This week's items: Tiger Bay Club of Tampa luncheon focuses on torte reformchael Jamieson appointed to American Bar Assocaition Committee on Corporate LawsInvestment bankers talk politics
Coffee Talk (Tampa edition)
It was supposed to be a debate about the great issues facing Florida over the next two years: Education funding, hurricane recovery, tax reform.
And it was, for a while.
But, with a lawyer and a doctor in the house, the discourse meandered o where else? o into the subject of tort reform.
Somebody at the Oct. 15 Tiger Bay Club of Tampa luncheon asked about Amendment 3, and away went state Reps. Kevin Ambler, R-Lutz, and Ed Homan, R-Tampa.
The third constitutional proposal on the Nov. 2 election ballot is an ingenious attempt by Florida physicians to limit medical-malpractice lawsuits while appearing to advocate for patients butchered by incompetents in the health care field.
To be precise, Amendment 3 would place a 30% ceiling on a lawyeris cut of court awards in contingency-fee cases involving imedical liability claimsi for the first $250,000. The limit drops to 10% for compensation above $250,000.
Ambler, a trial lawyer who has fought such legislation in Tallahassee during his first term in office, called the caps unfair. Law firms have to front clients thousands of dollars in trial preparation costs by taking a case on contingency, he says, with no guarantee of recouping any of it.
iThe law firm plays banker in these cases,i Amber told the Tiger Bay audience. Law firms typically collect between 33% and 40% of court awards now, he says.
Homan, an orthopedic surgeon, cast diplomacy aside in reply. iThis issue is all about money,i says Homan, comparing Florida unfavorably to California, which has capped lawyer payouts for 30 years. iThis is where they sue your ass, if you make a mistake.i
Also a rookie legislator, Homan says he moved his surgical practice to the University of South Florida medical school, where he is an assistant clinical professor. That way, Homan says he enjoys the sovereign immunity afforded a government-run institution.
In response to Amendment 3, Florida lawyers put two measures of their own before voters next month. Amendment 7 would open the records of medical errors to public inspection and Amendment 8 would banish from Florida any doctor found to have committed three or more instances of malpractice.
Of course, Homan opposes amendments 7 and 8 but, interestingly, so does Ambler.
Holland & Knight Tampa partner Michael Jamieson gets to tout his knowledge about corporate law on the national stage. The American Bar Association appointed him to serve on its Committee on Corporate Laws. The committee is staffed by 24 of the most respected corporate law scholars and practitioners in the nation.
Jamieson will participate in policymaking recommendations to the ABAis Model Business Corporation Act, a guide that states use for recommendations on corporate uniformity.
The ABA picked Jamieson because of his long-standing experience with corporate public offerings, acquisitions, dispositions, redemptions and reorganizations and compliance matters. He has been with Holland & Knight and its predecessors since 1965.
Drumming up business
Something has got to be up when investment bankers start talking politics instead of pricing multiples.
Nickolas J. Barbarine, a principal with Hovde Financial LLC who splits his time between Palm Beach and Washington, D.C., has given local bank investors a worry list for next month, just in case they were giving any thought to voting for U.S. Sen. John F. Kerry, D-Mass.
A Kerry presidency could result in higher taxes plus restoration of some taxes that President George W. Bush is trying to abolish, says Barbarine.
Barbarine, who has engineered the sale of several local financial institutions in the past year, says a Kerry administration would not be good news for bank directors looking to cash out.
Kerry is likely to hike the long-term capital gains tax rate to at least 20%, cancel tax cuts on dividends, revive the inheritance tax, and bring back the 39.5% tax bracket.
Referring to long-term capital gains, Barbarine warns, ia 5% increase in the tax rate could create millions of dollars of additional shareholder tax liability.i
He offers a hypothetical example.
Say, a bank with $1 billion in assets has a book value and shareholder tax basis that are equal at $70 million. If the bank is sold for three times book value, Barbarine says the bankis shareholders would have a total taxable gain of around $140 million.
If Kerry succeeds in raising the capital gains rate to 20%, these hypothetical shareholders would get $7 million less than they would under the current 15% rate. Todayis rate applies to most investors in the 25%-and-higher brackets.
If o God forbid o Kerry gets in, repeals Bushis tax cuts and boosts the capital-gains rate to 28%, Barbarineis hypothetical bank investors would see $18.2 million less of their gain.
What should bank executives and directors take away from this scenario, in a climate of escalating sale prices for Florida financial institutions?
iOur point is simply this: if you are considering a sale within the next year or two, now is the best possible time to explore the process from both a pricing and a tax perspective,i says Barbarine.
Nickis number is in the book, Coffee Talk thinks.
The Managing Partners Forum, an annual event staged in Florida for law firm chief executive officers, relied this year on the advice of some prominent Gulf Coast area lawyers.
The forumis advisory board included Tom Snow of Carlton Fields PA, Rhea Law of Fowler White Boggs Banker PA, Benjamin H. Hill III of Hill Ward & Henderson PA and James L. Richey of Sarasotais Williams Parker Harrison Dietz & Getzen.
The annual event offers law firm executives an opportunity to improve their leadership skills and network with peers. Forum participants met earlier this month in Fort Lauderdale.