Legal Malpractice

Lies, Crimes or Legal Malpractice

By (Andrew Lavoott Bluestone)

CEO Gregory Reyes was sentenced this week.  Judge Charles Breyer told him that a false affidavit netted him 21 months rather than 15 months.  Here's the problem for Reyes:  his attorney drafted the document, and admitted his own "poor drafting."

So, is this the rare occurrence when an attorney creates the situation in which his client spends more tim in jail? "Inexact drafting by lawyers for former Brocade CEO Gregory Reyes may have gotten an extra six months tacked onto his stock option backdating sentence.

U.S. District Judge Charles Breyer sentenced the former Silicon Valley icon to 21 months in prison Wednesday. Breyer also imposed a $15 million fine, but did not order Reyes to pay any restitution. Breyer stayed the entire sentence pending appeal.

Breyer indicated, however, he would have imposed a shorter, 15-month sentence had Reyes not submitted a sworn affidavit to the court saying he did not backdate.

Reyes filed that declaration in support of former HR Chief Stephanie Jensen's motion to sever her trial from his. At Reyes' trial, though, his lawyers acknowledged that he did backdate stock options, but said it was done in full view of the company's finance department.

On Wednesday, the judge called Reyes' statements in the declaration "seriously misleading" and an obstruction of justice because they suggested Reyes would provide exculpatory evidence for Jensen when, in fact, he could not.

"The court must have truthful information in order for it to be just," Breyer said evenly.

Reyes' attorney, Richard Marmaro, attempted to take the flak for the declaration, telling Breyer he had been the "proponent" of it, along with Jensen's attorney, Keker & Van Nest partner Jan Little.

The language in the declaration was a product of "poor drafting by the lawyers" and was not meant to apply to all of the disputed Brocade stock option grants, said Marmaro, a partner at Skadden, Arps, Slate, Meagher & Flom. "

Full post as published by New York Attorney Malpractice Blog on January 18, 2008 (boomark / email).