courts have ordered the intrusive custodianship remedy, and emphasizes the principle that a custodian’s authority should be as narrowly tailored as possible.

The court accepted a custodial sale as the only means of appropriate relief without first implementing viable alternative remedies. Further, in holding as it did, the court failed to recognize that the language and prior application of Section 226 does not provide stockholders with notice that a remedy as drastic as a forced sale of their company might occur, absent their consent.

(See link and/or attached story for more.) 

Just when we thought the amazing, legal saga of the TransPerfect Global case was over, the seemingly money-obsessed “woe-is-me” plaintiff, Elizabeth Elting is not only appealing Chancellor Bouchard’s recent 72 page decision to sell the company to Co-Founder Philip Shawe, but she has also started a new multi-million dollar lawsuit in Delaware’s Chancery Court. According to my sources at the company, instead of taking her $385 million dollar pay-day she was never entitled to in the first place, Elting and her attorney, Kevin Shannon of Potter Anderson, have chosen to bite the hand that has fed them millions, by accusing both the Chancellor and the Custodian of abusing their discretion. And why? Hold onto your seats… it’s for not selling TransPerfect to its largest competitor HIG-Lionbridge, which bid less, and which has a vast history of shipping U.S. jobs to China and India?!?   What’s most interesting here is, after winning practically every aspect of her case including a failed interim appeal to the Delaware Supreme Court by defendant Philip Shawe (Strine vs. Dershowitz I), Elting is now unhappy with the very result she clearly sought in the first place and is appealing Bouchard’s decision to the Delaware Supreme Court. Why? Well, it’s not because she didn’t get the auction she asked for, as she got everything she asked for, but it seems it’s because it was her partner and ex-fiance, Shawe, who bid the highest and won the auction. The twists and turns in this case are astonishing, yet true.   Please see the article below by Tom McParlan of “Delaware Business Court Insider.” McParlan also notes that it appears the watchful eyes of the legal and business communities worldwide will be robbed of Strine vs. Dershowitz II, as the Delaware Supreme Court may choose to decide this appeal without seeing the parties or their attorneys in court.   Interestingly, here’s what Chancellor Bouchard had to say in his decision: “Elting never put together a bid approaching what Shawe was willing to pay for the company,” he wrote last month. Bouchard also defended the auction result, “the Custodian deftly and firmly handled a challenging assignment to create a competitive dynamic that maximized the value of Elting’s shares while simultaneously preserving the Company as a going concern to the fullest extent possible.” He also refuted Kevin Shannon’s endless four-year fairytale that his client was, yet again, a victim, by saying “Elting forged her own path.”   Elting gets a boatload of money, the maximum possible, with no jobs lost as the company is being sold, yet she’s somehow unhappy with Bouchard’s decision. The employees were right all along to be worried about their jobs, but they are safe for now, or so it seems!   Even though she’s due to receive $385 million, she’s not happy with the auction result and the decision to affirm it, and now she appealed?! Huh?! She claims Custodian Pincus could have sold the company to HIG-Lionbridge and she could have made more shekels, while putting potentially thousands out of work. As much as I’m critic of the Chancellor, I give him credit for realizing Elting has used the court system enough already, pulling this ‘Delaware Gravy Train’ case feeding an entire ecosystem of lawyers and consultants into the station, and finally looking out for the 4,000 employees and their families.   According to Chancellor Bouchard, if he is affirmed, then Elizabeth Elting will receive $385 million ($287 million dollars after taxes), Shawe will get the company, and employees will enjoy job security for the first time in years. And yet, she objects?! Appeals?! AND starts a new lawsuit?! Custodian Pincus said that Shawe’s bid was highest, had the least strings attached, had the greatest chance to close, and was the safest for the employees. Boo-hoo Ms. Elting. Our heart bleeds for you now that you’ll have more money than you deserve !   Folks, the amount of money spent on this case is now approaching $250 million, it has blackened Delaware’s eye, and no purpose is served by continuing it other than paying a king’s ransom to army blood-sucking lawyers and consultants.  For once, I find myself on the same side of an issue as Chancellor Bouchard, who emphatically wrote in his legal decision that he hopes, “all concerned can move on with their lives.”   Please read the article below from “Delaware Business Court Insider” by Tom McParland which explains in detail what is happening. As always your comments are welcome and appreciated.      

Del. Supreme Court Eyes April Decision in TransPerfect Appeal

  The Delaware Supreme Court said Tuesday that it plans to reach a decision in April on Elizabeth Elting’s challenge to the Delaware Court of Chancery-ordered sale of TransPerfect to her rival on the company’s board. By Tom McParland | Feb 28, 2018 The Delaware Supreme Court said Tuesday that it plans to reach a decision in April on Elizabeth Elting’s challenge to the Delaware Court of Chancery-ordered sale of TransPerfect to her rival on the company’s board. In a two-page order, Chief Judge Leo E. Strine Jr. granted Elting’s motion to expedite her appeal, after Chancellor Andre G. Bouchard earlier this month approved the $770 million sale of the profitable translation-services company to co-founder and CEO Philip R. Shawe.   Fast-tracked briefing is scheduled to begin March 7, with a final decision expected the following month. “The matter will be scheduled for decision by the court on the basis of the briefs on April 18, 2018,” Strine wrote. Elting’s appeal could finally mark the end to nearly four years of tumultuous litigation over the company that Elting and Shawe launched from a college dorm room in 1992. Elting prevailed in her bid to have the company sold amid intractable deadlock stemming from deep personal rifts between its two founders. But she was handed a bitter defeat on Feb. 15, when Bouchard approved a court-appointed custodian’s plan to sell her 50 percent stake to Shawe following a modified auction.   Elting had tried to unravel the agreement and force Robert B. Pincus, the custodian in charge of the sale, back to the negotiating table. She argued that Shawe’s conduct throughout the case had compromised Pincus’ impartiality and caused him to ignore a better offer from an outside party. Bouchard, however, said there was no merit to the claims, and he noted the irony in Elting’s opposition to the result of an auction that she had requested in the first place. “The undercurrent of her opposition reflects an apparent, deep-seated frustration with the fact that the winner of the auction was Shawe—who Elting has battled for years and who seems to engage in litigation as a way of life,” Bouchard wrote in a 70-page memorandum opinion. “But Shawe also is the person Elting chose to go into business with when she formed the company and, as much as Elting might wish it were otherwise, Shawe was a core part of TransPerfect’s operative reality when Elting asked that the company be sold.” According to the ruling, Elting is expected to receive $287 million in net proceeds after taxes in the deal. Elting filed her appeal to the Supreme Court on Feb. 21. Shawe did not oppose Elting’s request for expedited proceedings, but asked for an even shorter timeline, citing an already substantial delay between Pincus’ recommendation on Dec. 1 to Bouchard’s ruling more than two months later. Shawe said there was still work to be done before the deal’s June 30 closing date, and he emphasized that the “continued uncertainty of this nearly four-year-old litigation is taking its toll on [TransPerfect], which needs to be relieved as soon as possible.” On Tuesday, Strine accepted Elting’s proposed schedule, giving Shawe two weeks to answer her opening brief. Elting’s final round of briefing is due April 4, according to the order. An attorney for Elting did not return a call seeking comment on Wednesday, and Shawe’s spokesman did not immediately provide comment on the appeal process. The case, on appeal, is captioned Elting v. Shawe.
 In my educated opinion, after over a year of intense research on the TransPerfect case, it is not only the very suspicious and biased decisions from Chancellor Bouchard of the Delaware Chancery Court at issue, but the highly unusual conduct of his Court-appointed Custodian, Skadden attorney Robert Pincus which, in my opinion, leads to the only logical conclusion that a conspiracy, based on greed and inbred corruption, is at work in Delaware. What a shame that the glorious reputation of our tiny, but first state of Delaware, will have it’s national reputation smeared and destroyed by a small group of selfish attorneys, judges and investment bankers. As the saying goes, when something feels so wrong, follow the money (please see this New York Court document):    I spoke with several TransPerfect employees about why they left recently, and here’s a big reason that is not easy to explain: The auction they have been forced to participate in by Chancellor Bouchard, as a management team, as it turns out, is believed by many employees to be a sham.  First, it is filled with conflicts of interest. TransPerfect’s main competitor, Lionbridge is a company with a deep history of eliminating U.S. and Western European jobs to send them offshore (TransPerfect has most of its jobs in America, Lionbridge has 6% of its jobs in the good-ole US of A). Lionbridge is owned by the private equity firm, HIG. Credit Suisse is the investment bank allegedly running a fair auction, but therein lies the rub. HIG also happens to be a client of BOTH Skadden Arps and Credit Suisse (CS). Is Bouchard’s apparent and possible Ponzi scheme starting to come into view for you now? It becomes clearer to me everyday. It’s like the Uranium One scandal, but on steroids — with U.S. jobs being the victim instead of our national security. Here’s my opinion: It gets shadier and shadier… Credit Suisse owns the risky Lionbridge debt, who as they say in the industry, was a “dog with fleas” and it seems the only way CS can get this risky debt paid back to them is by steering the fair auction away from Shawe, and toward their other client HIG. If HIG can buy out its biggest rival and eliminate the competition, “HIG-owned Lionbridge”, will be in a much better position to pay Credit Suisse back its debt; otherwise it cannot. Ahhh… but this onion still has more layers to be peeled. Equally disturbing is that the Custodian, Bob Pincus, works for Skadden; and Skadden (Bouchard and Judge Strine’s old firm) are attorneys for both CS and HIG!!! How can the Chancery let all these people that work together, seemingly scratch each others backs to get richer and richer. Only in Delaware folks, can such blatant and gregarious corruption be tolerated and allow to exist. Think about it: Why would the Custodian choose CS to run the auction when CS just months ago advised and raised money for HIG’s purchase of TransPerfect’s #1 competitor, Lionbridge?? It stinks to high heaven!!! Further, in my opinion, Bob Pincus and Skadden should immediately cease their role as Custodians, because, as attorneys to both Credit Suisse and HIG, they are anything but neutral; in fact, they owe CS and HIG a duty of undivided loyalty — so how can Skadden run a fair auction and pick a fair winner? I guess the answer is always the same…. only in Delaware. Let’s not forget that back in August of 2015, Chancellor Bouchard ordered the sale of a thriving profitable company for the first time in the history of Delaware to help Co-CEO Elizabeth Elting get a better price for her shares, indeed that the market was not willing to bear. Most importantly, he said that the sale should be conducted with the intention of maintaining the company as a going concern. Well Chancellor Bouchard, below is an article about all the defections at TransPerfect and the loss of the entire C-level suite and senior technology team, since you handed down your unprecedented order. Is this what you meant by keeping the company going- “as a going concern??” What you can’t tell from reading the public material that I will tell you from talking to the staff, is that no meetings are taken seriously or attended by Credit Suisse big wigs or by the Alvarez & Marsal consultants except for…? You guessed it, the HIG-Lionbridge meetings. The other meetings are attended only by CS neophytes. These employees are honorable, and they have fought to keep this company afloat while the custodian Bob Pincus, Skadden Arrps and his army of consultants looted over $25 million from TransPerfect with Skadden billing $1 million last month alone. The same employees who have continued to hold this great company together and raise the revenues every year for TransPerfect have been abused by the court and the custodian for sure. Only they know from attending the auction meetings that HIG-Lionbridge is the Chancery’s pre-determined winner — and the vast majority of them will get their jobs shipped overseas, thanks to the crooked Delaware court system — I don’t blame them at all for leaving on their own terms. I promised you folks, I would uncover the dirt, but I had no idea how deep this ditch would go. This plot is still thickening and I will keep digging until I find out what I suspect is the truth: I believe this whole thing is rigged: the $150 million no-witness trial, the unprecedented result and the “auction” remedy. I feel the money trail will lead straight back to the Delaware elite. I hope Bouchard and his cronies are listening and robes or not, no one gets a pass in my column. This is not the News Journal, where you can get coverage stopped with a well-placed phone call. I’m here for you, my readers, and this investigative journalist will not stop fighting until justice prevails.    
 

TransPerfect Hit By Senior Departures as Sale Imminent

by Florian Faes, Slator, October 25, 2017   More than three years of litigation about the future of TransPerfect is beginning to take its toll. Over the past two weeks, three senior TransPerfect technology executives have resigned, citing among other reasons the uncertainty created by the court-ordered forced sales process. Chief Technology Officer (CTO), Mark Hagerty, left the company after more than 15 years with TransPerfect. Chief Information Officer, Yu-Kai Ng, who joined 12 years ago, left shortly thereafter. Keith Brazil, a senior member of Hagerty’s technology team, then resigned on October 23, 2017 after nearly 18 years with the company. In his 6-page letter of resignation, obtained by Slator and addressed to Robert Pincus, the court-appointed custodian in charge of the TransPerfect sale, former CTO Hagerty explains that when he joined the company, TransPerfect “had no technology at all, it licensed Trados and SDLX and products from competitors.” Hagerty says that he initiated the development of and initially personally coded TransPerfect’s translation management systems (TMS) GlobalLink Content Director and GlobalLink Project Director, which he says are “the cornerstone of the entire TransPerfect production operation.” According to the letter, TransPerfect’s website proxy localization solution GlobalLink OneLink generated USD 31m in licensing revenue over the past six years. GlobalLink Project Director, meanwhile, generated USD 40m in licensing revenue over the same period. This would make it one of the top TMS globally if considered as a stand-alone product. Hagerty expressed his frustration at Custodian Robert Pincus in detail. His reasons for leaving include concerns about the legality of transferring WordFast source code to an attorney at Pincus’ law firm Skadden, despite a letter of indemnity from Pincus. The future of Wordfast has emerged as a contentious issue in the sale process. Hagerty also expressed anxiety over the release of his W-2 information in a data theft, which he alleged was due to the untrained accounting staff at Alvarez and Marsal, the firm appointed by Pincus to run TransPerfect’s accounting department. Hagerty also wondered why he had not received a pay rise for two years and questioned his future role in the company post sale. Sale is Imminent Slator reached out to Co-CEOs Phil Shawe and Liz Elting, as well as to custodian Robert Pincus for their comment on these departures. Shawe said “Speaking personally, the senior technology team that decided to leave were tremendous assets to TransPerfect. If the court-appointed custodian would allow me to address the concerns that they expressed, I would be happy to attempt to re-open a dialogue in the spirit of retention. In any case, their contributions were tangibly responsible for our success in technology, and much of our success as a company. They will be sorely missed.” Co-CEO Liz Elting emailed to Slator that “the recent departures of these few technology employees represent a very positive, not negative, development at TransPerfect, as I have long regarded each of them as underperformers. We have a deep bench of extremely talented and dedicated employees in our technology department who are more than capable of continuing to build on our success. There will now be more opportunities for each of them. In addition, we will soon be making some very exciting leadership announcements in our technology department, which will help take TransPerfect to a billion dollars in revenue and beyond.” Meanwhile Custodian Robert Pincus is proceeding with the sale. He told Slator in a phone call that “the business is strong due to the strong entrepreneurial culture of the employees. We are supplementing and enhancing the management of the technology group in a manner that will help facilitate continuity pending the consummation of the sale. Efforts to confuse, delay, and deter the sales process have accelerated as we get closer to a culmination of the sale process.” According to sources Slator has spoken to, the sale process has entered its final round and a winner will be selected in the next 30 to 60 days. However, before the closing either one of the Co-CEOs could still take further legal action and challenge how the sale process was run or how the winning bid was selected.  
  Please note new e-mail address, [email protected] Please note new Twitter account, https://twitter.com/Judson_Bennett Open to see all my articles on TransPerfect caseIt is upsetting for me to watch what I view as one of America’s greatest business success stories, TransPerfect Global, a Delaware corporation, crumble under the Chancery Court’s apparent improprieties, which have made this once esteemed institution now appear suspect. It is truly inequitable as the actions by this court have filled the pockets of Skadden Arps and the court’s other “consultant” friends, while TransPerfect employees lose raises and bonuses, as this great company suffers. Chancellor Bouchard, I hope you and your cohorts enjoy all the money you seem to be plundering from this 25-year-old company… started in a NYU dorm room and now being picked apart by a careless custodian all with your approval. Know that when you try to fall asleep at night, is it not only the TransPerfect employees’ lives you are destroying, but Delaware’s business reputation, Delaware’s jobs, and in turn, Delaware’s economy. I’m shaking my head as I write this. What you have done is grotesque by any reasonable legal, business standards. Please see below… the resignation letter of the company’s CTO, Mark Hagerty. He cites Custodian Robert Pincus’ corruption, and how Pincus forced him to make a pirated copy of the Wordfast software (see my last article). The letter reported by Doug Rainey on “Delaware Business Now”, appears in full below. According to the CTO’s affidavit and testimony, from what I can see, Elting’s allegations and Bouchard’s conclusions are completely false. Also, it looks like this guy is clearly a heavy-hitter in the technology world, having worked for Larry Ellison at Oracle, and the founders of Abode as well. Read his letter and feel his frustration, and his venom towards this court-corruption. It leaps out at you. With what’s happening to TransPerfect and now Wordfast (which was not even a part of the trial!), it is a joke to think Amazon or any other technology company would want to incorporate in Delaware, much less put their second headquarters in our great state! Thank you, Chancellor Andre Bouchard. What you are doing is truly despicable. The company is currently in a sales “auction” process, run by Custodian Pincus. From my perspective, folks the whole thing looks like a rigged money-making machine for Credit Suisse, Alvarez and Marsal, Skadden Arps and other “consultants” who are friends of the court — and their “other client” HIG (who owns TransPerfect’s #1 competitor, Lionbridge)? For proof of conflict and impropriety, see this quote: “Robert Pincus, an attorney appointed by the Delaware Court to sell TransPerfect, said “business remains ‘very strong’ and the 4,000-employee firm has ‘a deep bench of talent’.” But he then added, “that more executive departures might loom, which could make TransPerfect less attractive to a potential buyer and drive down its sale price.” – Crains New York Business Magazine. What receiver or custodian or seller of any business, in their proper mind, would make these kind of comments to the press? By his own astonishing admission, Pincus looks to be violating the courts (ill-conceived) mandate and stating that his own idea of running an expensive auction will not “maximize shareholder value”… so why is he doing it then?? To maximize his own value?? You have heard me try to fight through my articles, what I view as clear, judicial corruption within the State of Delaware from the outside as an educated and informed observer for over a year, but now I urge my readers to please read carefully the letter below and see how it feels from the inside, when it affects someone’s job and his family! Scary and heart-breaking. I again call upon our elected officials to make changes in the law that will prevent future arbitrary and capricious actions by arrogant and rogue judges who think they can legislate from the bench.    

RESIGNATION LETTER OF FORMER TRANSPERFECT CTO, MARK HAGERTY

Dear Mr. Pincus, By this letter, I officially tender my resignation as Chief Technology Officer of TransPerfect, effective immediately. I am submitting this letter to you because it is my understanding that you are for all intents and purposes in control of the company. As the Delaware Court of Chancery appointed Custodian for TransPerfect Global, Inc. for over two years now, you have been, and continue to be, in a unique position of power over the employees at TransPerfect. You control the future of the company by virtue of the power the Court has bestowed upon you and your ability to vote on company issues as a member of the Board of Directors. While my tenure at TransPerfect has come to an end, it is my sincere hope that by stating the reasons for my resignation in this letter you will consider the impact your decisions have on employees of TransPerfect and ultimately on the value of the enterprise itself. What I have witnessed firsthand during these past two years is that you do not value, and do not care about, the employees of TransPerfect. I thought you were supposed to be a neutral third party appointed to the board of directors to make decisions that were in the best interests of TransPerfect during this ongoing court ordered process. I thought that being a Custodian for TransPerfect meant caring about its employees, who are the ones that have made it into the success it is today, and who are the lifeblood of the company. Without the tireless dedication of the employees, TransPerfect would not be what it is today, and they all deserve to be treated with respect and motivated to continue to grow the company. I know how important the employees are, and how much they have contributed to the growth of TransPerfect because I have been a loyal employee for over 14 years, witnessing it firsthand. When I joined TransPerfect the company had no technology at all, it licensed Trados and SDLX and products from competitors. TransPerfect was unable to even get to the table for large enterprise sales deals that involved technology because they had none, zero technology. Starting with GlobalLink Content Director (which I personally coded and supported and extended for clients like Avis and Dollar/Thrifty), I created the architecture of TransPerfect’s technology products and have hired, trained, mentored, and led an incredible technology team that is now the industry leader. I created the initial GlobalLink Project Director product with a small development team for the Yahoo/FIFA World Cup in 2006. In addition to currently being the technology leader in the space with major enterprise customers like HPE and Dell/EMC, GlobalLink Project Director is now the cornerstone of the entire TransPerfect production operation, translating billions of words per year for our clients, improving gross margins for our internal production centers, reducing employee turnover and improving the quality of life for our project managers by eliminating manual tasks and increasing efficiencies. I am responsible for GlobalLink OneLink, our website translation proxy product, brought to market in just one year by creating the architecture and code for the first version with a talented senior software developer who I recruited and convinced to join the company because I knew he could deliver. The list goes on, but you should already know about all of our great technology products, created during my 14 years as CTO, during your preparation to sell the company. So far in 2017 our GlobalLink branded technology products, which I am responsible for creating and evolving over the past 14 years, are directly responsible for roughly 35% of TransPerfect revenue, and even for customers that do not license our technology, our internal production teams at TransPerfect use GlobalLink Project Director and the suite of products for over 90% of all translation jobs that the company delivers. In the last 6 years, one such product, GlobalLink OneLink, alone has brought in $31 Million dollars in technology licensing revenue, and over $107 Million dollars in total revenue including services, while GlobalLink Project Director has brought in $40 Million dollars in technology licensing revenue and over $311 Million dollars in total revenue including services. That is well over $400 Million in revenue directly related to these two GlobalLink products in just the last 6 years. Our year over year growth for technology and services through three quarters from 2016 to 2017 is over 40%. Clearly as CTO who is responsible for these technologies, one would think I would be congratulated and rewarded for this kind of success. Then I look at my paycheck and my compensation has not changed in 2 years. I make the same salary today that I was making in 2015. Mr. Pincus, you are on the board of directors, the board controls my compensation. You are responsible for this unfair treatment of me. Have you been able to force TransPerfect to pay you whatever you want, increase your hourly rate, and hire as many other Skadden lawyers to enrich your firm and your pockets? Is it really fair and just that Skadden makes millions of dollars annually from TransPerfect, and I don’t get a raise for two years when I am responsible for generating 35% of the revenue and profits that are used to pay you and your firm and the firms you hire to assist you? Money, Greed, Power, Arrogance: these things corrupt people, have they corrupted you? I have dedicated the last 14 years of my life to TransPerfect. I am directly responsible for hundreds of millions of dollars in revenue. I am responsible for millions upon millions of dollars in profits over the years that went directly to Liz Elting and Phil Shawe as shareholders. By creating the technology platform that increased the value of TransPerfect by hundreds of millions of dollars, I have delivered in my role as CTO. Who is going to profit from all of my hard work besides the owners of TransPerfect? Robert Pincus will profit. Skadden, Arps, Slate, Meagher & Flom will profit. Credit Suisse will profit. Joel Mostrom will profit. Alvarez and Marsal will profit. EY will profit. Every firm you hire to assist you will profit. But there is no recognition of my contributions to the value of the company, and there is no upside for me. In fact, the only possible upside for the TransPerfect success that I, Mark Hagerty, ever had was Phantom Stock. The Phantom Stock program was created at my urging to Phil Shawe for the company to give some upside to employees as the company grew, since as a private company there was no opportunity for real equity for employees. There was always the hope that as the company grew and continued to be profitable the Phantom stock would be worth something significant. In fact the Phantom Stock price had been increasing every quarter, every year, along with the company success. But then, it began to decline after you became Custodian. How is that possible? Company revenues have continued to increase every quarter, one would expect the Phantom Stock price would go up too. But there was always a profit component to the formula for Phantom stock, and the millions of dollars in money spent by yourself as Custodian on Skadden and Alvarez and Marsal and others you hired, devalued the Phantom Stock, driving the price down even as the company grew. I wonder, when you and your investment bankers calculate EBITDA for TransPerfect for the sale, I bet you exclude all of these legal costs and other millions of dollars of costs from that calculation, right? You probably say it is a one-time extraordinary expense that will not exist after the sale, so you exclude that from the calculations, right? That helps you sell the company at a higher valuation, right? But, for the Phantom Stock calculation, did you apply that same reasoning? No. Did you care about the value of the Phantom Stock to the employees? No. When I cashed in my Phantom Stock, the payout was far less than expected because of this. I lost a lot of real money as my Phantom Stock declined in value, the only possible upside in the company that I ever had, as a direct result of you and your law firm billing TransPerfect for millions of dollars in fees. You had the power to amend the Phantom Stock plan to keep your extraordinary fees from depriving TransPerfect employees of the true value of their labor. But you didn’t. How is that fair to me? How is that fair to the other TransPerfect employees that actually contributed to the incredible growth in the value of TransPerfect as a company? On the topic of being fair to employees, I have attached an email I sent you back in February of 2016 regarding employee health benefits. TransPerfect CUT employee health benefits in 2016 compared to what they were in 2015. You had a choice, you could have done the morally right thing and kept benefits the same, you had the power. You could have shown that you do care about the TransPerfect employees. It was a tiny amount of money, nothing compared to what you make annually and the millions of TransPerfect dollars that goes to your Skadden law firm and the firms and consultants you hire. But you chose to cut employee benefits because that meant spending a few TransPerfect dollars on actual TransPerfect employees. If you are so convinced cutting employee benefits is a good decision, have recommended to your own Skadden law firm that they should cut employee benefits too? Shortly after you became Custodian, on Dec 1, 2015, I emailed you directly about another employee related issue. I asked you to please resolve the Yu-Kai Ng employee situation, regarding the unfair treatment regarding his pay. As Custodian you had the power to do the right thing and solve that issue quickly and easily with very little cost to TransPerfect. Instead you chose to spend TransPerfect money. You hired an investigator to write a report (how much did that cost?) that was, in my opinion, completely flawed. The investigation was flawed because the investigator never bothered to speak with me, Mr. Ng’s immediate supervisor, at all during the investigation. Wouldn’t any competent investigator seeking the truth have at least taken an hour of his time to interview Yu-Kai’s boss and get clarification on the situation. By not resolving the issue, you forced Yu-Kai to sue TransPerfect, causing him unnecessary stress and duress by having to sue his employer to receive his proper back pay and future pay. No employee wants to have to go through the hassle of hiring an employment lawyer and suing his own employer. You forced a situation that went on for many months and required mediation to settle. How much TransPerfect money did you waste to settle that case when you could have solved it by paying him fairly what he was due and spending nothing extra? How much money did Skadden and other firms you hired bill TransPerfect related to settling the Yu-Kai lawsuit? If you had just been unbiased and fair and focused on your duties as Custodian, TransPerfect would have saved a lot of money. I would venture to guess that the total money spent on lawyers and investigators exceeded what Yu-Kai was owed. Who profited from that? Not Yu-Kai. Not TransPerfect. Only lawyers and investigators. How many other employee related lawsuits have you directly caused by your decisions on the board? Continuing on the topic of how you choose to treat TransPerfect employees, and how you do not value their contributions to the company, I received an email from Carol Chuang in HR on September 5th where I was informed Keith Brazil’s title promotion to Senior Vice President was rescinded. I had subsequent follow up with her and her response on September 14th where she says the board “specifically also discussed his promotion and voted to rescind it.” As the controlling vote on the Board of Directors, that means you had the power to decide on this issue. This is such a petty issue, has no bearing on the sale of the company whatsoever, and the only goal of voting to take away a deserved title promotion from Keith Brazil is to send a clear message that the Board does not care about the employees. It is clear from the email thread that Keith was promoted before any new rules were put in place regarding titles. Also, the Board did not even bother to ask me, his manager, to actually give the reasons for his promotion, which would have clearly illustrated why he clearly deserved it. The bottom line is you decided to embarrass a critical technology employee, someone who has been with the company even longer than me and who has had a huge impact on the success of our technology. There is no valid reason for you voting to strip his title, but the message was clear to this and other hardworking employees: you are in charge and they don’t matter at all. We are talking about a title, not money. If you sent out a poll to all of the employees in the company and asked them if Keith deserved to be promoted to Senior Vice President, I am certain the vote would be overwhelming in favor of his new title. Everyone on his team, everyone in Sales, everyone in Production would agree he deserves it. But somehow, the all powerful Mr. Pincus gets to decide and chooses to rescind his title instead of affirming it. What effort did you even take to find out if he deserved it? I know the answer, since you never asked me about it …. None. I believe you are aware that the social security numbers, home addresses and annual salary information of TransPerfect employees were handed over to criminals who specialize in identity theft. As a result, I and every other TransPerfect employee have to lose sleep worrying about someone possibly stealing our identity, filing false tax returns on our behalf, or raiding our social security benefits in the future. I personally had my IRS refund delayed for 4 months because I had to schedule an in person meeting to prove my identity before I could get my refund. These are hassles and stresses I don’t enjoy that I have to worry about forever, for the rest of my life, just like every other U.S. TransPerfect employee. Why? It is my understanding that after your hand-picked head of Accounting, Joel Mostrom of Alvarez and Marsal took over the department, someone under him responded to an obvious phishing scheme and sent out all of the company W-2s with employee names, addresses, and social security numbers to someone that specializes in identity theft. That person must have been untrained for the job they were doing, because anyone with any knowledge of privacy laws and anyone that understands anything about keeping social security numbers confidential would never have replied to that email even if it came from Liz Elting herself rather than an impersonator. There is no reason to ever send all of the Social Security numbers of the employees to Liz Elting or anyone that might ask for them. If a CEO or Board member asks for employee compensation information, that can be supplied without giving out the actual W-2s and comprising employee social security numbers. By hiring Mr. Mostrom, by extension you caused this breach that impacts me and every TransPerfect U.S. employee now every day for the rest of our lives. Throughout this sale process over the last two years, I have continued to keep my head down, tried to ignore the noise and just do my job. By any fair evaluation, I have done an exceptional job, improving our technology products, increasing our reputation as the leader in technology in the translation space, increasing our customer base, and growing our revenues with remarkable growth over the last 2 years. During 2017 I have been asked to provide lots of information and I have done everything asked of me. You hired EY to prepare a report on the company to give to prospective buyers. I provided information to EY whenever they asked for it, spending considerable time to give them very detailed spreadsheets and information. I met in person with EY when they asked for it and answered all of their questions. I fully cooperated with them. The same goes for Joel Mostrom every time he asked me for information. I participated in phone calls with Joel, and even with you, whenever I was asked. I answered every question asked of me. The same goes for Adam Mimeles, TransPerfect’s corporate attorney, whenever he asked for anything related to due diligence for the sale, I have provided it, in detail. The only time I hesitated for even one minute was when James Pak of Skadden asked me about Wordfast source code. On Wednesday, August 9th, James sent me an email asking for a conference call. I immediately replied that I could do it the following day, Thursday, August 10th and asked him what he wanted to talk about, so that I could be prepared. When he replied that it was about Wordfast source code, I was very concerned. I had provided Wordfast employee, cost, and product information to EY for their technology report. When they finalized their report, they had removed Wordfast as a category. I was told that was because Wordfast was not part of the sale. I later had a call with you and Joel Mostrom where you asked me what other CAT tools TransPerfect owned (I mentioned Alchemy Catalyst) and what it would take to replace Wordfast after the sale. These interactions made it clear to me that Wordfast was not owned by TransPerfect and not included in the sale. That was made clear to me by you, EY, and Joel. When Mr. Pak asked me to discuss Wordfast source code, I reasonably felt very uneasy because I did not want to be exposed to liability for discussing third party proprietary information, such as source code, related to Wordfast. On Thursday I told Mr. Pak I couldn’t do the phone call until this issue was resolved. It then took until the end of the day on Friday, August 11th before I received a letter from you, Mr. Pincus, granting me indemnity related to Wordfast. Over the weekend and on Monday I was on a scheduled vacation in Maine with my family hiking, and Tuesday I was driving back to Boston from Maine and flying back from Boston to San Jose, CA so that I could be back in the office on Wednesday. I had an out-of-office message indicating that I could be reached on my cell phone in the case of an emergency. When I returned to the office I immediately emailed Mr. Pak and set up a call with him that morning. I spoke with him and answered all of his questions and educated him about our products and the source code. It was only after I had spoken to Mr. Pak that I saw the letters Skadden had sent to my attorney threatening Board action against me. I was actually shocked by that when I found out, but then I realized it was in line with the standard bullying and intimidation tactics that you and your Skadden firm use in dealing with TransPerfect employees. I immediately called up Mr. Pak and asked him to apologize to me personally, as I had been fully corporative and my vacation was planned months in advance. I pointed out to him that he could have just called my cell phone on Monday if it really was so urgent, and such an emergency that it caused Skadden to threaten my job for being on vacation for 2 days. He said my cell phone was not in my out-of-office message so he couldn’t call me. I never put my cell number in my OOO messages because that message goes to every person that emails me, and I don’t want to give out my personal cell phone number to every person that sends me spam or any external person that emails me. It is really quite astonishing to me that Mr. Pak could spend the time to write threatening letters but couldn’t take the time to contact someone inside of TransPerfect and ask for my cell number. It is not a secret to anyone in the company, my cell phone number is available in outlook and in the company directory. I was actually suprised that Mr. Pak refused to apologize after he fully understood everything. He was quite nasty about it and simply said, “You will NEVER get an apology from Skadden!” I know I did nothing wrong, I was just being cautious and trying to not get in any future legal trouble, and I was fully available if Mr. Pak had just even attempted to reach me on my cell, which he did not. I then proceeded to actually find a way to give him access to the source code in the most secure and quickest way possible. I personally set up a virtual machine in AWS and secured access to it and granted him access right away. It then took Mr. Pak multiple days just to provide the proper forms for the IT department so that access could be given to another Skadden lawyer and two experts hired by Skadden. If everything was so urgent, I don’t know why it took so long for that to happen. Delays caused by Mr. Pak and Skadden don’t seem to matter, but if I am on vacation for 2 days that requires me to be threatened by Board action (a Board which you control and hold all of the power as the deciding vote Mr. Pincus). All of this once again proves to me how much Skadden is biased against me, even though I have been totally cooperative. Despite how Mr. Pak had treated me, I continued to do everything he asked of me. I got on conference calls with him and his experts. I set up a call with Chris Cowperthwait when Mr. Pak asked for that, keeping it a secret what the call was about, because that is what Mr. Pak asked me to do. I sent email to Jean-Philippe Odent when he asked for that. I answered every question he asked of me. Despite my complete cooperation with Mr. Pak, he remained totally condescending and rude to me when he directed me in email to transmit the source code electronically to him on Sept 19th. I even forwarded the email to Adam Mimeles to get his opinion and his response was “I am also troubled by James’ tone in the other email”. Even with the poor, unprofessional treatment of me by Mr. Pak and Skadden, I personally copied the files onto a secure drive, working late into the night, and hand-delivered them to Mr. Pak in his office instead of delivering it to him in an insecure way (he originally requested insecure unencrypted ftp). I still don’t feel right about being forced to give over Wordfast source code, and I hope I don’t get sued for delivering a copy of it to Skadden and your experts. I am still totally unclear why Mr. Pak and Skadden had to hire TWO experts to look at the code, neither of which ever asked me even one question about the source code over the course of the past two months. When we had a patent litigation trial, we only needed to hire one expert. The other side only hired one expert. Why Skadden had to pay two experts, spending more TransPerfect money, is beyond me. But I guess when you are not spending your own money it doesn’t matter, just spend, spend, spend. I had trouble sleeping all weekend long. I kept thinking about the conference call I was asked to participate in on Friday by Credit Suisse with Citi financing bankers. This was the very first call I was asked to participate in related to the sale of the company. I answered all of their technology questions, I explained some of the culture of the company and the growth potential for the future. I gave them my background and how we have grown technology over the past 14 years. At the end of the call I felt really good about myself – reflecting on my fourteen years as CTO I felt that I really have done a lot of great things for TransPerfect. I was proud of what we have built here, and my contributions to TransPerfect. Then, as the weekend went on, I kept thinking about this being the very first time I have been asked to talk at all to anyone during the sale process. I have clearly been purposely excluded from every other call. I have been given zero indication that I might have a future with the company post-sale, quite the opposite. When the sale process started, I was informed that TransPerfect management would have a seat at the table. There was hope that the senior management of TransPerfect would be able to participate and submit a bid and be a part of the process. Then that promise went unfulfilled. Senior management does not support a sale to H.I.G., and wanted a chance to compete for company ownership. Our senior management team was told “NO”: you cannot submit a bid, you cannot participate in the process, you have no chance. You, with your actions, have made it abundantly clear that I have no future with the company post-sale, and in fact you don’t really care about the future of the employees of TransPerfect at all. Once you sell the company, you cash out, go back to your wealthy law firm, enriched with unchecked TransPerfect fees, and wait for the Court of Chancery to give you the next opportunity to bill millions of dollars in fees with no accountability and unlimited power. I, on the other hand, will be out of a job with zero compensation beyond my past salary for the hundreds of millions of dollars in value I created for TransPerfect over the last 14 years of my life. So I thought about that all weekend long and came to the conclusion that I am not going to keep coming to work every day continuing to create value for TransPerfect, just waiting for the day the company gets sold to a competitor and I am out of a job. I just got back from the third annual GlobalLink Next conference in Chicago. It was so uplifting to hear our customers talk about how happy they are that they chose GlobalLink technology, how great TransPerfect is to partner with, how we solve their problems and how our technology is so much better than the competitors in our space. They know this firsthand because many of them switched from a competitor solution to GlobalLink and sing the praises of the GlobalLink technology. I love our customers. I love the technology I have created here. I love my senior technology team, many of whom have been working for and with me for ten years or more. I love our senior management team. Fourteen years I have been working to build something great, working tirelessly, with so much pride and dedication in my work that I never use up my annual vacation days and thus max out and lose vacation days every year. That has kept me here through all the turmoil, and I have kept my team together through it all. But my contributions are clearly not valued, as evidenced by the lack of a raise in 2 years, and everything else I have outlined in this letter. I just kept asking myself all weekend, “I have no future here, so why am I still here?” This resignation letter is the answer to that question. Sincerely, Mark Hagerty, Former CTO of TransPerfect Translations International, Inc.
   
Please note new e-mail address, [email protected]
Please note new Twitter account, https://twitter.com/Judson_Bennett
Please make absolutely no mistake about it, Delaware is in huge financial trouble. After a few legislative band-aids were implemented to temporarily balance the budget in 2017, next year is going to be five times worse. Unemployment is rampant and Delaware’s incorporation bonanza is going to disappear, not only because of the increase in the cost of franchise taxes, but because business people nationwide no longer trust Delaware’s Chancery nor the Delaware Supreme Court to render fair and equitable decisions based on logic and legal precedent. The responsibility falls mainly at the feet of Chancellor Andre Bouchard whose controversial and subjective rulings in the TransPerfect case have rocked the nation’s business world. The appearances of improprieties in this unprecedented adjudication exposes the extreme bias, rampant cronyism, and corruption that has long plagued Delaware and has now caused the precipitous drop in Delaware’s ranking in the U.S. Chamber of Commerce Survey as the best place to incorporate in America, from first place to eleventh place!   Interestingly, a few lawyers, a Court-appointed Custodian, and the law firm of Skadden Arps with the help of Delaware’s Chief Chancellor Andre Bouchard and Delaware’s Chief Justice Leo Strine of the Supreme Court (all interconnected and members or former members of the same law firm) have become filthy rich at the expense of TransPerfect. Protected by opposition from the Delaware Bar Association and certain ESTABLISHMENT LEGISLATORS who apparently have no interest in positive change, absolutely nothing has been done to repair the now broken reputation of Delaware. Senate Bill 53 (sponsored courageously by Senator Colin Bonini) was released from committee, but does not yet have the support needed to pass. My sources have reported that the combined fees to TransPerfect, based on Bouchard’s ridiculous manner in which he handled the case, are now over $150 million dollars… Insanity!   I have followed and researched this case in detail, read all the transcripts, and interviewed many involved. I believe I know more about this case than any person on earth. I know when there is a grotesque injustice happening, and folks this TransPerfect case is the most grotesque I have ever seen. I predicted that Delaware would suffer the consequences of its recklessness, and what many are calling criminal behavior, a long time ago. I have also recognized when serious consequences are happening to the detriment of Delaware’s citizens. Hopefully this time someone will finally listen and do something about it.   That being said, one of my readers forwarded one of my recent articles to a State Senator from Milford who is a Republican, voicing his concerns about this situation. The Senator’s reply, knowing about the fleecing of TransPerfect, the incestuous connections in the judiciary, the dissenting opinion by Justice Valihura, and the national criticism of Delaware’s unfriendly business reputation – dropping from # 1 to # 11 in a national survey, rudely said, “consider the source”. It is obvious to this writer and investigative reporter – that like this State Senator – there are many on both sides of the political aisle in the Delaware General Assembly, whose only care is to keep the status quo and keep everything within the good ole boy network, regardless of the damage to our state’s reputation and financial well being.   Please read the article below and seriously take it under advisement when casting your future votes for choosing our state’s leaders.   As always your comments are welcome.   Respectfully submitted,   JUDSON Bennett-Coastal Network  

Transperfect case part of why Delaware’s business law is losing ground: Delaware Voices

Chris Coffey

Published 10:06 a.m. ET Oct. 7, 2017

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Although the regular troupe of Delaware judges and lawyers shrugged off the troubling fall from the number 1 spot to number 11 in the U.S. Chamber of Commerce’s business litigation survey, Delaware residents are acutely aware of the state’s recent rankings plunge.

Delaware has always shouted its top ranking in the chamber’s review, and rightly so. However, now that Delaware has tumbled out of the top 10 in most areas of the well-respected poll, the survey has been disregarded by the same groups that have taken pride in that ranking for over 15 years. They now focus on the methods of the survey instead of the content of the results.

Citizens for a Pro-Business Delaware began as the voice for the thousands of silenced TransPerfect employees who have been impacted by the uncertainty of an unprecedented decision by the Delaware courts. However, the message resonates so vividly for Delaware residents that thousands more have joined to express their concern for the employees who live in Delaware and neighboring states.

When legislators passed the TransPerfect bill out of committee last summer, it was because they heard from thousands of Delaware residents who saw the future ramifications of the court-ordered TransPerfect sale.

While many supported the bill, it appears that some legislators hoped that they could remain in good graces with a very powerful band of judges, lobbyists, and lawyers, dismissing their constituents’ voices. Many, including the chair of the Senate elections and government affairs committee, proclaim they want Delaware to be the beacon for corporate law, but then they refuse to listen unless the jobs are Delaware jobs.

If this keeps up much longer, Delaware jobs will fast follow as the state continues to plummet in the business rankings. If these jobs go overseas, the 11th ranking will look like a pleasant memory.

Unemployment is already on the rise in Delaware. Do we need more uncertainty? Average Delawareans, on the other hand, empathized with the families about to lose their income and saw how the TransPerfect sales will be perceived: A state court meddling in the affairs of a private company, risking thousands of American jobs and Delaware’s ability to keep and attract businesses incorporated in the state.

Now, the U.S. Chamber of Commerce has reported that over thirteen hundred business executives and lawyers who control companies that earn $100+ million in annual revenues no longer believe Delaware is even in the top ten of business-friendly states. And if Delaware’s litigation leaders’ reaction is to disregard this long-treasured ranking, how much further will Delaware drop?

As the TransPerfect sale continues, thousands of Americans may move closer to losing their jobs to overseas workers, a common translation industry practice. Citizens for Pro-Business Delaware will focus its efforts on keeping jobs here in the United States.

We want to see any potential winner of the custodian’s process to include a commitment that 80 percent of the   domestic TransPerfect employees will remain in the United States for five years. We are calling on the governor and legislature to demand that any future outcome of this company involves leaving the jobs in the United States.

Every day, I speak with hard-working people who live in uncertainty about a process that feels rigged. A New York judge threw out the TransPerfect case based on its lack of merit yet after a second try in Delaware, an unprecedented ruling had led us to this scary place. The decision enriches a few Delaware elites, and one owner who wants to sell.

It subjects thousands of workers to massive uncertainty, and very possibly the loss of their jobs. The decision has helped to drop Delaware’s reputation for being the most business-friendly state, yet the courts continue.

If TransPerfect is sold and thousands of American jobs move overseas, how far will Delaware’s ranking fall? Will other companies incorporated in Delaware, like Ancestry.com and Dole, wait to see if Delaware disbands a company that is a global leader in translation services?

Citizens for a Pro-Business Delaware will continue to be the voice of thousands of TransPerfect employees and Delaware residents, as well as the supporters across the nation who recognize that Delaware is willingly leading the exodus of thousands of well-paying American jobs.

The custodian has tried to silence our efforts, but we will not kowtow to threats or intimidation. We will continue to fight for TransPerfect, and in turn Delaware. We will not back down from standing up for Transperfect employees. Delaware’s economy shouldn’t suffer even more because of a short-sighted unprecedented decision which could cost this country 3,500 jobs.

Chris Coffey is the campaign manager for Citizens for a Pro-Business Delaware, a group of TransPerfect employees and Delaware citizens working toward a solution in the case that preserves current jobs and the company.

Folks, beyond destroying, in my opinion, Delaware’s reputation for business, Chancellor Andre Bouchard may cost Delaware plenty of cold hard cash. Like I said back in February, Delaware’s Chancery Court’s Chancellor Andre Bouchard has put himself squarely in the crosshairs of Shirley Shawe who owns 1% of TransPerfect. While it would appear that her shares are only 1/100th of the company’s value, this does take into account that she is the swing vote! Therefore, her share isn’t worth 1/100th, but more like 20 percent of the value of the firm. Think about it this way, Elting should have had to pay Shirley Shawe to get the vote required for a sale, which experts may value as high as $50 million. But Chancellor Bouchard, by wanting to give all of Shirley’s value to Elting and his 20-year buddy, Kevin Shannon of Potter Anderson for free, has forced the sale of the whole company, per Shannon’s request. Putting aside that the “public use” requirement is not met, the State of Delaware also has a “just compensation” requirement. Delaware is responsible for transferring “market value” to the owner at the time of any “taking”, if this taking is deemed legal — so I logically believe Delaware tax payers will likely have to pay at the very least another $30 million plus to Ms. Shawe. The moment Bouchard steals her share against her will, she will undoubted file what is known as a “just compensation” case and it can be easily proven (I’m told by legal experts) that Shirley’s “swing vote” is worth 10- to 20-times what a normal share would be. I’m also told by folks close to the case that it is open and shut. If Bouchard operated in the real world of honest business people, Elting would have to pay Ms. Shawe somewhere around $50 million to $100 million for her share to get the control premium and dictate the exit strategy. In my view Chancellor Bouchard is robbing this 76-year-old retired mother of an absolute fortune! If this is proven, Delaware tax payers will then have to pay for his mistake!!! Think about it this way… if Shirley Shawe sues and wins, Delaware tax payers will owe her not her 1% stake, because that is not the value of the swing vote, Delawareans will have to pay 10% to 20% of the value of this company. And, for what? Why should Delaware tax payers have to pay for the arbitrary and capricious actions of a rogue judge? Bouchard is not only responsible for dropping us from #1 to #11 in the minds of corporate America, but mark my words, he also could cost our state millions of dollars for jilting Ms. Shawe! The press will have a field day writing about Bouchard’s age-discrimination against this female senior citizen (as well they should!). Folks, this assumes everything is on the up and up — but we all know better. In short and in my opinion, Bouchard is a horror show, and Delaware is buying tickets for everyone to watch. The problem is the tickets are extremely expensive!!! If TransPerfect co-CEO Elizabeth Elting wanted to take control of the company and sell it, she could have paid Ms.Shawe for her stake and taken control. Instead, she found a lawyer who was Chancellor Andre Bouchard’s buddy who was able to convince him to rule in her favor in an unprecedented illegitimate “taking” based on no evidence. Delaware may be on the hook to pay the price if Ms. Shawe sues and wins. I again call upon the General Assembly to pass SB-53 and restore integrity to our judiciary! See the story below which discusses Bouchard’s approved fleecing of TransPerfect’s coffers which has the appearance of nothing more than payola to his friends. It is hurting Delaware’s reputation and economic future. It must be stopped and respect and confidence restored to the Delaware judiciary. As always your comments are welcome. Respectfully Submitted, JUDSON Bennett-Coastal Network  

TransPerfect Mom Wants To Investigate Custodian’s Expenses

Source: Law360 By Matt Chiappardi Law360, Wilmington (October 2, 2017, 8:53 PM EDT) — Shirley Shawe, mother of one of the co-founders warring over control of the legal translation firm TransPerfect, launched a books and records demand to investigate the $21 million expense bill for the custodian appointed by the Delaware Chancery Court to sell the company. The lawsuit is another chapter in the ongoing saga of the business divorce between TransPerfect co-founders Philip Shawe and Elizabeth Elting. Chancellor Andre G. Bouchard ordered TransPerfect sold under court supervision in 2015 to break bitter infighting and a deadlock between the pair that the chancellor said threatened the profitable company’s financial future. Philip and Shirley Shawe have both staunchly opposed the decision, and in her records demand Shirley Shawe, a 1 percent shareholder in the company, is seeking to investigate “potential wrongdoing, mismanagement and corporate waste” connected to the custodian stemming from what she claims is “a lack of any meaningful oversight” over his invoices. Shirley Shawe claims the custodian, Robert B. Pincus of Skadden Arps Slate Meagher & Flom LLP, refuses to provide detailed invoices for his or his law firm’s time spent as custodian over the TransPerfect sale process, and has provided the court with contradictory reasons why, as well as falsely claimed that no group has raised objections or made allegations of abuse of discretion. “The custodian’s steadfast refusal to provide the requested information in spite of the extraordinary costs being incurred, and the attempts to prevent disclosure of the information, including through his counsel’s incorrect statements to the court, presents more than ‘some evidence’ to suggest a ‘credible basis’ for at least the following potential wrongdoing: mismanagement and corporate waste by the directors and officers of the company, related to, at least, a lack of any meaningful oversight of the invoices being paid vis-à-vis the services being rendered,” Shirley Shawe said in the demand. Philip Shawe told Law360 in an emailed statement Monday that Pincus would not allow any transparency into his “enormously large” itemized bills. “To my mother and I there is nothing more disheartening than seeing the court-sanctioned looting of our company,” Philip Shawe said. “The combined cost to the company and the parties, of the legal and custodian-related fees in front of Chancellor Bouchard, have now surpassed the $150 million mark. In my view, this provides the perverse motivations and incentives that driven the whole Delaware process.” Pincus and his counsel did not immediately respond to requests for comment Monday. Under Delaware law, shareholders can seek to have the Chancery Court compel a company to hand over records if they can show a “proper purpose” for doing so, usually to investigate a credible suspicion of wrongdoing. Shirley Shawe’s demand is the latest in a long line of court actions in multiple forums she and her son have filed after Chancellor Bouchard’s 2015 sale order, which was affirmed by the Delaware Supreme Court in a 4-1 decision. U.S. District Judge Gregory M. Sleet last week threw out a lawsuit Philip Shawe filed in Delaware federal court claiming the sale order violated due process and the takings clause in the U.S. Constitution, ruling it was an improper attempt to appeal a state court’s decision. The younger Shawe also sued Pincus in New York federal court, claiming the custodian was trying obtain authority to restrict him from the sale process. Shirley Shawe had filed a Chancery lawsuit to force a TransPerfect stockholder meeting where she said she would break the deadlock by voting her 1 percent stake with Elting’s 50 percent stake to Philip Shawe’s 49 percent. Elting had refused the overture because of what she said were strings attached that would alter the structure of TransPerfect’s board, and Chancellor Bouchard ruled any such meeting would be futile. Shirley Shawe’s bid for interlocutory appeal was denied by both Chancellor Bouchard and the Delaware Supreme Court. Elting and Philip Shawe have been locked in a very public battle over TransPerfect since at least 2014, when Elting petitioned the Chancery Court to break their deadlock. The pair founded the company in a New York University dorm room roughly 25 years ago and grew it into a global powerhouse that takes in hundreds of millions of dollars in revenue annually. The two were once engaged to be married, before breaking off romantic ties in the late 1990s. They remained business partners until a spectacular falling out that resulted in a tangle of messy litigation and accusations, some deeply personal. Shirley Shawe is represented by Jeremy D. Eicher of Eicher Law LLC. Pincus is represented as custodian by Jennifer C. Voss of Skadden Arps Slate Meagher & Flom LLP. The new case is Shawe v. TransPerfect Global Inc., case number 2017-0679, in the Delaware Court of Chancery. The other Chancery cases are In re: TransPerfect Global Inc., case numbers 9661, 9686 and 9700, and Shirley Shawe v. TransPerfect Global Inc., case number 2017-0306. The Delaware federal case is Shawe et al. v. Pincus et al., case number 1:17-cv-00277, in the U.S. District Court for the District of Delaware. The New York federal case is Shawe v. Pincus, case number 1:17-cv-06673, in the U.S. District Court for the Southern District of New York. –Additional reporting by Ryan Boysen, Jeff Montgomery and Chelsea Naso. Editing by Marygrace Murphy.
Please note new e-mail address, [email protected] Please note new Twitter account, https://twitter.com/Judson_Bennett

Question: What do all of these have in common?

    Answer:  Law firm- Skadden Arps.    As Bouchard’s handling of the TransPerfect case melts the main driver of Delaware’s economy (incorporating businesses), it also appears the ice may be melting beneath the feet of legal giant, Skadden Arps.   As I have been calling for an investigation into Bouchard, Bob Pincus and Skadden’s outrageous billing of TransPerfect, The New York Times reported this past Thursday that Skadden Arps is under investigation for potentially corrupt payments from the Ukraine.  I hope the investigation spreads to the Wilmington office of Skadden—God knows what they might uncover?  I always wondered where Bouchard learned his tradecraft? Bouchard’s alma mater and Pincus’ current employer were just featured in the New York Times.  Apparently, some of Skadden’s fees were shady enough to catch the eye of the Justice Department.  And, in my opinion, nothing could be shadier than the Custodian’s TransPerfect bills, which are now rumored at the company to exceed $500,000 per month?!   Here is an actual picture from a Spanish Newspaper of Bob Pincus drowning in money !  
Robert Pincus

Robert Pincus, lawyer partner of the firm Skadden and judicial administrator of Transperfect / FOTOMONTAJE CG

    Robert Pincus,   Below is the story as it ran in The New York Times.  I’m sure it’s all just an innocent coincidence—or is it?   Your comments are welcome as always, JUDSON Bennett-Coastal Network
Skadden, Big New York Law Firm, Faces Questions on Work With Manafort By KENNETH P. VOGEL and ANDREW E. KRAMER SEPTEMBER 21, 2017 The New York Times  WASHINGTON – Five years ago, Paul Manafort arranged for a prominent New York-based law firm to draft a report that was used by allies of his client, Viktor Yanukovych, the Russia-aligned president of Ukraine, to justify the jailing of a political rival. And now the report is coming back to haunt it. The Justice Department, according to two people with direct knowledge of the situation, recently asked the firm, Skadden, Arps, Slate, Meagher & Flom, for information and documents related to its work on behalf of Mr. Yanukovych’s government, which crumbled after he fled to Russia under pressure. The request comes at a time when Mr. Manafort, his work for Mr. Yanukovych’s party and for Russian and Ukrainian oligarchs as well as the handling of payments for that work have become focal points in the investigation of the special counsel, Robert S. Mueller III, into Russian meddling in the 2016 presidential election, and connections between Russia, Mr. Trump and his associates. It’s unclear if the Justice Department’s request to Skadden, as the firm is known, is part of Mr. Mueller’s inquiry. But the interest from prosecutors in what Skadden did for the Ukrainian government is one indication of the wide-ranging nature of the inquiries related to Mr. Manafort. It also highlights the risks associated with advising authoritarian governments overseas, a lucrative sideline among Washington lawyers, lobbyists and public relations consultants. Mr. Manafort played a central role in the effort to shield Mr. Yanukovych from international condemnation, according to consultants involved in the effort. He devised the strategy and recruited lobbyists, lawyers and public relations consultants from across the political spectrum, but left the day-to-day implementation of the campaign to others. Skadden’s report was one element of that strategy. Its conclusions provided a counterpoint to international critics who said that Mr. Yanukovych’s government had prosecuted and convicted the former Ukrainian prime minister, Yulia V. Tymoshenko, on corruption charges in 2011 for political reasons and without sufficient evidence. That kind of international consulting by American firms traditionally has not drawn much scrutiny from regulators or the media, but that has changed in the last year, thanks largely to Mr. Manafort’s role as Mr. Trump’s campaign chairman in 2016 after years collecting multi-million-dollar paydays  from Russian and Ukrainian oligarchs and political parties. As part of Mr. Mueller’s investigation, prosecutors last month issued grand jury subpoenas seeking testimony from officials from at least two lobbying and public relations firms that worked on the team Mr. Manafort assembled to plead Mr. Yanukovych’s case in Washington – Mercury Public Affairs and the Podesta Group, according to two people with direct knowledge of the subpoenas. The firms were paid more than $1.1 million each to try to rally support among American policy makers and opinion leaders for Mr. Yanukovych, and the firms’ lobbyists cited the findings in Skadden’s report to quell mounting concerns about his leadership. The subpoenas for Mercury and Podesta – which followed an earlier round of subpoenas to the firms for documents and information related to their Ukraine work – focused on “Manafort’s money – where it came from, how he got it, what he did with it,” according to a person familiar with the inquiries. Officials at Mercury and the Podesta Group did not respond to requests for comment. Through a spokesman, Mr. Manafort declined to comment. Federal agents raided his Virginia home in July, confiscating documents and copying some of his computer files. Shortly afterward, prosecutors working for Mr. Mueller told Mr. Manafort they planned to indict him. The Justice Department’s request for information about Skadden’s Ukrainian work came after Ukrainian prosecutors asked their American counterparts for assistance in pursuing an inquiry into alleged illegal spending by Mr. Yanukovych’s government. That inquiry included payments to Skadden, though the Ukrainians have not accused the firm of any crime. The Ukrainians nonetheless requested that the Justice Department question Mr. Manafort and Skadden’s lead lawyer on the case, Gregory B. Craig, who had served as President Barack Obama’s White House counsel. Mr. Manafort’s team hoped that the involvement of Mr. Craig, who maintained deep connections to Washington’s Democratic establishment, might win Mr. Yanukovych a more favorable reception with the Obama State department, according to the consultants who worked on the issue. Yet they said that even employees of Mercury and Podesta regarded the report as a “whitewash” that did little to address valid concerns about Mr. Yanukovych’s government. The report was concluded in September 2012 – just before one of Mr. Manafort’s daughters started work as an associate at Skadden – and released in December 2012. The day after its release, Victoria Nuland, a State Department official at the time, called it “incomplete,” at a department press briefing, saying that it “doesn’t give an accurate picture.” She said the State Department was concerned that “Skadden Arps lawyers were obviously not going to find political motivation if they weren’t looking for it.” In a recent interview, John E. Herbst, a former United States ambassador to Ukraine, went further. He said that Skadden “should have been ashamed” of the report, calling it “a nasty piece of work.” Mr. Craig declined to comment. Under the Foreign Agents Registration Act, or F.A.R.A., anyone engaged in lobbying or public relations for foreign governments must register with the Justice Department. But in a statement this month, Skadden contended that “none of our attorneys engaged in any activity that required them or the firm to register under F.A.R.A.” The firm also asserted that its report “did not opine about whether the prosecution was politically motivated or driven by an improper political objective” – an assertion that narrowly avoids directly contradicting the report’s conclusion that “Tymoshenko has not provided clear and specific evidence of political motivation that would be sufficient to overturn her conviction under American standards.” Rather, the firm’s statement said that Ms. Tymoshenko “was denied basic rights under Western legal standards,” was “improperly incarcerated during the trial” and that “in the West, she would receive a new trial.” In June, Skadden refunded $567,000 to the Ukrainian government – about half of the total it was said to have been paid by Mr. Yanukovych’s government. The firm suggested in a statement that it returned the cash because the money had been placed “in escrow for future work” that never took place. Less than a year and a half after the release of the Skadden report, Mr. Yanukovych fled the country amid street protests over his government’s corruption and its pivot toward Moscow. Under the government that succeeded Mr. Yanukovych, the country’s general prosecutors office – Ukraine’s version of the Justice Department – opened criminal corruption investigations into Mr. Yanukovych and members of his government, including his justice minister, Oleksandr Lavrynovych. Court documents in the case against Mr. Lavrynovych alleged that Mr. Manafort “designed a strategy” to enlist Skadden to “confirm the legality of the criminal prosecution of Yulia Tymoshenko and … reject any political motives of such prosecution.” Mr. Lavrynovych’s lawyer, Yevgeny V. Solodko, rejected the charges against his client, characterizing the case as a politically motivated crackdown on officials from the former government. The general prosecutor’s office, under a mutual legal aid agreement with the United States, began asking the Justice Department and the F.B.I. for assistance with the investigation into Mr. Lavrynovych starting in late 2014. But neither the Justice Department nor the F.B.I. had responded to the requests as recently as March, when the F.B.I. director at the time, James B. Comey, was asked during a congressional hearing why the Ukrainian requests for assistance had gone unheeded. More recently, Ukraine’s prosecutor general, Yuriy Lutsenko, acknowledged in written responses to The New York Times that his office had begun working with the Justice Department to investigate the payments from the Ukrainian Justice Ministry to Skadden. Asked whether Ukrainian prosecutors are assisting in Mr. Mueller’s investigation, Mr. Lutsenko’s office was coy. In a statement, it said that it had not publicly disclosed any such cooperation, but it also noted that not all international judicial cooperation can be disclosed. Representatives for Mr. Mueller’s team and the Justice Department declined to comment. Kenneth P. Vogel reported from Washington and Andrew E. Kramer from Moscow. Charlie Savage contributed reporting, and Kitty Bennett contributed research. Kenneth P. Vogel reported from Washington and Andrew E. Kramer from Moscow.  
Please note new e-mail address [email protected]
Delaware judiciary rating plunge self-inflicted, says Alan Dershowitz

Delaware judiciary rating plunge self-inflicted, says Alan Dershowitz

   My e-mail network, “The Coastal Network” reaches 6,000 people. It involves Republicans, Democrats, Independents, Conservatives, Moderates, and Liberals. I receive countless responses from my recipients. I believe, although controversial at times, my opinions are respected for the most part and certainly have influenced votes and perceptions in the past.
    This TransPerfect travesty of justice within our judiciary has created quite a stir amongst many Delawareans who are frustrated, concerned and angry. A good 90% of my network has responded to me with comments that indicate their concern over the actions of Chancellor Andre Bouchard, and the detrimental situation it has created for Delaware. Many remarks also involve the Legislature and the actions it has taken and not taken as well.
     Here below are some of the comments I have received concerning the TransPerfect Court Case. Housewives, Business people, Lawyers, Doctors, Mechanics, Sales People, and folks from all walks of life have responded accordingly — back and forth on blogs as well. I have removed their last names to protect their identities.
 

From Dave:
Thanks Judson. I have forwarded this and your previous commentary to my State Senator, Dave Lawson, who has responded. Some Senators have been calling the alarm about our “out of control Judges.”
In my opinion, Chief Justice Leo Strine should resign and the governor should elevate Justice Jimmy Vaughn to Chief Justice. Vaughn was previously qualified for the position. Randy Holland withdrew his name from consideration and has retired.We need a major change and shakeup in the judiciary management of Delaware.
Maybe you should suggest in your updates on TransPerfect, they be forwarded to each recipient’s State Senator and provide the 21 email addresses?

From Scott:
Judson, If we can’t trust the Courts to adjudicate fairly and equitably, what have we got. I own several businesses, all incorporated in Delaware. Bouchard is bad for business and the TransPerfect case is a legal abomination. Shame on the Delaware Legislature for not enacting Senate bill 53.

From Lawyer Bob:
Judson, I enjoy your e-mails. This TransPerfect Case is amazing from my perspective. As an attorney, I find it hard to believe that Chancellor Bouchard has conducted this case the way he did. I also find it disconcerting that Strine’s Supreme Court upheld it. I read Justice Karen Vallihura’s dissenting opinion and I agree with her. She is right on target. I believe that the U.S. Supreme Court will over-turn this ruling and Shawe will be vindicated. Depends on whether or not the Court will hear the case. With Alan Dershowitz involved, there is a good chance it could get to the Supreme Court. The Custodian thing with Robert Pincus is really something. I wonder if Shawe is taking legal action on that situation? Definitely seems that he has a case on that rip off. $1450 per hour is mighty steep for that kind of work. Please keep my real name confidential. Take care my man, BOB

From Rick: 
The only thing Delaware has going for it as an incorporation venue is a fair and unbiased Court of Chancery. Other states, particularly Nevada, are actively trying to wrest incorporation “business” away from Delaware. This ruling may well influence future corporate decisions.
By “future corporate decisions,” I mean newly formed companies incorporating in Delaware. The primary reason so many businesses incorporate in Delaware is the Court of Chancery being fair to big business — not prejudiced in favor of- but fair.

From Corinnia:
With Delaware no longer # 1, Looks like Amazon won’t be coming here.

From Don:
The real issue here it that there is no Inspector General in Delaware to oversee these obvious acts of cronyism or corruption, by the courts or legal system, let alone the law enforcement agencies of Delaware.
The case you state here is a prima facia case of cronyism and corruption of the court system. Of course all judges are appointed in Delaware not elected. This alone makes the difference you’re talking about here in this article.
Good to hear from you again JUDSON!

From Rick B:
Jud,
I know, and you’re right. I read every email you send out.
This is a big blow, and the Governor is definitely concerned about this right now like never before. So is every lawyer in Delaware, and every registered agent.This news just dropped today.Delaware has been #1 every year since this survey began and it’s “all of a sudden” #11 this year.

From Delaware Lawyer:
The accusation of cronyism… The senior Delaware lawyers on both sides (Kevin Shannon and Greg Williams) both represented defendants in the Disney litigation. Both of them recently appeared on panels with Chancellor Bouchard: Shannon at Tulane, and Williams at Penn.

From Mary:
Judson, Please keep up the good work. Your articles and research on TransPerfect are so informative. I believe Bouchard should be impeached. Our system of government is not supposed to work this way.

From Viper:
What are the least trust worthy occupations among public opinion?
1) lawyers
2) politicians
3) salesmen
No wonder the general public distrusts the government and legal system when most elected officials are either one or all three of the above!
Question is,then why are we electing any of the above three career people when they are the reason our government is so dysfunctional?

From Gerald:
The TransPerfect case is important for Delaware. The evidence for cronyism and judicial misconduct here sounds beyond compelling, and likely warrants investigation.
1) If Chancellor Bouchard really handed the case to his friend, Kevin Shannon, when Shannon called ZERO fact witnesses vs. 10 fact witnesses on the other side (as is being blogged about), then both Andre Bouchard and Kevin Shannon must be made to find another line of work for the integrity of our legal system.
2) If Chancellor Bouchard really found for Kevin Shannon on virtually ALL motions for nearly two years, then again, Bouchard is guilty of bias and favoritism, and there’s simply no place for this type of conduct in our justice system.
Scrutiny of this unprecedented ruling will surely increase over time. I’m looking forward to seeing more research, and getting the answers to the many questions raised by the TransPerfect case.

From Kathy:
In the TransPerfect case: The court-ordered dissolution and sale of a private, profitable company is the culmination of a series of unprecedented rulings in Elting’s favor by Chief Chancellor Andre Bouchard. The rulings were all at the request of Elting’s attorney Kevin Shannon, who also happens to be Bouchard’s personal friend. These unprecedented decisions, combined with Bouchard turning a blind-eye to obvious fraud by the Elting team (see link below), raise questions too large to ignore about what is really going on here.
Click Here

From John, retired Marine Colonel:
Can’t say that you didn’t tell them, Jud !
You knew (… and truly the legislature knew as well) that politics and cronyism from the bench would sooner or later bite-Delaware-in-the-ass. As you so well described, the unconscionable way the TransPerfect case was adjudicated was indeed the linchpin in the dethroning of Delaware from ranking as the nation’s top business litigation state.
For shame that it all unfolded as a sham in Chancery Court while everyone (from top-to-bottom) sat by the sidelines with their proverbial wine goblets in hand amused by the flames that burned the heretofore best business litigation court right out of contention.
At the outset of the TransPerfect party you “flicked on the lights”, but no one yelled “surprise” !!!…and the only present that was left, was Delaware’s smoldering reputation.
Sad and despicable…
(a non-attributable commentary)

From John D.:
Judson – Here is another article I just found and translated using a Google app. I’ll send another email with the original Spanish version.
Click Here

From Joseph:
Philip Shawe is really getting screwed here. Bouchard never should have gotten the job in the first place. The conflicts of interest, the bias, the cronyism, and the obvious corruption in the whole system is disgraceful. Bouchard should be disbarred and locked up. The do nothing legislators that have ruined Delaware also need to be replaced.

From James:
The appearances of impropriety whether Bouchard is or is not guilty of corruption in this case are inexcusable. He should have recused himself. The actions of Robert Pincus, the Custodian are unbelievable. There is no way this guy can get away with this. I am appalled!!!!

From Sally:
Hi Jud, Thank you for the outstanding job you are doing in exposing this travesty of justice to the people of Delaware. I appreciate your e-mails and look forward to receiving them. Judge Bouchard should be disbarred and removed from the bench. It sure looks like the fix was in. I am concerned that if the businesses and corporations flee Delaware because of his obvious poor decisions, our taxes will go sky high. Keep up the good work. I have enjoyed your articles over the years.
Well folks, there you have it — a cross section of the feelings of the people in Delaware who read my e-mails. There are hundreds more who have responded to me on this TransPerfect issue with extreme interest and great concern. I believe that Delaware is losing its credibility as a safe place to incorporate. The “Small Wonder” is no longer so wonderful. The state is flat broke and if something is not done legislatively to fix these problems, it will only get worse with rampant unemployment and huge income taxes. I urge you to contact your State Senators and State Representatives and tell them how you feel.

Respectfully submitted,
JUDSON Bennett-Coastal Network
Please note new e-mail address, [email protected]
Please note new Twitter account, https://twitter.com/Judson_Bennett
Below is an interesting overview of the TransPerfect Global case, adjudicated in the Delaware Court of Chancery by Andre Bouchard. What makes this article fascinating is that it was written by (Retired) Justice Melvin Schweitzer, the Judge who handled the case in New York Supreme Court, before the case went to Delaware and in front of Bouchard.  Before Justice Schweitzer hit the mandatory retirement age, he’d gutted Elting’s case and labeled it as “squabbles” — Then after losing in New York, Elting shopped the case to Delaware, where she found the Bouchard-Shannon duo… to turn “squabbles” into one of the most dangerous and controversial decisions in business-law history. Even more interesting is that Justice Schweitzer has been openly critical of Chancellor Bouchard’s handling of what was “his case” — and called the result “extreme” in an interview with the Delaware News Journal. According to sources close to the case, Justice Schweitzer was so moved by Delaware’s handling of the matter, that he agreed to judge a moot court scholarship contest for law students who entered a competition set up by TransPerfect co-CEO, Philip Shawe — offering hypothetical arguments of appeal before the United States Supreme Court, where this controversial case may indeed end up. A mock panel of Supreme Court Justices including Justice Schweitzer and Alan Dershowitz were among the panel members who determined the winners of the competition. This was an innovative and philanthropic idea by co-CEO Philip Shawe, who in my view has been unjustly damaged by Bouchard and the Delaware Chancery. Make no mistake, this is the greatest business injustice in Delaware, and possibly U.S. history as well.   In my opinion, the blood of every hard-working family left jobless, based on this unprecedented court intervention will be all over Bouchard’s hands. I pledge to profile each and every family for all of Delaware to see as to the significant massacre Chancellor Bouchard intends to create by his outrageous rulings. Perhaps in the near future they will be able to testify for his impeachment.  As always your comments are welcome. Sincerely Yours, JUDSON Bennett-Coastal Network CHECK OUT THE ARTICLE BELOW   For reference:   [youtube https://www.youtube.com/watch?v=wXEHyTA_8ck?ecver=1&w=560&h=315]  
Source: Law360

Possible Legal Precedents In TransPerfect Global

By Melvin Schweitzer August 2, 2017, 11:53 AM EDT     August 2, 2017, 11:53 AM EDT In 2015, the Delaware Chancery Court ordered the sale of the translation services company, TransPerfect Global, as part of resolving a dispute between the company’s largest shareholders, Phil Shawe, Shirley Shawe and Liz Elting. The Delaware Supreme Court earlier this year affirmed the Chancery Court decision with one of five justices dissenting. In the aftermath of the TransPerfect decision, much remains open regarding how much deference the Chancery Court should give to directors to resolve internal disputes, and when a directed sale is an appropriate remedy. The Delaware Chancery is considered the gold standard among corporations globally, and for that very reason, many find it hard to consider the possibility that the court could occasionally be wrong. This may be one of those cases. To bring attention to the issue, Philip Shawe began a scholarship competition among law school students to publicly explore the case as if it were being challenged at the U.S. Supreme Court level. The final oral arguments were heard on July 20 in Brooklyn before a panel of judges who also helped narrow the field of entry briefs to the final 10. Myself, retired Justice Carmen Ciparick, my former director of interns Joseph Hansen, and Harvard professor Alan Dershowitz served as the mock Supreme Court and we directed the moot court proceedings. Steven Hermosa, a recent graduate of the University of Florida, Levin School of Law, student turned in the top-scoring brief and had the best oral defense. TransPerfect was started in 1992 by two New York University business school classmates, Philip Shawe and Elizabeth Elting, while they were still in school. The privately held Delaware corporation has 100 shares outstanding, 50 owned by Elting, 49 owned by Shawe, and one share owned by Shawe’s mother, Shirley Shawe. Though the corporate charter provides for three directors, Elting and Shawe have served as the only directors since 2007, and have managed the company as two equal shareholders. Since 2012, despite the company’s successful performance for two decades, Shawe and Elting’s personal relationship deteriorated. Litigation between these principals ensued. The principal case was heard in the Delaware Court of Chancery, which ordered a sale of the profitable company. The Delaware Supreme Court affirmed the Court of Chancery, with one justice filing a lengthy dissent. This has now led to a federal court action by the Shawes, which raises alleged violations of the United States Constitution by Delaware’s courts and ultimately may reach the U.S. Supreme Court. The Delaware Court of Chancery has broad statutory powers to address corporate deadlocks that it deems detrimental to corporate shareholders, employees and the corporation itself. The Court of Chancery may appoint a “custodian” if the business of the corporation is suffering or threatened with irreparable injury or if required action by the board cannot be obtained. The purpose of such intervention is to protect the company, and the means used to achieve that goal are required to be tempered to be the least intrusive possible. Here, the Court of Chancery held a bench trial and found that both sides had engaged in “mutual hostaging.” Shawe, by not agreeing to large distributions demanded by Elting, and Elting remarkably exerted leverage over Shawe by refusing to exercise her fiduciary duty to act on important business decisions. The court found that the company’s business was threatened with irreparable harm even though it was extremely profitable. The court pointed to corporate morale, relationships with clients, and Elting’s refusal to agree on acquisitions. It appointed a custodian to be involved in managerial decision-making, but also to conduct an auction sale of the shares held by the Shawes and Elting. The Shawes remain unalterably opposed to selling their stock. The Delaware Supreme Court affirmed the Chancery Court’s decision and declined to hear the constitutional argument advanced by Shirley Shawe that a forced sale of her share violated the due process and takings clause of the Fifth and 14th Amendments. Accordingly, the Delaware Supreme Court did not consider the constitutional safeguard that provides, “No person shall be … deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.” The principal “takings” argument is that Delaware defines stock ownership as personal property and that the forced sale over the Shawes’ objection deprives them of their rights to possess, use and dispose of their property as they see fit. Such sale is violative of the Constitution because it is for a nonpublic use, (i.e. breaking a deadlock is a decision of what is best for the corporation and its shareholders and employees collectively). Things like employee morale, customer uncertainty, and damage to the company’s reputation are private harms. No public purpose is involved. The U.S. Supreme Court has long recognized in cases involving real property/economically depressed areas (Kelo v. City of New London, 545 U.S. 469 [2005], Justice Anthony Kennedy concurring but urging that a legitimate public purpose be a fact-based test) and intangible property (Ruckelshaus v. Monsanto Co., 467 U.S. 986 [1984]), for example, that there must be a broad public benefit to sustain a taking. To be sure, the “public use clause” is not satisfied simply when one person’s property is taken for the benefit of another private person, even if compensation is paid. Delaware’s argument presumably is that the state’s broad statutory power to regulate the internal affairs of the corporations that it charters is a “public purpose,” and that if it has the right to dissolve companies and approve the transfer of stock in a merger, then its public purpose surely extends to ordering the sale of stock in a deadlock situation adversely affecting one its corporations. Shawe’s argument with respect to due process is that the Court of Chancery issued the sale order without proper notice. Due process is met where the state can show that a particular procedure bears the “sanction of settled usage.” Due process in any proceeding must be reasonably calculated to apprise parties about the legal remedies for a deprivation of property by the state. Here, the Shawes argue that the relevant provisions of the Delaware General Corporation Law failed to give the Shawes fair notice that the Chancery Court could exercise a power analogous to eminent domain in forcing them to sell their shares against their will. Eminent domain cases in Delaware are heard in a different court — the Superior Court. Also, Section 226 only speaks of liquidating a corporation’s affairs and distributing its assets. Nothing in the statute contemplates the seizure and sale of an individual’s stock. Finally, as the lengthy dissent in the Delaware Supreme Court noted, the parties could not point to a single case in the history of Section 226 jurisprudence where a court ordered a custodial sale of shares over a shareholder’s objection. Along these lines, the Shawes argue that they could not have reasonably known that their property was in jeopardy of such a manner. Delaware, though, would argue that its statutory scheme, which allows dissolution of companies and hostile mergers, puts all shareholders on notice of the Chancery Court’s broad power to affect corporations, including forcing a sale. Should the case reach the U.S. Supreme Court, the justices will have to weigh Delaware’s argument for its public-purpose “taking” against TransPerfect’s facts of shareholders in a highly profitable company being made to sell their shares because of corporate deadlock — even when the Chancery Court has less draconian remedies in its statute. As for due process, the justices will have to weigh Delaware’s argument that its broad corporate statutory powers amply put a litigant on notice that such a sale could have been reasonably anticipated as one of Chancery’s options, even though there is no express statutory provision authorizing such action and it has never been done before over the objections of a shareholder, as is the case here. Author’s note: Some of the facts and arguments discussed in this analysis are based on excerpts from the briefs that were submitted to The Philip R. Shawe Scholarship Competition. Melvin L. Schweitzer, now a counsel at Liddle & Robinson LLP, served 10 years on the New York state bench, including as acting Supreme Court justice (Commercial Division, Manhattan) handling complex commercial cases, and as a judge of the New York State Court of Claims. DISCLOSURE: The author is one of four judges for the The Philip R. Shawe Scholarship Competition, which is sponsored by one of the litigants in the case discussed and asked law school students to prepare the best argument for reversing the Delaware Chancery Court ruling.
 
Judson Bennett   Please note new e-mail address, [email protected]   Please note new Twitter account, https://twitter.com/Judson_Bennett
Chancellor Bouchard’s relationship with Kevin Shannon of Potter Anderson is extensive and well-documented.  My opinion is the TransPerfect case is worthy of Judicial Corruption and whatever those Philadelphia judges did recently to get hauled off by the Feds doesn’t hold a candle to what Bouchard has done.   Here’s my view of what I’ve witnessed:   ·         Bouchard and Shannon (of Potter Anderson) share a 20-year country-club friendship dating back to when they worked the same side of the Disney Ovitz $100 million severance case.

·         When Bouchard became a judge for the first time — right before the TransPerfect case — he had to give up his prestigious board seat at the St. Francis Hospital, and he picked his friend Kevin Shannon to take his vacant seat.   ·         Bouchard, in his first big case, sees Shannon’s name on the TransPerfect case. He assigns all the cases as Chief Chancellor and assigns Shannon’s case to himself so he can control the outcome, in my opinion. Isn’t that convenient folks? And, what a nice time to start paying back your friends!?!   ·         Bouchard’s bias shows, as he ridiculously rules in Kevin Shannon’s favor in two different aspects of the case, Merits and Sanctions.  For the first time in history, he orders the forced-sale of a stock-based private company in a zero-witness case, simply on the word of Kevin Shannon. Again, not one person testified for Elting at trial — they all testified for Shawe — yet she won in a landslide!   ·         TransPerfect is an industry leader with twice the profit margins and twice the growth rate of its closest competitor. It has grown from just 2 people in 1992. It never had a year without growth and never a year without a profit. It is one of American’s greatest, business success stories. The company is not dysfunctional in any way and the testimony Bouchard cited to prove this, was totally plucked out of context.   ·         In the sanctions motions, after being railroaded by Bouchard for years, (Shawe lost 90% of all of the 50%/50% motions), Shawe motioned the Court for a criminal jury trial to fight what I’m sure he views as Bouchard’s corruption. What 25-year successful businessman requests and volunteers to subject himself to criminal conviction at the whim of a jury, on his own free will?  None. This proves to me two things. 1) Shawe is innocent and the Sanctions are trumped-up by Bouchard. 2) Bouchard badly wanted to be judge, jury and executioner for this case for a reason – and his rulings have transfered a king’s ransom to Bouchard’s former law partners and other cronies. The numbers are astonishing, my friends! You would be outraged if it were you on the other side of Bouchard’s ruling! Believe me!   ·         Bob Pincus of Skadden Arps is billing $1,425 per hour as the Custodian/Receiver in Delaware… hiding his bills in lump-sum billings. Bouchard then approves them by Court Order, and then (employees have told me) Alvarez and Marsal, run over to the Accounting Department and waive a court-order in front of the poor check-cutter named Silvia – and scream they all need their bills paid immediately! Alvarez and Marsal (Pincus’ Court Appointed Consultants) demand payment for Skadden’s outrageous bills immediately with no review – and Pincus scratches their back the same way, with immediate bill approval and no detail required. This crazy operation is a grotesque and greed filled feeding frenzy that is breaking TransPerfect.  I encourage investigative reporters to call TransPerfect, ask for Silvia in accounting, and ask her about this chicanery.     ·         In my opinion, Philip Shawe was denied a fair trial by Chancellor Bouchard. Although there are not jury trials in the Court of Chancery, they are supposed to be conducted under similar rules. Basically, I see this biased Judge as saying, “I’ll make the decision to fine you $7 million myself, even though no one testified against you, because I don’t like you.”  He did not follow the law, in either the Merits or the Sanctions, which were all in favor of Mr. Shannon. Does Bouchard think the public are idiots?

·         There’s more:  During the decision phase of the trial, when a jury would have been sequestered during a jury trial, what do Bouchard and Shannon do?  They travel to New Orleans and make a public appearance together, co-paneling before law students at Tulane University. This is insane, folks! From this move alone Bouchard should have recused himself!  What judge does public speaking appearances with one-side’s lawyer, while the case is being decided??     ·         It gets worse, and to me, this is the clearest evidence of wrong-doing in the judiciary: Bouchard orders a third of Elting’s trial fees to be paid by Shawe, and all Elting’s attorneys had to do was show their itemized bills, and had to take deductions – for things like mediation time and working on Shirley Shawe’s case – except one person, who didn’t have to produce ANY bills, and got a FULL 100% reimbursement without having to show anything. Can you guess who?  That’s right: Kevin Shannon and Potter Anderson. He didn’t have to show his bills and Potter Anderson didn’t take a single deduction. In my view, this certainly looks to be an arrogant act by Bouchard to show such biased favoritism, with an unprecedented enrichment by Chancellor Andre Bouchard for Kevin Shannon and the law firm of Potter Anderson. It is truly the appearance of an impropriety. I say this whole thing should be turned over to the Attorney General, for investigation of both Bouchard and Shannon for possible corruption. The evidence couldn’t be any clearer.   ·         Bouchard’s decision to order the dissolution of TransPerfect is 8 pages long. It basically says that “ these guys don’t get along.” Therefore, Elting loses her offensive claims against Shawe. Shawe loses his claims against her “without getting to the merits” (my view is that this means that Shawe proved his case, but the judge is not going to rule for him anyway). And therefore, he is going to arbitrarily force an auction of this 3-owner company, because of a “Director Deadlock”.  And he is going to give Kevin Shannon and Elting the maximum payout humanly possible, so the case can never settle.   ·         I have read other op-eds that blame the parties in this case for not settling. The bottom line here is, not being able to settle this case through reasonable negotiations, is indeed a circumstance obviously created by Bouchard, not the involved litigants. When a Judge intentionally uses nuclear weapons (when a fly swatter will do), and rules heavily against one party – a case can never settle under any circumstances. The deck was obviously and completely stacked by the Chancellor and in my opinion this is criminal.   ·         To give you a simple example of why this is all Bouchard’s fault (or worse, in my view, is his calculated and engineered plan)… Imagine two parties fighting over dollars, Party A says B is owed 0, Party B says he’s owed $1,000,000. Each party only has a million. The judge says, B, I rule you get $5 milllion, and A I’ll try to ruin your reputation with 106 pages of lies.  B now has a ruling worth $5 million, but all their assets together are only worth $2 million. How can the case settle? What can A give B to settle? The answer is nothing. And this is the answer that makes the case never ending, and makes Bouchard’s inner-circle of cronies, rich at the expense of TransPerfect and Philip Shawe.     I urge the Delaware Lawmakers, the Delaware Bar, the Court of the Judiciary, the Attorney General… Someone must step in and stop the TransPerfect madness! Shawe, Elting, and TransPerfect don’t deserve Bouchard’s continued fleecing of the company – and neither does any future Delaware corporation. THIS GOES BEYOND JUST THIS CASE, IT AFFECTS FUTURE INCORPORATIONS IN DELAWARE WHICH IS 1/3 OF DELAWARE’S BUDGET !

I have read the whole transcript several times and interviewed many folks, here’s what is obvious:  Did the litigants each write mean emails? Yes. Does the staff hate Elting? Yes. Is Shawe a tough, but good manager? Yes, And he’s respected and loved by the staff.  By Bouchard’s new standard of dissolution… every corporation or partnership or law firm, where people fight on email or in the Board Room, could be taken over by a rogue Judge and auctioned off without notice or due process! It Is an illegitimate “TAKING” under the 5th amendment to the United States constitution.     There is a lot at stake here. Being an eternal optimist, I’d like to believe this $100 million dollars, Bouchard has already cost TransPerfect, and the next $100 million that his planned forced auction is going to cost — is all going to be paid back by the apparent bilkers. Think about it!!!  A Delaware company, which has deadlock because of an even number of directors, comes to court for a solution, and rather than order the parties to appoint a third director and expand the Board — TransPerfect is forced to pay 1/3 of its value to legal fees, to the Judge’s inner-circle and to court-ordered consulting, accounting and investment bank fees. This is absurdity and sets a dangerous precedent that will ultimately hurt the State of Delaware which is already in huge financial trouble.     In closing, I will share more of my personal views: Bouchard’s handling of the TransPerfect case is completely insane and preposterous. Bouchard should face an investigation and potential impeachment. Kevin Shannon, Elting’s lawyer and Bouchard’s buddy, should also face investigation and possible disbarment. But all of this takes a back seat to the immediate issue of ending the environment of employee-fear that the Court appointed, Custodian (Chancellor Bouchard’s former business partner) Bob Pincus’s Nazi-like occupation and fleecing of this American success story. TransPerfect is a business being ripped apart by a Chancery Court that was supposed to be designed to protect businesses. Instead, the Chancery Court is lost at sea to the detriment of the State of Delaware, based on the current Chief Chancellor Andre Bouchard’s complete lack of a moral compass necessary to properly guide it.

As always your comments are welcome.

Respectfully Submitted,

JUDSON Bennett-Coastal Network   Judson Bennett   Please note new e-mail address, [email protected] Please note new Twitter account, https://twitter.com/Judson_BennettChancellor Bouchard is forever tarnishing the Delaware brand around the globe by his capricious, and in my opinion, illegal handling of the TransPerfect case. Bouchard’s “Implementation Order,” according to the Barcelona newspaper below, violates Spanish law. With a 25% unemployment rate in Spain, apparently any merger or acquisition of this magnitude inevitably results in the loss of jobs. Under Spanish law, before any merger or acquisition can be contemplated — much less thrusted into an auction process — an in-depth study is required on how it will affect the employees. And if this is the law for Spain, it would not surprise me if each and every European country where TransPerfect operates (about 20 countries) have similar laws.  Chancellor Bouchard, how do you say “I’m a Loco Gringo Judge” in Spanish?  If this Order does in fact break Spanish law, I will be shouting from the mountain-tops for your impeachment (and don’t say later that you weren’t on notice, because you are on my email list).   The Chancellor and his designated henchman, Custodian Bob Pincus have shown their real-world inexperience and naivety, and it is magnified ten-fold when dealing with the complex issue of global business and European employment law. How is it that a former Delaware River Pilot and former Lewes City Councilman like me can see that Delaware’s court system has fleeced this company out of $100 million, is destroying our state’s business-friendly reputation worldwide and threatens our entire economy while raising the dark shadow of possible corruption… and no one in Delaware seems to care?? I for one want to see the reputation of Delaware saved and restored to its former glory, and the negative publicity that Chancellor Bouchard is creating erased, as it is the greatest immediate threat to our already weak economy!! See the story I’m referring to here: http://www.aldia.cat/espanya/noticia-experts-afirmen-jutge-cas-transperfect-vulnera-seva-potestat-jurisdiccional-20170713125427.html  
Experts claim that the judge of the case violated his judicial power Transperfect Posted 13/07/2017 12:54:27 CET The group fears that a possible sale affecting their jobs BARCELONA, Jul 13. (AFP) – The judge of the Supreme Court of Delaware, André Bouchard, is in violation of the limits of its jurisdictional authority and violating rights to privacy and freedom of expression template Transperfect in Barcelona, ​​according to experts consulted next to the multinational translation and dubbing.   The operational center of Barcelona, ​​which has 500 employees, is the second largest company and is leading the creation of a European works council level, bringing together 26 centers for social dialogue interlocutor was against any change organizational occur before the conflict remain founders. Judicial sources have said that the “Implementation Order” he declared at the beginning of the conflict carries important implications not only for legal workers Transperfect United States, but especially for the operational center of Barcelona. This battery of legal measures would be out of power and influence Bouchard is an “overreach its powers”, say experts, recalling that Robert Pincus, judicial administrator appointed by Bouchard for this transition period would be acting as if “under the order issued by judge implementation, workers in Spain were under his supervision and order,” which is contrary to law. Under this tax, remember, Barcelona Transperfect workers are required to contribute to the risk of sanction the sale of the company and can not do evaluations, despite knowing the consequences it could have for the center of the Catalan capital. A few months ago, the Supreme Court of Delaware ordered the forced sale of Transperfect to resolve the conflict between the shareholders founders Elizabeth Elting and Phil Shawe. According to sources close to the most likely sale of a multinational private equity funds could lead to the relocation of Transperfect 90 centers worldwide and threatens 500 jobs in the company in Barcelona.
  Judson Bennett Please note new e-mail address, [email protected] Please note new Twitter account, https://twitter.com/Judson_Bennett

St. Francis-Gate

As you’ve been reading, I’ve been writing about what I see as obvious cronyism between Chancellor Bouchard and attorney Kevin Shannon of Potter Anderson here in the TransPerfect case in Delaware. The biased nature of Bouchard’s decisions through out the case are real and unquestionable. It’s not easy to dig up new information and I don’t exactly have the tools at my disposal that an investigative journalist a major media outlet has, but I have just learned about the most insidious tie I’ve learned of to date between Chancellor Bouchard and Shannon (the lead attorney for co-CEO Liz Elting of TransPerfect) that, of course, was never disclosed before trial. I call it “St. Francis-Gate.” Records have already shown Chancellor Bouchard, while in private practice, not only worked with Kevin Shannon on several matters over the years beyond the infamous Disney case. But perhaps most shockingly to me, Bouchard, when he was a senior officer on the Board of Directors at St. Francis Hospital, hand-picked Kevin Shannon for the prestigious Board seat vacancy that he left, when Bouchard had to give up his seat to become a judge. Let me tell you , this is breaking news, and it stinks. It is no coincidence that Kevin Shannon, who has been bestowed windfall after windfall by Bouchard from the Chancellor’s chair, was moved up to take Bouchard’s prestigious St. Francis board seat vacancy. The law is clear: Delaware’s Judicial Code of conduct requires that a judge is to disclose any potential conflicts of interest to the litigating parties including what could amount to the appearance of impropriety so that any of the parties can exercise their right to move for the judge’s recusal. This statute was designed to protect not only the litigants but the integrity of the judicial system in Delaware. Want more proof? Relationship Science is an independent site that tracks people with common business and social interests. Part of their slogan is: “We bring science to the art of business relationships.” Check out the science of Kevin Shannon.

Relationship Science

Relationship Science only connects Shannon to just 34 other people and, among his closest 34 personal connections, you guessed it, Chancellor Andre Bouchard: Let me take a small victory lap for uncovering St. Francis-Gate and the Bouchard-Shannon Board Seat, seemingly payola connection. I have been building reliable information sources in Delaware for over 50 years, and I want to thank them for providing me with vital leads to run down. I knew there was something wrong here, and the more I dig, the more it becomes painfully obvious that Bouchard’s agenda does not appear to be justice. Clearly Bouchard and Shannon have a long history of close connections together and in my learned and informed opinion, if we were in any other State but Delaware, this Chancellor never would have stayed on this case. The blatant disregard for ethics and corruption in Chancery is beyond belief, as I see it! Although now living in Palm Beach, I will always be a concerned Delaware citizen at heart. I am indeed concerned about the reputation of the Delaware Court System. This Chancellor, also as I see it, unethically did not disclose his friendship or former business connections with Shannon. He even made a public appearance with, and co-paneled together with Shannon, on a New Orleans legal boondoggle, during the decision stages of the litigation in the TransPerfect case last Spring.

Justice Leo Strine

So Leo Strine picks Bouchard to fill his Chancellor vacancy, in turn Bouchard picks Shannon to fill his St. Francis Board seat vacancy. According to various sources, Bouchard was socializing with both Shannon and Judge Leo Strine (who affirmed Bouchard and ran out Shawe’s attorney team clock at oral argument) at the Tulane legal boondoggle last year. By the way, I hear Kevin Shannon is not appearing on the Tulane panel for the first time in recent history, so this too could be tacit admission of his misdeeds last year? Bouchard never disclosed his relationship, hoping an investigative writer like me would not find it. Well I’ve been sniffing and I’m smelling smoke here. Then, predictably he proceeded to rule against Philip Shawe, although zero witnesses testified against him, in the most draconian rulings ever made in U.S. history. According to my sources, Bouchard did not allow email evidence on the company’s public server of a plot to manufacture deadlock by Elting and her attorneys, to be presented in Court. As seen below the Code of Judicial conduct is clear.

DELAWARE JUDGES’ CODE OF JUDICIAL CONDUCT 2008 CANON

1. A judge should uphold the integrity, independence and impartiality of the judiciary. RULE 1.1 Compliance with the Law. A judge should respect and comply with the law, including this Code of Judicial Conduct. Comment: Deference to the judgments and rulings of courts depends upon public confidence in the integrity and independence of judges. The integrity and independence of judges depends in turn upon their acting without fear or favor. Although judges should be independent, they should comply with the law, as well as the provisions of this Code. Public confidence in the impartiality of the judiciary is maintained by the adherence of each judge to this responsibility. Conversely, violation of this Code diminishes public confidence in the judiciary and thereby does injury to the system of government under Rule l RULE 1.2 Promoting Confidence in the Judiciary. (A) A judge should act at all times in a manner that promotes public confidence in the integrity and impartiality of the judiciary and should avoid impropriety and the appearance of impropriety in all activities. Comment: Public confidence in the judiciary is eroded by irresponsible or improper conduct by judges. A judge must avoid all impropriety and appearance of impropriety. A judge must expect to be the subject of constant public scrutiny. A judge must therefore accept restrictions that might be viewed as burdensome by the ordinary citizen, and should do so freely and willingly. The prohibition against behaving with impropriety or the appearance of impropriety applies to both the professional and personal conduct of a judge. Because it is not practicable to list all improper acts, the proscription is necessarily cast in general terms that extend to conduct by judges that is harmful, although not specifically mentioned in the Code. Actual improprieties under this standard include violations of law, court rules or other specific provisions of this Code. The test for appearance of impropriety is whether the conduct would create in reasonable minds, with knowledge of all the relevant circumstances, that a reasonable inquiry would disclose, a perception that the judge’s ability to carry out judicial responsibilities with integrity, impartiality and competence is impaired. In conducting such activities, the judge should act in a manner consistent with this Code. (B) An independent and honorable judiciary is indispensable to justice in our society. A judge should participate in establishing, maintaining and enforcing high standards of conduct, and should personally observe those standards, so that the integrity, independence and impartiality of the judiciary may be preserved.”
It’s time for the legislature to appoint a special commission to investigate this whole situation. It is clear to me that this case was poisoned for the Shawes before they even walked in the courtroom. This explains why Kramer Levin, Elitng’s primary counsel in New York chose as their Delaware counsel, Kevin Shannon since they had all served as co-counsel in the Disney case, one of the biggest cases in the history of Delaware and of course Bouchard was co-counsel as well. Delaware’s reputation was called into question this week by an article that came out on March 20 in The Wall Street Journal. The article, “Dole and Other Companies Sour on Delaware as Corporate Haven,” notes that Delaware’s business-friendly reputation is no longer justified. The last thing Delaware needs now is the Chief Chancellor being allowed to engage in unchecked judicial action which in my opinion can easily be construed as corruption. The judicial branch is the least democratic of all of our government, and a recent poll showed 70% of Delawareans disagree that the Court should have the power to force the sale of a profitable company. I again call upon the legislature to act. Stay tuned. Best regards, JUDSON Bennett Please note new e-mail address, [email protected]

WDEL radio host Rick Jansen speaks with Philip Shawe, the co-CEO of TransPerfect, on recent dangerous rulings by the Delaware Chancery Court.  Also joining the conversation, is State Senator Colin Bonini (R-DE).

A group of TransPerfect workers have spent nearly $300,000 on a new round of television commercials in an effort to change a law that could result in the company’s sale.

The new ad buy is almost double what the workers spent last month on television advertisements.
Citizens for a Pro-Business Delaware is a group made up of more than 2,200 members including employees of the global translation services company TransPerfect, as well as concerned Delaware residents, business executives and others.This is a long piece, but worth reading to understand how the rule of law is now seriously flawed by the inequities of a failed system. Even in little Delaware this growing disease now pervades our society through cronyism, favors, and improprieties I have been writing often about the TransPerfect Global case which has received national attention because of the controversial rulings made by Chief Chancellor Andre Bouchard. I have been extremely critical of the Chancellor in the way he has handled this case for many reasons, even suggesting perhaps he should be removed from the bench. I have read every public court document in detail about this case and interviewed objective lawyers and employees of the company. I know everything about this case. Here are the undisputed facts: TransPerfect is a translation company founded by Phillip Shawe and Elizabeth Elting that is incorporated in Delaware. Shawe owns 49%, Elting owns 50 %, and Shawe’s mother owns 1%. Despite any differences, Elting and Shawe moved past their failed romance, and from a dorm room, created a multinational company successful beyond imagination. Regardless of these differences, the company has been high growth, extremely successful, and extremely profitable (due primarily to Phillip Shawe’s leadership and innovation) each year, over the past 24 years. The company now has revenues of over $500 million per year, and employs 4000 people, from 90 offices world-wide. Elizabeth Elting decided she wanted to exit the company, and wants the whole company sold. Why? Because half of the whole company price — is worth considerably more than what Elting could sell her own stake for. In other words, Elting makes much more money if she can force Shawe to exit the business at the same time that she does. The problem is, Shawe doesn’t want to sell. Shawe loves his company, his stock is private property, and he doesn’t want to sell it. Even if the dramatics described in Bouchard’s romance novel decision were true (which they are not), the Court simply should not be forcing one person (two in this case, Phil and his Mom) to sell their shares involuntarily, just to enrich Elizabeth Elting within her timetable. The Court is not meant to insert itself and act as the buy/sell mechanism for Ms. Elting’s personal agenda. Further, Elting is no woman of virtue. Not one single, unpaid non-party witness took the stand for Elting. She supposedly does something at this 4000 person company, but yet no one I’ve talked to can speak to any contributions she has made. Again, Elting could not produce one single, fact witness, beyond her own self-serving story. In the past few years, Elting removed millions of dollars from the company in unauthorized cash distributions to buy lavish houses and other assets — over Shawe’s objection. Now, Chancellor Bouchard not only ordered the company to be forced to be sold and auctioned off — a result unprecedented in U.S. history, but the madness that is Bouchard doesn’t stop there. He has also now ordered sanctions of $7.1 million dollars against Shawe, the man who built the company, in favor of Elting. I can’t say for sure, but my research indicates no other sanction levied against an individual has been this high in U.S. history. Included in this ungodly sum is $1.4 million dollars awarded in legal fees to Kevin Shannon (Elting’s lawyer) who was not even made to show his bills to prove it. The law only allows for “reasonable” fees? How can the “reasonableness” of Shannon’s fees be judged if they are hidden? The bottom line is that I believe that Chancellor Bouchard, according to my legal experts has ruled incorrectly in virtually every aspect of the case, he has overreached his judicial authority, and he has abandoned his duty and his ethics. Bouchard is guilty of perpetrating extreme bias against Phillip Shawe in favor of Elizabeth Elting. All this being said, I ask the following questions to my 6000 readers: 1) If a Delaware Judge violates his judicial authority and that of the judicial canons directing judicial ethics and behavior under the law, what do you think should happen to that judge? 2) If a Delaware judge blatantly exhibits bias in a case, prevents relevant evidence from being presented, is guilty of improprieties and cronyism, and denigrates the respect that the Court should maintain by his actions, should that judge remain on the bench? Here is what I do know: The Delaware business law is clear about what constitutes the forcing of the sale of a company by the Chancery Court. First, there must be evidence of irreparable harm. TransPerfect Global makes 500 million a year and is extremely profitable. The employees love and admire Phillip Shawe (as per affidavits), feel they have a stake in the company, and they do not want it to be sold. Where is the irreparable harm Chancellor? The law does not even permit you take control of 2 shareholder company unless it is facing irreparable harm, and folks, TransPerfect has 3 stockholders. This being said, it appears that Chancellor Bouchard has erred in his creative ruling, possibly costing thousands of people their jobs, creating the risk of Delaware’s corporate franchise being denigrated, and possibly costing Delaware millions of dollars. Chancellor Andre Bouchard is a personal friend and former business associate of Kevin Shannon of the law firm Potter Anderson (Elting’s Delaware attorney). They worked together 20 years ago on the famous Disney case in the Chancery Court, and have been buddies ever since. During the decision stage of the TransPerfect trial, Bouchard and Shannon made a public appearance together in New Orleans. None of this was ever disclosed by Bouchard. This case is a textbook example of the “appearance of an impropriety” and Bouchard should have recused himself long ago. This issue unto itself presents serious problems under the law. Heard enough? The coincidences just keep mounting against the new judge. Chancellor Bouchard has appointed a Custodian (with unlimited authority) to run the company named Robert Pincus, another friend and former associate. Pincus receives an on-going amount of $1400 an hour! He has unnecessarily hired expensive consultant friends, and together they’ve run up an $8 million tab — all paid for by TransPerfect – and the expenses mount daily. Additionally, Pincus has created a “reign of terror in the company,” threatening job termination for employees who would speak against the case, been given judicial authority to seize employee private cell phones and computer e-mails—on pain of sanctions or termination—all clear violations of the First and Fourth Amendments of the Constitution. One brave employee has filed suit against Bouchard and Pincus in US Federal Court. If he wins this case, I believe Bouchard will be culpable. In his July ruling on sanctions, Bouchard stated that Shawe had broken into Elting’s office, copied e-mails, destroyed his cell phone records, and lied under oath justifying the sanctions in the amount of $7.1 million dollars. The ruling paints an extremely negative portrait of Phillip Shawe, however the real story has been hidden and prevented from being presented as evidence in court by Chancellor Bouchard. The Employee Handbook (and New York and Delaware Law) clearly gave Shawe the right to investigate any suspicion of fraud or funds being illegitimately removed from the company by any person, including Elting.   Here is the official statement from Shawe’s attorneys, which was published in several media outlets:   

“In my opinion the sanctions decision itself is indicia of an extreme court bias against Mr. Shawe. Although Mr. Shawe was given notice on particular grounds, the court permitted Elting’s team to change its theory at trial without proper notice because Elting had insufficient evidence of the issue they had sought to sanction Mr. Shawe for: alleged spoliation? The “evidence” against Mr. Shawe on spoliation was almost exclusively based on lawyers’ arguments (not evidence by definition in any court) and a cherry-picked paid “expert” witness who had never testified before in a U.S. Court. The truth of the matter is that Mr. Shawe provided more discovery than Elting produced, and her legal team could not identify a single document that allegedly had been destroyed or withheld and caused her “prejudice.” In fact, she claimed victory on the merits. Indeed, after the merits trial, Elting’s “expert” admitted that his findings used as a basis for filing the sanctions motion were untrue, because he had not investigated the issue well enough before Eltings’ team made the allegation. Faced with this deficit of evidence, Elting’s lawyers appeared at the sanctions trial with a new theory of “lying” which had never been raised before. Shawe was tried and sanctioned for allegedly “lying” without due process.


As a consequence, it is neither surprising (i) that the court did not find the deletion of relevant evidence nor (ii) that Mr. Shawe’s attorneys were not adequately prepared to defend him against the variance in trial theory. Such unfairness is not consistent with due process. Had they been given notice of the new “lying” theory (including what issues he allegedly lied about and when), it is likely that Mr. Shawe’s lawyers could have prepared and presented evidence demonstrating that the differences in recollection were nothing more than just that – with other disclosures in the record that make them immaterial.

The recent ruling on the amount of sanctions to be paid is more of the same from the Chancellor. Although the court did reduce the fees in some instances, it utterly failed to provide due process with respect to the reasonableness of many of the fees claimed. The most extreme example of this failure is the acceptance of more than $1.4 million in merits fees from the Potter firm based on the affidavit of Mr. Shannon without any actual billing descriptions to back up the claim. It begs the question: How can the reasonableness of fees be assessed if the court doesn’t even know what was done? It also lends some weight to the speculation by others that there is a reported personal and professional relationship between Mr. Shannon and the court which may be affecting this case. Regardless, accepting more than $1 million in fee claims without requiring backup is contrary to traditional notions of fairness. Mr. Shawe is considering his appellate options.

There also have been other indicia of court bias against Mr. Shawe. During the merits trial, the Court had to address Elting’s allegations of wrongdoing leveled against Mr. Shawe relating to his review of her emails on the public company server. Mr. Shawe asserted that the emails proved that Elting committed fraud and requested that Chancellor Bouchard examine the emails in camera (in private) because they proved fraud. The court was well aware that if fraud was found, it would remove the emails from any supposed claim of “privilege” (under the crime-fraud exception), but Chancellor Bouchard inexplicably refused to review them – yielding to Elting’s position with no basis in law. Chancellor Bouchard abandoned his sworn duty to equity and justice in this regard. Instead, without consideration of the content, for the purpose of the merits case he suppressed the very emails which may prove that Elting and her attorneys engaged in a scheme to provoke Mr. Shawe and create actionable discord in the company. These and other indicia of bias (such as the remarkable success rate of Elting’s team on all motions – which her attorneys bragged about (in a Law360 article) are particularly concerning, given the recent unsolicited and inappropriate negative public statement by Vice Chancellor J. Travis Laster which was directed at the free speech activities of Transperfect employees who have been appealing to the media and the public. It is the duty of judges and lawyers to avoid the appearance of impropriety and this unprecedented instance of one sitting judge commenting on the active case of another may not be consistent with that mandate – especially when it may be interpreted as an attempt to quell first amendment rights.

At this point, the case has been certified for interlocutory appeal, and I am confident that the Delaware Supreme Court will reverse both the sale order and sanctions order based on the law. With respect to the sale order, ponder this: the facts reported in the decision by Chancellor Bouchard clearly support a finding that Elting breached her fiduciary duty by refusing to consider real estate and merger/acquisition opportunities without regard to their merit, so how is it possible that a person with unclean hands (ELTING!) can come to Chancery Court and obtain relief? When similar claims were brought by Elting in New York State court, it was tossed out with the sense that the whole litigation was absurd and the parties needed to come to a solution on their own. Justice Schweitzer specifically found that it was “unclear who drew first blood.”

Mr. Shawe is resolute that the company never faced irreparable harm, regardless of any alleged acrimony between the shareholders. TransPerfect’s performance in 2015 was more successful than 2014, and it is on pace to perform even better in 2016 despite the litigation. He is confident that the company will continue to prosper and reiterates his offer of $300 million cash to Ms. Elting for her shares.”

There you have it folks. I believe that Chancellor Bouchard is suspect and deserves intense scrutiny in regard to his actions in this case. As always your comments are welcome and subject to being forwarded.