Stephen Palley, a lawyer in Washington D.C., known for his wry tweets about the industry's travails, has started a blockchain and cryptocurrency practice with an unusual focus.
The new 10-person team at Anderson Kill will concentrate on mediating disputes and what people in the traditional finance world call "workouts" – that is, resolving distressed situations.
It's a fitting mission for Palley, who has long voiced skepticism about the just-do-it mentality of some tech innovators. In his view, many projects are forging ahead without first thinking through dry but critical matters such as governance, indemnification, directors and officers insurance and so on.
This creates a need for lawyers who can help companies stay out of trouble – or get out of it.
As Palley told CoinDesk:
While many big law firms have created blockchain or digital currency practices in recent years, few have positioned them as cleanup crews. Silver Miller, which has sued a number of cryptocurrency exchanges and ICO promoters, comes closest, though Palley said he's not particularly interested in class-action plaintiff work.
Palley, who has 18 years of litigation experience, joined Anderson Kill in April 2016. His previous work at the firm involved construction and other insurance disputes, but also software development.
Taking advantage of that tech knowledge, he hopes to help clients build things that are useful but compliant. Blockchain networks, which know no borders, present interesting challenges in this regard.
"If somebody wants to work with a system of nodes that are distributed among various jurisdictions, you have to think through things a lawyer might worry about," such as local healthcare privacy laws, copyright, or takedown notices, he said.
But for clients who failed to do that sort of thinking at the outset, he and his colleagues are ready to defend them in court when necessary. Last year, he noted, he won a three-week trial case in a federal court in Brooklyn, N.Y.
The web page for Anderson Kill's new practice takes a dig at members of the profession who have branded themselves as blockchain advocates: "We are lawyers, not 'CryptoLawyers.'"
Palley said his main objection to that term is that unlike "divorce lawyer" or "securities lawyer," which indicate specialized knowledge but are essentially neutral descriptions, adding the "crypto-" prefix positions attorneys as "fellow travelers."
Such positioning "could preclude them from providing advice people don't want to hear," he said, adding:
Image via Shutterstock.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.