This blog started on April 4, 2011, and the blogger made 190 posts for the year plus 26 comments to previous posts.
WordPress reports there were 9,190 views for the year. The busiest day was October 25th with 131 views while December 27th had 113. Most of the viewers were from the U.S.A. with the United Kingdom and Canada not far behind.
Again according to WordPress the following were the most popular posts:
International Criminal Court: Four People Recommended for Election as ICC Prosecutor (Oct. 25, 2011)
My Grinnell College years (Aug. 27, 2011)
Celebrating the Rhodes Scholarships Centennial (June 21, 2011)
The Personal Jurisdiction Requirement for U.S. Civil Lawsuits (Aug. 8, 2011)
The IBM Antitrust Litigation (July 30, 2011)
My Years at the University of Chicago Law School (Dec. 27, 2011)
As indicated in detail on Page: Topical List of Posts and Comments to dwkcommentaries, the posts and comments for 2011 fell into the following categories:
The Faegre & Benson law firm developed a significant practice of representing accounting firms that had been sued for accounting malpractice. For example, I represented four of what were known as The Big Five accounting firms: Arthur Anderson, Coopers & Lybrand (Coopers), Deloitte & Touche and KPMG Peat Marwick. Another partner had primary responsibility for the other Big Five firm–Arthur Young & Co.
One of the most interesting of these accountants liability cases was the Australian KPMG Peat Marwick firm’s battle with Sentry Insurance of Stevens Point, Wisconsin.
The other accounting case I remember most vividly was for Coopers. It had been sued in the federal district court in Minnesota for alleged securities law violations and common law fraud. The plaintiff was an Argentine company that had invested and lost $35 million in a Minnesota company (Interfund Corporation). Interfund’s main business was financing the purchase and sale of Arabian horses, but it also helped to finance a company in Missouri that was breeding cattle and operating a catfish farm. The plaintiff alleged that in making its investments it had relied upon Interfund’s audited financial statements that allegedly were materially overstated.
The plaintiff because of its large investment, however, had one of its own people on the Interfund board of directors and thus was privy to all of its financial information far beyond what was in the audited financial statements. As I recall, this was the primary undisputed issue of material fact that was the basis for Coopers’ successful motion for summary judgment that I brought after the conclusion of pre-trial discovery. There was no appeal.
This case required several trips to New York City to consult with Coopers’ in-house general counsel, to inspect the plaintiff’s documents and to depose its personnel. In my spare time, I attended concerts and Broadway shows.
I also spent time on these trips in the famous New York City Public Library at Fifth Avenue and 42nd Street doing research about an ancestor, W.C. Brown, who was President of the New York Central Railroad in the early 20th century. 
Two blocks east of the Library on 42nd Street sits Grand Central Terminal that was built while Brown was the Railroad’s President.
See Post: Battling Australian and Wisconsin Courts (Aug. 12, 2011).
See Post: Minnesota’s Federal Court (June 28, 2011).
 See Post: Adventures of a History Detective (April 5, 2011).
Employers frequently get involved in lawsuits with former employees. That was not the primary focus of my legal practice, but I did represent former employees in two interesting cases. One was brought by Green Tree Acceptance, Inc. of St. Paul, Minnesota. The other, by Surgidev Corporation of Goleta, California, already has been discussed.
John Wheeler was an employee of Green Tree from 1977 through October of 1984. At the time, Green Tree was the largest U.S. company in the business of mobile home financing. Wheeler towards the end of his career with the company was its executive vice president and a member of its board of directors. In 1983 he entered into a written employment agreement and noncompetition agreement with the company, but in October 1984 he and the company agreed to a termination of his employment and, he testified, a release from the noncompetition agreement. In May 1986 Wheeler became the president and CEO of another company based in San Diego, California that was involved in financing mobile homes.
In September 1986 Green Tree sued Wheeler for breach of the noncompetition agreement in Minnesota’s federal court. In October 1986 the court denied the plaintiff’s motion for a preliminary injunction barring Wheeler from working for his new employer. The next month (November 1986) the case went to trial before Judge James Rosenbaum and a jury. The jury’s special verdict found that the noncompetition agreement had terminated before Wheeler went to work for his new employer. Accordingly the district court denied Green Tree’s motion for a new trial or judgment notwithstanding the verdict and entered judgment in favor of Wheeler.
Green Tree then appealed, and in October 1987 the appellate court reversed the judgment because of its conclusion that the district court erroneously had submitted to the jury the issue of whether the noncompetition agreement was still in effect. Accordingly the appellate court remanded the case to the district court for a new trial. Soon thereafter the case settled.
This was one of those unfortunately rare cases in which the opposing lawyers were professionally civil with each other while simultaneously vigorously contested the case. I, therefore, commend Green Tree’s lawyers, Peter Hendrixson and David Lauth of the Dorsey & Whitney law firm and Rick Evans, Green Tree’s General Counsel.
 See Post: Intraocular Lenses Litigation (Aug. 18, 2011).
Green Tree Acceptance, Inc. v. Wheeler, 832 F.2d 116 (8th Cir. 1987).
 See Post: Minnesota’s Federal Court (June 28, 2011).
Intraocular lenses or IOLs are artificial lenses implanted by ophthalmologists in the human eye to correct vision loss resulting from removal of the eye’s natural crystalline lens during cataract surgery. Since at the least the mid-1950’s, IOLs have been an acceptable mode of treatment.
As of 1985 there were 17 to 20 manufacturers of IOLs with the six largest having over 80% of the market. One of the leading competitors was Surgidev Corporation of Goleta, California near Santa Barbara.
In 1985 five key employees of Surgidev left the company and soon thereafter organized a new company, (Eye Technology, Inc. (ETI)), to manufacture IOLs and compete with Surgidev and other such manufacturers.
Litigation ensued. Surgidev sued its former employees and ETI in Minnesota’s federal court. It asserted claims for unfair competition, misappropriation of trade secrets, breach of contract, breach of fiduciary duty, conversion and wrongful interference with contractual relations and prospective economic advantage.
The defendants retained Faegre & Benson to defend the case, and I was in charge of the team at the law firm.
We answered the complaint by denying its material allegations and asserting counterclaims for alleged wrongful interference with ETI’s public offering of securities, abuse of process, malicious prosecution, and defamation. The district court granted Surgidev’s motion to dismiss the counterclaim for abuse of process, but otherwise denied the motion, holding that the counterclaims were not a “sham” and were protected by Noerr-Pennington privilege from tort liability for filing suit and the defamation claim was one for “slander per se” rather than “trade libel,” and thus, special damages did not have to be pled.
The parties later returned to the district court for a combined hearing and trial on Surgidev’s motion for preliminary and permanent injunction. The court concluded that there was no breach of the former employees’ contractual non-compete and non-disclosure provisions.  But the court held that they had engaged in wrongful interference with certain Surgidev agreements and, therefore, enjoined them from attempting to solicit through December 31, 1986, any Surgidev employees from joining ETI, from having four named doctors doing any work for ETI and from soliciting certain Surgidev customers to become ETI customers.
The granting of the injunction was affirmed by the appellate court.
I have three extraneous memories from this case.
Some of the depositions were taken in Santa Barbara and San Diego, California, and I remember opposing counsel and I split the cost of a rental car to drive to San Diego. I was the driver, and it was a harrowing drive on a very dark and very rainy night on Interstate 5.
Boston was the location for other depositions. On a day off in the midst of a heavy snow storm I had lunch in a Russian restaurant near Harvard Square with a Grinnell College contemporary to talk about our mutual interest in El Salvador.
The last memory is lunch at a Minneapolis hotel with an ophthalmologist who was involved in the case and who, out of the blue, offered to perform laser surgery on my eyes to correct my nearsightedness. I declined the offer.
In 1998 ETI was merged into Star Tobacco and Pharmaceuticals Inc. which was focused on developing a new, “less-harmful” cigarette. Now known as Star Scientific, Inc., it still is pursuing this cigarette goal and apparently no longer manufactures IOLs.
Surgidev Corp. v. Eye Technology, Inc., 648 F. Supp. 661, 669 (D. MInn. 1986).
In June 1982, all kinds of litigation erupted in Minnesota’s federal court involving Flight Transportation Corporation (FTC), a Minnesota-based company that purported to provide small-aircraft charter service.
The first case was by the U.S. Securities and Exchange Commission (SEC) against FTC, its subsidiaries, and its CEO and Chairman of the Board, William Rubin. The SEC alleged that the defendants had violated and aided and abetted violations of antifraud, reporting, and record-keeping provisions of the federal securities laws. The SEC sought an injunction prohibiting further violations by the defendants of these provisions, the appointment of a receiver to take possession of and marshal the assets of FTC and its subsidiaries, an accounting of all proceeds of FTC’s allegedly fraudulent securities offerings, and an order of disgorgement of all funds received by FTC as a result of those sales of securities. With respect to Rubin, the SEC sought a temporary freeze of most of his personal assets, an accounting of all funds received from FTC and its subsidiaries, and disgorgement of such funds.
Shortly thereafter, two underwriters of FTC securities, on their own behalf and on behalf of all persons who purchased FTC’s securities in the June 1982 offerings, commenced a class action seeking, among other things, imposition of a constructive trust on the $22 million in proceeds of the offerings.
Thereafter other private lawsuits were also commenced against FTC, its officers and others, including its external auditor and the New York City law firm for the underwriters of the public offerings of FTC securities.
Norwest Bank Minnesota (n/k/a Wells Fargo Bank Minnesota) had been providing working capital financing to FTC and brought a claim against FTC to collect that debt, and I was in charge of the Faegre & Benson team for Norwest. Later some of the other plaintiffs asserted claims against the Bank because its collateral review personnel had discovered certain problems at FTC; later the Bank reached a settlement over all of these claims.
Because there were so many different kinds of claims against FTC and others, the attorneys for the plaintiffs concluded that they needed to stop fighting among themselves and instead focus their collective efforts in prosecuting the claims against the defendants. As a result, the plaintiffs negotiated a complex Sharing Agreement whereby any monetary recoveries would be shared among the plaintiffs. This agreement was approved by the court.
The SEC’s request for the appointment of a receiver was granted. A Minnesota attorney, Thomas Bartsch, was so appointed. I participated in many meetings with him and thought he was doing an excellent job. I, therefore, was shocked later when he was convicted of stealing money from the FTC assets under his control as receiver and then disbarred as an attorney.
At the conclusion of the private litigation, the district court awarded the various plaintiffs’ law firms $7.8 million of attorneys’ fees. The court recognized the superlative work of the lawyers that resulted in recovering $52 million for the various plaintiffs.
I also was the attorney for Norwest Bank in a related case where a co-founder, outside director, shareholder and director of FTC sued the Bank for collecting and paying a check that allegedly had his forged endorsement. The district court entered judgment in favor of the Bank, and the appellate court affirmed.
Finally there were criminal prosecutions of FTC’s principal officers: William Rubin, Janet Karki, Brian Miller and James McGovern. Rubin, the CEO and Chairman of the Board, was convicted on 10 counts of securities fraud and two counts of filing a false securities registration statement with the SEC and sentenced to 35 years in prison plus a $120,000 fine. There also were convictions on similar charges against Karki, the Chief Financial Officer (20 years in prison); Miller, the Financial Controller (three years); and McGovern, a Minnesota lawyer and FTC’s General Counsel (six years).
I still find it difficult to believe that two fellow Minnesota lawyers with whom I had professional dealings ended up in prison as convicted felons.
Two memories of this case stand out.
At a posh Beverly Hills hotel, I participated in the deposition of Michael Milken from a FTC underwriter (Drexel Burnham Lambert). Known in the securities industry at the time as the King of Junk Bonds, Milken later pled guilty to securities fraud and tax violations and was sentenced to imprisonment. After release, he has concentrated his efforts on philanthropy, especially research regarding prostate cancer and melanoma. (Wikipedia, Michael Milken, http://en.wikipedia.org/wiki/Michael_Milken.)
I attended the criminal trial of Rubin and Karki. I was there as an attorney for a Norwest banker who was testifying about the Bank’s relationship with FTC. During her testimony two prominent Minnesota criminal defense attorneys, Ron Meshbesher and Joe Friedberg, objected to the receipt into evidence of certain Bank documents because they were photocopies and thus not the best evidence. While the attorneys had a sidebar conference with the judge regarding this objection, I went to the U.S. Attorney’s table and whispered to an FBI agent that the originals were in my office and were destroyed in the Northwestern National Bank fire on Thanksgiving Day 1982. The FBI agent then went to the sidebar conference and relayed the information to the U.S. Attorney, Tom Hefflefinger.
The judge then asked me to leave the courtroom, presumably while foundation questions were asked of the banker. I assume her examination went something like this: “Do you know Mr. Krohnke? (Yes.) Was he involved in any way with the Bank and FTC? (Yes.) How was he involved? (He was an attorney for the Bank regarding litigation over FTC.) Did he have any original Bank documents in his office? (Yes.)”
I was then readmitted to the courtroom and put on the witness stand. The U.S. Attorney asked me a few questions along the same lines and established that the original documents in question were destroyed in the fire. There was no cross-examination by Meshbesher or Friedberg. The photocopies of the Bank documents were received into evidence.
 See Post: Minnesota’s Federal Court (June 28, 2011).
SEC v. Flight Transportation Corp., 699 F.2d 943 (8thCir. 1983).
Id.; In re Flight Transportation Securities Litigation, 593 F. Supp. 612 (D. Minn. 1984).
In re Flight Transportation Securities Litigation, 730 F.2d 1128 (8th Cir. 1984), cert. denied sub nom. Reavis & McGrath v. Antinore, 469 U.S. 1207 (1985); In re Flight Transportation Securities Litigation, 794 F.2d 318 (8th Cir.), cert. denied sub nom. Subclass IV v. Fox & Co., 481 U.S. 1013 (1987).
In re Flight Transportation Securities Litigation, 685 F. Supp. 1092 (D. Minn. 1987).
Lund v. Norwest Bank, 669 F. Supp. 284 (D. Minn. 1985), aff’d, 825 F.2d 1249 (8th Cir. 1987), cert. denied, 485 U.S. 936 (1988).
U.S. v. Rubin, 836 F.2d 1096 (8th Cir. 1988); U.S. V. McGovern, 822 F.2d 739 (8th Cir.), cert. denied, 484 U.S. 956 (1987). I knew McGovern; he was one of the attorneys for the Wisconsin breeders cooperative in a lawsuit in which I was an attorney on the other side of the case. (See Post: The Artificial Insemination of Cattle (Aug. 16, 2011).
 I once had a civil case in which Meshbesher was the opposing lawyer, and the case settled soon after I took his client’s deposition. The recent movie, A Serious Man, by Joel and Ethan Coen, takes place in the Minneapolis area. When a character needs a criminal defense lawyer, he is told to hire Ron Meshbesher. The line was inspired by the Coen brothers’ memories of growing up in St. Louis Park, Minnesota and seeing attorney ads for Meshbesher. (Wurzer, Twin Cities lawyer is a Coen brothers punch line, MPR News (Oct. 9, 2009), http://minnesota.publicradio.org/display/web/2009/10/07/meshbesher.)
U.S. dairy farmers and beef producers frequently form cooperatives to purchase and maintain equipment for the artificial insemination of cattle and to hire and train people to be the technicians to perform the insemination. Farmers often believed that some of these technicians were better at their craft than others.
In the 1970s two competitive cooperatives–one based in Minnesota; the other in Wisconsin–were raiding each other’s skilled technicians, and when a technician switched co-ops, many of the farmers would also switch.
These competitive skirmishes ended up in a lawsuit in Minnesota’s federal court. The Wisconsin co=op sued the Minnesota co-op for alleged antitrust violations and other wrongs. Faegre & Benson was retained to represent the defendant, and I was on the team for the case.
The case, as I recall, settled rather quickly.
Before it settled, I attended a meeting of the employees of the Minnesota co-op. One of them told me about awful things that the Wisconsin co-op’s people were saying about them. He then asked, “Is that defecation of character?” suppressing a laugh, I said I did not think so.
 See Post: Minnesota’s Federal Court (June 28, 2011).
Girard Henderson was an interesting client of the New York City law firm of Cravath, Swaine & Moore (CS&M), where I was an associate attorney, 1966-70.
His grandfather was a Sandy Hook ship pilot who piloted ships into the City’s harbor and who managed to save a significant amount of money. Henderson’s father invested the inheritance from the grandfather in a New York City warehouse that burned to the ground, and there was a long delay in obtaining payment by an insurance company. As a result, the father went to work as a bookkeeper for the California Perfume Company (CPC) in Suffern, New York and became one of its substantial shareholders.
After Henderson’s father’s death, his mother inherited the CPC stock, and in 1935 she contributed those shares to a newly formed personal holding company, Alexander Dawson, Inc. (ADI) in exchange for all of ADI’s stock. Later, presumably after his mother’s death and after a buyout of his brother, Henderson became the sole owner of ADI.
Prior to 1955, however, he gave 27% of the ADI common stock (and some ADI preferred stock) to his then wife, Theodora Henderson, while Mr. Henderson maintained his personal control of ADI. In 1955 Girard and Theodora separated and later were divorced.
In 1967 Theodora formed her own holding company, Theodora Holding Corporation (THC), and she contributed her ADI common stock to THC in exchange for all of its stock.
In the meantime, in 1939, CPC changed its name to Avon Products, and in 1964 Avon’s stock was listed on the New York Stock Exchange and became a very successful stock with rising prices.
As of September 1968, ADI’s net worth was $150 million with Avon stock comprising 75% of its assets. The other 25%, pursuant to a diversification policy, was invested in other stocks and several small companies.
One such company was the Underground World Home Corporation that promoted such homes as safe places in the event of a nuclear attack by the USSR. It had a demonstration home at the 1964 New York City’s World Fair. Henderson also had his own underground home in the Rocky Mountains near Denver; its underground swimming pool had a mural of the New York City skyline on the east wall and one of the San Francisco skyline on the opposite wall. As of September 1968, ADI also had invested $14 million in silver bullion and Swiss francs that were stored in a vault under the airport in Zurich, Switzerland.
In or about September 1968 THC commenced a stockholders derivative lawsuit against ADI, Henderson and another corporate officer. The complaint alleged mismanagement regarding these non-Avon investments and corporate contributions to the Alexander Dawson, Inc. Foundation. As ADI was a Delaware corporation, the case was filed in the Court of Chancery in Wilmington.
The case went to trial in 1969. It was the first trial in which I participated. I was “second chair” to Cravath partner, Jack Hupper. I handled the exhibits and other papers and did not say one word on the record. But at least I was in court observing the trial and seeing how it was done.
In September 1969 the court issued its decision. It noted that after trial the plaintiff had withdrawn its claims regarding silver bullion and other ADI investments made at Henderson’s direction, including the Underground World Home Corporation. Instead the plaintiff after trial had limited itself to claims regarding ADI’s purchase and sale of a seat on the New York Stock Exchange (NYSE) and the ADI charitable contributions to the Foundation. The court upheld the validity of the charitable contributions, but concluded that Henderson had used corporate funds for his personal benefit with respect to the NYSE seat and, therefore, had to account to ADI for any profit on the sale of the seat and on brokerage commissions.
I do not remember any of the substantive or procedural details of the trial, but I do remember that just before trial Henderson broke a leg in a New York City taxi accident. When he testified at trial, the broken leg in a cast had to be elevated on a makeshift pedestal.
I also recall that before trial Henderson had to delay a trip from the West Coast to New York City to meet with Mr. Hupper and me because he was hosting a special dinner with Rudy Vallée, a famous crooner in the 1920s through the 1940s.
Nor can I forget that Henderson and ADI kept some of their records in an informal office in a small house in a New York City suburb on the west side of the Hudson River. One day I drove there over the George Washington Bridge to find relevant documents. I was surprised to find a bar of silver bullion at the back of one of the file drawers.
 This account is based on memory and Theodora Holding Corp. v. Henderson, 257 A.2d 398 (Del Ct. Ch. 1969). See also Post: Lawyering on Wall Street (April 14, 2011).
At its May 1999 Commencement Exercises, Grinnell College, my alma mater, granted me the honorary degree, Doctor of Humane Letters.
The citation said that I had “discovered a way to integrate his professional life as an attorney with his spiritual life and his desire to ‘do good.’ In the midst of a prestigious legal career, [he] found ‘a reawakening of [his] spiritual life’ through tireless pro bono work on behalf of clients in need of political asylum in the United States. . . . A 1989 trip to El Salvador to learn more about conditions there was, for him, a ‘spiritual journey.’ Despite the horrendous suffering he witnessed, [he] found himself uplifted and transformed by the faith and hope of the Salvadoran people. . . . Of this work, he says, ‘it provides a deeper sense of satisfaction of really helping someone.'”
I responded with these words to the new graduates:
Listen to your life. To your successes and joys. To your disappointments and pain. To the strangers you encounter on the road to your Jericho.
As you listen and reflect, hopefully with the support of a community of faith, attempt to discern how God is present and active in your life. Then allow yourself to be nudged down paths that are consonant with God’s will for your life.
Thirty-eight years ago when I was at my Grinnell commencement, I was convinced that all that mattered were intellect, rationality, logic, knowledge and hard work, all of which were challenged and enhanced by my being a member of this academic community. I had persuaded myself that religion and spirituality were antiquated superstitions of no use to a liberally educated, intelligent person.
I eventually learned otherwise, but it took a long time.
 See Post: My Christian Faith (April 6, 2011); Post: Minneapolis’ Westminster Presbyterian Church (April 6, 2011); Post: The Parable of the Prodigal Son and His Older Brother (April 20, 2011); Post: The Sanctuary Movement Case (May 22, 2011); Post: Becoming a Pro Bono Asylum Lawyer (May 24, 2011); Post: My Pilgrimage to El Salvador, April 1989 (May 25, 2011).
 These comments were inspired by my own life and by the words of Frederick Buechner, an author and Presbyterian pastor, in Now and Then: A Memoir of Vocation (1990): “Listen to your life. See it for the fathomless mystery that it is. In the boredom and pain of it no less than in the excitement and gladness: touch, taste, small your way to the holy and hidden heart of it because in the last analysis all moments are key moments, and life itself is grace.” (See also George Connor, Listening to Your Life: Daily Meditations with Frederick Buechner (1992).) Recently I have encountered another book with the same theme by Parker Palmer, Let Your Life Speak: Listening for the Voice of Vocation (1999). (See Post: Westminster Town Hall Forum: Krista Tippett (July 26, 2011).)
Detail-obsessive lawyers like to cite to specific pages in legal materials that support their factual or legal assertions. Sometimes court rules require them to do so.
When the legal material appears in multiple versions, there is a similar desire to cite to the pages in the original version. As a result, publishers of the subsequent versions developed a practice of including the page numbers in the original version in addition to the page numbers of the subsequent versions. This practice became known as “star pagination.”
This practice is believed first to have been used for the later editions of Sir. William Blackstone’s treatise, Commentaries on the Laws of England. It was first published in four volumes in 1765-1769, was long regarded as the leading work on the development of English law and played an important role in the development of the American legal system.
In the U.S.’s pre-computer days, our court decisions were printed in books, the most popular of which for lawyers were published by West Publishing Company (West) of St. Paul, Minnesota. These books were known as the National Reporter System, and the published court opinions also included editorial enhancements by West that summarized and classified key points on law in those opinions. Over time, these reporters became the de facto (and sometimes de jure) official sources for U.S. judicial opinions.
As a result, when computerized legal databases and services became available, there was a desire, if not a market need, for the providers of those services to have star pagination of judicial opinions in their databases to the previous reports of those decisions in the National Reporter System.
One of the first computerized legal research services was LEXIS in 1973 from Mead Data Central, Inc. (MDC) of Dayton, Ohio. At first it only had materials of two states (Ohio and New York) online, but by 1980 it had materials from all the states and federal government.
In June 1985 MDC announced that it was adding star pagination to the LEXIS service. This new feature would consist of “the addition of the official page cites to the full text of online case law material.” This would eliminate the physical necessity of referring to the volumes of the National Reporter System publication in which the reports appeared.
In response, West sued MDC for copyright infringement in Minnesota’s federal court. MDC retained Faegre & Benson to defend the case with the assistance of MDC’s Wall Street lawyers (Sullivan & Cromwell), and I was a member of the Faegre team for the case.
The initial skirmish of this war between the two major competitors in the then new field of computerized legal research was West’s application for a preliminary injunction to ban LEXIS’ star pagination to West publications while the litigation proceeded to trial. I argued this motion for MDC. Unfortunately the court granted the preliminary injunction. The court by Judge James Rosenbaum held that the page numbers and arrangement of cases were within the scope of protection of West’s copyrights, that the proposed star pagination by MDC infringed those copyrights and went beyond fair use and that a preliminary injunction was warranted based upon likelihood of success on the merits, irreparable harm, balance of harms and the public interest.
MDC exercised its right to an immediate appeal of the granting of the preliminary injunction to the U.S. Court of Appeals for the Eighth Circuit. This time, a Sullivan & Cromwell partner argued the case for MDC. Unfortunately the result was the same. The Eighth Circuit, 2 to 1, affirmed the preliminary injunction. The U.S. Supreme Court thereafter denied permission to bring the issues before that Court.
Later, without Faegre’s participation and according to press reports, MDC and West entered into a settlement agreement that ended the litigation and that granted MDC a license to include star pagination in LEXIS along with West’s corrections to judicial opinions for an annual licensing fee of $50,000.
In the mid-1980’s Sentry Insurance A Mutual Company (Sentry) of Stevens Point, Wisconsin, and the parent of The Sentry Corporation, sold its Australian operations to an Australian insurance company. Thereafter the Australian buyer alleged that the financial statements for the purchased operations were materially overstated.
This set the stage for a conflict and battle between the Federal Court of Australia and the state courts of Wisconsin. It is an illustration of the unnecessary disputes that can be generated by litigation over international commercial disputes and that would not exist in an agreed-to international arbitration.
In 1987 the Australian insurance company (the buyer) commenced a lawsuit in the Federal Court of Australia against The Sentry Corporation (the seller) and Peat Marwick Mitchell & Co. (PMM), an Australian accounting firm, for money damages caused by those alleged material financial misstatements. The Sentry Corporation made a cross claim against PMM in that case, and the case was scheduled to commence trial in Australia in October 1990.
In October 1988 Sentry commenced a lawsuit in Wisconsin state court in its home town of Stevens Point against KPMG Peat Marwick, the U.S. affiliate of PMM, relating to these issues. In January 1990 Sentry amended its complaint to add PMM (the Australian accounting firm) as a defendant, and I was retained as PMM’s attorney.
My first maneuver was a motion to dismiss the Wisconsin complaint for lack of personal jurisdiction over the Australian accounting firm and alternatively to stay or postpone the Wisconsin case until the prior Australian litigation was resolved.
Before the Wisconsin dismissal and stay motion was decided, however, the plaintiff (Sentry) noticed the oral depositions of nine PMM auditors to be taken for the Wisconsin case in Sydney, Australia. While such depositions are common practice in U.S. civil litigation, they are not in Australia and most other countries, and PMM and I believed that such depositions were a tactical move by Sentry to gain an unfair advantage in the Australian litigation. Therefore, we moved the Wisconsin court to prohibit the depositions, but the Wisconsin court denied the motion.
I, therefore, went to Sydney to prepare the Australian auditors for their depositions and to defend those depositions, but after I was there, PMM requested the Australian court to issue an injunction against the depositions taking place on Australian soil. The Australian court granted that injunction. Thus, the depositions did not take place in Sydney.
Later, after my return to the U.S., the Wisconsin court denied PMM’s motion to dismiss for lack of personal jurisdiction and granted Sentry’s motion to strike that defense to the Wisconsin plaintiff’s claims.
PMM then sought and obtained permission to take interlocutory appeals (immediate appeals before final judgment) to the Wisconsin Court of Appeals from the denial of PMM’s motion to bar the depositions and from the denial of its personal jurisdiction motion and defense.
Before the Wisconsin appeals were argued and decided, however, trial of the Australian case commenced. Contrary to Australian and U.S. general practice, the Australian insurance company’s expert witness was called as the first witness (instead of waiting until all the fact witnesses had testified) and was demonstrated not to have expertise on at least some of the subjects of his proposed testimony. As a result, the plaintiff’s barrister had a nervous breakdown. This triggered the collapse of the Australian plaintiff’s case and a truly global settlement that ended all of the litigation.
I should add that as I did not have much to do in Australia for the Wisconsin case after the Australian court enjoined the depositions. I thus had some time for personal pleasure.
I attended a production of “Aida” at the spectacular Sydney Opera House and saw many interesting sights in that great city.
I also went scuba diving near Heron Island on the Great Barrier Reef. I flew from Brisbane, Australia to Heron Island by helicopter and saw large triangular manta rays in the water from the air. In the hotel on the Island a male nurse from Melbourne, Australia and I formed an unbeatable team in an international game of Trivial Pursuit.
My return 14-hour flight to Los Angeles on Qantas Airlines was rescheduled, and much to my consternation the only available seat was in the smoking section. I was told not to worry because I probably could be re-seated on the plane itself. That happened. I got a very comfortable and quiet seat in the upper deck of the 747.
My Australian adventure was over. Thereafter I often referred to this Australian jaunt as the best business trip I ever took.
 See Post: Resolving Disputes between Manufacturers and Distributors/Dealers (Aug. 9, 2011); Post; International Commercial Dispute Resolution (Aug. 11, 2011).
 See Post: The Personal Jurisdiction Requirement in Civil Litigation in U.S. Courts (Aug. 8, 2011).
 Order, Sentry Ins. v. KPMG Peat Marwick, No. 88-CV-481 (Wis. Cir. Ct. Portage Cty, May 24, 1990).
 Decision and Order, Sentry Ins. v. KPMG Peat Marwick, No. 88-CV-481 (Wis. Cir. Ct. Portage Cty, June 28, 1990).