{"id":246945,"date":"2025-05-19T08:16:25","date_gmt":"2025-05-19T08:16:25","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/legal\/risk-roundup-private-equity-pursuing-new-client-culture-ethics-opinion-creative-law-firm-investment-strategies-conflicts-concerns-in-mexican-judicial-elections-firm-employees-pro-bono-b\/"},"modified":"2025-05-19T08:16:25","modified_gmt":"2025-05-19T08:16:25","slug":"risk-roundup-private-equity-pursuing-new-client-culture-ethics-opinion-creative-law-firm-investment-strategies-conflicts-concerns-in-mexican-judicial-elections-firm-employees-pro-bono-b","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=246945","title":{"rendered":"Risk Roundup \u2014 Private Equity Pursuing New, Client Culture Ethics Opinion, Creative Law Firm Investment Strategies, Conflicts Concerns in Mexican Judicial Elections, Firm Employee&#8217;s Pro Bono Billing Bad,"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div id=\"post-9164\">\n<p>\t<!-- .entry-header --><\/p>\n<div class=\"entry-content\">\n<p><img fetchpriority=\"high\" decoding=\"async\" class=\"aligncenter size-full wp-image-3182\" src=\"https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2021\/08\/2021_news_typewriter.jpg\" alt=\"\" width=\"480\" height=\"273\" srcset=\"https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2021\/08\/2021_news_typewriter.jpg 480w, https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2021\/08\/2021_news_typewriter-300x171.jpg 300w, https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2021\/08\/2021_news_typewriter-230x131.jpg 230w, https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2021\/08\/2021_news_typewriter-350x199.jpg 350w\" sizes=\"(max-width: 480px) 100vw, 480px\"\/><\/p>\n<p>\u201c<a href=\"https:\/\/www.washingtonpost.com\/world\/2025\/05\/12\/mexico-judicial-election-narco-ties\/\"><strong>This lawyer was counsel to El Chapo \u2014 and could soon be one of Mexico\u2019s judges<\/strong><\/a>\u201d \u2014<\/p>\n<ul>\n<li>\u201cWhen the Mexican government announced it was holding the world\u2019s largest judicial election \u2014 with voters electing thousands of magistrates and an entirely new Supreme Court \u2014 it hoped to bring fresh faces into the legal system.\u201d<\/li>\n<li>\u201cWhat it didn\u2019t expect was El Chapo\u2019s lawyer.\u201d<\/li>\n<li>\u201cYet here is Silvia Delgado, 51, in a snug black minidress and four-inch heels, handing out leaflets and smiling brightly at vendors at a Sunday flea market. Eight years ago, she was counsel to Joaqu\u00edn \u2018El Chapo\u2019 Guzm\u00e1n when he was extradited from this city\u2019s fortresslike prison to New York. She accompanied his beauty queen wife, Emma Coronel, during the U.S. trial that ended with his life sentence. Now Delgado hopes to be a criminal-court judge, in a state where El Chapo\u2019s Sinaloa cartel remains powerful. \u2018I hope I can count on your vote!\u2019 she calls to bargain-hunters.\u201d<\/li>\n<li>\u201cThe June 1 judicial election, intended as a radical exercise in democracy, has increasingly been overshadowed by concerns about penetration by drug-trafficking groups. The Catholic Church and the U.S. government have warned that narcos may try to put their own candidates on the bench. There has been a string of startling revelations about the candidates. One used to be an attorney for a leader of the Zetas \u2014 a cartel that \u2018disappeared\u2019 thousands of people. Another candidate served six years in a Texas jail for possession of methamphetamine.\u201d<\/li>\n<li>\u201cPresident Claudia Sheinbaum has pointed out that the scandals involve only a small number of candidates. Legal scholars have cautioned that it\u2019s no crime to defend an accused trafficker; Delgado said she provided \u2018the same kind of defense as in any other job\u2019 to El Chapo, a legendary drug lord whose exploits were chronicled in two Netflix series.\u201d<\/li>\n<li>\u201cYet legal analysts say the reports about questionable candidates underscore the inadequate screening by Mexico\u2019s government, which set few requirements for those running. Until now, most judges were selected through a civil-service system based on exams and experience. Under the new rules, legal scholars fear, candidates will owe their election not to the judicial system, but to groups that can round up votes for them \u2014 including from organized crime.\u201d<\/li>\n<li>\u201cSheinbaum\u2019s government, stung by the revelations, is now moving to exclude at least 18 judicial candidates. But analysts say the threat goes beyond the handful of \u2018narco lawyers\u2019 highlighted in media reports. Drug traffickers have already shown their political clout by installing scores of mayors in Mexican towns in recent years. Why wouldn\u2019t they try to quietly impose their own judges?\u201d<\/li>\n<li>\u201cThe new judicial system is the brainchild of former president Andr\u00e9s Manuel L\u00f3pez Obrador. Like President Donald Trump, the Mexican leader attacked judges who blocked his actions, calling them corrupt and politically biased. He also shared Trump\u2019s enthusiasm for big, bold changes in government. If the judicial system wasn\u2019t working, why not create a new one? When his Morena party swept elections last year, and Sheinbaum became his successor, they did just that.\u201d<\/li>\n<li>\u201cNow, the entire Supreme Court and half of federal judges \u2014 roughly 850 \u2014 will be chosen by voters. The other half will be replaced in 2027. Mexicans will also select about 1,800 state magistrates. The requirements to run are minimal: as little as three years\u2019 legal experience, letters of recommendation from colleagues or neighbors, and lack of a criminal record. More than 50,000 candidates were screened in a few weeks by the federal and state governments.\u201d<\/li>\n<li>\u201cMeza\u2019s group labeled Delgado a \u2018highly risky\u2019 candidate. \u2018The minimum risk in these cases is conflict of interest,\u2019 Meza said in a cafe in the capital\u2019s trendy Roma neighborhood, where indie pop mixed with the hissing of milk being steamed for lattes. \u2018You can\u2019t one day be defending the Sinaloa cartel, and the next day be in a job where you\u2019re judging a lot of people who belong to the Sinaloa cartel.&#8217;\u201d<\/li>\n<li>\u201cDelgado, who\u2019s running for state judge, notes that drug trafficking is a federal crime, so she wouldn\u2019t handle such cases. Still, she could face Sinaloa cartel members accused of homicide, extortion, car theft or small-scale drug sales.\u201d<\/li>\n<li>\u201cShe dismisses the concerns raised by Defensorxs. \u2018They don\u2019t understand that when lawyers defend a person, what you defend are his individual rights. You defend his right to an appropriate technical defense.&#8217;\u201d<\/li>\n<\/ul>\n<p>\u201c<a href=\"https:\/\/www.law.com\/americanlawyer\/2025\/05\/12\/private-equity-has-its-eye-on-us-law-firms\/\"><strong>Private Equity Has Its Eye on US Law Firms<\/strong><\/a>\u201d \u2014<\/p>\n<ul>\n<li>\u201cLaw firms have long prided themselves on independence and tradition, but the reality is shifting. Smart money is eyeing firms as scalable, under-optimized businesses ripe for investment. A new wave of capital is coming\u2014and it promises management expertise, technology upgrades, and demands for growth.\u201d<\/li>\n<li>\u201cBut this isn\u2019t just about who cuts the check. It\u2019s about regulation, culture, and control. Before you crack the door open to outside capital, you need to know the rules of the game and the risks of letting the wrong partner in.\u201d<\/li>\n<li>\u201cAfter years of saturation in tech and healthcare, private equity investors are looking for new frontiers. Law firms offer exactly what they\u2019re hunting for: recurring revenue, strong client relationships, and plenty of room for operational improvement. In a world obsessed with \u2018platform plays,\u2019 law firms represent untapped potential. They are inherently relationship driven, increasingly technology enabled, and capable of building cross-selling opportunities across service lines. The right investment could transform a regional player into a national powerhouse.\u201d<\/li>\n<li>\u201cStill, there\u2019s a catch\u2014and it\u2019s a big one. ABA Model Rule 5.4 bars non-lawyers from sharing in legal fees or owning interests in law firms. It\u2019s designed to protect attorney independence, ensuring that the duty to clients remains paramount. For private equity, that means the usual playbook of majority ownership and profit-sharing is off-limits. Ownership must stay firmly with licensed attorneys.\u201d<\/li>\n<li>\u201cIn the U.S., without widespread reform, firms and investors are getting creative. Some spin up affiliated companies in tech or consulting where PE can invest. Others create management companies that own the operational backbone but leave the legal practice untouched. And some are partnering with ALSPs (alternative legal service providers) where private equity can take a more traditional stake.\u201d<\/li>\n<li>\u201cThese models are innovative, but they\u2019re not without risk. Ethical landmines are everywhere.\u201d<\/li>\n<li>\u201cBecause here\u2019s the hard truth: the firms that chase growth at all costs will find themselves answering to new masters who care more about quarterly returns than client outcomes. In other words: be careful what you wish for.\u201d<\/li>\n<\/ul>\n<p>David Kluft notes: \u201c<a href=\"https:\/\/www.linkedin.com\/posts\/davidkluft_legalethics-law-activity-7320412309493882880-58Hg\"><strong>Can I represent a client whose culture I don\u2019t understand?<\/strong><\/a>\u201d \u2014<\/p>\n<ul>\n<li>\u201cOregon Opinion 2024-3 addresses situations in which a lawyer is representing clients from another country, whose language and culture the lawyer does not share, and the lawyer therefore may not be aware of \u2018cultural taboos, expectations, family norms, or communication and conflict resolution styles, factors that could significantly affect the quality or usefulness of the lawyer\u2019s representation and advice.&#8217;\u201d<\/li>\n<li>\u201cTurning to the rarely discussed Rule 2.1, the opinion states that the duty of competency includes not just knowledge of the law, but an awareness of the \u2018moral, economic, social and political factors, that may be relevant to the client\u2019s situation.&#8217;\u201d<\/li>\n<li>\u201cA lawyer who may not understand these factors does not have to turn down the representation but can gain the necessary competence through independent study, discussions with their clients, or associating with other competent assistance.\u201d<\/li>\n<\/ul>\n<p>\u201c<a href=\"https:\/\/www.legalcheek.com\/2025\/05\/eversheds-employee-barred-after-invoicing-for-pro-bono-work\/\"><strong>Ex-Eversheds employee barred after invoicing for pro bono work<\/strong><\/a>\u201d \u2014<\/p>\n<ul>\n<li>\u201cAccording to the Solicitors Regulation Authority (SRA), Thomas Elliott was a non-legally qualified project coordinator at the firm and also served as club secretary for a local football team. When a footballer was investigated by a local sports association for disciplinary proceedings, Elliott introduced the player to the firm as a pro bono client.\u201d<\/li>\n<li>\u201cHowever, after the matter was resolved, Elliott created two invoices on the billing system seeking to recover costs associated with defending the footballer \u2014 even though the firm had worked on the matter on a pro bono basis.\u201d<\/li>\n<li>\u201cThe first invoice, dated 2 August, totalled \u00a379,926.95 and the amount sought was \u00a339,963.47. A second invoice, issued two days later, totalled nearly \u00a396,000. After these invoices came to the firm\u2019s attention, he was subjected to an internal investigation.\u201d<\/li>\n<li>\u201cWhen interviewed, Elliott initially denied creating the second invoice. He later admitted to fabricating it using information from the firm\u2019s system. Elliott resigned from the firm in October 2023.\u201d<\/li>\n<li>\u201cThe SRA found that Elliott\u2019s conduct was dishonest, involved misuse of confidential information, and was done without the firm\u2019s knowledge or consent. Though the invoices were never paid, the regulator said Elliott\u2019s actions made it \u2018undesirable\u2019 for him to be employed in legal practice.\u201d<\/li>\n<li>\u201cIn mitigation, Elliott told the SRA that he acted not for personal gain but out of frustration over how the footballer and his family had been treated. He also wanted the firm to recover some costs. Elliott described his own behaviour as \u2018hot-headed\u2019.\u201d<\/li>\n<li>\u201cWhilst the SRA acknowledged his admission, remorse, cooperation, and lack of financial benefit \u2014 it nonetheless found the misconduct serious enough to warrant a ban. The regulator concluded: \u2018a person willing to do this is not suitable to work in legal practice. If such conduct were to be repeated in future, it would pose a risk to clients and public trust.&#8217;\u201d<\/li>\n<\/ul><\/div>\n<p><!-- .entry-content --><\/p>\n<p>\t<!-- .entry-footer --><\/p>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>\u201cThis lawyer was counsel to El Chapo \u2014 and could soon be one of Mexico\u2019s judges\u201d \u2014 \u201cWhen the Mexican government announced it was holding the world\u2019s largest judicial election \u2014 with voters electing thousands of magistrates and an entirely new Supreme Court \u2014 it hoped to bring fresh faces into the legal system.\u201d \u201cWhat [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":117695,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[97],"tags":[4643,25986,72809,12982,11184,19972,1087,3733,16155,11416,13746,16127,4524,10910,13232,12685,8497,21046,11448,1190,32575,11115,4098,11124],"dealstore":[],"offerexpiration":[],"class_list":["post-246945","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legal","tag-bad","tag-billing","tag-bono","tag-client","tag-concerns","tag-conflicts","tag-creative","tag-culture","tag-elections","tag-employees","tag-equity","tag-ethics","tag-firm","tag-investment","tag-judicial","tag-law","tag-mexican","tag-opinion","tag-private","tag-pro","tag-pursuing","tag-risk","tag-roundup","tag-strategies"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.4 - 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