As we've mentioned before, Lavi Soloway has posted some great coverage of yesterday's hearing in Aaron Charney v. Sullivan & Cromwell. He offers detailed discussion of the arguments before Justice Bernard Fried, his impressions of them, and original photos.

You can access Soloway's two posts here and here. They're well worth your time.

Some excerpts, with commentary from us, appear after the jump.

From Soloway's initial post:

Fried began by reciting a list of letters he had received from attorneys on both sides. It was a cross-correspondence (still done the old fashioned way) that, to my ear at least, seem to reflect a heated difference of opinion below the surface between two famed and respected attorneys, Michael Kennedy (for ABC) and Charles Stillman (for S&C). The skirmish centered on whether Charney's lawyers' should be allowed to conduct depositions that would, in part, reveal what happened at the January 31, 2007 settlement conference.

Normally settlement discussions are off limits for discovery. But here's why Charney's lawyers wanted to get into this:

Charney's lawyers, relying on their client's affidavit, allege that an S&C partner ordered Charney to destroy his home computer hard drive. According to this theory, not only were there abundant witnesses to the "order to destroy," but notes were taken of this exchange. Only one individual was permitted to take notes at the settlement conference. That person was mystery man, Gera Grinberg.

Yes, Gera Grinberg (who from all accounts is not gay) was the associate with whom Charney is reported to have worked most closely, and it was this closeness that allegedly inspired a partner's accusation that they had an "unnatural relationship." And what law firm seems to have managed to also become entangled in this whole mess? The prestigious law firm of Gallion & Spielvogel.

The plot thickens:

At the settlement conference, only Gera Grinberg was allowed to take notes. Gera Grinberg, it turns out, handed those notes over to his lawyer Edward Gallion (who also happened to have been a former S&C associate). Apparently Grinberg expected Gallion to maintain the notes in safe keeping. However, it is undisputed now that Gallion in fact destroyed them. Now comes Mr. Kennedy and requests that Gallion be deposed on the issue of those notes, because, as Mr. Kennedy, building to a climax, pointed out, that would REALLY be an issue of spoliation! If Gallion destroyed the notes as is now alleged by Charney's attorneys, and if those notes contained proof that S&C partner Gondolfo V. DiBlasi ordered the hard drive's destruction, this would seem to undermine S&C's claim that Charney should be scrutinized for spoliation.

Oh goodness -- this is looking messy for Ed Gallion. Did he have the best interests of Gera Grinberg at heart? Or was he looking out for his former employer, Sullivan & Cromwell?

(We'd be interested in finding out whether S&C referse business to Gallion, e.g., in cases where they are conflicted out.)

Back to Soloway:

Just when you thought you had enough excitement for one day, along comes a new character in this Law & Order episode unfolding drama, as if on cue. He rises from the gallery and approaches the well of the court, encouraged, it seems, by Mr. Alterman. He is one Gary Edward Ireland, Esq. Mr. Ireland is.... Gera Grinberg's new attorney. Apparently, Grinberg is no longer represented by the prestigious (?) firm of Gallion & Spielvogel. What's more, Ireland was beckoned up to the podium by the judge (yes, it was just like you watch on TV, very spontaneous). Judge Fried asked Mr. Ireland to make his appearance for the record noting that Ireland was not there as an attorney for any of the parties but might be in possession of useful information (we learn he is a solo practitioner with offices on Fifth Avenue). Judge Fried then asked (paraphrasing): "Counsel, where are those notes taken at the January 31 settlement conference by his client, Gera Grinberg?" Ireland replied that it was his understanding that Gallion destroyed the notes. (Ireland then offered in open court one more piece of information about the fate of Mr. Grinberg's former counsel, Mr. Gallion, which I'm not yet posting.) There ensued a bit of a spat as Charney's lawyers willfully implied that Gera Grinberg's original representation may have been influenced by their past affiliation with S&C, and that the destruction of the notes may have been done to serve S&C's interests (it's hard to see how any of this benefits or hurts Mr. Grinberg). Charles Stillman, furious at this implication, made every effort to cast Gallion as completely independent (chosen by Grinberg, happened to work for S&C a decade ago, etc.) from S&C. Understandably!

Oh Lordy! It just gets more and more insane, doesn't it?

Now we get to Lavi's second post. Soloway describes the argument before Justice Fried between Michael Kennedy and Charles Stillman.

This part confused us. We agree with Lavi's take:

Then Stillman dropped another bombshell. Attorney Edward Gallion, Stillman assserted, was present at the settlement conference to be "of assistance to Aaron Charney" as well as to represent Gera Grinberg. That one sentence seemed to me to suggest that Kennedy was not so far off the mark when he asserted that Gallion was not solely the independent actor one might expect. Once those words left Stillman's lips I started to think: did S&C think bringing friendly Gallion & Spielvogel into the mix would help both Grinberg and Charney see the light, co-operate with a settlement, move on, end this whole sordid affair? Why would Charles Stillman state that Gallion was there to "assist" Aaron Charney? Charney's interest do not seem to be aligned iwth those of Grinberg. It seems to me that Charney should have had his own counsel at that January 31 meeting, but to "share" counsel with Grinberg? That makes no sense to me. Stillman was, perhaps, trying to put a more compassionate spin on the presence of Gallion intot he mix. He was there to help..... He does not seem to have helped Aaron Charney by destroying the extensive notes of that meeting, right? I can't be the only one who noticed that this peripatetic extemporaneous attempt at spin was leading no where useful.

Something fishy is definitely going on here...

Well, at least Lavi got some good pictures at the hearing. Here's a nice photo of Charney descending the courthouse steps with his counsel. Cool!

What Happened to the Notes Taken at the Settlement Conference? [Soloway]
Posturing on the Slippery Slope: The "Reign of Terror" and the Appearance of a Second Hard Drive [Soloway - Continued]