Morning Ethics Warm-Up, 12/28/2017: Bad Lawyer, Bad Losers, Bad Lottery, Bad Policy



1 Gee, I wonder how this happened? I’m doing a year-end legal ethics seminar for D.C. Bar members this afternoon, and this story showed up in time for me to use. A federal jury has found Evan Greebel, the former lawyer for convicted fraudster Martin “Pharma Bro” Shkreli guilty of helping the fick pharmaceutical executive craft a scam to repay defrauded investors. You remember Shkreli—this guy, who entered the Hall of Infamy for his unapologetic price-gouging of the HIV drug Daraprim after he bought the rights to the drug and  then hiked its price from $13.50 to $750.

Prosecutors  claimed Greebel, Shkreli’s lawyer during  scheme, gave his client detailed advice on how to pay off investors in his  hedge funds, MSMB Capital and MSMB Healthcare, with his company’s  funds, as well as how to circumvent trading restrictions. He was also was accused of participating in fraudulent backdating of documents and helping draft phony settlement and consulting agreements. Greebel’s lawyers countered that Shkreli was an evil manipulator who dragged his own lawyers, unaware, into his crimes. his own lawyers. Greebel, they said, acted in good faith as the outside attorney for Shkreli’s company, and lacked criminal intent.

The news story ends with this:

“Greebel, a partner with Katten Muchin Rosenman, saw his annual salary triple from $355,000 in fiscal year 2013 to $900,000 in 2014, when he was advising Shkreli.”

The moral: Nothing freezes ethics alarms like a lot of money.

2. What do Roy Moore, Al Gore and Hillary Clinton have in common? They are lousy losers. Moore, the horrible GOP candidate for the empty Alabama Senate seat, has filed a lawsuit to try to stop Alabama from certifying Democrat Doug Jones as the winner of the U.S. Senate race. Moore lost by 20,000 votes, but insists that there were irregularities. He wants a fraud investigation and a new election. Once upon a time, even the losers in close elections where some funny things went on conceded gracefully and accepted the results. This was a traditional demonstration of respect for the system and democracy, and girded our elections from cynicism and distrust. Even Samuel J. Tilden, the Democrat who was cheated out of the Presidency despite winning both the popular and the electoral vote, acceded to the back room deal that gave Hayes the victory.

No longer. Al Gore permanently killed that tradition in 2000, and Hillary’s minions set the corpse on fire in 2016. Now losing candidates can be expected to exploit any excuse imaginable to try to reverse election results. This is a dangerous slippery slope the endless Florida recount put us on, and I fear that it will eventually slide into violence. Better that the occasional election be won illicitly than to have every election be a potential court case.

In other news, the determination of a tie-breaker to settle who won a decisive seat in Virginia’s House of Delegates has been delayed after lawyers representing Democratic candidate Shelly Simonds filed a motion asking a trio of circuit court judges to reconsider their decision to allow a controversial ballot to be counted as a vote cast for her Republican opponent.

Of course!


3. Serves the state right; now pay up! The South Carolina Education Lottery has suspended its Holiday Cash Add-A-Play game after a Christmas Day programming error in its computer system caused an avalanche of winning numbers yielding up to  $500 per ticket. One man bought additional tickets when he noticed that he couldn’t lose, and won $12,000.

Lotto officials told people who played that day’s game to hold on to their tickets, and they will make an announcement later this week. There is only one ethical announcement to make, unless the reason there were so many winners was intentional interference with the system by a crook. Those weren’t “false winners,” as all the new reports are calling them. They were winners, period. The winning numbers were generated by the same software and the same system as always. The ticket purchasers did nothing wrong; the gambling administrators screwed up. Tough. State lotteries are a scam that prey on the poor, desperate and dumb. The least they can do is pay the winners, no matter how many winning numbers there are.

This will also end up in court, and the lottery might win. It shouldn’t matter. In the interests of fairness and integrity, South Carolina should let the original results stand.

Then it should end the lottery for good.

4. Observations on a “heroic” tweet. Actress Jenna Fischer of “The Office” fame attacked the GOP tax bill like the reliable progressive she is, tweeting

“I can’t stop thinking about how school teachers can no longer deduct the cost of their classroom supplies on their taxes … something they shouldn’t have to pay for with their own money in the first place. I mean, imagine if nurses had to go buy their own syringes.”

The final version of the bill had restored the deduction for teachers. Informed of that fact, Fischer tweeted a retraction and apology:

Well, from the reaction online you would have thought the actress had given her kidney to a stranger. Look:

  • When one sends incorrect information into the public consciousness one has an obligation to issue a correction. Not being irresponsible isn’t grounds for sainthood.
  • Her much praised apology deflates its virtue by excessive self-praise. You say “I’m sorry. I was careless.” Fischer, in contrast, spends four paragraphs telling us how she’s doing the right thing, and how she was taught to do the right thing, and how she loves teachers and thinks dialogue is important—we get it, Jenna, you’re terrific.
  • Thanks to a troll, I get the Democratic Party’s daily screeds, lies and talking points via e-mail. All Fischer did was read the same one I got about this deduction, and dutifully relayed it via Twitter  as we were directed to do by Tom Perez.  Her reference to “research” is deceitful. She’s not an independent commentator, she’s a partisan celebrity soldier.
  • If she likes dialogue so much, why doesn’t she engage on the topic of why that deduction makes sense, because, in fact, it doesn’t. It allows communities that underfund their schools to shift costs onto the federal government. It also validates a practice that should be reserved for dire emergencies at most, and not shrugged off by local government officials because “now the teachers get deductions for it, so its no big deal. Let’s hold the line on that budget.”
  • Why are teachers the only ones who get this benefit? Oh, right, Jenna LOVES them. Many, many individuals in all sorts of fields use their personal resources for work-related projects when the budgets run out. Why should only teachers be given special treatment by the tax laws? Jenna? What does your “research” tell you?

10 thoughts on “Morning Ethics Warm-Up, 12/28/2017: Bad Lawyer, Bad Losers, Bad Lottery, Bad Policy

  1. On #4, I will give a bit of credit, as she is apparently trying to reverse the trend of sticking to “alternative facts”, and instead promote the need for dialog to based on objective facts. The new tweet is self indulgent, but it does draw attention to the need to publicly correct the record, rather than bury retractions.

    “These are not ordinary times” – so a bit of over promotion when acting ethically may be just justified to encourage the same in others.

    • I agree, Rich—I took it as her attempting to set an example for others, rather than simply engaging in self-praise. Lots of people *don’t* believe in admitting when they are wrong for the fear that it weakens them or their “side,” so she was explaining why doing so is so important.

  2. “why doesn’t she engage on the topic of why that deduction makes sense, because, in fact, it doesn’t. It allows communities that underfund their schools to shift costs onto the federal government. It also validates a practice that should be reserved for dire emergencies at most, and not shrugged off by local government officials because “now the teachers get deductions for it, so its no big deal. Let’s hold the line on that budget.””

    If you look at the tax codes, deductions fall into two major categories:

    1) Deductions that reflect the reality that income has been reduced. You had hospital bills? Spent money on certain utilities or insurances? Had certain deductions taken off your cheque? Had someone steal your property? Depending on where you are, some or all of these could be deducted.

    2) Deductions that represent societal benefit.These deductions are… Nudges. They’re messages the government sends to people: “We want to encourage these behaviors, so we’ll let you keep a little bit more of your money if you do this.” Charitable donations? Please do this! Keep some of your money! Have kids? Please do this! Keep some of your money! Buy a home? Please do this! Keep more of your money! Going to school? Caring for infirm family members? Moving to your first job? Spent time on a jury? depending on where you are, some or all of these can result in deductions.

    Teachers spending the salary dollars on school supplies is atrocious, and allowing deductions for it both legitimizes it and encourages school divisions to continue the practices that leads to it. What’s worse is that the people who purport to care have effectively given up on getting the school supplies properly funded and retreated to trying to get 20% of the cost covered by the feds.

    Gross. Ick. Ptooey.

  3. 1. Larry Flynt beat you to it. He already said “There’s nothing that will change someone’s moral outlook quicker than cash in large sums.” Like it or not, most people can be bought if the price is high enough. For those who can’t, I will amend to “there’s nothing that will change someone’s moral outlook quicker than cash in large sums, except threatening to harm their loved ones.”

    2. It will slide into violence, Jack, you bet your bookshelf. Antifa is paving the way for full-on days of rage, and then maybe a brief civil war.

    3. Agreed.

    4. I can only sneer.

  4. #4. What makes this a “Man-bites-dog” story is the fact that a partisan celebrity soldier actually took a moment to correct the misinformation that she was spreading. Ideally, she wouldn’t have spread it in the first place, and her correction wouldn’t have been quite as self-laudatory, but in today’s political speech climate…I’ll take it, with praise. Like one would praise a middle-school kid who recants their nonsense when presented with accurate information. They are, after all, just learning how to think.

  5. 2: Roy Moore didn’t conceded in either of his runs for governor either, that’s how he rolls.

    As for Simonds, a 10 vote margin certainly made a recount necessary, it’s only after she won by one vote that her opponent took it to court. Fair’s fair, he went to court, she gets to go to court.

  6. 1. The man advised how to do unlawful things. He knew they were unlawful. Good he was convicted.

    2. Elections are an impediment to proper governance, according to the Elite Establishment of both parties. Other countries can tell their populations to pound sand: the 2nd Amendment makes the aristocracy a bit more cautious here. So we have to steal elections.

    3. Lotteries are a tax on people who are bad at math.

    4. Faint praise, in that a correction was made after it was going to bite her in the ass. A simple ‘oops’ and a correction would have sufficed.

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