Tapie, DOJ, and FTP Likely Winners

Tapie, DOJ, and FTP Likely Winners
Will Players Pay for the Deal?

In today's article which is published at eolis.com and pokerplayernewspaper.com, I address the DOJ civil forfeiture case against Full Tilt Poker primarily as it relates to to the prospects of repayment of player funds that have been unavailable to them since the DOJ's crackdown on FTP' s online gambling operations.

DOJ - GBT Have Signed Agreement - Now Up To FTP Approval

BREAKING NEWS BULLETIN

DOJ & GBT REACH SIGNED AGREEMENT FOR ACQUISITION OF FULL TILT;
TAPIE AGREES TO PAY US GOVERNMENT $80 MILLION FOR FTP’s ASSETS

STUNNING MOVE BY GOVERNMENT PAVES WAY
FOR TAPIE DEAL TO GO FORWARD

CRITICAL NOTE: This afternoon, CNN published a story regarding this deal while it was still embargoed, noting in its headline that the story could not be published without clearance from representatives of Groupe Bernard Tapie. EOLIS International Group had the same information from multiple sources. Following publication of the CNN story, Wendeen H. Eolis, CEO of EOLIS Intl Group, spoke with GBT counsel Benham Dayanim who confirmed for her all of the information herein.

In a letter signed by Laurent Tapie, the contents of which this writer has confirmed with Groupe Bernard Tapie’s outside counsel, the United States Department of Justice has signed off on an unprecedented agreement with GBT, allowing Tapie to “buy” FTP’s full assets from the Justice Department—subject to approval of the Company.

1. Upon approval by Full Tilt Companies, the deal can and will be put in place as follows:

A. FTP agrees to forfeit all of its assets to the United States in consideration of the Government’s dismissal of the forfeiture action against the companies comprising FTP.

B. The DOJ takes possession of FTP’s assets for the purpose of selling them in their entirety to GBT for the sum of $80,000,000 and on the understanding that GBT will re-establish FTP based on the following understandings:

1. GBT will hold at least a majority interest in the company
2. None of the current FTP directors will be permitted to hold shares in the company
3. The Agreement does not bar any other shareholders from owning shares in the company
4. With respect to FTP’s US customers, the Agreement provides that such customers can submit petitions to the US government to “request compensation for their losses”
5. With respect to players outside of the US, the Agreement provides that GBT will, “repay or make whole,” all of those customers
6. The US customer list is a part of the assets, but GBT has no plans of any kind to utilize that list except to assist the DOJ to identify customers who are due or entitled compensation, according to GBT counsel, Behnam Dayanim.

Mr. Dayanim notes that the next step is to obtain an agreement from the Full Tilt Companies and he "anticipate[s] it will happen,” and that he is optomisitic because the deal will "allows for players to be repaid, and resolves the FTP forfeiture action by the Government.”

It should be noted that there is nothing in the signed agreement between GBT and DOJ to suggest any relationship whatsoever between the proposed resolution of the April 15 forfeiture action (as amended September 19), and the DOJ’s prosecution of any of the defendants in the April 15 indictment, U.S. v. Scheinberg, et. al which notably includes FTP CEO and board member Ray Bitar, among others.

EOLIS Recruits Lawyers to Give Back...

Cyprus (March 26, 2011) This morning, Wendeen H. Eolis, Chairman of Eolis International Group and Commander of HOPE’s Champion Task Force, announced that the Company has dispatched a complement of 100 affiliated consultants to HCTF legal evacuation and relocation operations and related legal consulting services in the ravaged region of northern Japan and in hotbeds of rebellion in Egypt, Libya, Bahrain, and Yemen.

During the past week, HCTF has recruited and assigned specialized legal talent with expertise in more than a dozen different disciplines. Assisting families of victims and displaced survivors in cities, hamlets and tribal villages--more than 15,000 "clients" have received some form of service -- on a pro bono basis. Commander Eolis noted, "If billed at big law firm discounted rates, the tab would have already exceeded $1,000,000."

HOPE's Champion Task Force was originally founded in the wake of 9-11 with a mandate to counsel and assist evacuees removed from danger and disaster zones following terrorist and weather-related tragedies. Today, HCTF continues those activities worldwide with significant additional responsibility for providing outstanding legal talent for government agencies around the world to assist in diverse projects within a country's large cities, smaller towns and rural environments as needed.

HCTF invites qualified lawyers to submit biographical information if they are available to lend, on a pro bono basis, special expertise in family law, banking, construction, energy, and other complex regulatory practices. Projects will require a minimum of one full week in the local area in which assistance is needed. Kindly contact Ed Mead at Eolis International Group at (212) 472-4000 or emead@eolis.com

It's Risky To Dine At The Plaza!

Teatime at the Plaza Hotel in New York City is a uniquely fancy experience. But visits by the hoi polloi, including society matrons and other high falutin’ ladies who lunch, do not guarantee that your smartly plated food will not be contaminated.

In the incident reported to us by an EOLIS executive, it was luscious strawberries and cream cheese, or maybe just plain old-fashioned strawberries that were the culprit; an insect contently nestled under a strawberry, much to the diner’s dismay. The tearoom’s maitre d’ went on the defensive instantly, questioning the guest’s first-hand knowledge of the creeping insect that suddenly sped off to a low flying cloud as the diner and a server watched in disbelief.

In a city like New York, the cleanliness of the establishment is not necessarily defined by the prices on the menu, and consumers are routinely at risk for falling ill. Rarely considered, but ever present, are the real risks for New Yorkers who dine out, whether it be at a neighborhood bistro or an upscale and refined tea. While the legal issues that may come into play in your next restaurant visit appear to be about negligence, the obvious question of negligence if you are poisoned by a restaurant’s food is but one potential problem diners can face when they go out to eat.

The larger issue is inconsiderateness, arrogance, and an utter disregard in the kitchen and the front of the house towards diners they put at such risk. From a lay person’s perspective, the Plaza’s conduct in the instance reported to us is reflective of a company running scared when good manners are their best defense against litigation. So for all of those restaurants that would prefer to bully the patron as to their creditability, our office will be happy to assist them in the retention of counsel, but it is likely their costs will exceed the tab the customer paid.

EOLIS consultants advise clients as to when they may have an immediate need for negligence counsel, explaining that there are four elements that must be established. According to New York law firm Rottenstein LLP, in any matter in which you’re claiming negligence, you need to have the following four elements: (1) duty (2) breach of that duty (3) causation of harm, and (4) damages. If you get sick from food that you ate at a restaurant, these four elements can most certainly be established and you may be able to seek compensation for medical bills, lost wages during your illness and recovery, as well as for your pain and suffering.

In the Plaza teatime incident, if the customer had fallen ill, showing causation of harm would be a simple matter of snapping a cell phone picture of the insect, the server witness, and later, the dismissive maitre d’.

EOLIS Releases Results of New York City Law Firm Poll

Eolis International Group has polled 100 law firms in New York, including managing partners, hiring partners, and department heads on lateral acquisition plans for 2011. Results: across the board, including national firms, boutique firms, and law firms with as few as 10 lawyers, moderate expansion is anticipated with emphasis on increased business in transactional work, labor relations, and intellectual property. According to EOLIS CEO, Wendeen H. Eolis "law firms in New York area are less concerned with the outcome of the midterm election than with their own internal streamlining to increase profitability on their revenues."

Further details on this report are available through Ann Minster (aminster@eolis.com).

Negotiate Terms Before Saying, "I Do.", Part 4

Note: This case study by Wendeen H. Eolis has previously appeared in the New York Law Journal. I republish this article in 4 parts during December 2009 in response to current client demand for advice on law firm retention arrangements (whe).

Ultimately, a law firm under scrutiny volunteered to reduce its fees for a litigation by 10%. It proved to be a savvy move by the key partner who had impressed his new client but for questions about the fess—given the current economy.

The firm is currently acting for the client in a major transaction. The re-negotiated retention agreement should give Mr. Wise and Mr. Foreman a good bang for the buck and the firm a healthy profit from an efficiently managed matter.

Here are some pointers that were applied to the re-negotiated retention letter:

1) Include a statement that reinforces American Bar Association rules and legal requirements of a law firm to make "reasonable" fee charges and holds the law firm's feet to the fire with respect to cost-effective management of the work.

2) Insure that the law firm sets forth the legal issues to be addressed and the scope of the matter in clear layman language that fully comports to your understanding.

3) Require advance notice and/or authorization for billing rate increases prior to commencement of work at the increased rate and a cap on the percentage increase in a given year.

4) Ask for the lowest billing rate offered to standard commercial clients and for billing in time increments of six minutes

5) Insist upon monthly bills, appropriate summaries (as advised by your accounting department), and clear information regarding personnel, and their individual rates.

6) Obtain bills that are broken out by matter with task-based billing descriptions (free of bundled tasks to the extent practicable).

Negotiate Terms Before Saying, "I Do.", Part 3

Note: This case study by Wendeen H. Eolis has previously appeared in the New York Law Journal. I republish this article in 4 parts during December 2009 in response to current client demand for advice on law firm retention arrangements (whe).

Sitting in my office, I estimate that a client has paid approximately $250,000 more would have been chargeable with just a few reasonable changes in the law firm's boilerplate agreement.

Looking at the document, I spot the big trouble item: "Billing rates are periodically reviewed and adjusted." This is exactly what happened, quietly, on four separate occasions, over the fourteen months under review. The first increase occurred thirty-four days into the matter with a firm wide upward adjustment of 3 %. The last increase took effect in the most recent invoice, another firm wide increase-this time 4 %. In between the firm wide increases, the rates were separately elevated for partners and then associates and para legals.

The upward adjustments flowed as follows: (a) annual firm-wide rate revisions (January) (b) annual partner billing rate reviews (March) c) annual bumps of associates and para legals following acceleration in associate starting salaries (September). The firm invoked this and other policies to keep its business healthy-in a manner it considered "least painful for clients to bear."

After recalculating the company's bills at the original billing rates of timekeepers as specified in the retention agreement (and researching others who later joined the team), I find that the $1,245,000 in billable time would have been reduced by $240,000. I also ponder the possibility that the key partner's increased rates could reflect a compensation reward by his firm- thanks to the new business my client infused into his portfolio! When I review the billable time, I find that the firm bills in time increments of ¼ hour rather than six minute intervals I would recommend; that would produce another chunk of change. Then, I scan the addendum to the retention agreement that spells out the firm's disbursement policy. Aside from items dubbed "expenses" that look like "allocable charges," the provisions secure travel accommodations fit for a king. I proceed through the letter, dissecting and redrafting the language and noting modifications that make fractional differences that add up.

At the end of the review, Mr. Wise faults mostly himself for getting stung, telling me that he did not see himself in a strong negotiating position; a mammoth lawsuit was at his door. In fact, law firms salivate for interesting legal work that can produce $1,000,000 of business in the course of the year! He now concurs that the negotiated retention agreement is a critical document, not only for the provisions it contains, but also for the way in which it structures the relationship between client and counselor.

In discussing the negotiating process, he says that he and his general counsel might have happily agreed to provisions that I or others might be more likely to resist-such as specified conditions for a premium or a discount on fees. He has been stunned by the obvious! A contract between client and counselor (whether it be oral or written, signed or unsigned) should be addressed with knowledgeable eyes on both sides and negotiated with mutual business and fiscal considerations in mind.

The third part of this article will appear on December 23rd.