I recently finished reading "Servants of the Damned," a new book by New York Times business investigations editor David Enrich. The book exposes how Jones Day, one of the world's largest law firms, has used its immense power to enable corporate misconduct and, more recently, the Trump administration. I reached out to Enrich because his book provides essential insights into how corporations, with the help of firms like Jones Day, manipulate the political system. This conversation has been edited for length and clarity. I hope you enjoy it. — Judd
Thus is the culture of enabling malfeasance and "pushing the envelope" now damaging all of the people of this great nation in many ways , large and small. "It's just business?" Well corporations were never and will never be people and the republican wet dream of an American version of fascism is closer at hand than ever.
Many of the tools previously used to rein in such corporate excess have been legislated away. So all we've got left is the ballot and the obligation to get good information out there, so people who are swayed by the facile grifting republicans and conservatives engage in, can be educated? Is it even possible to negate the rampant disinformation? Neuter it perhaps?
I have some heat for the democrats as an organization too. There seems to be a cadre of 5-7 democratic lawmakers who pay lip service to "the good" but very slyly pull their punches. They'd be OK with fascism, as long as they keep their positions, their money and access to power. The rest of us can go to hell! And the DNC operates with full knowledge of whom they are and of course, the DNC is not above engaging in their own brand of chicanery!
Years ago I owned a diner frequented by many lawyers from a local firm (Wilmington, DE). They focused on business, tax, trust, etc. and were frequently representing clients in Chancery Court.
I recall having a conversation with the office manager (a lawyer) about how creating "trusts" to help exceptionally wealthy folks avoid taxes was simply wrong. He didn't understand my pov. He said the job of his firm was to rrepresent their clients to the best of their ability. Whether what they did was morally correct didn't matter, that wasn't any of their concern.
And therein we get to the crux of many a problem in this country......
As a lawyer who practiced in Ohio for many years (back when Jones Day was just a regional Ohio-based law firm), and was occasionally counsel for their opponents, I am very familiar with their (former) reputation as good lawyers who were “zealous advocates” but certainly did a good job of applying the law on their clients’ behalf. My practice brought me to DC and into a completely different field of law, so I stopped interacting with them a couple decades ago. My, how things have changed!
As a lawyer, I am embarrassed and horrified at the way they have corrupted my profession. Yes, law schools do teach ethics, and I’m pretty sure that every state that imposes a mandatory continuing legal education requirement (including Ohio, where JD’s home office is still located) includes in that requirement mandatory ethics (professional responsibility) hours. Apparently, at JD, they apply what they learn in mandatory ethics CLE classes to figuring out how to skirt the boundaries, rather than to apply the rules to ensure compliance with the letter AND THE SPIRIT of the ethics rules.
But very few ethics rules are actually codified as laws, and the process of filing claims against lawyers for ethics violations (usually enforced by state supreme courts where I’m sure JD must have close relationships with the judges - who often are elected and therefore are dependent upon campaign contributions) means that even blatant disregard for ethics usually can be practiced with impunity. The ethics system is designed to protect clients, not other parties and certainly not the public. And I don’t hear JD’s clients complaining.
My Husband was a Partner at J/D in SV office . He left for another job at another firm. That office (at least the IP group and the lead attorney) was a pathetic display of insecurity and unjustified bravado. It was pretty funny to watch as an outsider. He left way b4 the Tr mp bs. They were cheap (midwestern) and smiled when they were f-cking you (again mid west polite) glad he left way before the jump into the GOP pool bc then he would hav left. Twisting rules around(the law) to assist criminals simply for money (WITH NOT REGARD FOR OUTCOME) makes you and your law firm MORALLY VOID and a FULL DEGENERATE (they did pay my s/o very well full disclosure)
My husband, now retired, worked for a big accounting firm as a partner. When he made partner he had to have his aunt sell stocks because he was her Power of Attorney( though she was still of sound mind) because there was some whiff of a conflict of interest. So though he had no control of her money or estate, just that he may at some future time was enough for them to insist. I admired the firm line that was drawn. Sadly, Judd has pointed out that this is certainly not the case for Jones Day...
David Enrich ends his interview with you on a mild and modest note. Maybe too mild. His book is describing another way our democracy gets twisted by powerful entities. It isn't just about law school students sorting themselves at the end of law school. These books are good, but make me wonder how to reclaim our democracy. How can we fight this stuff! There are so many beachheads now.
"Less and less of the work that big law firms are doing takes place inside the confines of a courtroom or even in the context of litigation."
This is normal. I worked in New York's Supreme Court for 10 years until 2004, and it always astonished me to learn that most civil lawsuits never see the inside of a courtroom. Both the plaintiffs and defendants are eager to settle because litigation is extremely expensive. I was friends with one court reporter who had worked in the federal court system for years, and he said that lawyers will keep cases going for years by filing countless motions, which required no small number of transcripts of previous court appearances (which made the court stenographers very wealthy).
Because of attorney-client privilege, we can only speculate on what role big law firms play in white collar crimes and their facilitation. It's yet another ugly part of capitalism, that money is the gasoline that fuels so many engines.
There's a (relatively) new "technology" deployed in the bankruptcy context called "The Texas Two-Step," which allows big corporates to effectively siphon off major liabilities into a separate corporate entity and then file that new entity for chapter 11 bankruptcy (making it a chapter 11 "debtor"). The non-debtor legacy company -- say, Johnson & Johnson $JNJ -- then seeks (i) an injunction against all the litigation against it and (ii), ultimately, liability releases, in exchange for some committed amounts to the debtor pursuant to a funding agreement. First this strategy was used primarily in the asbestos context because there are specific provisions in the Bankruptcy Code to deal with asbestos claims, using a "channeling injunction" to filter all claims to a trust for administration. But, lately, larger corporates have been employing the strategy, including, again JNJ (3M also). Who are the lawyers who've most deployed this strategy? A strategy that the proponents say creates an orderly mechanism for addressing claims in a fairer and more equitable way, rather than a rush to the courthouse? A strategy that detractors say frees highly solvent and well capitalized companies like JNJ from addressing the harms they've caused (in this case, producing and selling cancer-inducing products)? We'll spare you the suspense: Jones Day. Was this covered at all in the book? If not, that's a huge miss.
Thank you do much for addressing David Enrich and "Servants of the Damned" (great title!). This matter encapsulates just how damaging Capitalism can be for those of us living under this system. [I am NOT in favor of the systems in China, Russia, or early 20th Century Nazi Germany.] We have a problem and are being forced to look at it more carefully, and that endeavor will hopefully be beneficial.
Thus is the culture of enabling malfeasance and "pushing the envelope" now damaging all of the people of this great nation in many ways , large and small. "It's just business?" Well corporations were never and will never be people and the republican wet dream of an American version of fascism is closer at hand than ever.
Many of the tools previously used to rein in such corporate excess have been legislated away. So all we've got left is the ballot and the obligation to get good information out there, so people who are swayed by the facile grifting republicans and conservatives engage in, can be educated? Is it even possible to negate the rampant disinformation? Neuter it perhaps?
I have some heat for the democrats as an organization too. There seems to be a cadre of 5-7 democratic lawmakers who pay lip service to "the good" but very slyly pull their punches. They'd be OK with fascism, as long as they keep their positions, their money and access to power. The rest of us can go to hell! And the DNC operates with full knowledge of whom they are and of course, the DNC is not above engaging in their own brand of chicanery!
That's how it appears from my narrow perch.
I so love being an infinitesimal help in rattling these cages with you. Think maybe Schlapp is humping corporate legs and is protesting too much?
Years ago I owned a diner frequented by many lawyers from a local firm (Wilmington, DE). They focused on business, tax, trust, etc. and were frequently representing clients in Chancery Court.
I recall having a conversation with the office manager (a lawyer) about how creating "trusts" to help exceptionally wealthy folks avoid taxes was simply wrong. He didn't understand my pov. He said the job of his firm was to rrepresent their clients to the best of their ability. Whether what they did was morally correct didn't matter, that wasn't any of their concern.
And therein we get to the crux of many a problem in this country......
As a lawyer who practiced in Ohio for many years (back when Jones Day was just a regional Ohio-based law firm), and was occasionally counsel for their opponents, I am very familiar with their (former) reputation as good lawyers who were “zealous advocates” but certainly did a good job of applying the law on their clients’ behalf. My practice brought me to DC and into a completely different field of law, so I stopped interacting with them a couple decades ago. My, how things have changed!
As a lawyer, I am embarrassed and horrified at the way they have corrupted my profession. Yes, law schools do teach ethics, and I’m pretty sure that every state that imposes a mandatory continuing legal education requirement (including Ohio, where JD’s home office is still located) includes in that requirement mandatory ethics (professional responsibility) hours. Apparently, at JD, they apply what they learn in mandatory ethics CLE classes to figuring out how to skirt the boundaries, rather than to apply the rules to ensure compliance with the letter AND THE SPIRIT of the ethics rules.
But very few ethics rules are actually codified as laws, and the process of filing claims against lawyers for ethics violations (usually enforced by state supreme courts where I’m sure JD must have close relationships with the judges - who often are elected and therefore are dependent upon campaign contributions) means that even blatant disregard for ethics usually can be practiced with impunity. The ethics system is designed to protect clients, not other parties and certainly not the public. And I don’t hear JD’s clients complaining.
My Husband was a Partner at J/D in SV office . He left for another job at another firm. That office (at least the IP group and the lead attorney) was a pathetic display of insecurity and unjustified bravado. It was pretty funny to watch as an outsider. He left way b4 the Tr mp bs. They were cheap (midwestern) and smiled when they were f-cking you (again mid west polite) glad he left way before the jump into the GOP pool bc then he would hav left. Twisting rules around(the law) to assist criminals simply for money (WITH NOT REGARD FOR OUTCOME) makes you and your law firm MORALLY VOID and a FULL DEGENERATE (they did pay my s/o very well full disclosure)
Very interesting report. I wonder if law schools bother to teach ethics any more.
As for leg humping. Bet Schlapp is good at it and is missing having so many corporate legs to go after.
Perfect title!
My husband, now retired, worked for a big accounting firm as a partner. When he made partner he had to have his aunt sell stocks because he was her Power of Attorney( though she was still of sound mind) because there was some whiff of a conflict of interest. So though he had no control of her money or estate, just that he may at some future time was enough for them to insist. I admired the firm line that was drawn. Sadly, Judd has pointed out that this is certainly not the case for Jones Day...
David Enrich ends his interview with you on a mild and modest note. Maybe too mild. His book is describing another way our democracy gets twisted by powerful entities. It isn't just about law school students sorting themselves at the end of law school. These books are good, but make me wonder how to reclaim our democracy. How can we fight this stuff! There are so many beachheads now.
"Less and less of the work that big law firms are doing takes place inside the confines of a courtroom or even in the context of litigation."
This is normal. I worked in New York's Supreme Court for 10 years until 2004, and it always astonished me to learn that most civil lawsuits never see the inside of a courtroom. Both the plaintiffs and defendants are eager to settle because litigation is extremely expensive. I was friends with one court reporter who had worked in the federal court system for years, and he said that lawyers will keep cases going for years by filing countless motions, which required no small number of transcripts of previous court appearances (which made the court stenographers very wealthy).
Because of attorney-client privilege, we can only speculate on what role big law firms play in white collar crimes and their facilitation. It's yet another ugly part of capitalism, that money is the gasoline that fuels so many engines.
There's a (relatively) new "technology" deployed in the bankruptcy context called "The Texas Two-Step," which allows big corporates to effectively siphon off major liabilities into a separate corporate entity and then file that new entity for chapter 11 bankruptcy (making it a chapter 11 "debtor"). The non-debtor legacy company -- say, Johnson & Johnson $JNJ -- then seeks (i) an injunction against all the litigation against it and (ii), ultimately, liability releases, in exchange for some committed amounts to the debtor pursuant to a funding agreement. First this strategy was used primarily in the asbestos context because there are specific provisions in the Bankruptcy Code to deal with asbestos claims, using a "channeling injunction" to filter all claims to a trust for administration. But, lately, larger corporates have been employing the strategy, including, again JNJ (3M also). Who are the lawyers who've most deployed this strategy? A strategy that the proponents say creates an orderly mechanism for addressing claims in a fairer and more equitable way, rather than a rush to the courthouse? A strategy that detractors say frees highly solvent and well capitalized companies like JNJ from addressing the harms they've caused (in this case, producing and selling cancer-inducing products)? We'll spare you the suspense: Jones Day. Was this covered at all in the book? If not, that's a huge miss.
Excellent, Judd! I'm grown to expect nothing less. Thank you.
You go Judd
Judd: Excellent questions about Jones Day and thoughtful replies by David Enrich and by the readers below. Well done and much appreciated.
Thank you do much for addressing David Enrich and "Servants of the Damned" (great title!). This matter encapsulates just how damaging Capitalism can be for those of us living under this system. [I am NOT in favor of the systems in China, Russia, or early 20th Century Nazi Germany.] We have a problem and are being forced to look at it more carefully, and that endeavor will hopefully be beneficial.