The Law School Magazine  ·  Spring 2010 : Features

Top 10 Legal Developments of the Past Decade

By - Spring 2010
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 Whether change is perceived as good or bad normally depends upon to whom you’re speaking. One person’s blessing may be another’s curse.

But nonetheless, change is inevitable. And over the past decade, there have been countless legal developments that changed how attorneys practice law or how specific laws are interpreted.

Some developments were sparked because of major national events: the Sept. 11, 2001 terrorist attacks, unthinkable natural disasters, or an agonizing recession.

Others were gradual: the steady introduction of new technologies; a shifting U.S. Supreme Court, or a collection of monumental court rulings.

In the following pages you’ll read what we perceive to be the top 10 legal developments from the 2000s, and Moritz alumni and faculty provide thoughtful insight regarding each one.

To say the least, creating this list was a challenging compromise. Some you may agree with; others you may not. But we hope you, just as we did, enjoy reminiscing how the legal developments of the past 10 years are shaping the law today.

 Boom, Bust, and Uncertain Future

The first half of the previous decade continued a comfortable trend for most of the country’s law firms – an upward economy meant a growing number of clients, new practice areas to pursue, and plenty of work.

The country’s large firms continued to grow and expand. Jobs were plentiful and starting associate salaries were escalating – setting records year after year.

But with a shift in the economy came changes to the legal services industry. In 2008, partners across the country were faced with tough questions on staffing levels, hiring, and how to proceed during the recession.

Frederick L. Ransier ’74 is a partner at Vorys, Sater Seymour and Pease LLP in Columbus. Earlier in his career, Ransier along with his wife (Kathleen Ransier ’74) operated a small private practice for 26 years.

“There is certainly a correction taking place,” Ransier said, specifically regarding large law firms with corporate clients. “We grew to serve companies in their growth, but they are not growing today. The transactions and deals that the Wall Street law firms were accustomed to dealing with are far fewer and perhaps even less complex today.”

But not all lawyers are facing less business over the past few years. Bankruptcy attorneys – for obvious reasons – saw a rise in clients. And smaller firms that represent individuals – particularly in criminal matters – are more immune to economic downturns than firms directly tied to corporations, Ransier said.

However, many firms chose to slow their hiring of new associates. Others decided to stop decade-long streaks of hiring new associates all together.

But will the recession be a small speed bump in the history of law firm operations, or will it present a detour that sends firms down an entirely new path?

“It’s a tough, tough question,” Ransier said.

What he did predict was that the recession will cause many large firms to focus and refine their hiring practices. “Hiring and growth really became such an automatic process,” he said. “New associates had a pretty good chance of not only coming on board, but even having a choice of which practice area they would like to be placed.”

Despite the uncertain future for the structure and operation of some law firms, Ransier emphasized that if there are professionals who will learn to adapt, it’s lawyers.

“There are still so many great opportunities for young lawyers,” he said. “We’re problem solvers. We have a problem in front of us, and if we put all these bright minds together, we’ll find a solution. We’ll make this a pause for our industry, and not a permanent position.”

 Financial Meltdown

 What was certainly one of the top overall developments of the 2000s – the bursting of America’s housing bubble, the subsequent collapse of the mortgage industry, and government bailouts that followed – also made a significant impact on the legal industry.

Just as skyrocketing housing prices hit their peak in early 2005, foreclosures began to escalate in unparalleled fashion. Firms that had invested – sometimes billions of dollars – in subprime mortgages began reporting losses and write downs that snowballed out of control.

Bear Stearns’ near collapse preceded several more problems in September 2008. Lehman Brothers and others – which had billions of dollars invested in what was now widely known as the “toxic” subprime mortgage market – filed for bankruptcy. The news seemingly froze credit markets around the globe and sent the stock market in a tailspin. As the world’s largest insurance corporation, AIG, was taken over by the U.S. government, Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson went to Congress to present a rescue plan.

After the House of Representatives rejected the proposal and the one-day, 778-point Dow drop that followed, Congress approved a bill that allowed the Treasury to inject capital in the country’s banks. Despite opposing opinions on the bailouts, the nation’s economy was left badly bruised and the dust continues to settle two years later.

Changes designed to prevent a repeat will introduce new challenges for attorneys, said Paul Rose, a Moritz professor whose research areas include securities regulation.

“The entire collapse is going to create a reshuffling of regulators,” he said. “It’s not something that we necessarily like to admit, but anytime we have an increase in the regulatory state it is good news for the legal industry.”

Rose said that he expects several changes. One of President Obama’s proposals, named after former Federal Reserve Chairman Paul Volcker, would forbid depositary institutions from investing in hedge funds and private equity. “Whether you agree or disagree with the ideas, attorneys are going to be needed to sort whatever changes are made.”

Sarbanes-Oxley Act

As the 2000s began, so did skepticism related to accounting tactics of some of the nation’s largest and then most profitable corporations. The Enron Corporation quickly plummeted after it was discovered that many of the company’s losses and debts were kept off the books. The massive energy corporation’s stock rapidly dropped from $90 to just cents, but not before several Enron executives cashed in on the inflated price prior to the fraud news breaking.

The “Enron scandal” was the first and most glaring example in what became a domino effect of accounting problems at other Blue Chips, like WorldCom, Tyco International, and Adelphia.

In response, Congress took extraordinary measures to pass what is commonly referred to as the Sarbanes-Oxley Act of 2002. The law was named for its sponsors, which included Rep. Michael Oxley ’69, and provided a major overhaul of accounting reporting and auditing procedures, oversight, and penalties for violators. Oxley was chairman of the Committee on Financial Services from 2001-06.

When President George W. Bush signed the act on July 30, 2002, he called it “the most far-reaching reforms of American business practices since the time of Franklin Delano Roosevelt.”

The legislation created the Public Company Accounting Oversight Board, which oversees and registers auditors and enforces compliance. The law also makes more transparent the stock transactions of corporate officers, requires management’s assessment of the effectiveness of the company’s internal control over financial reporting, and enhances penalties for and better describes specific white-collar crimes.

“It really was a game changer in the role of government in the accounting profession,” Oxley said in a recent phone interview. “It changed the whole concept of corporate governance, which had traditionally been with the states. Whether you like it or you don’t like the law, it would be hard to say it didn’t have a great impact on the entire landscape.”

Oxley said that it was clear when he was helping to create the law that, in Enron’s situation, every entity intended to act as a “gatekeeper” for investors had failed, from the board of directors to the auditors.

“The profession up to that point had been self-regulated,” said Oxley, now the nonexecutive vice chairman of the NASDAQ exchange and of counsel at Baker Hostetler in Washington, D.C. “Arthur Anderson representing Enron really blew the lid off the whole thing. The whole concept of auditor independence that we tried to create in the act and the need for oversight was pretty clear.”

The legislation also was a game changer for attorneys. The law’s “noisy withdrawal provision” required outside or in-house counsel, when discovering fraudulent behavior, to withdraw from a case and report it.

 Court Pushes Back on Presidential Power

 It’s nearly impossible to choose an aspect of our lives that did not change as a result of the events of Sept. 11, 2001. Almost everything could – and still can – be seen through a different lens than one used the day prior to the attacks.

The legal changes most prominently recognized as a result of Sept. 11 came though the PATRIOT Act, which broadened the rights of law enforcement agencies in searching communications and records, expanded discretion to detain and deport suspected terrorists, and allowed the government to more easily regulate financial transactions involving foreign individuals.

But, although governmental power was being expanded by the PATRIOT Act, the U.S. Supreme Court pushed back significantly against the Bush Administration’s most ambitious claims of presidential authority under the Constitution. The weightiest rulings came from four cases emanating from the Administration’s efforts to create military commissions at Guantanamo Bay.

“The Bush Administration was trying to stake out the president’s powers in the broadest possible terms,” said Peter M. Shane, the Jacob E. Davis and Jacob E. Davis II Chair in Law and an expert on separation of powers law. “The Court’s rulings established that the president does not have a blank check on the exercise of power even in wartime.”

Rasul v. Bush (2004) affirmed the power of federal courts to decide whether non-U.S. citizens were being wrongfully imprisoned at Guantanamo. In Hamdan v. Rumsfeld (2006), the Supreme Court ruled that the Guantanamo military commissions were constituted in violation of the Uniform Code of Military Justice and the Geneva Conventions. In Hamdi v. Rumsfeld (2004), the Court ruled that persons detained as enemy combatants must be allowed to challenge their classification as “enemy combatants,” rather than “prisoners of war,” in an impartial administrative proceeding consistent with constitutional standards of due process. Boumediene v. Bush (2008) held that the writ of habeas corpus applies to Guantanamo detainees even after passage of the Military Commissions Act, and that full judicial review must be available unless an adequate substitute is in place.

“What is particularly significant about these four rulings was that the court was saying, ‘This is not World War III and not the legal equivalent of World War II,’” Shane said. “The fact that terrorism can happen anywhere doesn’t mean that the president may act as if the entire world is a theater of war. The law of the battlefield applies only to an actual battlefield.”

The rulings also cast the United States in a different light in countries around the world, Shane said.

“The Court showed it still cares how American institutions are viewed internationally,” he said. “It shows that we still worry about the judgment of the international community and how fairly and effectively the United States is perceived in its administration of justice.”

 Bush v. Gore

 On the morning of Nov. 8, 2000 and after a night of prematurely declared winners, the presidential election between George W. Bush and Al Gore was simply too close to call.

And although it may have been easy to predict that a firestorm of litigation was coming, it was impossible to know how long the battle would persist.

No one could have projected that it would have taken five weeks, hundreds of attorneys, and three separate rulings by the U.S. Supreme Court.

Bring the case up with Edward Foley, the Robert M. Duncan/Jones Day Designated Professor of Law and director of Election Law @ Moritz, and he admittedly is still troubled by the manner in which the Supreme Court interjected.

“There is an increasingly disturbing sense that the Court appears insufficiently constrained by law,” Foley said. “That its decisions are not dictated by law, but by whatever the justices want. And not necessarily what they all want, but what five of them want. And, for that matter, what Justice Kennedy wants.”

Foley continued. “This point applies not just to Bush v. Gore but to constitutional law generally, and Bush v. Gore is perceived as a particularly stark example because the justices took positions that were opposite of their normal judicial philosophies,” Foley said. The conservative justices adopted a liberal position to rule in favor of Bush, while the liberals embraced a conservative judicial philosophy in order to side with Gore’s position in the case.

“The seemingly political positions taken by the justices  rattles your confidence in the Court as an institution and its ability to act pursuant to the law when the road gets a little bumpy,” Foley said, although he hastened to add that with a benefit of a decade of additional thinking about the case the issues seem more complicated, not less so. “The Court’s intervention seems more justifiable when you consider it in light of other disputed elections in American history.”

But, Foley continues to wonder, would the same five justices been willing to intervene if Gore, not Bush, had been making the identical legal arguments.

Since ruling in Bush v. Gore, the Court has never cited it. “And there have been opportunities for them to do so,” Foley said.

But, although it’s possible that the U.S. Supreme Court may not plan to use the case as precedent, lower courts and election officials continue to struggle to abide by what was written. “They are treating Bush v. Gore as a normal case, embodying a principle of constitutional law,” he said. “Life goes on for these folks, and they are stuck with trying to figure it  out and applying it to new circumstances”

 One Step Forward, Two Back

For those fighting for racial and gender equality, the U.S. Supreme Court’s ruling in Grutter v. Bollinger was one ray of sunshine amongst several dark clouds over the past decade in federal courts.

The Court prohibited a Seattle school district from using race when assigning students to public schools in Parents Involved in Community Schools v. Seattle School District No. 1 (2007); said employers couldn’t be sued for race or gender pay discrimination if claims are based on decisions made by employers longer than six months ago; and upheld the Partial-Birth Abortion Ban Act of 2003, which prevents a form of late-term abortion.

Groups advocating on behalf of affirmative action, civil rights, gay rights and other traditionally liberal causes are shying away from the federal courts, said Martha Chamallas, the College’s Robert J. Lynn Chair in Law and an expert in legal equality.

“Advocates realize that the best they often can hope for is for the Court to maintain the advancements that they currently have, and there is a considerable risk that hard-fought rights will be taken away,” Chamallas said. “The federal courts used to be the place for social change and now they see them as a place for fear.”

In Grutter (2003), the U.S. Supreme Court ruled that the University of Michigan Law School could maintain its affirmative action admissions policy. The school used race as a potential “plus” factor in making its admissions decisions. The Court expressed its hope that such policies may not be needed in perpetuity with Justice O’Connor writing in her majority opinion that she “expects that 25 years from now” such policies will no longer be necessary.

Grutter wasn’t a trend-setting victory,” Chamallas said. “I think it is disproportionally relevant to us because it involved law school admissions. But it was a narrow victory.”

In Ledbetter v. Goodyear Tire & Rubber Co. (2007), Lilly Ledbetter filed charges of gender discrimination with the Equal Employment Opportunity Commission (EEOC) in March 1998. The Court ruled that because the pay decisions that resulted in Ledbetter’s salary being thousands of dollars less a year than her male counterparts were not made within the 180 days of her beginning the formal complaint process with the EEOC, all claims were time-barred. Congress quickly reacted by passing the Lilly Ledbetter Fair Pay Act in 2009.

Chamallas said that groups advocating for equality measures involving race and gender are pursuing other avenues, rather than the U.S. Supreme Court, to advance their initiatives.

“I don’t think you are going to see civil rights groups traveling to the Supreme Court for national change for equality anytime soon,” Chamallas said. “That is just not going to occur.”

 New Sentencing Rules, Tougher DNA Technology

 Suspects and defendants in criminal cases today are faced with a much different landscape than even a few years ago – largely because of a landmark series of U.S. Supreme Court rulings regarding sentencing and continual advancements in DNA technology.

Before 2000, it had been some time since a major U.S. Supreme Court ruling involving sentencing. But then came a series of landmark U.S. Supreme Court rulings that altered constitutional rules and statutory regulations on sentencing. In particular, Blakely v. Washington (2004) and United States v. Booker (2005), revolutionized how sentencing procedures operate by limiting what judges could do within mandatory guideline systems and by making the federal sentencing guidelines advisory. And, since the decisions were handed down, state and federal legislatures and courts continue to adapt to the altered procedures.

“Every criminal justice practitioner has to know what Blakely and Booker were about because sentencing procedures and outcomes are continually impacted by these decisions,” said Douglas A. Berman, the William B. Saxbe Designated Professor of Law and an expert in sentencing law. “Because the rulings were close and controversial and full of vague uncertainties, they have forced the U.S. Supreme Court every term to address follow-up sentencing issues.”

Berman said that Blakely and Booker were so significant and potent because “they came out of left field. Most sentencing debates usually focus on how severe or light sentences should be under guideline sentencing rules,” he said. “But the Court in these cases were concerned with how these rules were being administered procedurally.”

And other changes affected defendants as well. Prosecutors and defense attorneys throughout the decade continued to adapt to even more impressive DNA-based technology. Although introduced in the 1990s, DNA evidence, because of its high percentage of certainty, is more available and desired than ever before. And the technology continues to improve, said Mark Godsey ’93, a professor at the University of Cincinnati College of Law and director of the Lois and Richard Rosenthal Institute for Justice and the Ohio Innocence Project, which represents convicted Ohio inmates for whom new evidence, such as DNA, proves their innocence.

“What is now emerging is ‘touch DNA,’” Godsey said. “This allows us to get DNA off of something that someone has simply touched. Fingerprints have skin cells in the oil that was left in them. This will probably someday replace fingerprints.”

But as the use of DNA and other forensic techniques have become more popular – specifically as they are projected on primetime television dramas – so have the expectations of jurors, Godsey said. And those jurors’ preconceived beliefs are making the jobs of prosecutors and defense attorneys tricky.

“Jurors will come in to a trial and expect evidence involving forensic science, and if there is not forensic science in the case they believe there must be a hole in the case,” Godsey said. “And where there is forensic evidence, jurors tend to believe that it is some magical power that they see on TV. The fact is that, outside of DNA, forensic science isn’t as reliable as the public thinks.”

 Lawrence v. Texas

As the 1980s brought one of the most troubling U.S. Supreme Court rulings for lesbian and gay rights, the 2000s welcomed that landmark case’s landmark reversal.

The 1986 U.S. Supreme Court ruling in Bowers v. Hardwick upheld the criminalization of all same-sex sexual activity. And just 17 years later in Lawrence v. Texas, the Court turned Hardwick on its head.

“This is one of the few cases when the Supreme Court has openly admitted its own error,” said Professor Marc Spindelman, an expert in constitutional law and lesbian and gay rights, whose work on Lawrence appears in the Michigan Law Review. (A special issue of the Ohio State Law Journal was also dedicated to the case.)

In 1998, a police officer responding to a call of a weapons disturbance in the apartment of John Geddes Lawrence found Lawrence and Tyron Garner engaging in what was then illegal sex under Texas law. The couple was arrested on a misdemeanor charge of violating the Texas law banning anal and oral sex between members of the same sex even when consensual.

By the time the case made it to the U.S. Supreme Court in 2003, amici curiae briefs were filed on behalf of numerous gay rights groups, which understood the potential significance of the case.

The Supreme Court, in a majority opinion written by Justice Anthony Kennedy, overturned Hardwick, and also the sodomy laws of Texas and 12 other states.

For the first time, the court declared homosexuality was just like heterosexuality in terms of intimacy and intimate relations, Spindelman said. “The Court’s reasoning goes out of its way to analogize same-sex to cross-sex intimacies, including those of marriage. That was unprecedented.”

It was impossible to tell at the time of the decision how far-reaching the ruling would be. Seven years later, the decision’s aftershocks continue to be felt in laws and litigation across the country. Lawrence provides context for understanding the Ohio Supreme Court’s ruling in Ohio v. Carswell, which preserved room in state law for recognitions of same-sex intimacies short of marriage notwithstanding a constitutional amendment that had seemed to bar them.

Maybe even more significantly, Lawrence may have shifted momentum in the ongoing battles over gay rights. Since the 2003 ruling, five states have legalized same-sex marriage. A significant number of other governments, localities, universities (including Ohio State) and companies have since extended benefits to same-sex couples.

Notwithstanding Lawrence, there’s a long battle ahead for those fighting for lesbian and gay rights. Forty-one states have state statutes that define marriage between one man and one woman, and 30 states define marriage in their constitutions. In 2006, Arizona became the only state to reject a constitutional amendment that defines marriage as between one man and one woman, but in 2008 an identical amendment was passed.

Still, “Lawrence changed the game,” Spindelman said. “Subtly, but significantly, it shifted a burden of justification – from those who are seeking equality under law to those who would deny it.”

Tech Boom = New Lawyer Advantages, Responsibilities

Technologies that once were reserved for the big screen became commonplace in the 2000s. Each year seemed to bring with it a new device or Internet application that had the potential to change the way in which attorneys conducted business.

Everything from responding to a client’s inquiry to trial preparation has been altered in the last 10 years.

E-mail obviously began this acceleration during the 1990s. But in the start of the 2000s, in order to send an e-mail, most people were required to be parked behind a computer in a home or office. But the last decade’s exponential expansion of smart phones, which allow e-mails and text messages to be sent from just about anywhere, took e-messaging to an entirely new level.

“My Blackberry allows me the freedom to be away from my office and desk and not worry about missing an urgent message or call,” said Ritu Singh ’07 an associate in the Fort Wayne, Ind., office of Baker & Daniels LLP. “A feature that I particularly appreciate about my Blackberry is that it will playback any voicemails that I receive at my office phone.”

Such accessibility has certainly changed clients’ expectations. Letters that previously took several days for an appropriate response now may be expected in just a couple hours – if not less. Legal opinions that once were drafted via dictation and formal memorandums suddenly could be sent from the sidelines of a child’s soccer game.

Technology has also affected the shear volume of documents produced while preparing for and during trials, said Deborah Merritt, John Deaver Drinko-Baker & Hostetler Chair in Law at Moritz. It now takes a few seconds to fire off an e-mail that one day will make itself into mountainous piles of discovery documents.

“We produce so much more than we used to,” Merritt said. “I would dare to say that the amount of documents produced has increased 10-fold.”

As a result, some firms have shifted the document review responsibilities to outsourced businesses or paralegals, Merritt said.

Technology also allows prosecutors and defense attorneys to cast a wider fact-gathering net. As an increasing number of people are blogging, “tweeting,” and posting on various social networking sites, more information is readily available online than ever before.

“It’s amazing what people will write for all to see,” Merritt said. “It just goes back to clients understanding that everything can be used against you. I mean everything.”

O’Connor Departs

Justice Sandra Day O’Connor represented much more than the first woman on the U.S. Supreme Court. She brought with her experience as a legislator – something none of the nine current justices have – a perspective from the Southwestern United States, and a valuable “swing” vote.

Her valuable fifth vote was paramount throughout her 25-year term in cases involving abortion, gerrymandering, private school vouchers, and religious displays.

“For a quarter of a century, she brought to the Court a powerful yet pragmatic voice and a movement of moderation that resonated beyond the sum of her individual ‘swing’ votes,” said RonNell Andersen Jones ’00, who clerked for Justice O’Connor during the 2003-04 term and now is an associate professor of law at Brigham Young University’s J. Reuben Clark Law School. “The year that I served as her law clerk I saw that in so many ways she had a calming, leavening influence on the Court as a whole. She cultivated and fostered an atmosphere of respect and cooperation — even among Justices who were sometimes deeply divided — and I think that her spirit of collegiality was critical to the Court’s ongoing dignity as an institution and legitimacy in the eyes of the American public.”

When Justice O’Connor announced her retirement in 2005, Justice Kennedy was quickly labeled the Court’s “swing” vote. His unpredictability keeps critics anxious, but it’s agreed that he’s currently the most powerful justice in America.

According to a 2009 New York Times story analyzing the 2008-09 term, Justice Kennedy was in the majority 92 percent of the time and in all but 5 of the 23 decisions that were split 5-to-4. In 16 of those 23 rulings, the Court split with four of the traditionally liberal justices on one side and the four traditionally conservative justices on the other. Kennedy joined the liberals five times and the conservatives 11.

 “As the swing justice, so much more rests upon your language,” said Deborah Merritt, John Deaver Drinko-Baker & Hostetler Chair in Law at Moritz and a 1981-82 O’Connor clerk. “You’re often asked to write closely divided opinions because the Chief Justice wants to keep your vote. A lot of the Court’s vision now rests with how Kennedy feels about the particular topic at hand.”

 

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