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Q&A With Lane Powell's Doug Greene
Law360, New York (April 16, 2013, 2:19 PM ET) -- Douglas W. Greene is a shareholder in Lane Powell
PC's Seattle office. He co-chairs the firm's securities litigation group. For more than 15 years, his practice
has focused exclusively on defending public companies and their directors and officers in securities class
actions, mergers and acquisitions litigation, shareholder derivative actions, and U.S. Securities and
Exchange Commission investigations and enforcement proceedings, and on conducting internal
corporate investigations.
Q: What is the most challenging case you have worked on and what made it challenging?
A: Part of what I find so satisfying about being a securities defense lawyer is that nearly every case is
challenging, with a fresh mix of facts and law that presents a unique puzzle. But my most challenging
case would be one from early in my career — the Boeing securities class action filed in 1997. It jumpstarted my career as a securities litigator. I started the case as an associate and finished it as a partner,
and have defended securities litigation matters exclusively ever since.
The lawsuit followed a stock drop caused by a $1.6 billion charge against earnings related to the
shutdown of airplane assembly lines. The part of the case that most of the defense team gravitated
toward was the facts behind the assembly line shutdowns. The accounting part was less glamorous, but,
for loss causation reasons, I thought it was the most important. I ended up being right, and volunteering
to work on it was a career-defining decision. As a young lawyer, I got the opportunity to defend the key
accounting depositions, including the chief financial officer’s deposition, and to work with several
renowned accounting experts. It was fascinating and challenging work, and the relationships I developed
have served me well.
Q: What aspects of your practice area are in need of reform and why?
A: As I have written on my firm’s D&O Discourse blog, reforms are needed to curb plaintiffs’ misuse of
“confidential witnesses” and to rein in indiscriminate M&A litigation. But not all of the reforms needed
in my practice area relate to the conduct of the plaintiffs’ attorneys. On the defense side, there is a
looming challenge: Typical D&O insurance limits are becoming too low to accommodate rapidly rising
defense costs, while still leaving room for settlement payments. Absent a solution, companies will need
to increase their D&O limits just to pay for increased defense costs.
The sources of the problem are plain. A small number of firms defend the vast majority of securities
class actions, and their billing rates have skyrocketed during my career as a securities litigator. In
addition, most of those firms feature high associate-to-partner ratios, which yields less hands-on partner
involvement, and often results in heavy staffing. All this creates a securities defense system that costs
more, even while sometimes delivering less strategic results.
This year, I moved to a Pacific Northwest firm where billing rates are significantly lower than they would
be at most national securities practices, and where there is a one-to-one partner-to-associate ratio. This
allows me the luxury of defending cases with greater personal involvement, economic flexibility and a
more focused, strategic approach. But it will be a challenge for most other national securities litigation
practices, and their clients, to address this looming problem.
Electronic discovery also continues to push defense costs higher. As the number of documents kept by
companies continues to rise exponentially, we need to continue to find more effective strategies to
combat rising costs. The system of document review most firms now use — document-by-document
review by associates with high hourly rates, sometimes combined with contract lawyers — is a
throwback to the days of paper documents. It is antiquated, ineffective and uneconomical.
Technology has advanced to the point where computers, with thoughtful priming from the most
knowledgeable lawyers, can categorize documents not only more cheaply, but also more accurately,
than associates can — and quickly point attorneys to the documents that are actually important to a
case. Appropriate use of this technology is vital to more responsible, efficient and strategic use of
discovery resources.
Q: What is an important issue or case relevant to your practice area and why?
A: Perhaps the most striking part of the U.S. Supreme Court’s recent decision in Amgen Inc. v.
Connecticut Retirement Plans was Justice Samuel Alito’s one-paragraph concurrence, which baldly
called for reconsideration of the fraud-on-the-market presumption articulated in Basic v. Levinson. This
doctrine makes securities class actions possible by eliminating the need for class members to prove
individual reliance on a company’s allegedly false statements. It creates a rebuttable presumption of
reliance for the whole class, based on the assumption that the price of a security traded in an “efficient
market” reflects all material public information, and that all traders in that market rely on that price, and
by extension on any material misrepresentations.
Alito’s concurrence signaled that he agreed with three judges in the Amgen dissent, who called Basic’s
presumption “questionable.” Even the Amgen majority did not defend Basic, instead noting with
apparent relief that the court had not been asked to revisit it. Considered together, these three opinions
put out a welcome mat for the right case challenging Basic. When Basic is reconsidered, the result could
have a large impact on the future of securities litigation, by calling into question the very foundation
upon which class actions are built.
Q: Outside your own firm, name an attorney in your field who has impressed you and explain why.
A: Through the course of my career, I’ve worked with many excellent securities litigators, but Jack
Auspitz of Morrison & Foerster stands out. He was the lead liaison counsel for the issuer defendants in
the IPO securities litigation — the so-called “laddering” cases filed in the Southern District of New York
beginning in the late 1990s, against more than 300 issuers and their directors, officers and underwriters.
The litigation could have been a case-management train wreck, but the court wisely organized the
parties into groups, and appointed liaison counsel for each. I represented two of the issuer defendants,
and Jack was our liaison counsel.
He did a masterful job fulfilling the court’s mandate that the issuers speak as a group, by synthesizing
the strategic views of dozens of other lawyers. I sometimes flew across the country to attend meetings
to make sure my clients’ views were adequately considered — and Jack handled my advocacy with great
respect and diplomacy.
Q: What is a mistake you made early in your career and what did you learn from it?
A: Slowly but surely, over the course of my career, I found I was becoming someone I didn’t want to be. I
did not fully appreciate this until I moved to Lane Powell last summer, and realized that the world of
“big law” was a poor match for my personality. It caused me to become too preoccupied by firm
economics and internal politics, so that I became less considerate and allowed my stress to impact my
colleagues.
I moved to Lane Powell because I finally recognized that I needed a different environment, and that this
didn’t need to come at the expense of my practice. To the contrary, Lane Powell allows me a new
freedom to shape my practice to serve clients in the most effective and efficient way. I wasn’t trying to
slow down. And I haven’t. But the environment is just different, with more reasonable economics, less
partner-to-associate leverage, and a more collegial attitude. This environment not only makes me
happier — but it also makes me a better person. And for me, that means I’m also a better lawyer.
The opinions expressed are those of the author and do not necessarily reflect the views of the firm, its
clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general
information purposes and is not intended to be and should not be taken as legal advice.
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