
Mark Cuban offers to pay SEC lawyers to speed up the investigation against him - grellas
http://abovethelaw.com/2010/10/mark-cuban-wants-to-pay-government-attorneys-to-get-off-their-ass/
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corin_
He can't expect it to actually happen, so presumably his aim is to give the
impression that he's confident of winning the case (and, I hope, to create a
little entertainment - I sure found it bloody hilarious.)

~~~
aguynamedben
Keep in mind that this is the same guy that responds to NBA fines by donating
a matching amount to charity. Also, after getting fined for claiming a referee
"wasn't fit to run a Dairy Queen", he worked at a Dairy Queen for a day.

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btilly
So how _do_ you organize legal cases with over 66,000 pages of paperwork? I
know that blowing cases up to this size is standard operating procedure, but
I'm curious how it is handled in practice.

~~~
anigbrowl
This is tiny, I'm sorry to say! E-discovery requests now yield millions of
documents as a matter of routine. Mrs Browl works for a company in this
sector, though I'd rather not say which one (it isn't mentioned in this thread
though, and yes, most software in this area is hideous).

This is the industry reference that everyone more or less agrees on:
<http://edrm.net/>

Essentially one side can request any and all data concerning
people/places/events in the case, though they have to specify (loosely) what
they want and why, and what format they want it delivered in - some want
native files, some PDFs, some TIFF images, some even want paper.

Typically attorneys of both the plaintiff and defendant work through the terms
of a court order, then the defendant's lawyers do a big data collection with
the aid of forensic specialists, possibly supervised by the plaintiff's
attorneys. This can be as disruptive as an IRS audit, but across the entire
company - engineering, sales, business development, finance, executive suite,
you name it. Assume everything will be collected, and I do mean _everything_ :
the idea is to get a snapshot of all relevant data that was available on the
date the court granted the motion. Many firms are now moving towards just
archiving everything ahead of time to avoid disrupting operations. Also, that
makes it much easier to manage as a rolling process for both sides later. As
well as the original files, there's a giant database of all textual content
(including transcriptions of audio/video) and case-specific legal metadata
referencing the source material.

The plaintiff isn't entitled to see all of this stuff, but is entitled to know
it has been preserved as evidence whose completeness can be verified legally,
so everything's numbdered and tracked from here on. Then the defendant's
lawyers go through looking for a) anything that could fall within the scope of
the court order, b) what they think the Plaintiff is going to use against them
in particular, and c) what the defendant is entitled to keep from them (eg the
communications between the CEO and company counsel, or material which is just
not relevant to the plaintiff's case).

They build (a) by doing wide-ranging database searches for each legal issue in
the case, of which there can be many. Then a team of review attorneys looks at
every document individually to see if it's responsive (relevant) to the issue
and/or privileged (legally private), maybe adding a short description that
will go into a list of evidence. In a big case like Google v. Oracle there can
be over 100 attorneys doing this for months on end, factory style. They're
usually contractors, not employees. 5 years ago this paid $60-75/hour or more;
now it typically pays half that, and some companies pay as little as $15/hour.
The job is so basic that only minimal qualifications are required, so now a
lot of material is sent to India; because a bunch of law schools got certified
in the years before the financial crisis and many more exaggerated hiring
stats for their grads, there's a huge surplus of JDs and far fewer jobs; a lot
of law firms went bust in the crisis, and a lot more complain schools graduate
too many theorists unprepared to actually practice law; and most of these
grads are $1-200k in non-dischargeable debt for their student loans. Hence
debt-ridden attorneys being offered $15/hour.

Naturally they aren't happy, and everyone is waiting to see if (more like
when) a class action lawsuit gets filed against the whole legal education
establishment. In the meantime, most law schools still charge at least
$30k/year in tuition.

After the review team has classified everything to legal standards, the
defendant's attorneys - the ones earning real money this time - then go
through double and triple checking what's responsive, redact any information
that might be privileged, and approving each document required for production
to the plaintiff, they're all given another set of numbers and converted to
the agreed-upon output format. They also (typically) approve lots more
documents which look responsive but aren't and are safe to give away, so as to
bury the plaintiff's attorneys in as much irrelevant data as they possibly can
- because the plaintiff's lawyers _don't_ get access to this trove of
metadata, just the bare document in digital or occasionally printed form.

Then the _other side_ puts all those into a big database of their own, hires a
smaller bunch of review attorneys, and does essentially the same thing. Often
the defendant has launched a countersuit against them in the meantime, and
requests discovery of the original plaintiff's documents...this process
sometimes takes a few years before the trial proper starts.

There are huge profits to be had, but lots of competition; also most law firms
are conservative about technology. So it's not a fast buck.

~~~
jacquesm
I looks to me like we're reaching some kind of information singularity that
will ground down the wheels of legislation any day now. After all, you can get
a million documents with the click of a mouse to presumably support your case.
But you'll still have to comb through them in order to get to the good stuff
and automation will only help so much with that. In the end it boils down to
human analysis.

~~~
anigbrowl
Arguably we're at or even past that point in some respects. I'm very
interested in law (as you can probably tell) and the more I study the more I
feel that clarity predicts quality. If anyone in the Bay Area or beyond wants
to have recurring discussions about interesting research avenues I'd be
delighted.

Right now most vendors compete on volume processing and retrieval speed, which
are very important - deadlines in this field are not targets, but legal
obligations, and inaccuracy or failure to perform is a quick path to ruin. But
I have a growing wishlist of less obviously commercial things that should
exist already but don't. I'm more interested in studying law than researching
what's hot in semantic modeling, text parsers and so on...but thee's a ton of
interesting possibilities and vast public domain datasets.

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semipermeable
Maybe the SEC should counter by saying that they will take his money to make
their entire operation faster -- his case will be processed faster, along with
everyone elses!

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iwr
The ammount of paperwork is astounding. Make simpler, better rules instead of
just more regulations!

~~~
mahmud
Good point, make that into a 55k page recommendation and attach it to a
morality bill, then congress will look at it.

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philwelch
If by "look at it" you mean "ignore it and vote based upon the title of the
bill, its nominal purpose, which party proposed the bill, and how the party
whips say to vote on it"...then yes, Congress will "look at it".

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staunch
I don't see why it wouldn't make sense. As long as it's handled in a careful
way. You can pay extra to expedite all kinds of government services, why not
SEC investigations?

~~~
Construct
It creates a conflict of interest for the attorneys. It sets a precedent that
wealthy people can receive faster treatment from the SEC. Of course, the SEC
tends to investigate people who have made large amounts of money through
potentially illegal means, so this may not be an issue. However, it also
provides less incentive for the SEC to move quickly on other cases. If the SEC
can accept money in exchange for speeding up the process, they are now one
step away from slowing down or drawing out the whole process as a means for
extorting money.

~~~
mirkules
"SEC tends to investigate people who have made large amounts of money through
potentially illegal means"

I suspect it is illegal to accept illegally-obtained money. Therefore, if Mark
was found guilty, the staff cannot be paid. Which also gives incentive to not
find him guilty, resulting in a conflict of interest. IANAL, though.

~~~
anigbrowl
No, his staff are still owed unless they're complicit. Are you going to raid
his janitor for happening to sweep the wrong floor? Same concept.

~~~
0x44
Your parent meant the SEC staff, not Mark Cuban's staff.

~~~
anigbrowl
D'oh!

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pasbesoin
If Cuban can draw some attention to the SEC's chronic, deliberate under-
funding, more power to him.

Congress has for years siphoned off the majority of the fees the SEC collects.
They raise enough revenue to do significantly more than they have (whether,
politically, they would ever be allowed/enabled/encouraged to, is another
matter). But Washington gathers it up and wastes (err, spends) it elsewhere.
[1]

A few years ago, there was a lot of hoopla and excitement over the SEC's
"receiving" additional funding for 100 more attorneys to prosecute
investigations and regulatory proceedings (100, IIRC). Last I checked (earlier
this year), SEC management was still "optimistic" that that additional funding
would soon be showing up. (My resulting impression after that conversation
was, 'yeah, RSN (Real Soon Now)'.)

[1] This is off the top of my head (or out of my *ss), but I seem to recall a
few years ago seeing SEC fee and whatnot revenues quoted as being in the $600
million range, while their annual budget was set at around $100 - $110
million. Maybe someone else here will have better knowledge of this.

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kylelibra
I'm not up on this case at all. Any other thoughts as to Cuban's motives here?

~~~
smalter
the procedural history of cuban's case is somewhat confusing. there are
actually two ongoing suits right now.

one is the insider trading lawsuit. the sec's suit against cuban was dismissed
by a district judge in dallas for failure to state a claim (even if all the
facts accused were true, they still wouldn't be enough to support a conviction
of cuban). however, the court of appeals overturned that on appeal and sent
the case back to the district court to keep going on the case. that happened
relatively recently. the basic issue is whether cuban agreed to keep
confidential the information he received.

not long after the sec sued cuban, cuban sued the sec in district court in
washington dc based on the freedom of information act (foia). this is the case
being discussed in the article. he wants documents the sec used in its
investigation of him and other documents. presumably cuban would get ahold of
the relevant documents as part of the discovery process in the first lawsuit,
but perhaps cuban sought some pr benefits of looking like he was going on the
offensive and perhaps he thought he could learn more about what the sec had on
him to prepare for the first litigation. the gist is that the sec acted in bad
faith by withholding relevant documents from cuban.

there was some discussion about whether the sec was stalling in the hopes that
they'd get an exemption to foia provided by congress, but i believe obama
repealed that provision in early october. cuban has been pretty brash this
whole time, and as a matter of law, it's clearly not an open and shut case.
the bravado i find somewhat embarrassing because it's pure grandstanding -- no
court would ever grant his request (although judge walton is known as a bit of
a renegade). as a matter of litigation strategy, i don't see much benefit to
what cuban is doing here. the sec isn't going to back down and has been quite
dogged about pursuing the case against cuban. i don't see any advantage in
terms of litigation strategy. seems like pure pr.

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guynamedloren
Mark Cuban is my hero. This guy has balls and he's not afraid to use them.

