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.
“Citizens for Pro-Business Delaware” has been posting a series of ads in the Delaware News Journal implicating law firms like Skadden Arps in what this activist group sees as unethical and suspicious behavior both locally and nationwide, especially involving what I see as its shady billing practices with TransPerfect, under the direction of Delaware’s Chancellor Andre Bouchard, who was once a partner at Skadden.
As a big skeptic about Bouchard’s integrity, having followed his decisions for over 4 years now, I am definitely for transparency and unbiased decisions in the Chancery Court. I frankly think Bouchard is a terrible representative of Delaware’s respected equity court and should be replaced now before it gets any worse. The Chancery Court is operating under a cloud of darkness as things are now. As I see it, folks, when you have a Chancellor who ignores obvious conflicts of interest and condones the appearance of impropriety, it must be fixed!
The Citizens group also harps on diversity. I don’t believe that someone should be appointed a judge or Chancellor, simply because they come from a certain background. That said, I do believe that regardless of their race or background, the most qualified candidate should be appointed, and right now the system is failing because we are only getting a select group from a very small pool of candidates.
Regardless, in my view, I am sure that Skadden Arps will eventually succumb to the pressure and find a few Ivy League, liberal African American Lawyers to fulfill the public demand for diversity, as will eventually the State of Delaware. Diversity is indeed a good thing, but personally, I believe, as do most of my friends and readers, that the best person for the job should be hired. That is my objective view and this old dog is not going to change his mind.
Please read the article below and tell me what you think. Thank you and best regards.
See the press release below:
June 08, 2020 01:36 PM Eastern Daylight Time
WILMINGTON, Del.–(BUSINESS WIRE)–Today, Citizens for a Pro-Business Delaware, a grassroots advocacy group, announced the latest in its series of print ads in the Delaware News Journal highlighting the conflicts of interest and failures of transparency that plague the Chancery Court and elite Delaware law firms like Skadden Arps.
The ad shines a light on Skadden Arps’ history of ethically dubious behavior both in Delaware and internationally, including their direct role in the Ukraine voter suppression scandal, the appalling lack of diversity in the firm’s Wilmington office.
The ad, in part, reads, “over the past 3 years, Skadden Arps has named 38 new partners, only 2 of whom are African-American. Of 66 attorneys in Skadden’s Wilmington office, there is just one Black partner and one Black associate.”
The ad comes on the heels of a letter penned by civil right activist Reverend Al Sharpton to Robert Saunders, the head of Skadden Arps’ Wilmington, DE office, calling for more diversity at the firm and others like it.
Skadden Arps has also been subject to criticism over the egregiously non-transparent billing practices practiced by Bob Pincus and Jennifer Voss in their role in the TransPerfect case, which has now cost the company over $14 million in unexplained fees.
Said Citizens for a Pro-Business Delaware Campaign (CPBD) Manager Chris Coffey, “Over the past year, our members have been calling for Delaware to make progress in diversifying its court system, but to no avail. We said from the beginning we weren’t going to be afraid of calling out those we see responsible for perpetuating a rigged system the only helps a select few, and this ad campaign shows how serious we are about that.
“The inequities in Delaware’s justice system, caused by a court system run by mostly white judges is a direct result of firms like Skadden Arps denying opportunities to people of color. We can’t possibly expect the judges in our courts to accurately reflect the racial, ethnic, gender, and socioeconomic diversity of this state if they aren’t given the opportunity to gain the relevant experience.
“Lacking diversity in our justice system is a national and systemic issue. But in a state that’s home to the country’s busiest corporate courts, where judges are handpicked to join an old boys’ club from top firms like Skadden, it’s critical we end the status quo, and Skadden needs to answer for their role in this corrupt system.”
Once again our infamous Chancery Court is splashing negative headlines across the globe. See the sordid details in the story below from Spain’s el Economista newspaper about how the notorious Skadden Arps Law Firm helped put a political prisoner in jail for three years, where, for all we know, she was tortured?? This is quite shameful that Delaware’s Chancery Court is indirectly mixed up in any way in this terrible story. Shameful, folks.
You have to ask yourself about the connection between the millions in payments in this Ukraine story and the $15 million I clearly believe was swindled away from TransPerfect, while ordered to be collected by Chancellor Andre Bouchard’s former colleagues at Skadden? In the process, 5,000 employees suffered for almost 5 years, as their jobs were threatened by Bouchard’s Court and his court-appointed custodian Bob Pincus?! It appeared to me that Bouchard acted like an evil Robin Hood, taking money from the poor TransPerfect employees and giving it to the rich buddies at his former law firm, Skadden Arps.
And worse folks, this disproportionately hurt the minority employees at TransPerfect. They had their benefits cut, with callous disregard for their families or personal well-being! As a glaring example, I was informed that two minority members of the company’s five C-suite level executives had to sue, and won, in order to get their back pay due to actions taken by Bouchard’s former business partner Robert Pincus. Why these two minority employees in particular? Was Pincus discriminating? As you know, this issue is more important now than ever, with what is going on in our country. I worry for the future of Delaware with the incessant detrimental publicity about Bouchard’s Chancery Court that it ultimately hurts future incorporations and franchise fees.
It is interesting to point out that apparently Skadden Arps has virtually no minorities in their Delaware office either — coincidence or intentional??
Folks these continuous appearances of impropriety in Bouchard’s Court and the negative effect it has on equity and positivity worldwide is significant. Please read the article below and send me your thoughts.
Ukrainian Prime Minister
06/03/2020 – 11:03
The law firm Skadden, Arps, Slate, Meagher & Flom has accepted the payment of 10 million euros to Yulia Tymoshenko to avoid a lawsuit by the former Ukrainian Prime Minister, who blames the New York law firm for having actively participated in the persecution campaign policy that the former president of his country Viktor Yanukovych would have orchestrated.
Skadden’s relationship that various media attribute to the Yanukovych government dates back to 2012 with the preparation of a report in which he tried to justify the imprisonment in 2011 of the Ukrainian opposition leader for alleged abuse of power.
Citizen protests denouncing alleged corrupt practices and ties to Moscow with Yanukovych ended up in 2014 leading to the fall of his government and the release of Tymoshenko, who later accused the American office of “covering up Yanukovych and his government” in exchange for money.
The US law firm’s business in Ukraine has led to other federal investigations and heavy fines. In 2019, Skadden also agreed to pay more than € 4 million for breach of the Foreign Agents Registration Act (FARA) in lobbying work with former Donald Trump campaign adviser Paul Manafort, in favor of Yanukovych.
CONNECTIONS IN SPAIN
It is not the first time that the controversy affects Skadden. His role in the ‘TransPerfect case’, which endangered more than 600 jobs in Barcelona and 5,000 worldwide, has highlighted the shortcomings of the Delaware state judicial system and opinions have emerged that denounce an alleged treatment in favor of the supreme court judge and ex-Skadden partner André Bouchard to the court’s administrator, Robert Pincus.
After closing the forced sale of TransPerfect, some media have pointed out that Pincus continued to charge the firm for two years fees worth more than 12.5 million euros. The invoices for these works remain sealed by decision of Judge Bouchard, alleging that they must be kept secret.
I’ve been using my column as a soapbox to complain about Chancery Court Chancellor, Andre Bouchard, and what I view as the lame nonsense and bullying coming from his bench over the past few years, specifically from the TransPerfect case, among other things, which have been, in my opinion, levels of corruption, too hard to believe. His ties to law firm giant, Skadden Arps, have been well documented here and elsewhere over the past few years.
Well, folks, now we’re seeing what I think is a new low for even this group, new facts have come to light, according to the press release below that, Jennifer Voss, who is a partner in the Skadden Arps’ Wilmington office, was “purported to act on behalf of the Delaware Judiciary when she attempted to silence the advocacy group, Citizens for Pro-Business Delaware (CPBD).” The group is founded by TransPerfect employees and Delaware residents and is looking to help create transparency, accountability and diversity in Delaware courts. So why is Voss seemingly trying so hard to silence this group, in coordination with the Chancery Court? Is it because they’ve been critical of her colleague Robert Pincus? Something isn’t right here, folks.
As we all are, this Citizens group is protected by the First Amendment and no matter how hard attorney Voss tries, that isn’t going to change. Thank goodness our founding fathers created a Constitution that is designed to protect all of us, including free speech, which is one of the things that sets this country apart from others and makes America great! Authoritarian and corrupt people in all walks of life will attempt to skew the law and ignore the Constitution if you let them get away with it. The appearances of impropriety continue to be rampant, in my view, with what I further believe, between such law firms, the state’s courts, and the Bar Association.
Founder Chris Coffey doubled down on the group’s commitment to pursuing these changes and will continue to strive for these goals. Citizens for Pro-Business Delaware are willing to put their money where their mouths are. He said the group will be spending half-a-million dollars this year to put a spotlight on failures in Delaware’s courts while continuing their battle for reform.
He even plans to create a political action committee, dedicated to electing candidates at every level of Delaware’s government. As someone who has deeply cared about and influenced Delaware politics for years, I think that’s a perfectly good idea! No doubt with the dedication and capital this organization is willing to commit, Citizens for Pro-Business Delaware will be an effective political operation! Call me, Mr. Coffey, anytime. I’d be happy to advise you and your group on the ways of Delaware politics and how to get things done in America’s First State! I am happy to promote the changes you advocate because things are not right in Delaware these days in my opinion!
I think Ms. Voss’s attempts to silence Citizens is downright unconstitutional. The First Amendment, this Citizen’s Group, and our great state won’t go down so easily!
Let me know what you think about this, folks! Delaware is Rising!
May 07, 2020 10:00 AM Eastern Daylight Time
WILMINGTON, Del.–(BUSINESS WIRE)–Following a series of recent filings in the Delaware Court of Chancery, new facts were released publicly that Jennifer Voss, a partner in Skadden Arps’ Wilmington office, was purported to act on behalf of the Delaware Judiciary when she attempted to silence the advocacy group, Citizens for Pro-Business Delaware (CPBD). CPBD, a grassroots organization founded by TransPerfect employees, advocates for transparency, accountability and diversity in the Delaware Judiciary has been subject to threats and hate mail from some of Delaware’s elite law firms.
“If Voss and Skadden would like to engage in a meaningful conversation about how to end corporate corruption and cronyism, and the overwhelming lack of diversity in the Delaware Chancery Court, we’ll meet them anytime and anywhere – we’re in this fight for the long haul.”
During a heated exchange of attorney correspondence, Voss is alleged to have publicly posted privileged settlement communications between attorneys representing TransPerfect and Skadden Arps in violation of ethical canons. The substance of the emails revealed that Voss sought to silence the CPBD movement by disallowing any public discourse that casts a negative light on Custodian Robert Pincus, Skadden Arps, the Chancery Court system, and the State of Delaware.
Said Citizens for a Pro-Business Delaware Campaign Manager Chris Coffey, “Our organization is made up of more than 5,000 Delawareans working to increase accountability, transparency, and diversity not just in the state’s judiciary, but the entire government. The First Amendment clearly protects our right to call out injustice where we see it. It’s unfortunate that Skadden would try to dictate the actions of our members without actually talking to us directly. But what we want to see happen should come as no surprise to anyone, as we have relentlessly advocated for our platform for increased judicial transparency, accountability, and diversity for the better part of a year. To demonstrate our commitment to stay in Delaware for the long haul, we will be spending over $500,000 this year to highlight the failures of transparency and diversity in Delaware’s courts and advocating for reforms to fix the broken status quo, and we’re planning to declare a political action committee dedicated to electing candidates at every level of the state government who support our cause.
“If Voss and Skadden would like to engage in a meaningful conversation about how to end corporate corruption and cronyism, and the overwhelming lack of diversity in the Delaware Chancery Court, we’ll meet them anytime and anywhere – we’re in this fight for the long haul.”
Citizens for a Pro-Business Delaware fight for commonsense and modern-day reforms to the archaic Chancery Court system, and for more diverse representation in courts, and government and in law. It supports the following legislative initiatives:
1. Establishing an independent Office of Inspector General with a degree of jurisdiction over the Chancery Court, which would ensure a rigorous and regular review process for auditing the Chancery Court’s decisions.
2. Ensuring that Delaware’s courts reflect the ‘broad diversity’ of Delaware’s citizenry.
3. Introducing transparency to the judicial nomination process by making public the members of the judicial nominating commission and the names of the candidates they put forward to the Governor.
4. Building awareness of the lack of diversity in Delaware’s legal industry and advocating for a diverse pipeline to Delaware’s elite law firms.
5. Ensuring that appointed Members of Courts can’t serve on the Court of Judiciary, which has the power of judicial review.
6. Ensuring that if a Justice of the Chancery Court appoints a custodian or a receiver to any Firm, Corporation or Officer of the Court for whom they were previously employed or shared business interests with, this conflict must be disclosed and consented to by both parties.
7. Requiring that any custodian or receiver appointed by the Delaware Chancery Court itemize and make public a complete list of costs incurred because of acting in that capacity.
8. Allowing a camera in the Chancery Court to ensure that a public record exists of the Court’s actions, allowing citizens and good government groups to audit the Court’s actions and deliberations to make sure they honor justice and transparency.
9. Requiring ‘wheel spin’ in the Chancery Court so that Chancery Court
Chancellors cannot select cases based on their own self-interest.
10. Requiring financial disclosure by Delaware’s judges so the public can see the income they receive outside their judicial salaries, including investments, business and charitable affiliations and gifts.
Here’s a quick update, folks, on the Delaware front, regarding Delaware Governor John Carney. There are 1,000 TransPerfect employees requesting the relationship between Chancellor Andre Bouchard and law firm Skadden Arps be investigated. I have one question, what has taken so long?
It’s time for Governor John Carney to take a leadership role and clean up our shameful old boy’s club in Delaware. As I see it, folks, this case, and this court-ordered looting is a sham that hurts workers and hurts Delaware, and it has gone on long enough!!
Please read the article below, and let me know your thoughts.
By TransPerfect
On April 14, 2020
Wilmington, DE – Today, a letter co-signed by more than 1,000 TransPerfect Global, Inc. employees was sent to Delaware Governor John Carney, demanding an inquiry into the close, mutually-beneficial relationship between Delaware’s beleaguered Court of Chancery and the law firm of Skadden, Arps, Slate, Meagher & Flom LLP.
The letter comes following several recent motions filed by TransPerfect in the Delaware Court of Chancery alleging that the law firm of Skadden Arps has billed the translation services company for upwards of $14 million in undisclosed legal fees since being appointed the company’s custodian, causing significant financial harm to the company’s employees.
According to recent court documents, in the over two years since the TransPerfect sale process was complete, the company’s Chancery Court-Appointed custodian, Skadden Partner Robert Pincus, has continued to bill the company every month for undisclosed services, including his own $1,475 an hour fee. According to one recent motion by TransPerfect, Pincus’ 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 over two years ago.
In their call to action for Delaware Governor John Carney, the employees wrote, the “actions of Robert Pincus and his Skadden partner, Jennifer Voss, have hurt TransPerfect. For the first time ever, this spring we will not receive raises. Even worse, many of us who work hourly have had our hours reduced or been furloughed entirely. We are asking for your office to open an inquiry to scrutinize both the cozy relationship between Chancellor Bouchard and his former firm, as well as the Chancery Courts complete lack of transparency and Skadden’s questionable billing practices. These actions and to end this Court-sanctioned looting of TransPerfect. It’s hurting us in irreparable ways. Enough is enough, we need you to step up and investigate this matter immediately.”
Said Chris Coffey, Citizens for a Pro-Business Delaware’s Campaign Manager, “From day one of being appointed TransPerfect’s custodian, Robert Pincus and Skadden Arps have been taking advantage of the company and its thousands of employees by billing them millions of dollars without saying why or what for. These Skaddenomics are so shady, it’s become increasingly clear that Governor Carney needs to step in and scrutinize Chancellor Bouchard, who has been violating his own court’s rules and effectively funneling over $14 million dollars to friends at his old law firm. We’ve called on the Court to put an end to the secrecy, and we’ve called on the state legislature to advance the bill before them that would create a fairer and more transparent Chancery Court by requiring all custodian’s fees to be disclosed. Now we’re calling on the governor to open an inquiry. These thousand employees and our members deserve to have their voices heard. Enough is enough.”
Look folks, I’ll be straight with you, this COVID-19 has scared the hell out of me. I certainly don’t say that lightly. I’m a retired Ship’s Captain and Pilot, a father, and a widower. My dear wife of 33 years passed away several years ago of cancer, so I’ve had my share of treacherous moments. Now, I’m home alone with my cat and not going out unless absolutely necessary.
While my life has changed because of this virus, it’s startling what the TransPerfect employees have been through over the past few years. I’ve written about them, I’ve met some of them, and I’ve come to care about their plight and the battle they have had to fight against the giant Delaware law firm of Skadden Arps and in my view the nefarious Chancery Court Chancellor — Andre Bouchard.
One-thousand TransPerfect employees have penned and signed a letter to Delaware Governor John Carney, which is herein attached, calling upon him to stop the perceived “burglary” from Skadden and Chancellor Bouchard. This letter and the signatures ran in Sunday’s Delaware News Journal and I have attached it for your review with this article. Please open the attachment and read this well-written letter. It is impressive!
In the letter, these employees stand for all 5,000-plus workers of the company, as they explain how they are being hurt by the $14 million in fees that have seemingly been drained out of the company by Skadden and court-appointed custodian and Bouchard pal, Robert Pincus — a former Skadden partner. Pincus and Skadden continue to collect huge sums two years after the company sale closed and without invoices, itemization, or explanation.
I’m outraged, folks, and I have attempted calling the Governor’s office for comment, but have been met with radio silence.
TransPerfect has already given millions, due to this cozy relationship between Pincus, Skadden, and Bouchard. The employees are asking the Governor to help stop this now. They want an inquiry and, hell folks, I want an inquiry too. They are right to ask for one!
Their health benefits were hurt due to Mr. Pincus already and now with the impact of this virus on their lives and ours, they are feeling more pain through furloughs and no raises this year. Like so many others in our country right now, they are hurting due to the changes COVID-19 is bringing, and it’s downright immoral for Pincus and Skadden to continue kicking them indirectly through their avaricious actions when they’re down.
Folks, join me in asking Governor Carney to do what’s right here. This is unacceptable and he needs to take action and do the right thing. Bouchard’s relationship with Skadden Arps and various, in my opinion, appearances of impropriety need to be investigated?
I would love your feedback on this one. Please stay safe and healthy as we all get through this.
Please check out this victory for TransPerfect. The real story here as I see it folks is that Bouchard and his court-appointed custodian, Skadden’s Robert Pincus — his former law partner, to whom he has ordered TransPerfect to pay $14 million, without being able to see even one invoice — was using this case to bad-mouth TransPerfect and Shawe, saying they were litigious.
Pay attention carefully here lawmakers: In my opinion, this is proof once again of the Chancery Court misleading for two reasons: One, Shawe was the “Defendant” against an advisor trying to claim a false fee over a transaction that the Custodian backed out of — to line his and his friends’ pockets with a $250 million court auction. And two, because TransPerfect and Shawe won the case.
Check out the lawyer’s closing quote in the story below: “It was refreshing to litigate outside of Delaware with truly neutral jurists who make decisions based on the facts of the case.” How refreshing! What does that say about Delaware, folks?!
I wanted to keep you in the loop on how much other judges are, in my opinion, seeing Bouchard’s antics for what they are: A three-ring circus designed solely to provide payola to his pals. I say shame on Bouchard for continuing to destroy the Chancery Court’s once pristine image with every breath he takes.
March 5, 2020
NEW YORK, March 5, 2020 /PRNewswire/ — TransPerfect, the world’s largest provider of language and technology solutions for global business, and CEO Phil Shawe, today announced emerging victorious in a New York State Supreme Court–ordered arbitration related to disputed advisor fees stemming from a controversial 2015 Delaware Chancery Court decision.
The victory is a decisive step toward ending the residual litigation created by the Delaware Chancery Court’s unprecedented decision to appoint a Custodian to control a thriving and profitable company for three years and to then sell it at public auction. Shawe, TransPerfect’s original Co-Founder and CEO, ultimately prevailed in Delaware court and in the auction, raising questions about the necessity of Chancellor Andre Bouchard mandating more than $250 million in fees and expenses to achieve a result that was available and obvious since the beginning of the proceedings.
Shawe stated, “This is the first major victory against those who sought, or are still seeking, to take unfair advantage of TransPerfect stemming from the Delaware Chancery Court’s unprecedented intervention into a private, profitable, and thriving business.”
A complaint for breach of contract was filed in New York State Supreme Court by Cypress Partners, and Justice Jennifer G. Schecter issued an order compelling arbitration of the matter with JAMS Commercial Arbitration Tribunal. Cypress claimed they were entitled to a full fee for any transaction involving the TransPerfect auction process despite clear contract language to the contrary. The neutral JAMS tribunal reviewed all evidence and found no merit to the claims. Further, the arbitrators notably disregarded Chancery Court findings and dicta as having no bearing on the adjudicated matter. From start to finish, this binding arbitration battle in front of a New York panel lasted over 18 months.
Martin Russo of Russo PLLC, lead outside counsel for TransPerfect, commented, “It was refreshing to litigate outside of Delaware with truly neutral jurists who make decisions based on the facts of the case. In fair jurisdictions and forums, the rules compel triers of fact to rule on the evidence and do not allow undue influence from or favoring of friends and associates of the Court. TransPerfect has spent the last two years cleaning up the messes left behind by a series of bizarre and unpredictable rulings by Chancellor Bouchard, and we are pleased that this matter has been justly closed.”
About TransPerfect
TransPerfect is the world’s largest provider of language and technology solutions for global business. From offices in over 100 cities on six continents, TransPerfect offers a full range of services in 170+ languages to clients worldwide. More than 5,000 global organizations employ TransPerfect’s GlobalLink® Product Suite to simplify management of multilingual content. With an unparalleled commitment to quality and client service, TransPerfect is fully ISO 9001 and ISO 17100 certified. TransPerfect has global headquarters in New York, with regional headquarters in London and Hong Kong. For more information, please visit our website at www.transperfect.com.
Without a doubt in my mind, the Delaware Court of Chancery under the auspices of Chancellor Andre Bouchard is seemingly engaged in some very irregular activity. Chancellor Bouchard has apparently ordered and approved the billing of millions in unexplained invoices from his former business partner Robert Pincus, who was Bouchard’s appointed Custodian in the TransPerfect case.
I see this as being outrageous, especially considering the case has been closed for years. According to my sources at the company, the Custodian did little to justify his nearly $1,500 per hour fees! For the record, Bouchard, Pincus, and former Chief Justice Leo Strine all were former members of the infamous law firm of Skadden Arps, which has been sanctioned in the past by the Federal Government.
Folks there is indeed the appearance of impropriety in the Chancery Court. It appears to me that Bouchard is filling the pockets of his buddies. I am sick to death of perceived corruption not only in Ukraine but in our Delaware as well. It presents a terrible picture of what Delawareans expect in the way of justice and equity.
So what is next? I have learned that TransPerfect is now going back to Court, filing a new motion in the Court of Chancery, seeking an explanation ONCE AGAIN?? The thing that blows me away is that this apparent and incessant suspicious activity is directly in our faces.
Delaware’s once-respected Chancery Court, I believe, has lost its honor and its objectivity. I believe Bouchard is corrupt, unfair; not objective. I demand an investigation into this situation. It is clearly untenable. I believe the impeachment of Andre Bouchard is in order ASAP.
Please read the article below and send me your ideas and feedback on this horrendous inequity. Hopefully, this crazy impeachment debacle of our President will be over soon, and we the people can get back to local issues in Delaware. Thank you kindly.
Scroll down to read the article :
https://www.prnewswire.com/news-releases/court-motion-reveals-skadden-arps-has-charged-10-million-in-undisclosed-legal-fees-as-custodian-of-transperfect-while-hiding-behind-obscure-chancery-court-order-citizens-for-a-pro-business-delaware-renews-call-for-reform-300991682.html
Jan 22, 2020, 16:25 ET
WILMINGTON, Del., Jan. 22, 2020 /PRNewswire/ — Following a court motion filed in the Delaware Court of Chancery today by TransPerfect Global, Inc. revealing that the law firm of Skadden Arps has billed the translation services company for upwards of $10 million in undisclosed legal fees since being appointed the company’s custodian, Citizens for a Pro-Business Delaware (CPBD) is renewing its call for reforms to the opaque business court.
Among the much-needed reforms is legislation, introduced to the Delaware State Legislature, that would bring much-need transparency to the Chancery Court, requiring appointed custodians to 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 legislation follows Delaware Chancery Court Chancellor Bouchard’s abuse of court rules, as he appointed his last employer, Skadden Arps, 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. Since, Skadden Arps has received a significant amount of the $250 million that was spent on the case.
Said Chris Coffey, Citizens for a Pro-Business Delaware’s Campaign Manager, “The Skaddenomics that Chancellor Bouchard has enabled in his Chancery Court by violating the court’s rules to direct millions of dollars to friends at his old law firm are unacceptable, and exactly the sort of behavior that our over 5,000 members are committed to fighting. The Delaware State Legislature should take a long look at this motion and consider the legislation before them to create a fairer and more transparent Chancery Court. 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?”
According to TransPerfect’s motion, over two years after the 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. According to TransPerfect’s motion, 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 over two years ago.
As Delaware dropped 10 spots to number 11 according to the Chamber of Commerce in its judicial rankings last year, CPBD announced a new platform to dramatically improve ethics, transparency, and accountability in the State’s Government and Chancery Court.
OPINION Dear friends, One more on this topic, because it’s just too hard to resist not mentioning this. See the story I’ve posted below, as law firm Skadden Arps is defending its “diversity culture” after Rev. Al Sharpton accused the firm of racist hiring practices. This couldn’t be happening to, in my view, a more incredulous bunch at Skadden Arps because they appear to have a culture of taking what they want in Delaware’s Courts. Considering Chancellor Andre Bouchard, his appointed TransPerfect Custodian Robert Pincus and former Supreme Court Chief Justice Leo Strine were all once members of Skadden Arps. They collected millions from TransPerfect and continue to bill the company with sealed and unitemized monthly bills, so I for one will shed no tears for this firm, which seems to have their way in Andre Bouchard’s Chancery Court. This firm has also had problems with the Feds, which have been reported widely in the press. Apparently under public scrutiny, which is detailed in the story below, Skadden is finally having to answer for some of its practices. I say, good! (even though the diversity issue is not at the top of my list.) Regardless, this pundit and political observer, believes there is some kind of perverse justice going on here. Many of the positions of power in the Delaware Courts have been filled with Skadden folks and I’m honestly surprised that no one besides me has noticed this potential Skadden domination within the Chancery and Supreme Courts in Delaware?? Please read the article below, which prompted this op-ed. Respectfully yours, Judson Bennett-Coastal Network http://www.abajournal.com/news/article/biglaw-firm-defends-its-commitment-to-diversity-after-al-sharpton-criticismBigLaw firm defends its commitment to diversity after Al Sharpton’s criticism
BY DEBRA CASSENS WEISS Skadden, Arps, Slate, Meagher & Flom is defending its diversity efforts after the Revs. Al Sharpton and Dale D. Dennis II criticized the law firm for having few racial minorities in its Wilmington, Delaware, office. Skadden responded with a Jan. 6 letter to Sharpton and Dennis saying the law firm has a long-standing commitment to diversity and inclusion, although its journey toward that goal is a work in progress. The firm outlined several of its efforts to attract minorities to legal careers and to hire and promote diverse lawyers. World Intellectual Property Review and Law.com have coverage. Those efforts include:Skadden also released this statement: “Diversity and inclusion are values upon which our firm was founded, and while there is more to accomplish in this area, we are steadfast in our efforts to build and maintain a world-class, diverse workforce that delivers the highest caliber work product to our clients. We agree with civil rights advocates that diversity on the bench and throughout the legal profession should be a priority in Delaware and globally, and we are proud that the first two female justices on the Delaware Supreme Court were attorneys from Skadden.” Sharpton and Dennis had expressed concern with a lack of diversity in Delaware courts and in the state’s prestigious law firms in a Dec. 30 letter to Skadden published by Above the Law. “While Skadden claims that ‘diversity and inclusion are fundamental to [its] success as a global law firm,’ its presence in Wilmington tells a different story,” the letter said. “According to Skadden Arps’ own reporting on law firm diversity, of the 72 lawyers in the firm’s Wilmington office, exactly one summer associate is black, while 9 of 10 partners are white. And of 49 full associates in the same office, just six are racial minorities.” The Dec. 30 letter said Sharpton and Dennis are commissioning a study on the state of diversity in Delaware’s legal industry.
- Establishing the Skadden Honors Programin Legal Studies at the Colin Powell School at the City College of New York, which has prepared more than 250 CCNY students for law school admission.
- Participation in Legal Outreach, a diversity pipeline program that includes a one-week summer internship at Skadden for high-achieving New York City public school students.
- Participation in the Delaware Minority Job Fair for second- and third-year law students.
- Creation of a formal sponsorship program that pairs some of Skadden’s highly performing associates and counsel from underrepresented backgrounds with senior law firm leaders.
How ridiculous is this? See the nutty story below for a story that’s not to be believed! It appears to me that the people at Skadden Arps are trying to blame TransPerfect because this law firm has too few attorneys of color in their Wilmington office. I wonder how ignorant Skadden and their former workers Andre Bouchard and Robert Pincus think the pubic is?
The TransPerfect case is still sealed up, two years after it ended and Skadden is still billing them! In my educated opinion, folks, this appears to be an attempt to hide and to divert attention away from their endless money-grab from this company by saying that TransPerfect is somehow responsible for Skadden having not being diverse enough? I don’t understand what’s up with the incessant billing, nor can I get an explanation from anybody on why it is still going on?
Look, at the end of the day, I’m an old guy set in my ways and diversity is not on my agenda of problems to solve in the world. I believe that you hire the person you feel is best suited for the job, regardless of color, race, religion or sexual orientation. As I see it, everyone should be somewhat suspicious of Skadden Arps and those Limousine Liberals that cruise around our justice system.
I’ve been watching this BS for a few years now and in my opinion, it seems they do not NOT value what they say they value. So whether it’s the non-stop money faucet from this company or playing favorites with former Skadden folks, who have moved on to positions of power in the Delaware court system, or it’s diversity in their own workplace, these guys, in my view, are not upfront.
What’s good for these guys is what’s good for them and no one else, as far as I’m concerned. They have a not-so-great track-record, not just in the U.S., but around the world. You think they’re worried about diversity in Delaware? I think they’re worried about money and cronyistic behavior. In my opinion, they’re counting on no one peeking too hard in on little-ole Delaware, while they have their way with court appointments, finances and running the show from Wilmington to Dover and everywhere in between??
I’ve been keenly aware of Skadden Arps because many of its former and current employees were involved in the TransPerfect case, which I have written about over the past few years. This law firm once employed Chancery Court Chancellor Andre Bouchard and former Chief Justice of the Delaware Supreme Court Leo Strine and of course the court-appointed custodian in the case, Robert Pincus.
The firm has doubled-down on that arrogance, in my opinion, by going after advocacy group Citizens for Pro-Business Delaware, after being faced with racism allegations from Reverend Al Sharpton last week. For the record, I can’t stand Al Sharpton! Regardless, Skadden issued a statement saying, while they are open to addressing “this systemic issue,” and they “reject attempts by Citizens for a Pro-Business Delaware” the statement says, “a group comprised primarily of employees of TransPerfect—to co-opt the conversation of diversity and inclusion in Delaware as a means to further their vendetta against our firm and former partner, who we represent in his capacity as the court-appointed custodian who oversaw the sale of TransPerfect.”
So, in my view, they cast blame and accuse wrongdoing while not taking on any blame or admitting any wrongdoing on their part. How about taking responsibility?
The Citizens group fought back, you’ll see in the story below. As far as Skadden is concerned, in my view, this is all shameful. Frankly , this diversity crap is ridiculous from both sides. I have felt that TransPerfect, Philip Shawe, and his mother Shirley Shawe all got a raw deal. Considering the conflicts of interest and in my view, continuing appearances of impropriety, is the real rub here!
By Citizens for a Pro-Business Delaware
Published Jan 7, 2020 at 8:00 am | Updated Jan 7, 2020 at 4:02 pm
WILMINGTON, Del., Jan. 7, 2020 /PRNewswire/ —
Following Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates’ response to Reverend Al Sharpton’s recent call for top law firms, including Skadden, to increase diversity and inclusion efforts, CPBD Campaign Manager Chris Coffey has released the following statement:
“It’s not shocking in the least that the same firm responsible for suppressing the voices of those advocating for basic human rights in Ukraine would now shift its focus towards slinging mud at a 5,000-member grassroots organization seeking to improve diversity in the historically white and male Delaware court system. We spent over $1 million advocating for diversity in Delaware last year. What have they done?
Instead of addressing the fact that out of 72 lawyers in Delaware, Skadden has barely a handful of African American lawyers in a state that’s almost 30% black. Meanwhile, despite hollow promises to change their legacy on this, and be ‘steadfast in their efforts to build a diverse workforce,’ just one of their summer associates in Delaware – home to the nation’s busiest corporate courts – was black.
Skadden should take a long look at themselves and what they can do to be better, more honest, and more inclusive leaders in the legal community before throwing mud at those trying to break the status quo. It’s 2020 and it’s time legal industry leaders like Skadden Arps acted like it.”
Folks, it’s amazing how sunlight acts as a disinfectant for corruption. TransPerfect won the right to see the bills in their Chancery Court case, but I think it’s only because they used a lawsuit in Nevada to successfully shed a spotlight on what Bouchard was doing, which in any other court would be deemed corruption in my view.
After four years, and, from what I understand from sources at the company, $14 million later, he is finally allowing TransPerfect to see itemized invoices from his old law firm, Skadden Arps for work allegedly performed by Chancery Court-appointed Custodian Robert Pincus.
That all sounds nice but the order has not been signed and in my view, there is no chance Bouchard is going to rule against his former colleagues at Skadden Arps and order them to produce a real itemized bill. If he did, he would risk exposing 4-years of court-sanctioned money siphoning from TransPerfect while also risking folks seeing potentially padded Skadden bills.
I think Bouchard wants the public to believe that he is being transparent, but nothing that has happened in this case has been transparent and there is no reason to believe anything would change now. Why has the court-appointed custodian wanted his bills to be hidden in the first place? And why did Bouchard threaten to hold TransPerfect in contempt with a $30,000 a day fine if they didn’t withdraw their lawsuit in Nevada? In my opinion, the only answer that makes sense to me folks is that there is something to hide.
If there is nothing to hide, why is the custodian fighting to keep his bills a secret? Why hasn’t Bouchard ordered him to turn over his bills without lawyers spending thousands of dollars telling him why? The only conclusion I can see is that in my opinion, Bouchard is protecting his Skadden-buddy Pincus.
If the court doesn’t order a custodian to turn over his bills to the company that is paying those bills, then there is no transparency. When will the corruption end?!
Please read the Delaware Business Court Insider article below, which recaps the initial news from Bouchard to open up Skadden’s bills. The story explains the latest events.
As always, your comments are welcome and appreciated.
By Tom McParland | October 21, 2019
Despite being held in contempt last week, TransPerfect Global Inc. has won its Chancery Court bid to access the details of bills being paid to the former Skadden, Arps, Slate, Meagher & Flom partner appointed to oversee the company’s court-ordered sale.
Chancellor Andre G. Bouchard said Monday that he would grant a request by the New York-based translation services company and its CEO, Philip Shawe, to see what type of work it was being charged for, as well as the billing rate, time spent and positions of the Skadden attorneys working on the case.
The ruling, which Bouchard said he planned to formally enter later this week, ratcheted down tensions in a two-state standoff between Shawe’s legal team and attorneys for Robert Pincus, the court-appointed custodian in what has become Delaware’s most vexing legal drama.
The latest spat centered on bills Pincus submitted for some expenses he incurred following the 2015 sale, including costs related to two lawsuits in New York state and federal court stemming from the sale.
Shawe, who won the court-mandated auction following a bitter battle with company co-founder Elizabeth Elting, argued that he should be able to see a full list of itemized expenses, and TransPerfect altogether refused to pay two disputed bills from June and July. The company then sued Pincus in its new home-state of Nevada, seeking a declaration that it was under no obligation to indemnify Pincus for his role as a former tie-breaking director of TransPerfect.
Pincus responded by asking Bouchard to hold TransPerfect in contempt for trying to undermine the Chancery Court’s exclusive jurisdiction over the case.
On Oct. 17, Bouchard agreed that TransPerfect had “intentionally and willfully violated court orders and said he would fine TransPerfect $30,000 per day if the company did not dismiss its Nevada suit by Monday. However, that ruling did not touch on TransPerfect’s gripes about Pincus’ billing.
In a brief telephone conference with counsel Monday morning, Bouchard said he would grant TransPerfect’s request out of “practical concerns” that TransPerfect had raised, even though he disagreed with the company’s legal analysis. Under the order, TransPerfect would be able to challenge the bills in court.
Nothing in the ruling, he clarified, was meant to walk back his ruling on contempt. “There’s a right way and a wrong way to do things,” Bouchard said. “Seeking to undermine the court’s exclusive jurisdiction in the wrong way.”
Attorneys for TransPerfect said after the hearing that they had gotten all they wanted with regard to billing and confirmed that they would, in fact, withdraw the Nevada suit before the end of the day.
Because of the victory today in Delaware, we are withdrawing the Nevada suit,” Shawe’s lawyer, Martin Russo of Kruzhkov Russo in Manhattan said in a statement. “There is no fine, no contempt, and there is finally going to be clarity on Skadden Arps’ billing, as we had called for.”
Shawe, likewise, said the ruling was a “major win for transparency and openness in the Delaware courts” and that Skadden’s billing would now be subject to “some level of review.” A spokesman confirmed that TransPerfect still intended to appeal last week’s contempt ruling.
Skadden, which represents Pincus, said the firm was “pleased with the court’s well-reasoned decisions, which adopt Skadden and Mr. Pincus’s position that TransPerfect and Mr. Shawe are in contempt, were in violation of applicable fee orders, and should be permitted access to invoices, but only in accordance with appropriate procedures.”
Monday’s ruling followed an escalation in rhetoric aimed at Bouchard over his handling of the TransPerfect case. Shawe and his team have been fiercely critical of Bouchard throughout nearly five and a half years of litigation. Last month, however, a TransPerfect-linked group ran a television ad in the Delaware market calling out Bouchard’s wealth and connections as part of a pressure campaign aimed at keeping him from being nominated to an opening on the state Supreme Court.
The Delaware legal community was swift in its condemnation of the ad and its message, calling it nothing more than an unwarranted attack seeking retribution against the chancellor.
Shawe’s spokesman has denied any involvement on the part of his client, and the group’s leader said it had taken no money or direction from Shawe.
Still, Russo said last week that Bouchard has a “bone to pick” with Shawe.
“Why hasn’t the chancellor recused himself,” he asked rhetorically, in a statement.
Bouchard did say Monday that he would wait until at least late Wednesday to officially enter his billing ruling, after David Finger, Shawe’s Delaware counsel, said he would be withdrawing from Shawe’s team.
Contacted by phone Monday, Finger, of Finger & Slanina, said his decision was related to “confidential attorney-client” interactions, but declined to comment any further.
An attorney for TransPerfect said he believed “there is something in the works” and that Shawe planned to substitute counsel within one to two days.
This is outrageous, folks! A $30,000 a day fine for TransPerfect CEO Philip Shawe imposed by Delaware Chancery Court’s Chancellor Andre Bouchard. Look how badly it seems they want to hide these bills! They’re willing to try to override the Nevada court, where this first started. They are willing to throw away a contract that says TransPerfect gets to see the bills and pretend the contract doesn’t exist. And they’re willing to go for “Contempt”charges, which is nearly unheard of! See the New York Law Journal story below for the sordid details.
What is Skadden and Andre Bouchard so desperately hiding? As I see it, we already know they didn’t do the work, which we heard from the testimony from TransPerfect CFO and employees. Are they really that desperate to hide the truth from the public? I’ve never seen such blatant circling of the wagons!
Bouchard and the Delaware Bar Association are in my opinion doing the dirty work for Skadden Arps. The sad truth is that the truth will probably never come out. In Bouchard’s court, protection will set you free, but apparently not the truth. It isn’t so bad if you’re the one being protected, is it?! If you’re not among the protected, you’re done for, apparently? The blatant bias and appearances of impropriety are astonishing in this ongoing, legal saga.
I think this is outrageous! Do you?! Let me know your thoughts.
Scroll down for the story…
By Tom McParland | October 17, 2019
Chancellor Andre Bouchard on Thursday held Philip Shawe and TransPerfect Global Inc. in contempt for refusing to pay the bills of the court-appointed custodian charged with overseeing the company’s forced sale in 2015.
In a 37-page memorandum opinion
(https://courts.delaware.gov/Opinions/Download.aspx?id=296570)
Bouchard said Shawe and his profitable New York-based translation-services company “intentionally and willfully” violated court orders and sought to use a Nevada lawsuit to undermine the Chancery Court’s exclusive jurisdiction over the years-long dispute.
Bouchard’s ruling required TransPerfect to pay all of custodian Robert Pincus’ fees and expenses, and ordered the New York-based firm to pay a $30,000-per-day fine if it does not dismiss the Nevada suit by Oct. 21. If the case remained pending as of Oct. 31, Bouchard said he would consider ratcheting the sanctions even higher.
“Awarding this sanction is particularly appropriate given the intentional and willful nature of the contempt violation, including respondents’ insistence on pressing its prosecution of the Nevada action in the face of the contempt proceedings,” he said. Thursday’s ruling was the latest turn in Shawe’s long-running feud with the Chancery Court and its appointed custodian, even after he secured full control of TransPerfect in a 2018 court-ordered auction. Shawe has been fiercely critical of Bouchard’s
handling of the case and has publicly advocated for increased transparency on the Chancery Court.
Last month, a TransPerfect-linked group ran an ad targeted at Delaware viewers of CNN calling out Bouchard’s wealth and connections in a pressure campaign aimed at keeping him from being nominated to an opening on the state Supreme Court. A spokesman for Shawe has denied any involvement, and the group’s leader said it had taken no money or direction from Shawe.
The latest legal spat centered on bills Pincus submitted for some expenses he incurred following the sale, including costs related to two related lawsuits in New York state and federal court.
Shawe refused to pay, saying that it should be able to access itemized expenses detailing the charges. In August, the company sued in its new home state of Nevada for a declaration that it is under no obligation to indemnify Pincus for his role as a former tie-breaking director of TransPerfect.
Pincus, for his part, called the suit a “vexatious” attempt to justify Shawe’s “flagrant violation” of the Chancery Court’s previous orders, and asked Bouchard to hold Shawe and TransPerfect in contempt by assessing “meaningful” monetary sanctions, as well as an anti-suit injunction to protect the Delaware court’s jurisdiction.
Both sides argued the motion Oct. 10 in a hearing that stretched on for
approximately three hours.
Bouchard said Thursday that the Nevada complaint misrepresented Pincus’ role as a former director, rather than a custodian overseeing the company’s sale.
“Putting aside that this distinction is legally irrelevant to the applicability of the indemnification and compensation provisions in this court’s orders,there is strong evidence … that respondents knew they were concocting a false narrative in portraying the custodian’s role in this manner,” Bouchard wrote.
“Respondents did so in an apparent attempt to circumvent the exclusive jurisdiction provision in the final order … by suggesting that the indemnification provisions in this court’s orders would not apply to the custodian’s service as a director,” the ruling said.
Bouchard said the company and its attorneys then “doubled down” by continuing to press the lawsuit in the face of the contempt motion in Delaware.
Skadden, which represents Pincus, said Shawe and TransPerfect had been “rightly sanctioned” for pursuing “meritless claims” in Nevada.
“Once again, Shawe’s attempt to ’cause pain’ to others through frivolous litigation has backfired against himself and TransPerfect,” the firm said in a statement.
Martin Russo, an attorney for Shawe, meanwhile, slammed the ruling as “devoid of merit.”
“Today’s decision is weak on the law and avoided the pink elephant in the room —Pincus’ steadfast refusal to show the company why it is being billed tens of thousands of dollars with the promise of higher amounts in the future,” he said in a statement.
“The chancellor’s decision today was activism intended to arrive at a conclusion which is not borne out in his orders or the documentation—that is, [that] he now says everything Pincus did as a director was also done as a custodian,” Russo said, promising that “strong appeals will be forthcoming.”
A spokesman for Shawe did not say when or if TransPerfect would begin paying the fines or whether it planned to have the Nevada suit dismissed by Monday’s deadline.
Citizens for a Pro-Business Delaware support diversity on the state’s Supreme Court. Chancellor Andre Bouchard is out of touch with normal Delawareans, and should not be the next Chief Justice of the state’s highest court. Delaware deserves transparency, equity, and diversity in its court system. Join the movement at http://www.delawareforbusiness.org/join-our-efforts.
If Former Vice President Joe Biden Doesn’t Win, Delaware Democrats Can Point the Finger at One Person: Andre Bouchard I told you so, folks! You heard it here first. You can’t go around doing, what I clearly see, as stealing $250 million and not expect to be held accountable for it! Andre Bouchard has led his band of cronies, happily, as I see it, milking a very-profitable, not-at-all “dysfunctional” and, in fact, quite successful company for millions upon millions of dollars. Did they think no one was watching? Did they think no one would see this injustice happening over the past few years? You read it here first folks and now you’re reading about this story EVERYWHERE! CBS, Bloomberg News, U.K.’s Daily Mail (see below). This story is not only getting national headlines, it’s getting international headlines and it’s being talked about as the Democratic debates are about to heat back up and Delaware’s own Joe Biden and Democratic presidential hopeful Elizabeth Warren are both part of this international story! You can’t have $250 million being siphoned off over the past few years from a very successful company without serious ramifications. While that money may have gone from TransPerfect to many lawyers associated with Andre Bouchard, and his comrades– Bob Pincus of Skadden Arps, Kevin Shannon of Potter Anderson, and Stephen Lamb of Paul Weiss — and now that missing money is now sparking a controversy the likes of which Delaware has never seen before! Folks, as I see it, we owe all of this negative attention and unflattering notoriety to Chancellor Andre Bouchard. What’s happening is Shirley Shawe, the 79-year-old shareholder at TransPerfect and mother of CEO Philip Shawe, is fighting the “Good Ole Boy’s Club” and taking on the role of an Anti-Chancery Court, Corruption activist. By doing so, she’s holding former Vice President and current 2020 Democratic Presidential candidate Joe Biden accountable for his blind support of Bouchard’s Chancery Court. This isn’t the first time she has taken on Chancery Court Corruption. Here are two examples of Shirley Shawe turning to the airwaves to fight Delaware Chancery Court corruption: I’ve been forewarning about this, pounding the table, and demanding action from the legislature for the last few years. In my opinion, Chancellor Bouchard is undermining our State’s reputation and is detrimental to our entire state economy. I applaud fellow senior-citizen Shirley Shawe for having the courage and grit to take on the establishment cronies. As always, your feedback is welcome!Republican businesswoman behind $500,000 Joe Biden attack ads explains she was furious he supported ‘corrupt’ Chancery Court that dissolved her business costing her millions
Political unknown Shirley Shawe paid for the TV ads in Iowa and New Hampshire to show next week Shawe shared with DailyMail.com the ad is to ‘raise public awareness to the serious issues plaguing America’s most powerful business court’ It is the largest third-party attack ad spend so far in the 2020 campaign The ad includes a 2005 exchange between then Senator Biden and Elizabeth Warren – at-the-time a Harvard professor – as they discussed bankruptcy reform But the ad dices up the dialogue between the two and suggests that they were speaking on the Chancery Court Transcripts from the hearing reveal that Biden had just misspoke and confused bankruptcy courts with the Chancery Court, a point he later clarifies Both Warren and Biden have called for the ad to be pulled from the air Shawe seems to be angry about a business dispute that impacted her son in 2015, more than ten years after the political exchange took placeBy MATTHEW WRIGHT FOR DAILYMAIL.COM and KEITH GRIFFITH FOR DAILYMAIL.COM
PUBLISHED: 14:52 EDT, 29 August 2019 | UPDATED: 16:15 EDT, 29 August 2019 A Republican entrepreneur who released a perplexing ad decrying Joe Biden’s relationship with the Delaware Chancery Court has explained that she was angry at the presidential candidate for supporting the court that dissolved her business – costing her millions. Shirley Shawe told DailyMail.com that she released the misleading advert as a means to ‘raise public awareness to the serious issues plaguing America’s most powerful business court.’ ‘I was a personal victim of ageism, sexism, and corruption at the hands of Delaware Chancellor Andre Bouchard over the last five years; my constitutional rights were trampled and my private property was seized by a Delaware government body and put up for auction-and part of the justification for this was my age,’ she claimed in a statement to DailyMail.com. She added the behavior was ‘typical of the “Old Boy’s Club” that runs Delaware.’ ‘The Chancellor turned simple board deadlock into a 3 year occupation of the company I am part owner of, and caused over $250 million to be spent on the case, much of which directly benefited his social circle in Delaware. Bouchard was sworn in as Chancellor in 2014, five years after Biden ended his time as Senator of Delaware and almost a decade after the footage Shawe used in her advert. Shawe clarified that she sought to ‘encourage the candidates to drive reform’ with her ad that correctly identifies Delaware as getting an ‘F’ grade from the 2015 State Integrity Investigation that looks at ‘state government accountability and transparency.’ The ad includes a 2005 exchange between then Senator Biden and Elizabeth Warren – at-the-time a Harvard professor – as they discussed bankruptcy reform. ‘The Delaware court is too male, too white and anything but open,’ the ad’s narrator asserts in the advertisement. In the ad, Biden speaks on how the Chancery Court are open and calls it ‘outrageous’ to suggest otherwise. The clip then shows Warren ‘responding’ and seemingly pointing out how the Chancery Court impacts Delaware workers. But, the clip actually chops up Warren’s entire comment and fails to contextualize Biden’s comment – especially once he realizes that the conversation is about bankruptcy courts and not the Chancery Court. A transcript from the hearing shows that Biden realized his mistake and focused on Bankruptcy. Chancery was only ever mentioned in his initial comment. ‘Employees of companies like Enron literally cannot go to Delaware and hire local counsel, which the Delaware bankruptcy court requires of them before they can make an appearance, and that effectively cuts thousands of small employees, pensioners and local trade creditors out of the bankruptcy process,’ Warren said in the entirety of her quote. ‘If they can’t afford it, they are not there.’ Both Biden and Warren demanded the ad to be pulled, with the former Vice President declaring that the advert mischaracterized his remarks. Shawe shared that she was ‘disappointed’ by the politicians reaction but added that it was not ‘unexpected’ for Biden to respond in that way ‘given his home state court’s attempt to silence me and treat me as less than a person for years.’ She continued: ‘It is typical of the “Old Boy’s Club” that runs Delaware.’ ‘For Ms Warren, I suspect the Senator doesn’t yet fully understand how the Chancery Court harmed me and our 5000 workers worldwide. If she researches this case more deeply, I believe she will understand the facts and may have a different view.’ The Republican apparent endorsement of Warren – as seen on the ad – happens to just fall on that particular issue. Shawe said ‘who knows’ when commenting on who she would support for other issues and added that she and Warren agreed on this particular one. ‘The court needs to be brought up to 2019 and needs transparency,’ she stated. ‘I will keep fighting for that. This is just the first in a planned effort to drive awareness.’ Shawe’s grudge seems to stem from a costly legal battle that her son’s translation company, TransPerfect, fought in Delaware’s chancery court in 2015. ‘Two years after the case has ended, my company is still be billed outrageous sums per month by Skadden Arps, the Chancellor’s and the Chief Justice’s former employers,’ said the businesswoman. ‘We are required to pay these bills by court order, yet we are not allowed to see them, or even know what this work is for.’ She plans to run the television ad in early primary states Iowa and New Hampshire next week in what is the largest third-party attack ad spend so far in the 2020 presidential race. The ad eschews mainstream campaign issues and instead focus on the Chancery Court, a legal system which Shawe blames for a business dispute that hurt her son’s company. ‘The Delaware court is too male, too white and anything but open,’ the ad’s narrator intones. The 60-second ad shows Biden during a 2005 Senate hearing, in which he debated Elizabeth Warren, then a Harvard law professor. The ad accuses Biden of defending the Chancery Court as Warren attacks it. The transcript of the hearing shows that Warren was actually speaking about the bankruptcy courts, a separate forum of equity law, but Biden became briefly confused and referred to chancery court. Delaware’s Court of Chancery oversees business disputes, though not bankruptcy, which is a federal matter. The state’s chancery court has great influence due to the large number of companies that are incorporated in Delaware, which has business-friendly laws. Both Biden and Warren, who are among top contenders for the Democratic presidential nomination, have called for the ad to be pulled. ‘The ad misrepresents Vice President Biden’s position in this exchange from 2005 by manipulating footage to suggest he means one court when he means another,’ Biden campaign national press secretary Jamal Brown told CBS News in a statement. ‘It’s a clear reminder of the way that third-party money poisons our politics with false attack ads, and it has no place in this race,’ he continued. Warren also spoke out against the ad, even though it seems to cast her in a heroic light. ‘Elizabeth does not believe individual donors should have an outsized influence in this primary, and has consistently said that Super PACs or individuals with the means to finance ad campaigns on their own should stay out of the primary,’ her deputy communications director Chris Hayden said. Shawe’s grudge seems to stem from a costly legal battle that her son’s translation company, TransPerfect, fought in Delaware’s chancery court in 2015. In a landmark case, the head of the Delaware Chancery, Chancellor Andre Bouchard, ordered the dissolution of the company even though it was not in financial distress, but because its co-owners could not get along. The court-ordered decision to sell TransPerfect came in 2015 after a chancellor concluded the feuding CEO’s Philip Shawe and Elizabeth Elting were ‘hopelessly deadlocked’ over significant matters and business decisions. Shirley Shawe owned 1 percent of the company at the time of the forced sale, which resulted in her son Philip Shawe gaining ownership by bidding in the public auction. Shirley Shawe launched a crusade against the chancery courts, however, lobbying lawmakers to banned forced sales like the one of TransPerfect. ‘When a judge makes a precedent and makes a ruling to just sell a privately held company, then why would other people be motivated to start a company and why would they be motivated to incorporate in the state of Delaware? If someone is just going to take their private property?’ Shawe told WMDT-TV in 2017. Shawe has said through a spokesperson that she is a Republican and did not intend to boost Warren with her ad. She has vowed to run to run the TV ads in spite of the candidates’ protests, and has also reportedly ordered print newspaper ads on the subject.
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:
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:
FEBRUARY 13, 2017
“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.”
I am asking you to click on this link and watch this video:
Please take a quick look and let me know what you think. I am preparing a feedback piece. Send your comments as soon as you can, as the response has been strong! I would like to thank the legislators who have responded as well, and I want your voice to be heard too!
15 minutes into it you will see me asking a probing question.
I believe that Delaware’s absolute, basic, economic, moral, and ethical future is at stake here!
The link will take you to a video showing the beginning of an important movement! It started with a press conference (shown in the video) that is going to affect the future of Delawareans for years to come!
I attended the press conference in front of the Court House in downtown Wilmington, Delaware on July 10th. The “Citizens for Pro Business Delaware” event was led by their Chairman, Chris Coffey.
Thank you for taking the time to view this important video.
Your comments are welcome and appreciated!
JUDSON Bennett-Coastal Network
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…
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.
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.
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.
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:
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.
That Chancellor Andre Bouchard, in my view, continues to engage in a cover-up and hide documents by abusing his sealing power has reached a Spanish newspaper (links and article below). As I’ve screamed from the mountaintops, this man continues to be a stain on Delaware’s image. Can our state really afford to have our judiciary be the laughingstock of the international press for arbitrary, capricious, and suspicious behavior? We don’t need continued damage to our economy from self-inflicted wounds such as from Chancellor Andre Bouchard!!! To summarize, news from the TransPerfect case, in which Chancery Court Chancellor Andre Bouchard continues to hide court documents has reached a newspaper in Spain! The case has been closed now for 18 months. How long can we let the “good ole boy” cronies get away this? Delaware citizens are rightfully concerned, and the Delaware legislature should act on these concerns through its power to investigate.The “good ole boy”, Skadden Arps network should not prevent Delaware from governing itself. The mass court-ordered transfer of wealth in the TransPerfect case from shareholders and employees to Bouchard’s close pals is the greatest miscarriage of justice on American soil since World War II. And the icing on the potential corruption cake is that Bouchard’s Chancery Court — arguably the most powerful business court in all of America — is further violating the public trust by refusing to unseal court documents and refusing to open itemized Skadden Arps and other bills related to its 3-year “custodianship” of a successful company, which many Americans clearly view as an illegal occupation and looting. So again, SHOW THE DOCUMENTS MR. BOUCHARD?!?! If you don’t have something to hide, why the cover up? By requesting this unsealing, as a recognized member of the press, aren’t I giving you and your cronies a specific chance to clear your names? Everyday you do not come clean and simply be open and transparent, you further cost Delaware its historic and respected credibility, not only in the U.S., but abroad as well!The weeks pass but the opacity in the TransPerfect case lasts. The records and details of the conflict are still blocked by Judge André Bouchard. Meanwhile, the associations of citizens of Delaware redouble their pressure to see what the judge ordered to spend 250 million dollars in one of the most controversial shareholder conflicts in the history of the United States. The collateral effects of the dispute have also been noticed in Spain. During the conflict, the 4,000 jobs generated by the company throughout the world have been put at risk, of which 500 are located in Barcelona.
Grouped around the Citizens for a Pro-Business Delaware association ,citizens disapprove of Bouchard’s attitude, which, in addition to damaging the image of the State, goes against the current US legislative framework, which obliges the public to publish detailed information on resolved cases. A maneuver that demonstrates a clear intention to hide the records and invoices with the aim of covering up all the law firms and consultants that have profited from this conflict.
Pressure on the Delaware court system
The favorable resolution of the TransPerfect case, with the purchase of Phil Shawe from the remaining 50% of the company, making it possible to secure employment and maintain the growth path, has not calmed the mood in Delaware.
Resolved the case of the multinational translation, the case now focuses on the neutrality of the judicial system of Delaware, which is in question. This American state has fallen from the first to the eleventh position in the neutrality ranking of the country’s judicial systems, according to a survey prepared by the United States Chamber of Commerce. As a result, some companies – including TransPerfect – have moved their headquarters to other states in search of a more neutral and competitive system.
Business leakage
The Delaware citizens’ associations believe that this fall in Delaware’s neutrality and competitiveness is holding other companies from establishing their headquarters in the State and involves the flight of companies to other, more competitive places. Something that poses a high risk for employment and directly impacts the generation of new jobs.
Now, the goal of these associations is to highlight the irregularities that have been in the TransPerfect case by the State Chancellery and prevent a repeat case like this, in which a judge decrees the forced sale of a company private multinational with benefits and approves the expenditure of 250 million dollars in law firms and related consultants.
Law firms involved in controversy
One of the firms that have profited the most in the TransPerfect conflict, with the consent of Judge André Bouchard, has been the Skadden Arps law firm. One of its partners, Robert Pincus, was appointed as judicial administrator of the company during the conflict precisely by Bouchard. According to data from the Citizens for a Pro-Business Delaware platform, Pincus would have received a salary of 1,425 dollars per hour to supervise the controversial forced sale of the company and would have presented invoices without details or breakdown, according to sources close to TransPerfect. Invoices that remain hidden today by the judge’s decision.
But the controversies that surround the firm do not end with the TransPerfect case and go further. In January of this year, the firm Skadden Arps agreed to pay a sanction of 4.6 million dollars (4.1 million euros) to resolve its responsibility with the Department of Justice of the United States for violating the Agent Registration Act. Foreigners (FARA) in political lobbying work done with Trump campaign advisor Paul Manafort to benefit the Government of Ukraine in 2012 and 2013 in favor of Yanukovych.
In this context, from Citizens for a Pro-Business Delaware demand to investigate the work commissioned by Bouchard to companies such as Skadden Arps, which have endangered thousands of jobs by targeting the division and sale of the company to funds vulture.
The latest on the TransPerfect Global case is that the employees of the company apparently have no choice but to go on offense, because the injustice and corruption are so over-the-top that the company itself is powerless to take legal action, because it knows it will see no justice from Andre Bouchard, Leo Strine and their Good Ole Boys Club known as the Chancery Court in Delaware. Understand folks, the problems here are dark and deep. The employees feel that the Chancellor has been and is continuing to steal from them. So much so, they have resorted to taking up the mantle for their own company because the money going to Bouchard’s friends at Skadden Arps is costing them their benefits and costing them their raises! Their lives and livelihoods are at stake as the Chancery Court’s approved looting has forced them to galvanize to battle this perceived corruption. All that money is going to Skadden Arps. Andre Bouchard, Chief Chancellor of the Delaware Chancery Court, is ordering it and there is nothing anyone can do to stop it. In fact, I’ve been told by contacts from within the company that these bills have been approved by Bouchard in 15 minutes or less! You’re hearing this right folks, the Chancery Court isn’t even looking over the very bills that they are ordering TransPerfect to pay. Given the intimate relationship between Skadden and Chancery, you would think they would handle them with extra care, instead they rubber stamp them! Egregiously, this is all happening under court seal and Bouchard continues to hide it from public view! It has to stop! Our state legislators need to take action. Now the employees — who in my opinion are really the ones being robbed — are so rightfully disgusted by the Court’s action that they are mounting a challenge to see these bills. Employees are demanding complete transparency from Bouchard’s Court and a release of all the documents, which is the law. These bills should be open to the public, by statue! Please read the detailed article below. The Chancery Court irregularities are so brazen that the employees are rising up against Bouchard’s shady court system. I again implore our legislators to no longer sit idly by as the largest heist in American court history continues unabated.Apr 11, 2019
WILMINGTON, Del., April 11, 2019 /PRNewswire/ –18 months after the historic TransPerfect case was settled, the custodian in the case, Robert Pincus, has continued to bill TransPerfect every month for undisclosed services, including what his own $1,475 an hour role entails. His responsibility remains unclear, and any efforts to ascertain his work on behalf of TransPerfect has 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 late 2017. The custodian’s spending is a matter of public record and public concern and employees deserve answers. Skadden, Arps, Slate, Meagher and Flom has received a sizable amount of the 250 million that was spent on the case. Chief Justice Andre Bouchard previously worked at Skadden before joining the Chancery Court in 2015.
“Why these records are still under seal is a perpetual mystery for our members. Pincus and his company has spent over $1M on secret services since the company changed ownership and the case ended,” said Chris Coffey, Campaign Manager for Citizens for Pro-Business Delaware. “This means fewer resources for TransPerfect employees in the form of income and benefits. To have those records under seal is arbitrary and capricious and you can only get away with that kind of rubber stamping in the secretive boys’ club that is the Chancery Court and its network of cronies. We need transparency at long last.”
CPBD will begin an ad campaign this Spring to highlight efforts to get to the bottom of this secret spending. The efforts may also include a push for legislation to increase transparency at the Chancery Court in cases similar to this one. Indeed, TransPerfect has continued to set records for growth despite the factual inaccuracies spread by the Court about the health of the company. The campaign will include digital ads, billboards, polling, and the hiring of a lobbyist. David Walsh has been engaged in the work.
About Citizens for a Pro-Business Delaware
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 defend the TransPerfect employees and fight for more openness in the Delaware Chancery Court. For more information on Citizens for a Pro-Business Delaware or to join the cause, visit DelawareForBusiness.org.
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.By Alex Vuocolo March 5, 2019
Delaware Business Times
Citizens for a Pro Business Delaware (CPBD), the lobbying group that successfully fought to stop the break up of TransPerfect by the Court of Chancery, delivered the keynote address at the translation services company’s annual sales conference.
CPBD Campaign Manager Chris Coffey spoke to upwards of 300 employees about what he calls the “existential threat” posed by the Court of Chancery.
“Existential threats are threats beyond typical business competition that put successful businesses at risk, such as through government actions or hostile takeover attempts,” Coffey said. “Our organization stopped both types of efforts.”
In the address, Coffey outlined the history of the legal battle, which began in 2016 when the Chancery decided to break up the company following an irreconcilable dispute between its founders. A group of senior managers later approached Coffey, a New York-based consultant, about taking up their cause.
“We may have won the biggest battle over TransPerfect in Delaware, but if history has taught us anything – it’s that the same court agents and lawyers who made millions of dollars coming after TransPerfect are not going to stop now,” Coffey said. “That is why our members have asked us to keep organizing and fighting and that’s what we intend to do.”
“From meeting with elected officials to educating the public through a new campaign, we will ensure the Delaware government cannot be used to improperly occupy successful companies against the wishes of a majority of shareholders,” he added.
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
https://www.nytimes.com/2019/01/17/us/politics/skadden-arps-ukraine-lobbying-settlement.html“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.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.
For the those of you who haven’t watched “Game of Thrones” on television and aren’t eagerly awaiting the final season in April on HBO, perhaps I can explain this analogy. King Joffrey is a fictional character, who is the product of incest. He is corrupt to the core, and willing to do anything to vanquish his enemies. His ascent to the throne was illegitimate. He tortures innocent people for his own amusement. He is a pathological liar and abuses his power in unspeakable ways to better his own position and his allies. He is all powerful; everyone fears him, so they tell him what he wants to hear (versus the truth), and all the kingdom’s subjects truly know he’s not the man for the job, but are powerless to drive change. Other than being a product of incest, which I can’t opine on, in my opinion, Chancellor Bouchard is the spitting image of King Joffrey. I’m glad TransPerfect Global and its CEO Philip Shawe were willing to demand trial by combat, a Game of Thrones reference, and win a victory not only over Bouchard, but the cadre of, in my personal view, the many suspicious sycophants, he surrounds himself with such as (Bob Pincus, his former partner at Skadden Arps; Kevin Shannon, his BFF; and Leo Strine, his former Intern at Skadden Arps). Let’s hope Delaware is not powerless to stop this apparently sadistic man who, since he ran the Judicial Nominating committee, and used to employ Leo Strine, the Chief Justice, should in my opinion, have never been given this appointment. Just to give you some background and an outrageous example, Bouchard wanted to give his friend Kevin Shannon and his client (former TransPerfect Global co-CEO Elizabeth Elting) an artificial leg up in the case. I have read over 5,000 pages of the transcripts in great detail. Take my word for it, it’s all lawyer lies and hyperbole — sad — and all designed to make this $650 million industry-leader look unusual — Why? I believe it was so Chancellor Bouchard could justify using TransPerfect’s company coffers as a conduit to enrich his pals beyond belief. When I think about the $250 MILLION (verified by Crain’s Business magazine) that Bouchard ordered private U.S. citizens to spend, just to seemingly benefit his cronies, it truly makes me nauseated. There was nothing wrong with this corporation, except for a 50% passive shareholder and scorned woman (Elting) who wanted out – and I think this Chancellor saw a huge opportunity knocking to use his position to feather all his friend’s nests and I am sure his own as well. What would a non-corrupt judge have done? Elting could have sold HER shares, even with a Custodian. But the rub is, half of a company (Elting’s share) wasn’t worth as much as 50% of the whole company — so seeking to enrich his pals, Bouchard embarked on a non-sensical judicial result: the most long, arduous, illogical, expensive, ripe for abuse, tortuous to 4,000 employees, a government run public auction from a successful private company — which is without precedent in America. To do this, Bouchard performed an illegal taking (contrary to the Takings Clause of the 5th Amendment) of Philip and Shirley Shawe’s stock (50% of TransPerfect) and put their private property up for sale, against their will, at the same time, to give Kevin Shannon’s clients a windfall. So, Bouchard then seemingly makes up an endless series of outrageous lies to justify what I believe is the biggest business theft in American history, courtesy of the Delaware Chancery Court and its cronies. You might say, well Shawe bought it anyway at the public auction, so no harm no foul — Philip and Shirley Shawe got to keep their property. If you believe blackmail is a proper activity for Delaware judges to engage in, you would have a point. Bouchard pitted Shawe’s bidding against his largest competitor, HIG-Lionbridge, an off-shorer of U.S. jobs — so in effect, Bouchard extorted Philip Shawe into over-paying, as this was the only way Shawe could save 2,700 American jobs and keep his company. Back to what I believe, based on the evidence, is that the Chancellor outrageously misrepresented the facts. Much to Bouchard’s disappointment, the law and the constitution prevents him from issuing a fine without a jury (thank God). So how does a potentially corrupt judge get around the law? As I see it it’s in how he lies in his opinions and tries to damage his enemies, and enrich his friends. Bouchard wrote in his opinion that Shawe “did not deny” stalking Elting. Naturally, “stalking” is a criminal offense that would be picked up by the newspapers, and would hamper Shawe’s ability to get financing. This ridiculous lie was blown up by Chief Justice Strine during the appeal, who also falsely refers to it as an undisputed fact. I have talked with 100 employees and Shawe never stalked anyone, and Bouchard himself must now agree, since he eventually awarded Shawe the company. From what I’ve read, here is what I see as the EVIDENCE Bouchard relies on from the trial, and again Bouchard said publicly “Shawe did not deny” this, back in 2015 to set these wheels in motions… A HUGE NEFARIOUS FABRICATION !!!! ELTING ATTORNEY: … Now, Mr. Shawe, you’re also fond of stalking Ms. Elting, aren’t you? SHAWE: No, not in any way, shape, or form. Bouchard should go to jail for the reputation damage of this outrageous lie alone. But the whole case is a grotesque misrepresentation which I believe was engineered by Bouchard for the benefit of his friends, and in my opinion, himself. Here is what Bouchard himself wrote when Shawe requested an itemization of legal fees on November 10th, 2015: “It is customary, after a sanction is imposed, to take evidence on the itemization of the amount.” But I guess if you are the judge’s best friend, Kevin Shannon of Potter Anderson, you get $1.4 million dollars of TransPerfect money and these rules don’t apply to you. Shannon did not have to justify or itemize anything! The Coastal Network will offer a reward to anyone who can find Shannon’s itemized bills on the $1.4 million Bouchard forced Shawe/TransPerfect to pay in the record. I cannot. And don’t get me started on Bob Pincus’s $25 million share of the $250 million in pirate’s booty. UNBELIEVABLE!!!!!!! Lastly to close on the point of who is worse, Chancellor Bouchard or King Joffrey from Game of Thrones, it’s a close call. Bouchard tortured thousands of employees for 4 years — innocent hard working Americans who were forced to delay weddings, put off having children, put off sending kids to college — all because of Bouchard’s, in my opinion, illicit scheme. Further, Shawe’s lawyers during the legal battle, were forced to pussyfoot around the issue of the Chancellor’s possible improprieties. This is from an actual legal document:Delaware is a small state with a small bar. The Plaintiff, however, resides in New York, which is a large state with a large bar, so he raises that the context of the relationship between the presiding judge in the Chancery Action and Shannon lends color to this appearance. Although the Court of Chancery’s decisions concerning the Defendants’ conduct at issue does not preclude this action or control concerning the validity of Plaintiff’s claims, Plaintiff provides a few anecdotal facts regarding the relationship of Shannon and Chancellor Bouchard. Shannon and Chancellor Bouchard, upon information and belief, have known each other since they represented aligned clients in In re Walt Disney Co. Derivative Litigation, 907 A.2d 693 (Del. Ch. 2005) approximately twenty years ago. Both served on the board of St. Francis Hospital. They have appeared as co-panelists at the annual Tulane Law School Corporate Law Institute in New Orleans, Louisiana (including while the Chancery Action was pending). Plaintiff understands (and has been assured by counsel) that these facts are not necessarily indicia of impropriety. The Court of Chancery’s failure to require Potter to submit itemized records like its co-counsel, coupled with Shannon’s relationship with the presiding judge, does however engender speculation, even if unwarranted.
This makes me sick, look at this weak presentation from the defense, even Shawe’s lawyers felt they had to walk on egg shells, when battling Bouchard’s insidious operation. The inevitable conclusion is: There is just too much power centered in the Delaware Judiciary, and this is not what our forefathers intended. Perhaps, back when the Delaware Chancellors were honorable and the Chancery Court was a nationally respected institution, this wasn’t a life or death issue for the state of Delaware. Regardless, in my view after doing more research than anyone else, I am certain that Chancellor Bouchard’s handling of the TransPerfect case, his appearances of impropriety, the innumerable irregularities, and his unusual and unprecedented decisions were not just a product of gross incompetence, but something far darker. While King Joffrey is the product of familial incest, King Chancellor Bouchard is the product of his incestuous relationships within the Delaware legal system — and even though he’s the most powerful man in our kingdom, he is not above the law and must be held accountable for his actions. Delaware’s financial future, and thus the financial future of it citizens depends on it! Delaware Lawmakers, I again call upon you for change and reform.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.”
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? Hoorah! After four-years, the TransPerfect legal battle has finally ended with co-founder Philip Shawe and his mother Shirley Shawe continuing to own and run this successful private company. After following every detail of this case, reading all available documents several times, and interviewing many employees, I feel I know what is right and wrong about this case. First, let us celebrate what is right: Philip Shawe, the manager and 49% owner who built the business, and who EVERY witness in the case testified in favor of, prevailed in his bid. He now owns 99% of the company. Additionally and importantly, my fellow senior citizen, Shirley Shawe, who was never accused of anything in this case and was being unconstitutionally forced to sell her 1%, was able to maintain her stake (However, I understand that she did lose her control premium in the process). I also understand the Shawes have pledged to keep the jobs where they are, and not offshore them. While there are many in Delaware who scoffed at my analysis, it was obviously correct that massive jobs were at risk, based on Bouchard’s decision to go to public auction, because the Custodian and the Court relied on this in their final rulings. Shawe was forced to bid against a private-equity backed competitor that would have cut or off-shored an estimated $50 million in U.S. jobs, according to my research. Simply put, Shawe was made to compete on an uneven playing field for the shares he already owned, and not bid their market value (or even his former business partner’s value), but instead had to outbid HIG-Lionbridge, which is known for job-offshoring. Shawe was competing with a company that would have cut jobs, raised prices, and in the end, TransPerfect would have been devastated. While the TransPerfect case never should have occurred, the bloated and outrageous expenses of nearly $300 million also should have never happened. This victory was righteous for Shawe, TransPerfect, and for thousands of employees worldwide. Delaware and the Chancery Court have been embarrassed by Bouchard’s method of operation, but ultimately, they got this case right. Could the same result have been achieved without years of litigation hanging over the company, and without hundreds of millions of unchecked dollars spent by court order? That is a question generations of law students will ponder in the future, but not today. The many unanswered questions about this TransPerfect case, and who truly benefited, can be left for another day. Today let’s celebrate. I say to Chancellor Bouchard and Custodian Pincus, I do not agree with how you got there, but I do applaud the end result because the employees and their families are safe in the hands of the man who built the company, Philip Shawe. Folks, read this industry trade article below from “Slator” which has devoted extensive coverage to this unprecedented decision throughout the case, and wraps up what everyone hopes is the final chapter clearly and concisely.One of the most acrimonious boardroom battles in recent American corporate history is over. On May 3, 2018, the Delaware Supreme Court affirmed the Court of Chancery’s final judgment to approve the sale of TransPerfect to co-founder (and now sole) CEO Phil Shawe.
For years, Shawe had been fighting for control of the company with co-founder and former co-CEO Liz Elting. In June 2016 a court in Delaware, where TransPerfect is incorporated, ruled that the company was to be sold in an auction process.
As reported earlier, the process that began with 97 potential participants ran four bidding rounds and ended with H.I.G. Capital, Lionbridge’s owner, and Phil Shawe, virtually neck-and-neck.
Elting made an attempt to team up with private equity group Blackstone but failed to put together a competitive bid. Eventually, Robert Pincus, the custodian in charge of the sale process, went with Shawe’s USD 770m offer, citing five factors that tipped the balance in Shawe’s favor. Shawe is buying all of Elting’s shares for USD 385m in cash, yielding her about USD 287m in after-tax net proceeds.
In a May 3, 2018 email to TransPerfect staff obtained by Slator, Pincus called the Supreme Court’s decision the “last major step in the process” and expects the sale to close on May 7, 2018.
“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,” Shawe said in an email statement to Slator. “However, at this time, I simply want to thank the TransPerfect staff; it is our team who deserves profuse praise for driving the company’s unparalleled performance.”
TransPerfect’s performance throughout the saga was indeed impressive. The company’s revenues grew from USD 401m when the battle began in 2013 to USD 549m in 2016. Even more remarkably, the company managed to grow by another 12% to USD 614.8m in 2017, a year that saw mass departures amid the company’s executive ranks and precious management attention absorbed by the legal case.
TransPerfect can now claim the bragging rights of being the world’s largest language service provider by revenue as per the Slator Language Service Provider Index (LSPI) released on May 3, 2018. Upon completion of the sale, TransPerfect will be released from its current M&A restrictions and is expected to return to the acquisition trail. Slator reached out to a spokesperson for Liz Elting but is yet to receive a response as of press time.
Update: In a press release published on May 7, 2017, TransPerfect said revenues in the first quarter 2018 grew nearly 16% to USD 154m vs. the first quarter 2017. The company also announced it was going to resume M&A and pursue strategic mergers and acquisitions (the legal battle meant TransPerfect has not completed a major acquisition for over 4 years).
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.Whoops, not so fast Robert Pincus, the Bouchard-crony and former law partner who Delaware’s Chancellor Andre Bouchard appointed to be Custodian of this profitable company, TransPerfect Global — in the wake of erroneously forcing its sale to the highest bidder — may not work out as planned. A Georgia Court has ordered that an employee’s lawsuit — demanding that the company and Ms. Elting issue the shares he was promised — should move forward, and that TransPerfect Global should be added as a party in the lawsuit. If the company is forced to keep its promise, and issue his corporate stock share, this would give SVP Kevin Obarski not only the share he was promised in order to work, but also the power to break any log-jams from Bouchard’s alleged “deadlock”. Could this change the direction of TransPerfect’s future, and take it out of the hands of Bouchard’s cronies, and back into the hands of an employee who built it? Who is more deserving… the SVP of Sales, or Bouchard’s biking buddy, Robert Pincus, from Sadden Arps? Being one of the most heartfelt, born and raised, patriotic, former Lewes, Delaware men on this planet, it pains me to say this, but justice simply cannot be found in our state’s Chancery Court any longer. Thank goodness these people only control Delaware’s Chancery Court and it doesn’t bleed into any other states! The incestuous noose of corporate fleecing, irregular and biased rulings, and a plethora of what I and many others perceive as suspicious and improprietous activities by Delaware’s judicial Bonnie and Clyde (Bouchard and Strine) are indeed coming home to roost in this amazing case. The company is in disarray because the employees want no part of what they view as Bouchard’s and Pincus’s rigged auction toward Lionbridge — their largest competitor. Indeed, many TransPerfect employees have reported to me that the auction is a sham — and the only meetings the Custodian’s consultant, Joel Mostrom, even attends, are for the Lionbridge executives. Lionbridge is a well-known outsourcer of Amercian jobs, and I will personally call the President, the U.S. Attorney General, and the FBI if Bouchard’s profiteering cronies eliminate 4,000 jobs from this successful American company to line their own pockets. Conflicts of all kinds abound in this absurd case within and without, both past and present. The connections between the Judges, the Plaintiff’s lawyers, and the Custodian are so far reaching it boggles the mind. The apparent and seeming collusion between law firms in their legal representation of the parties, pirating of intellectual properties, ex-parte communications, paranoid and dictatorial rulings by the custodian, violation of civil rights, top executives resigning (one wrote in his letter of resignation a clear expose of Pincus’ possible nefarious activities) are raising eyebrows throughout the state of Delaware. The billing and ordered payment by Chancellor Bouchard of $25 million dollars in undocumented and unexplained fees from TransPerfect’s coffers by Pincus is unbelievable. It is incessant corruption in my opinion with Chancellor Andre Bouchard at the center of it all. I find it very interesting that both Pincus and Elting use the exact same phrasing when addressing the recent departures — they have a “deep bench” of talent… from Pincus’ quote in the “Crain’s New York” article, and Elting’s quote from the “Slator” article. This is clear evidence of collusion, if anymore was needed. 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 going ahead with the sale. He said, according to “Slator”, in a phone call “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.” Well folks there are now a bunch of legitimate flies in the ointment and these avaricious actors may not get what they want. Heck, some of them might even go to jail if what I suspect could be proven? Follow the money! Please see the article below, urge your legislators to stop these obscene, monetary commissions that Bouchard’s cronies stand to gain from “auctioning” off this company to its largest competitor, disgorge their ill-gotten fees, and save TransPerfect. Legislative investigations in both the Delaware House and Senate would be appropriate and are necessary. However, I won’t hold my breath.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.
EQUITY IN TRANSPERFECT IN DOUBT AS GEORGIA COURT RULES IN FAVOR OF TRANSPERFECT EMPLOYEE
Delaware custodian purportedly will still take bids for sale of TransPerfect even as court joins TransPerfect into the employee’s case for equity shares in the company. Employee contends his equity owed is the swing vote on alleged deadlock, and thus carries enormous value.
Dover, Delaware (November 6, 2017) – Georgia courts grant procedural ruling moving TransPerfect employee’s case for equity in the company forward. The plaintiff, Kevin Obarski, serves as Senior Vice President at TransPerfect’s Atlanta office where he negotiated and executed contracts for the company. Obarski was promised ownership in the company through equity shares for his success in building revenue. The Georgia court granted joinder, which will allow TransPerfect and Elting to be added as defendants in Obarski’s lawsuit against the company to acquire his promised shares.
The decision in favor of TransPerfect employee, Kevin Obarski, coincides with the due date for bidders to send their offers for TransPerfect to Delaware’s court-appointed custodian this week. The custodian is aware of the favorable ruling that adds doubt to the equity in TransPerfect, but there have been no signs of slowing the sale. “We continue to urge Delaware legislators to rein in the reckless actions of the court-appointed custodian. Pincus is charging forward even as state courts across the country shed doubt upon the basis of the Delaware court ruling,” said Miranda Wessinger, President of Citizens for a Pro-Business Delaware. “Other states have consistently ruled in favor of TransPerfect employees and against the volatile allegations of co-CEO Liz Elting. Citizens for a Pro-Business Delaware will not stop fighting for job security for more than 4,000 TransPerfect employees here in the United States.”
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. They formed in April of 2016 to focus on raising awareness with Delaware residents, elected officials, and other stakeholders about the issue.
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.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.
NEWS PROVIDED BY
The Edelsteins, Faegenburg+Brown,llp
Oct 09, 2017, 17:40 ET
NEW YORK, Oct. 9, 2017 /PRNewswire/ — After three years of contentious litigation, numerous motions and unyielding delay tactics, TransPerfect Co-CEO Elizabeth Elting and her Legal Team consisting of Kramer Levin, Paul Weiss and Gerald Lefcourt are now asking New York Supreme Court Judge, Debra James, to discontinue Elting’s claims against Co-CEO Philip Shawe. This comes after the judge made a recent determination that the exchange of discovery would proceed in the New York Tort case.
Shawe’s attorney Glenn Faegenburg of The Edelsteins, Faegenburg & Brown LLP said, “Elting’s legal team should not be permitted to unilaterally discontinue claims they have already presented and aggressively litigated in New York County Supreme Court, in order to avoid providing discovery regarding those claims.”
“Among Elting’s frivolous claims against Shawe, that she and her legal team now want to drop, are false allegations of defamation, assault and intentional infliction of emotional distress,” Faegenburg continued. “Absent the Court’s permission to withdraw their claims, discovery supporting Shawe’s contention that Elting and her legal team filed a false defamation action against Shawe they knew was untrue will likely be uncovered.”
Faegenburg said, “We believe that the false defamation countersuit is the product of a scheme by Elting, in concert with her advisors, to manufacture false claims against Shawe, and that many of those schemes are memorialized in Elting’s emails. If their motion to discontinue Elting’s counterclaims is denied, emails regarding these schemes may be required to be turned over to Shawe as part of the discovery proceedings in the New York Tort action.”
“Now that Elting and her team know that the discovery process may, in fact, reveal nefarious planning on their part, she is seeking to petition the Court to ‘take-back’ the claims she previously swore to and fiercely litigated,” Faegenburg said.”Notably, this same tactic was used in the Delaware case where Elting withdrew over 250 allegations from her complaint the day before an expedited trial was to begin. In that case Shawe alleged that Elting and her lawyers had fraudulently manufactured deadlock to convince the Chancellor to put the company up for sale,” Faegenburg added.
The court’s edict also subjects Ms. Elting’s mental and psychological history to the scrutiny of the Court. Elting and her attorneys know that by claiming physical, emotional, and psychological damages, Shawe will be entitled to copies of her medical records including mental health records. In light of the Court’s recent ruling to permit the discovery process to proceed, Elting’s only hope of keeping her personal records from being revealed to the court and to the public is to ask the Court for permission to withdraw the claims that she herself intentionally made against Shawe.
“My time is important. Mr. Shawe’s time is important. Elting and her lawyers have wasted our collective time litigating non-meritorious claims against Shawe for years. What really disturbs me is that the only reason they are backing out now is because they don’t want the discovery process to expose that they used an e-mail that I myself wrote in an effort to protect both parties, as a basis to file a knowingly false defamation claim against my client,” Faegenburg said. “Now, they want to just snap their fingers and make their prior misdeeds magically vanish without repercussion!”
Faegenburg said, “We find it laughable and preposterous that Elting and her legal team are now claiming in their motion papers that they want to ‘streamline and simplify the litigation, and to bring it to an expeditious conclusion.’ If that was their desire why did they bring and litigate these unsupported and false claims for years in the first place. The truth is that, this time, their plan is not playing out the way they wanted it to; now they are running for cover. We can only hope that the court sanctions them accordingly.
SOURCE The Edelsteins, Faegenburg & Brown LLP
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 NetworkChris Coffey
Published 10:06 a.m. ET Oct. 7, 2017
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 NetworkPlease note new e-mail address, [email protected] Please note new Twitter account, https://twitter.com/Judson_BennettTransPerfect 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.
Robert Pincus, lawyer partner of the firm Skadden and judicial administrator of Transperfect / FOTOMONTAJE CG
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]
The forced sale of TransPerfect has cost the company $ 20 million in lawyers
A US association claims that several companies are enriched by the conflict while 4,000 workers fear for their jobs
CARLES BALLFUGÓ 14.09.2017 11:35 h Delaware Supreme Court Judge André Bouchard’s decision to order the forced sale of the Transperfect translation multinational has cost the company more than $ 20 million to hire a variety of law firms , investment companies and specialized entities in mergers and acquisitions. According to a piece of advertising by the Citizens for a Pro-Business Delaware’s association (CPBD) published on full page in various media, a dozen signatures would be enriching themselves with the shareholder conflict that the company lives. The advertising piece which has had access Global Chronicle also notes that Robert Pincus, a lawyer partner at law firm Skadden and custodian (judicial administrator) of Transperfect , would be getting a salary of $ 1,425 an hour, about 1,200 euros, for overseeing the controversial sale force of the company.HAZARD JOBS
Through this action, the association CPBD wanted to point out that while several companies invoice huge amounts of money to the company under Pincus, the 4,000 employees of the company worldwide, 500 of them in the operating center of Barcelona , continue fearing for their jobs if the forced sale of the multinational of translations is finally executed . A few months ago, Delaware Supreme Court Judge Andre Bouchard ordered the company’s forced sale to resolve the stakeholder conflict between the company’s co-founders, former Liz Elting and Phil Shawe, whose relationship is more deteriorated than ever and their positions in regard to the company, the antipodes of each other.WITHOUT PRECEDENTS
The forced sale of a successful private company is an unprecedented move in United States history and its precursors, Judge André Bouchard and attorney Robert Pincus, may be breaking the legal limits,according to experts familiar with the case. The purchase of Transperfect by a private equity fund would entail relocation and dismissal, as has already happened with the company Lionbridge, Transperfect’s largest competitor globally, which relocated the centers of Spain and France and destroyed thousands of jobs.
Paranoia reigns in the mind of the Delaware Chancery Court-appointed Custodian, Robert Pincus. He is seeking — through a Court order — to find out who is leaking information that shows just how insidious his administration of TransPerfect Global actually is!
In my opinion, Custodian Pincus is using a false premise to go after employees because he’s embarrassed by Skadden Arps’ outrageous fees being made public, and things being said about him in the news. He’s a court-appointed receiver folks — his bills should be public. The way Bouchard is letting Pincus hide his bills in darkness is similar to what he did for his old friend, Elting’s attorney Kevin Shannon at Potter Anderson — making TransPerfect and/or Philip Shawe pay legal bills with no ability to challenge the reasonableness of the fees. His fees should be public. Instead, Pincus is conducting a witch-hunt for employees, which is exactly what he promised employees he wouldn’t do.
Plus, Pincus has not made good on his promise to let employees bid for their company. And, my sources say the custodian could stymie the quarterly press release, which has been a stellar publication, quarter over quarter, for years now. Folks, there is only one way I see this, Pincus is dirty, and he’s trying to mask the truth by silencing employees and sealing everything possible under a court order, with the nefarious help from his former business partner and crony of the Delaware Chancery Court, Chancellor Andre Bouchard (who adjudicated the most heinous and inequitable decision in U.S. business history). Pincus’ rate of $1,425 per hour is three times the rate of most court-appointed receivers. Bouchard has managed to let his buddy fleece TransPerfect out of millions of dollars.
It is the opinion of this writer that Pincus has illegitimately taken advantage of his position. Why should this Custodian be allowed to get rich off the back of this prosperous company and its employees who have helped build the company to what it is? And then not allow them to bid on ownership of the company in order to save their jobs? I’m hearing speculation from employees that Lionbridge (a competitor) could very well buy the company and possibly outsource many American jobs. Employees should not be silenced by the courts in stating the truth. This is America! And, as disappointing as it may be to Bouchard and Pincus, Free Speech is guaranteed by the Constitution.
Please read the article below from “Delaware Business Now” about this sensational saga, that is now before a New York Court where hopefully some real justice might transpire in contrast to the Kangaroo Chancery Court in Delaware!
I am going to beat this drum until justice is served and these wrongs are righted. Read below folks.
Sincerely Yours,
JUDSON Bennett-Coastal Network
Judson Bennett Please note new e-mail address, [email protected] Please note new Twitter account, https://twitter.com/Judson_BennettCustodian seeks info on employee ‘leakers’ in disputed TransPerfect sales effort
By Delaware Business Now – August 25, 2017 The battle over the sale of translation service TransPerfect now extends to the public relations effort from an employee group. Tusk Strategies and Chris Coffey of Citizens for a Pro-Business Delaware have asked a New York court to quash the nonparty subpoenas and for a protective order. The custodian working to effect a sale of the company claims leaks from employees are hampering the process of selling the company. “The Subpoenas that Petitioners challenge are designed to chill civil discourse on a matter of public importance,” Chris Coffey stated. “This court-ordered sale is unprecedented. It is the first time a Delaware court has forced the sale of an ongoing and profitable Delaware company without stockholders’ consent. The forced sale has potentially significant implications for the future of TransPerfect’s employees’ jobs.” Coffey continued, “Throughout the sale process, Citizens has tried to draw attention to its members’ concerns about the sale process and its implications. To that end, in late July 2017, Citizens ran (1) a press release referencing concerns that one potential bidder might move their jobs offshore, and (2) another press release and advertisement that listed the fees charged by the Custodian and the many advisors he has hired to assist him in selling the company, collectively totaling more than $20 million over an 18-month period. In response to these two press releases and advertisement by Citizens, the Custodian claims he needs to identify any TransPerfect employees who allegedly disclosed this information – notwithstanding that much of this information was already public.” Coffey concluded, “The Subpoenas are vastly overbroad and duplicative, and they are nothing more than an attempt to cause ‘unreasonable annoyance, expense, embarrassment, disadvantage, or other prejudice’ to Tusk and Coffey – and, by association, Citizens — as a consequence for the assistance they provided to TransPerfect employees and Delaware citizens in voicing their concerns regarding the Delaware court’s unprecedented actions.” Citizens for a Pro-Business Delaware has been running advertisements and issuing press releases opposing the sales process. Citizens has drawn the ire of the custodian, members of the corporate bar and some legislators for its advertisements and press releases that indicate the dispute will harm the state’s incorporation business, a key source of tax and fee revenues. The sale process comes after co-owners Philip Shawe and Elizabeth Elting have been unable to come up with an agreement to sell the company.
TransPerfect Custodian Cleared To Probe Sale Leaks
By Jeff Montgomery Law360, Wilmington (August 1, 2017, 3:28 PM EDT) — Delaware’s chancellor authorized an investigation Tuesday into leaks of bidder data and other details on the court-ordered sale of translation company TransPerfect Global Inc., after warnings that the disclosures are being used in an attempt to disrupt the already hotly contested process. Chancellor Andre G. Bouchard signed the discovery order moments after a brief telephone conference on a request filed on behalf of TransPerfect custodian Robert B. Pincus of Skadden Arps Slate Meagher & Flom LLP. “To take no action will only embolden the violators and further jeopardize the sales process,” Jennifer C. Voss of Skadden, Pincus’ counsel, told the Chancellor Bouchard in a letter filed with the court. “TPG cannot permit any of its employees to facilitate, or cooperate in, the intimidation of potential buyers and advisors,” it said. Voss wrote that the discovery effort would seek to identify the employee or employees who shared confidential information about a purported bidder and compensation paid to advisers to the sales process, with “appropriate action” to follow. “The leaked information has been used by third parties who oppose TPG’s sale (and are funded by undisclosed TPG managers) to try to harm the sales process, and intimidate potential acquirers and the advisors,” Voss wrote. Chancellor Bouchard, who has presided over TransPerfect litigation for years and ordered the company’s sale, described the issue as “a very serious, time sensitive matter” in a docket note filed in response to Voss’ request. He issued the discovery order immediately after the teleconference, saying that “I certainly understand what the issues are.” Pincus’ discovery request came on the heels of a press release by sale opponents last week claiming that TransPerfect competitor Lionbridge Technologies Inc. was a prospective bidder in the custodian-managed process. In the statement Chris Coffey, campaign manager of Citizens for a Pro-Business Delaware, called the potential sale a “heist.” The same organization published what it said were details on charges by contractors retained by Pincus for TransPerfect-related work, along with objections that Pincus discloses only his own billings for job. The report quoted Coffey as calling on Pincus and consultants to return payments for their work. Coffey was one of the targets of example discovery and subpoena documents included in Tuesday’s court filings on the request to Chancellor Bouchard. Another was addressed to Coffey’s employer, New York-based Tusk Strategies Inc., where Coffey is identified as leader of its New York City practice. Information demands in the subpoenas included details on documents and communications among Tusk, Coffey and TransPerfect employees involving consultants hired by TransPerfect and the custodian. Also sought were communications by Tusk and Coffey involving potential bidders and bids for TransPerfect, sources of the information and details on spending made by Tusk or Coffey by or on behalf of Citizens for a Pro-Business Delaware, which has actively lobbied and campaigned against the sale. Coffey could not immediately be reached for comment. His organization has previously objected to custodian efforts to secure details on its funding, arguing that the effort amounted to an intrusion on company worker First Amendment rights. The case, and several related actions in Delaware state and federal court, stems from the deterioration of the relationship between TransPerfect co-founders Phil Shawe and Elizabeth Elting, and a deadlock on corporate action that came to a head in 2015. Elting owns 50 percent of the company, and Shawe owns 49 percent. Shawe’s mother owns the remaining 1 percent and voted with her son.
Chancellor Bouchard ruled in 2015 that the feud left TransPerfect hopelessly deadlocked and ordered the company’s sale under a custodian’s supervision. Shawe, in addition to legal challenges, has since offered to buy out Elting’s half of the company, while his mother, Shirley Shawe, has offered to vote with Elting and hold a shareholders meeting to appoint new directors. Both offers have been rebuffed. Delaware’s Supreme Court upheld the chancellor’s sale ruling earlier this year. Voss wrote that the discovery request filed on Tuesday relied on a provision in the sale order allowing court assistance in addressing problems encountered by the custodian. The same order declared that TPG employees “shall cooperate fully” with the effort, at risk of sanctions. “Buyers must be assured that TPG and the custodian can and will make every effort to stop leaks. So too, advisors must be assured that efforts to intimidate them will not be tolerated,” Voss said. “In short, TPG employees cannot have license to try to undermine the sales process.” Attorneys for the Shawes took no position on the discovery action during the teleconference. Elting attorney Kevin R Shannon of Potter Anderson & Corroon LLP said that his client shared the custodian’s concerns. Philip Shawe is represented by Lisa A. Schmidt, Robert L. Burns and Nicholas R. Rodriguez of Richards Layton & Finger PA, Howard J. Kaplan of Kaplan Rice LLP, David B. Goldstein of Rabinowitz Boudin Standard Krinsky & Lieberman PC, and Martin Russo of Kruzhkov Russo PLLC. Elting is represented by Kevin R. Shannon, Berton W. Ashman Jr., Christopher N. Kelly, Jaclyn C. Levy and Mathew A. Golden of Potter Anderson & Corroon LLP and Philip S. Kaufman, Ronald S. Greenberg, Jeffrey S. Trachtman, Marjorie E. Sheldon and Jared I. Heller of Kramer Levin Naftalis & Frankel LLP. Shirley Shawe is represented by Jeremy D. Eicher, Thomas A. Uebler and Mark M. Dalle Pazze of Cooch & Taylor PA and Alan M. Dershowitz. Pincus is represented by Jennifer C. Voss of Skadden Arps Slate Meagher & Flom LLP. The cases are In re: TransPerfect Global Inc., case numbers 9661, 9686 and 9700, and Shirley Shawe v. TransPerfect Global Inc., case number 2017-0306, in the Court of Chancery of the State of Delaware. Additional reporting by Matt Chiappardi, Brandon Lowery, Chelsea Naso and Vince Sullivan. Editing by Brian Baresch.
While jeopardizing Delaware’s $1.4 billion incorporation industry, Custodian Robert Pincus and other high-powered firms are profiting on the backs of TransPerfect employees.
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
Full Page TransPerfect Employee Ad to Bouchard