Jessica Carey is a partner in the New York office of Paul, Weiss, Rifkind, Wharton & Garrison LLP. Her practice, while primarily focused on commercial and criminal work involving financial institutions, incorporates several novel and niche instruments such as crypto and blockchain and economic sanctions. Carey also maintains an active commitment to pro bono work. Carey speaks with Benchmark editor Michael Rafalowich to discuss her practice and offer commentary and insight on the market as well as some forecasting for its future.
“Our work really shows the kind of complex and fast-moving matters that we do here at Paul, Weiss. Time and again, we’ve proven that we know how to ramp up quickly and guide clients smoothly through a crisis. I’m immensely proud of having overseen all the various moving parts needed to make that report happen.”
Tell us what your practice looks like these days. Does it stay consistent year after year or does it tend to vary?
My practice has long focused on advising clients, particularly in the financial services sector, on their most significant regulatory enforcement and litigation matters and internal investigations.
Given the tumult in the banking sector earlier this year, I was particularly busy advising clients that were affected by a loss of depositor confidence and ensuing bank runs, as well as those clients at risk from potential broader market contagion, as they navigated unprecedented challenges.
Even before this year’s banking crisis, federal and state regulators and government authorities had been pursuing aggressive enforcement agendas in areas such as anti-money laundering, sanctions compliance and risk management, among others, and I was able to help my clients successfully resolve a number of multi-regulator, multi-jurisdictional enforcement actions in these areas.
My practice is constantly evolving as the challenges my clients face evolve. Given calls for increased regulation and heightened enforcement in areas impacting the financial sector, I expect the next year to be as interesting and challenging as this one.
Can you discuss some of the more recent and novel phenomena in litigation, such as crypto/blockchain work and AI? Do any of these appear to be trends that will subside over time or do they have real staying power?
Emerging technologies are a major focus for our clients, as the legal and regulatory enforcement landscape surrounding these technologies continues to develop in real time; we’ve seen an explosion of litigation and regulatory work in the cryptocurrency and digital assets space as regulators and innovators continue to dispute whether these assets are securities and how they should be regulated. Because there is limited precedent, clients are really looking to us for counsel when questions or problems in these novel areas arise.
The SEC has been particularly aggressive in carrying out their crypto enforcement agenda, and we’ve been right at the center of some key matters. In October, we won a complete victory, alongside co-counsel, in a high-profile enforcement action against enterprise blockchain company Ripple and our client Chris Larsen, the company’s co-founder and executive chairman, when the SEC voluntarily dismissed its case, with prejudice, against our client and the company’s CEO, an exceedingly rare action by the SEC. This followed our summary judgment win in July, when the court ruled that the sale of digital assets on public exchanges does not constitute the sale of unregistered securities — a major victory for the entire crypto industry.
We expect that emerging technologies will continue to be a key driver of growth in the legal industry in years to come. To meet our clients’ needs, we recently launched a multidisciplinary Digital Technology practice providing advice across the legal spectrum: in the enforcement, litigation and transactional contexts. We also recently brought on a number of tech experts, including Katherine Forrest, a former federal judge and an exceptional litigator who is the nation’s leading authority on AI and the law. Katherine is currently advising major financial services firms, among other clients, which have a burgeoning interest in AI.
What would you consider to be your biggest client achievement?
One of my most satisfying achievements was our independent investigation for Credit Suisse, which I led alongside our chairman Brad Karp and my partner Claudia Hammerman. Archegos Capital Management, a highly leveraged, highly concentrated family office, collapsed in early 2021 when certain of its large positions plunged suddenly and it couldn’t meet margin calls. The total fallout involved over $10 billion in bank losses — the biggest, most closely scrutinized investment banking event since the “London Whale” case in 2012 — with our client absorbing a $5.5 billion hit, the largest loss.
We mobilized within hours. In just 90 days, we conducted interviews with over 80 employees, collected over 10 million documents and in July 2021, we published a comprehensive report detailing our findings. The Wall Street Journal wrote that our report held “lessons for bankers, regulators and investors,” and Bloomberg called it “as good as anything you will ever read about the management and sociology and processes of big investment banks.”
Our work really shows the kind of complex and fast-moving matters that we do here at Paul, Weiss. Time and again, we’ve proven that we know how to ramp up quickly and guide clients smoothly through a crisis. I’m immensely proud of having overseen all the various moving parts needed to make that report happen
Sanctions work appears to be steadily on the rise. What trends are you seeing, and how much of your practice is devoted to it?
These days, global companies are on the front lines of the geopolitical and national security challenges around the globe, and consequently, a lot of my practice is devoted to this area. Many of my clients are grappling with how to comply with the sweeping sanctions imposed following Russia’s invasion of the Ukraine, as well as the expectations of regulators and government authorities focused on enforcing those sanctions.
Our clients, many of the world’s largest companies, are focused not only on ensuring their compliance with sanctions laws, but also strengthening their controls relating to sanctions evasion and money laundering as well as export controls. As Deputy Attorney General Lisa Monaco said earlier this year, “sanctions are the new FCPA” given the applications of sanctions laws to a variety of industries and increasingly multi-lateral enforcement regimes.
We are frequently called on to advise not only on enforcement matters but also sanctions compliance issues as our clients attempt to ensure they not only are compliant with the myriad Russia-related sanctions, but also are taking proactive steps to avoid supporting Russian aggression.
Your role at the firm encompasses responsibilities of Litigation Department co-chair as well as management duties. What do you enjoy most about your roles? How do you balance attending to these duties in parallel with your litigation work?
I’ve been fortunate to have played an important role in planning and executing our department’s strategic initiatives, and it’s been so gratifying to see our successes across the department. In the last couple of years, we’ve pivoted to meet our clients’ most urgent needs, including launching a highly successful San Francisco office to meet the growing litigation needs of our tech clients. Today, we’re not just the go-to litigation department for “bet-the-company” litigation, multifaceted investigations and threatening enforcement actions, we’ve have also launched some of the legal market’s first dedicated AI and racial equity audit practices and greatly deepened our cybersecurity capabilities, among others. And we’ve recruited some of the country’s foremost legal talent to our department, including in the cybersecurity, antitrust and AI areas, and across the associate and counsel ranks, as well.
Because I continue to have a busy private practice, it can be a juggling act, but I’ve found that each role makes me better at the other. Because I’m talking to our clients every day, I understand what is keeping them up at night, and therefore I understand what we need to be spending more time on as a department — which makes me a better co-chair. And because, in my capacity as co-chair, I’ve gotten to know all of our litigation partners extremely well, I am better able to make sure that our clients are getting the right lead lawyer and appropriate talent and capabilities across the team for each matter. Making these connections — and making sure that clients get exactly what they need — is one of the things I love best about my job.
Mentoring up-and-coming junior partners and associates is also incredibly rewarding. It’s very motivating to see the members of my matter teams grow and evolve and foster their own client relationships. It gives me a lot of confidence in the future of our department.
What have been the keys to success in your career?
Two things: the flexible work policies at Paul, Weiss and being focused on doing my best by my clients. Both have both been crucial to success in my career.
I have a husband who plays a big role on the home front, but during my associate years when our two children — now entering their teenage years — were babies, I spent several years working a flexible schedule. I was supported throughout my early career by more senior partners and mentors who always made sure I got the opportunities to grow and advance, and who recognized my achievements in promoting me. In fact, the year I made partner I was out on parental leave for a good portion of the year with the birth of my second child; Paul, Weiss did not miss a beat in promoting me despite my absence.
Second, rather than meticulously planning my career trajectory, I’ve always focused on delivering the best client service I possibly can on every matter I’m on. That approach has allowed me to be open to exciting new opportunities as they arise, and also has created opportunities for me to show clients and colleagues that I am fully committed. My ability to not only adapt to, but embrace change, has also helped me stand out.