A daily look at legal news and the business of law:

Time to Reassess Foreclosure Documents


A Bloomberg report shows homeowners' attorneys' claims were right: The problem of faulty foreclosure documents was not limited to GMAC. A JPMorgan Chase (JPM) employee testified in a deposition that she was one of eight managers who combined to sign some 18,000 documents a month without the personal knowledge the documents claimed they had. As these revelations come out across the industry, the foreclosure market is likely to shut down while courts figure out what to do. Already-sold foreclosures may have their titles clouded. Foreclosures under way will be stopped or slowed while documents are checked, and future foreclosures will be delayed. That's because the improper affidavits leave open the possibility that the foreclosing bank doesn't really own the loan it's foreclosing on. After all, not all accusations of bad mortgage documentation involve "technicalities."

Of course, there's one easy thing the banks can do to address this mess, assuming they still want to foreclose on all these properties: Hire enough people to have employees personally and properly verify the information in the documents they sign and send to court.

Massey Mine Investigation Trying to Get Serious

One of the challenges facing the federal Mine Safety and Health Administration is that it can only subpoena witnesses if it holds a public hearing, but can only give whistle-blowers anonymity if it doesn't. But without subpoenas, it's hard for MSHA to get the information it needs. Perhaps that's why West Virginia has decided to wield its own, separate subpoena power to get reluctant witnesses to cooperate in the investigation of the April explosion at Massey Energy's (MEE) Performance coal mine, which killed 29 people. The state is assisting the federal investigation in a backdoor sort of way -- at least, that's what Massey managers subpoenaed by West Virginia are claiming as they ask a judge to quash the subpoenas, reports Bloomberg. Based on the logic of that argument, it's somehow not surprising that the witnesses the feds are having trouble with are Massey managers.

And in the Business of Law:

Winston & Strawn were kicked off Pfizer team in the $1 billion suit Brigham Young University brought against the drugmaker over Celebrex and BYU's research underlying Celebrex, reports the National Law Journal. The firm had been representing BYU when it took on Pfizer (PFE), and the judge ruled BYU didn't waive the conflict. Moreover, the judge found, the Winston & Strawn partner who had represented BYU since 2001 in other patent matters impermissibly got involved the BYU/Pfizer case, trying to act as a go-between and persuading BYU to share information about the case with him despite the fact that his firm was representing Pfizer.

Six partners have left Lytal Reiter to set up their own firm, reports the ABA Journal. While the number of partners involved makes the defection noteworthy, as only 10 attorneys were listed on the firm's website Monday morning, what makes the departure really striking is the way the partners went about it: They gave one hour's notice. The defectors included a partner who had been with the firm for 25 years.

• Facebook is not just for divorce attorneys anymore, reports the ABA Journal. Now Facebook is a powerful tool for debt collectors to target people behind on their payments. Melanie Beacham missed some car payments while she was on medical leave from her job, and the debt collectors tracked her down on Facebook, sending messages to her sister and a cousin as part of their efforts to get paid. Beacham has sued for invasion of privacy and harassment, plus a court order banning similar contacts in the future.

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