By Reuben Guttman

Federal prosecutors have indicted former baseball star pitcher, Roger Clemens, for lying to Congress about his alleged use of steroids.

Whether Roger Clemens took steroids and whether, if he took steroids, his statistics need to be placed in a different light undoubtedly is proper banter for the sports pages.

This country has a drug problem but the focus of that problem is not the baseball diamond. There are - as I have said in this blog - more children watching baseball who are on performance enhancing drugs than there are players who play professional baseball. Pharmaceutical companies place drugs on the market that are not safe or effective, and then the companies proceed to misrepresent to the medical community and the public the truth about their products. Meanwhile, our health care systems bear the costs of paying for these products and the damage they cause.

Maybe it is a lot easier and more interesting - at least for the TV news as it currently exists in a withered state - to focus on Roger Clemens. Unfortunately, the “tragedy of the Clemens” is that there is indeed a real drug problem in this country and Roger Clemens has nothing to do with it. Congress and prosecutors need to focus their attention elsewhere. At the end of the day, a multi-million dollar trial of Mr. Clemens will do nothing more than embarrass a former baseball star who at worst made the mistake of not being candid about a subject that - probably from his perspective - should not be one of material public importance.

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By Reuben Guttman

There are approximately 875 federal judicial slots, and approximately 90 openings, give or take. The President is not appointing judges quickly enough, and when he does submit nominations, the Senate is delaying their confirmation. Up on Capitol Hill, the Democrats are blaming the Republicans for holding up judicial nominations, while the Republicans counter that the Democrats are naming candidates unworthy of appointment.

Caught in the middle are those working men and women who need a fully staffed federal court system. Who is it that uses the federal judicial system? It is working people, shareholders, and consumers. Laws protecting the environment, employee savings, the rights of shareholders, and the rights of workers on the job are federal laws that for the most part get enforced in federal court. Those who seek to invoke these laws for their protection are not large corporate interests but working people. Cut back on the number of judges and justice is delayed. And, as the British Statesman William Ewart Gladstone was reported to have said: "Justice delayed is justice denied."

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By Reuben Guttman

Ken Feinberg, who has been tasked to administer British Petroleum's $20 billion cleanup fund, may be one of the nation's great problem solvers, and by all accounts he is a decent guy. He took on the task of administering a 9/11 Victims Compensation Fund and he served as "Pay Czar," overseeing the salaries of Wall Street executives whose firms received bailout monies.

In contrast to the work he did with the 9/11 Fund, Mr. Feinberg recently announced that his foray into the Gulf is not free of charge. Aside from being compensated for his work in the Gulf, the New York Times has reported that he is flying around in a plane owned by British Petroleum.

Clearly, Mr. Feinberg deserves to be paid a handsome fee, and because his time is precious these days, it is understandable that he is not using commercial planes to ferry him from meeting to meeting. This does not mean that victims of the disaster do not need to know the score. How much is Ken Feinberg being paid and who is paying him? What is the deal he has with regard to the use of BP's aircraft?

Disclosing this information is really not about exposing a scandal as much as it is about creating the transparency that gives oil spill victims confidence in an individual who claims he is not beholden to BP or the White House.

The alternative to Mr. Feinberg's processes is a court system that is over-burdened in such a way that justice for the spill victims will not be swift. Despite its inefficiencies, however, our nation's judicial system was established to be open and impartial. It is designed this way because we recognize that the matter of due process and process devoid of conflicts of interest leads to results that are easier to accept. If Mr. Feinberg wants to convince spill victims that his processes have the same if not greater integrity than the judicial system he needs to makes some disclosures. If he does not make these disclosures, at some point he will lose the trust of the very victims he hopes to help. Mr. Feinberg has a lot to offer. He needs to make the right decision. 
 

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By Reuben Guttman

Stocks and bonds are called securities. There is a cost to purchase securities and the cost is a factor of what the company says publicly about its product and its financial prospects. People either buy securities directly through brokers or they purchase them indirectly through their retirement plans. Some people think that only wealthy people own securities. The truth is that most Americans who participate in some form of retirement plan own stock at least indirectly.

Sometimes corporate executives lie about their company’s product, the services it renders, or how much money the company made. One reason they do this is because they are compensated with company stock and want to push the price of the stock as high as possible so they can sell it before the market learns that it is not as valuable as it was thought to be. This is called "insider trading" and it is illegal.

Once the market catches onto the lies made by corporate leaders, the price of the security drops meaning that investors, including hard working Americans, have invested in something that has lost some if not all of its value. Enron is a case in point.

Investors can bring suit where they have been victimized by securities fraud but those suits only happen after it is too late; after the fraud has caused the loss of precious retirement savings.

Last week, President Obama signed a whistleblower law that will allow individuals to report securities fraud to the Securities and Exchange Commission (SEC) well before the fraud causes injury to shareholders. The law provides whistleblowers with a "bounty" or reward which can be as high as 30 percent of the money or sanctions that the SEC collects from the wrongdoers. To become a whistleblower, an individual must have original information about the fraud or the individual must have conducted his or her own original analysis of information which would confirm the fraud. The law expands the oversight of our securities law well beyond the limited investigatory and oversight ability of the SEC and other federal agencies. It is a powerful tool.

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By Reuben Guttman

Harvard University Medical School has issued a revised conflict of interest policy precluding faculty from taking gifts or gratuities from the pharmaceutical industry. The policy also precludes participation in programs where the faculty member's opinions are restricted.

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By Reuben Guttman

There are more disputes than ever these days, and it turns out that there are not enough judges to handle them.

According to the Administrative Office of the U.S. Courts, there are 875 Federal Judicial slots, including nine Justices of the Supreme Court, 179 Appellate Court Judges, 678 District Court (or trial) Judges and nine Judges of the Court of International Trade. There are currently 98 openings, including 20 Appellate Court slots and 78 District Court slots. This does not count the Supreme Court opening where President Obama has nominated Elena Kagan to fill the seat held by retiring Justice John Paul Stevens.

With 98 judicial openings, only 44 nominations are pending before the Senate for confirmation. It seems that the President is not acting quickly enough to fill the openings and the Senate is moving too slowly in confirming them.

It is not as if the justice system can afford all of these open seats. Undoubtedly, everyone who lives near the Gulf wants his or her day in Court. Meanwhile Big Pharma continues to market drugs that do not work or cause injury, and odds are that the new financial reform package will not eliminate the type of wrongful conduct that has historically caused the masses to run to the courthouse. Meanwhile, and just to make the point that I am evenhanded, every white collar criminal, from Jeffrey Skilling to Conrad Black, needs some judge's attention for a "Get out of Jail Free Card."

The Senate could say that it has better things to do, but it seems that a good bit of its time is spent passing legislation to fix what the Court's broke. Remember the Lilly Ledbetter Fair Pay Act, which was the first bill President Obama signed? That legislation did not really create additional rights for women and minorities. It just restored the rights that the Supreme Court took away in Ms. Ledbetter's case against her employer. And than there is the "False Claims Corrective Act" which corrected what the Courts got wrong. Than there are several versions of legislation floating through the halls of congress to address a myriad of court opinions compelling private arbitration of disputes and thus denying litigants their right to a hearing in open court. I suppose if everything was arbitrated or decided behind closed doors, there would not be much "corrective" legislation because legislators would not know what to correct. Whether this has been the intent of those judges who write these opinions, it is a lot easier to see how judges favor resolution by private arbitrators when there is a shortage of federal judges. If I were an  overworked judge, I might consider hanging a sign on my door that said "take your disputes elsewhere."

So here is the bottom line: Congress can spend its time creating laws that prevent disputes but undoubtedly even those laws end up being disputed. It seems like the simple solution is for the President to start nominating and for the Senate to start confirming. It seems like the Constitution says something about this process.

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