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November 1, 2010

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STORE & SHRED Exceptional Quality at Reasonable Prices! COPY, SCAN, Call us today to fi nd out how much you can Save. TF: 1.888.781.9083 $4.00 • Vol. 21, No. 34 ocdavit_LT_June7_10.indd 1 6/4/10 9:22:44 AM Inside This Issue 3 Child Protection Covering Ontario's Legal Scene Billions of dollars invested, not a penny lost. ntitled-3 1 November 1, 2010 5/4/10 2:49:21 PM Mid-size firms missing out Few aware of new opportunities for corporate work BY MICHAEL MCKIERNAN Law Times 6 M Final Chapter? 9 Focus On Real Estate Law Quote of the week "And residential real estate practice itself has become commoditized where price is king and title insurers are more than ready to assume the risks of less diligent practice standards. As a result, fewer lawyers are attracted to the practice, and practice standards have slipped." — Sidney Troister, Torkin Manes LLP See Young, page 11 id-size law fi rms are missing out on new oppor- tunities to grab a bigger share of corporate work, says a U.S. legal marketing leader. Speaking at the TAGLaw conference in Toronto last week, John Remsen, president of the Remsen Group in Atlanta, said many fi rms in that range lack awareness of initiatives such as the Association of Corporate Counsel's Value Challenge that aims to reduce legal costs and im- prove clients' value for money. "It amazes me that mid-size fi rms aren't paying more attention because they have a tre- mendous opportunity with what ACC is trying to do. "Corporate fi rms are starting to ask why they should have to pay $300 an hour for an associate in Manhattan when they can get a partner in Toledo, Ohio, who's an ex- pert in my matter. More and more companies are willing to make the leap and hire smaller fi rms." But at the same time, law fi rms need to get more in tune with their clients if they hope to survive in the chang- ing marketplace, said Darryl Cross, vice president of client profi tability at LexisNexis, who also spoke at a conference session on the future of the legal industry. During the talk, he presented a worldwide survey of private practice lawyers and corporate counsel canvassing opinions about the re- cent downturn that showed wide disparities in perceptions about the responsiveness of law fi rms. "Th e future of the legal industry will belong to the fi rms that are most closely aligned with their clients in terms of their perceptions, value, how their businesses work, and how profi table you should be," Cross said. Th e survey found just 38 per cent of in-house counsel thought law fi rms had been responsive to their concerns about costs and fees in the last 18 months. But that number 'More and more companies are willing to make the leap and hire smaller firms,' says John Remsen. See Firms, page 5 Lawsuits ensnare Toronto firm in Ponzi case A BY MICHAEL McKIERNAN Law Times Toronto law fi rm is fend- ing off two lawsuits from investors in a suspected Ponzi scheme who say it should have told them their money was at risk. Aylesworth LLP represented notorious Toronto businessman Robert Mander — who left inves- tors with more than $40 million in losses — during an Ontario Securities Commission investiga- tion into his business in 2009. Mander committed suicide in March as the roof began to cave in on his scheme with RCMP and OSC investigations under- way and investors launching a fl urry of lawsuits. Separate actions fi led by investors Peter Sbaraglia and Da- vide Amato, who both claim they also retained Aylesworth, allege the fi rm breached its fi duciary duty to them. Peter Welsh, an affi liated counsel at Aylesworth who refers business to the fi rm, is also listed as a defendant in both lawsuits. Sbaraglia is seeking $15 million in damages, while Amato wants $14 million. None of the allegations have been proven in court. In an interview with Law Times, Welsh says he had no knowledge of the Ponzi scheme and only helped Sbaraglia and Amato with the structure of the companies they had set up to funnel investments to Mander. "I update the minute book, fi le bylaws and resolutions of the directors, issue shares, and charge $800, inclusive of disbursements, and now I'm in a lawsuit for $29 million," Welsh says. In his statement of claim fi led on May 5, Sbaraglia, a former dentist, says he was convinced to invest as a result of Mander's promises to deliver returns of 25 per cent. He agreed to set up a company with Mander, C.O. Capital Growth, to solicit invest- ments. Th ey would then split the profi ts. Sbaraglia claims he raised $20 million and that he and his wife both gave up their dental practices "in the belief that they were making substan- tial returns." Amato, another former dentist, describes in a statement of claim fi led on Sept. 20 how he set up his own company, S.A. Capital Growth Corp., to generate money #1 Untitled-1 1 to invest with Mander. According to the lawsuit, Mander introduced him to Welsh and Aylesworth, a move Amato says Mander used to lend legitimacy to his scheme. He also says the law fi rm and lawyer should have warned him his deal- ings with Mander exposed him to "signifi cant and unusual fi nancial and legal risks." Both Sbaraglia and Amato claim Welsh and Aylesworth knew about the fi nancial diffi cul- ties Mander was facing since as early as 2007 and allege the infor- mation was withheld from them. Welsh says he now believes Mander was running a Ponzi scheme, a conclusion he came to only from reading about the case. He notes there was no way for him to know the details of the See Amato, page 5 LT Digital version.indd 1 Software application for Real Estate Law Offices in Canada. Used by over 6,000 professionals in 2,500 law firms. To find out more call or email us today 1 866.367.7648 I ©2010 Do Process Software Ltd. The Conveyancer is a registered trademark of Do Process Software Ltd. All rights reserved. 9/22/10 10:05:05 AM 6/25/10 12:59:47 PM Click here to subscribe today to LAW TIMES Photo: Michael McKiernan

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