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First female New York attorney general appointed by state Legislature

Barbara Underwood officially became the first woman to serve as attorney general in New York after she was appointed to the role in a joint legislative session Tuesday.

Underwood took over as the acting attorney general for New York after Eric Schneiderman resigned earlier this month amid allegations of assault by multiple women.

She will serve in this position until the end of the year. An election for the next attorney general will be held in November. Underwood has previously said she does not anticipate running for a four-year term in November.

On Tuesday, Underwood released a statement thanking the Legislature for the “privilege” of holding the position of attorney general.

“I want to thank the legislature for entrusting me with the privilege of serving as New York’s 66th Attorney General,” she said. “I’ve served in many roles in government throughout my career. But I believe this job — at this moment in history — is the most important job I have ever had.”

New York Democratic Gov. Andrew Cuomo hailed the appointment, calling Underwood a “brilliant legal mind” in a statement.

“She is a brilliant legal mind and an extraordinarily qualified attorney who has argued 20 cases before the Supreme Court, and she will provide strong leadership and important continuity in the office of attorney general during these challenging times,” Cuomo said.

Kathy Hochul, the New York state lieutenant governor, highlighted the historic nature of the appointment on Tuesday.

“Congratulations to Barbara Underwood, the first woman to hold the position of @NewYorkStateAG. Another #glassceiling shattered,” Hochul tweeted.

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Q1 rankings see resurgence of UK firms, as Freshfields rises up tables

UK law firms have returned to dominance in the Q1 M&A tables after playing second fiddle to the US elite last year, with Freshfields Bruckhaus Deringer rising up the rankings following a busy quarter for the firm.

Figures from Mergermarket show Freshfields topped the European deal value ranking for the first quarter of the year, after acting on 37 deals worth a total of $121bn (£86bn).

While last year the Q1 European M&A rankings were dominated by US firms, this year the top five spots were taken by four magic circle firms and Herbert Smith Freehills (HSF).

Freshfields’ strong showing also saw the firm rise to second in the global M&A rankings, up from ninth last year, after acting on 45 global deals worth a total of $141bn (£100bn).

Skadden topped the global and US deal value tables for Q1, after advising on 47 global deals worth a total of $194bn (£137bn) and 39 US deals worth $170bn (£121bn).

Slaughter and May came top for UK M&A by value, having acted on 12 deals worth a total of $37bn (£26bn), with Herbert Smith Freehills (HSF) second and Clifford Chance (CC) third.

Meanwhile, DLA Piper took the top spot for European deal volumes, acting on 50 deals worth a total of $52bn (£37bn). Kirkland & Ellis took first place for global deal count, acting on 112 deals worth $67bn (£47.5bn) during the quarter, with CMS top for UK volumes with roles on 21 deals.

Total global deal value increased by 18% on Q1 last year to $891bn (£632bn), although global deal volume dropped 19% to 3,774, the lowest quarterly figure since Q3 2013.

Deal count in Europe also fell by 22% year on year to 1,409, the least active quarter since Q1 2013. Despite the fall in deal numbers, total deal value across the continent rose to $256bn (£182bn), a 22% increase on last year’s Q1 total of $211bn (£148bn).

The same trend was seen in the UK, with a fall in the total number of deals coming against an increase in deal value. UK deal numbers for Q1 fell 31% year on year from 386 to 266, alongside a 41% increase in total deal value across the same period to $59bn (£42bn), up from $42bn (£20bn).

HSF M&A partner Caroline Rae said: “Several of the issues we faced in Q1 2017, including Brexit, remain unresolved, but many UK corporates now have the confidence to plough on and execute their M&A strategies despite the ongoing uncertainty.

“One of the key trends in 2018 will be technology as an important factor for M&A strategy. Technology is having an impact across sectors and we are seeing a lot of clients who are looking at how they are going to keep up with their competitors. They are looking to M&A as a way to acquire technology.”

Allen & Overy (A&O) global co-head of corporate Richard Browne added: “The market is strong across a broad base, and we are not seeing any sign of it slowing up. Quite a lot of significant deals have been announced in the quarter, including a lot of good-sized private M&A deals. There are a lot of political macro events out there that can affect the market, but the fundamental dealmaking environment is still strong.”

The rankings are notable for the resurgence of UK firms in the top 10 European advisers by value, with six making the top 10.

Freshfields, Linklaters, CC, A&O and HSF ranked first to fifth respectively, with DLA Piper in eighth. For 2017, the Q1 rankings saw just three UK firms make the top 10 European and UK advisers by value.

The largest UK deal of the quarter was GlaxoSmithKline’s $13bn (£9bn) purchase of a 36.5% stake in its consumer health joint venture with pharma giant Novartis. Freshfields advised Novartis while Slaughters represented GSK.

Slaughters also won a role on the second largest UK deal, representing FTSE 100 engineering business GKN on its bitterly contested takeover by Melrose. Its initial £7bn bid was rejected, but Melrose won support of more than half of GKN’s investors and its subsequent $12.1bn (£8.6bn) bid was accepted last week (29 March).

Meanwhile, the biggest European deal this quarter was E.ON’s €46.6bn (£33bn) deal to acquire a controlling stake in renewable energy business Innogy from German rival RWE. That deal handed key roles to Freshfields for RWE, Linklaters for E.ON and Hengler Mueller for Innogy.

Going forward, partners believe activity levels will continue to hold up, despite Brexit looming on the horizon.

Skadden M&A partner Scott Simpson says: “Everyone saw a slowdown of M&A activity during the time of the Brexit vote and thereafter, but M&A activity has returned. It doesn’t mean the uncertainty is behind us, but people are getting on with their plans and probably concluding Brexit is not going to disturb their long-term investment plan for Europe.”

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Family and consumer law ‘need greater attention under Brexit’

Family law is heading for “the wilderness of uncertainty” under current Brexit proposals, a senior member of the Faculty of Advocates has told MSPs.

A second member called for consumer protection issues to be moved up the Brexit agenda.

Janys Scott QC, chair of the Advocates’ Family Law Association, and James Mure QC, convenor of the Faculty’s International Committee, along with advocate Peter Sellar, a member of the International Committee, gave evidence to the Scottish Parliament’s Justice Committee.

The committee was examining Brexit in relation to family law, and to civil, commercial and consumer law.

Mrs Scott gave an example of a divorce where a wife was in Scotland and the husband was in France. Currently, the wife could start proceedings in Scotland and the French court could not intervene. However, under the EU Withdrawal Bill as currently drafted, courts in the two countries could each deal with the case, and possibly come to conflicting decisions.

“One cannot defend the EU system as perfect, it is a work in progress. But what is proposed is to set us off into the wilderness of uncertainty when we are on a course bringing us greater certainty, albeit it is not perfect,” said Mrs Scott.

Family law was “a long way down the list” of Brexit issues, she added, but it was an important issue for citizens of Scotland and the UK, and she asked the MSPs to help raise the profile of family law.

Her plea was echoed by Mr Mure in relation to consumer protection. He said concern had been expressed widely that consumer protection had not figured sufficiently in UK government papers on Brexit.

“I think there is a need for people to articulate consumer protection particularly…the answer is to bring it up the agenda. These are real issues that will affect people,” added Mr Mure.

Watch the evidence session at https://www.scottishparliament.tv/meeting/justice-committee-january-30-2018

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European backing for agreement to protect rights of lawyers

An agreement protecting the rights of lawyers across Europe has taken a step closer to reality, after a Council of Europe (CoE) body approved plans for a convention specifying those rights.

The Parliamentary Assembly of the Council of Europe (PACE), made up of members of parliament from the CoE’s 47 member states, approved recommendations to draft a convention at a meeting in Strasbourg last week.

The idea will now go to the CoE’s Committee of Ministers for approval. The deadline for approval is nine months. Should ministers approve the plans, a convention will be drafted by an expert committee which, once agreed, would need to be signed and ratified by member states.

The assembly cited an increasing number of threats and attacks against lawyers as its inspiration for recommending the convention. Sabien Lahaye Battheu, PACE rapporteur, said a string of attacks on lawyers has taken place in the past 12 months alone. Last year, hundreds of lawyers were detained after the failed coup in Turkey.

According to the recommendation, the convention should ‘fully respect, protect and promote the freedom of exercise of the profession of lawyer’. The recommendation also considers that there is a need for an ‘early-warning mechanism’ to respond to immediate threats to lawyers’ safety and independence.

The CoE is recommending that the convention be open to non-member states to opt in.

Legal professional bodies, including the Bar Council, have backed the idea.

Law Society president Joe Egan said lawyers must be allowed to carry out their professional duties without interference and should never be identified with their clients or clients’ causes.

The Council of Bars and Law Societies of Europe said the recommendation was a ‘major step forward in the protection of human rights and the rule of law’.

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Hogan Lovells appoints superexam guru

International law firm Hogan Lovells has created a new position to oversee implementation of the solicitors’ superexam which is set to spell the death knell for the LPC from 2020.

Edward Brown, a partner in the firm’s pensions practice, will take the lead on the firm’s ‘input into and implementation’ of the new Solicitors Qualifying Examination (SQE).

Brown, who will work with the rest of the graduate recruitment team, is a member of the trainee recruitment interview panel and has supervised trainees. According to the firm he ’trained with the firm and progressed to partnership, so has a wealth of experience that will prove invaluable in managing SQE implementation.’

Meanwhile litigation partner Crispin Rapinet has agreed to become the firm’s new training principal. His role began with effect from 1 January. Rapinet will work alongside graduate recruitment partners Louise Lamb and Jon Chertkow, overseeing legal training and helping to guide graduate trainees through their qualification as solicitors.

Rapinet said: ’The new SQE is a major change for the legal industry – firms and prospective trainees alike. Implementing a qualification process that meets the crucial aim of widening access to the profession and ensures a consistent and high quality calibre of qualified lawyer is no small task. The addition to our team of a colleague with a dedicated focus on its implementation, who can give detailed and due consideration at every stage as we work with the SRA and develop our offering, is an important asset.

’Brown trained with the firm himself and progressed to partnership, is a member of our trainee recruitment interview panel, and has supervised trainees. This wealth of experience of the system will prove invaluable in managing the new SQE implementation.’

City firms have already begun airing concerns over the SQE. The City of London Law Society suggesting that transitional arrangements for implementing the exam may need to be delayed to ensure firms have time to prepare for changes to training courses.

Developments are set to pick up pace in the first quarter of this year when the Solicitors Regulation Authority is due to appoint an assessment partner for providing the exam. After the appointment, expected to be in February or March, information on prices and assessment details will begin to emerge.

This week the SRA rejected fears that the new qualifying route would be a ’cash cow’ by pledging that any profit from the scheme will be paid into an ‘access and investment’ fund.

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City watchdog consults on huge expansion of ombudsman scheme

City watchdogs want to radically expand access to redress for tens of thousands of small businesses that cannot afford the legal costs of taking banks and other financial services providers to court.

In a consultation paper today, the Financial Conduct Authority proposes bringing an additional 160,000 SMEs within the remit of the Financial Ombudsman Service (FOS), which has the power to order compensation for loss up to £150,000. This would be achieved by greatly increasing the eligibility threshold for referring complaints to the ombudsman, which presently covers only individual consumers and microbusinesses.

Today’s development follows a Commons debate last Friday on calls for a formal tribunal system to deal with such disputes, spurred by controversy enveloping Royal Bank of Scotland and its Global Restructuring Group. Barrister Richard Samuel of 3 Hare Court, principal author of the tribunal plan, insists this route would be ‘100% better’ than expanding the ombudsman scheme because tribunals can ‘change culture’ and develop the law.

In today’s consultation, the FCA points out that many SMEs struggle to resolve disputes with financial services providers through the courts and have few alternative routes to redress. Only a tiny proportion of SMEs go to court as the associated legal costs can swallow up a large chunk of the claim.

’Not all legal action requires a court hearing, but even starting legal proceedings can be very expensive,’ says the FCA. ’The court fee alone for starting a claim of over £10,000 is 5% and fees are only capped once the value of the claim goes over £200k. SMEs might also be discouraged from taking issues to court by the prospect of having to cover the other party’s legal costs.’

Under the FCA’s plan, about 160,000 additional SMEs would be able to refer complaints to the ombudsman. The watchdog wants to widen eligiblity to those with turnover below £6.5m, an annual balance sheet total under £5m and fewer than 50 staff.

The FCA points out that a more formal scheme of resolving disputes – such as a tribunal – would require legislation, ‘which only the government is in a positon to bring about’.

But Richard Samuel dismissed this, pointing out that primary legislation already exists in the form of the Tribunals, Courts and Enforcement Act 2007. ’You could simply expand an existing chamber or bolt on a new one,’ he told the Gazette.

Samuel suspects the Treasury has little appetite for establishing a new tribunal as its civil servants grapple with Brexit. But he believes a new tribunal would not be difficult to establish or expensive, as funds could simply by reallocated from mass redress schemes that are being closed down anyway.

’Tribunals could change banking culture,’ Samuel stressed. ’Look at how employment tribunals moved us on from the “master-slave’ scenario to the current framework of unfair dismissal and discrimination. A second factor in the favour of tribunals is that they apply and create law – the ombudsman service does not, merely coming to a “reasonable outcome”. If we want the law to develop that is the way to go.’

Samuels also pointed out that the ombudsman service is not wholly independent in that it is funded by the banks.