LAW DISRUPTED : JULIO BUENO : BRAZILIAN LAW

[00:00:00] JOHN QUINN: This is John Quinn. This is Law Disrupted. And today, we're going to be talking with one of our friends in Brazil, a lawyer by the name of Julio Cesar Bueno, who's with a very known firm, Pinero Neto, uh, based in Sao Paulo, I believe, uh, and Among the major firms, uh, in Brazil, uh, the Pinheiro Neto firm is extremely well known, very highly regarded.

We've worked with the firm a lot. They may be the largest firm of their, of their kind, uh, in Brazil and Julio is head of the litigation department, a position that he has held since January, 2024. Julio, I said Julio, and you had corrected, you told me Portuguese. It should be Julio. So Julio, thank you very much for joining us and talking to us about the brilliant legal system.

[00:00:58] JULIO BUENO: Thank you very much, John. You know, I'm a big fan of yours and your. So I'm very glad you'll be able to contribute. 

[00:01:07] JOHN QUINN: Well, let me begin with, uh, maybe putting you on the spot a little bit. Uh, I like to ask large company, multinational companies. I like to ask the in house lawyers. Uh, when I talked to them, uh, what countries or jurisdictions around the world do they find it most challenging to do business in?

And when I 1st started to ask that question, I expected the answer I would get would be, well, maybe India, or maybe China, or Indonesia, or maybe someplace in Africa. But I was very surprised, uh, initially, and I've heard multiple companies, especially large tech companies say more often than not the most challenging jurisdiction for them.

Is brazil julio, do you can you share with us? Do you have any insights you can share with us as to why that might be? What is it about the Brazilian, uh, legal system that makes it so challenging for international in house lawyers? And then we're going to get to, once we've identified the challenges, maybe you can share some insights about how best to navigate those challenges, but let's start with, why is it that Brazil seems to have this reputation, at least among some multinational companies?

[00:02:22] JULIO BUENO: I fully understand that. And I think this is a, I would say initial reaction to any. Clients, especially the tech companies who do business globally, uh, they may find challenging to fully understand some peculiarities. And I would say the, uh, the most prominent peculiarity would be the tax system, uh, contrary to other, uh, countries where the tax system doesn't change that much or is not, uh, I would say a very, I wouldn't say very important, but I'm some, I'm very big challenge for most campuses, national, international in Brazil.

Uh, it is because we have a system that deals with, uh, federal taxes, state taxes, and also municipality taxes. Uh, in some taxes, they change, uh, completely the way, uh, it's, uh, uh, established from state to state. And of course, municipality to municipality. So if you, Brazil is a continental country, it's a very big country as us.

Uh, so you have different, uh, I would say aspects of doing business. You have areas like Sao Paulo where, uh, big portion of the business in Brazil is done here, so you would have a more, uh, open, uh, system in terms of welcoming international investors, et cetera, but on the other hand, what I would say is that Brazil.

It has a very two key elements that I find important when you see a big country. First, we speak the same language. So this is a inter important thing. So once you understand the market, you understand the market, you know, way that you can move people from state to state, from city to city. Uh, also, uh, is not a country that has no, uh, xenophobic aspects.

So doing business in Brazil for foreigners. It's no different than the nationals in terms of, uh, especially going to court as is your special speciality, my specialty as well, uh, uh, quite often, uh, clients say, well, is it safe to litigate in Brazil? What are the challenges? I would say the challenges are the normal channels that you find in any big country, but at the same time, you can rest assured that you not be treated, uh, treated, uh, different only because you're foreign.

Maybe. They would treat you even better because they will understand that certain aspects. 

[00:04:57] JOHN QUINN: And truly, oh, is that true? Even in, uh, you know, remote, uh, provincial states, maybe far away from the West Coast. I mean, I'm not sure I would say that's true in the U. S. If you go to, you know, uh, a rural district in, uh, some obscure, you know, if you're going to South Dakota or someplace like that, where they're not used to seeing, I mean, they, they may not even want to see people from New York there.

I mean, it used to be the case that when, you know, I'm based in Los Angeles. It used to be that we felt there was a real prejudice down in San Diego, just, you know, two hours south of us that they didn't want to see LA lawyers coming down to San Diego. And I've heard the same thing. I don't know if it's true about San Francisco and Oakland across the bay that they want to see local lawyers.

Uh, is there, do you have that kind of phenomenon in Brazil? 

[00:05:53] JULIO BUENO: I think so. Yes. Yes. In certain parts of the country, uh, I think it's natural that the lawyers. Uh, that work there that are local lawyers, they will understand better the name of the judges, what they do, how they operate, and also the state judge, the court of abuse.

So I think, but it's different in terms of the client. Yes. So, uh, a big client doing business in Sao Paulo or in Pará or in the Amazon area. Consider that they have the proper legal team. And this means that you at least have someone locally, uh, focusing on the challenge and the difference, et cetera, there will not be a problem.

So you will not be treated, uh, in the worst position if you are in Sao Paulo, or if you are Amazon only because you have foreigner clients. 

[00:06:45] JOHN QUINN: Right. But do you sometimes, well, if you're working, if you have a case. For a client, whether it's Brazilian or an international client in a, uh, a remote, uh, province or state in Brazil, is it important to get local counsel?

[00:07:02] JULIO BUENO: Well, um, our firm has offices in Sao Paulo, Rio and Brasilia. Okay. So, uh, of course, in the surroundings of those cities, we, we can, uh, would say pretty much cover the, we, we understand the local, uh, courts and the. Local, uh, business, et cetera, but, uh, for sure, in any case that we have, especially a complex case, uh, outside of those place, we normally, we tend, we advise the clients we have just to give you, we have 550 correspondence.

That we call. So firms that if you, if you need anything in Manaus, for example, six hours from Sao Paulo, uh, I will have at least two close, uh, firms that we can call them. They can start working in your case immediately. And this makes a lot of difference, especially for foreign clients. They know that they will have the best treatment.

Right. We, of course, continue to be involved in the case. We, we, we. Manage the strategy, uh, as you do in several other cases as well. But, uh, it's important to have someone local that will help you in the process. 

[00:08:15] JOHN QUINN: You talked about the challenges of the tax system, which, um, in some ways is very much what we're familiar with in the U S like if you live in New York city, you pay city taxes, you pay New York state taxes, you pay.

Federal taxes now famously now, Florida and Texas, you don't have any state income taxes and a lot of people move there for just for those exact reasons. Um, but you also said the tax system changes. Does that result in some countries when there's a change in the tax regime? It results in a, you know, a treaty claim, an investor state treaty claim arising out of changes in the tax laws where the investor will.

Argue that this is a represents a fundamental change and the basis on which they invested in the country. Does Brazil see those types of those types of claims? 

[00:09:07] JULIO BUENO: Not in the sense of having a treaty. Uh, it's I wouldn't I'm not of course, I'm not a tax expert. But Brazil is not part of, uh, exit system. So we don't have those bilateral, uh, uh, claims that you have.

Brazil has never been a signatory of those. Although, uh, you have, for example, many, uh, An important case where the foreign clients, especially they came to certain regions in Brazil and they established with the government, for example, some sort of exemption or a certain level of reduction. And of course, if this changes, this will allow them to file a claim, but it will be a local claim based in Brazil, even if the client is a foreign one.

[00:09:59] JOHN QUINN: Right. I mean, I've had clients, these happen to be IP clients who have had the experience. Of finding out that a proceeding has been started and an injunction what we would call a temporary restraining order. T. R. O. has been issued in favor of the plaintiff and against the client and they didn't have any notice that it started that.

And we were advised that this is not uncommon. This can be done. You can have what we would call an ex parte proceeding with a judge. Where you would present your case for getting an injunction with no notice to the defendant and the judge could enter an injunction and then, you know, you serve the papers and it's up to the defendant then to respond and try to dig out from under that.

I mean, is that a common scenario? 

[00:10:52] JULIO BUENO: I would say it's a common scenario, but it's a possible scenario. Uh, it's something strange, I know, for foreign clients, especially US and UK, that you would have ex parte communication with the judge. And this in Brazil is something very common. Uh, and doesn't mean that you are seeking any special treatment whatsoever.

Uh, so it's very common that, for example, I can file a suit and I go to the judge and I say, those are the, uh, elements. for a decision material and the judge grants with certain caveats or certain conditions. And then the other party will be served. So, uh, in mostly because we have our Civil procedure system is very much influenced by Italian system, also the German one.

So, and, and so that we have certain elements in our civil procedure that contribute to that. But, uh, since 1939, uh, the first civil procedure code that, uh, Uh, was established to, for the whole country, uh, we have the possibility of urgent decisions, urgent measures, ex parte, uh, so the party will be served later.

That's why important to have capillarity. So if you have a claim from a very, uh, far place, you, you need to have someone local that can deal immediately with this, uh, with this circumstance. 

[00:12:29] JOHN QUINN: Yeah, I mean, you, you, you made reference to the, uh, Italian and German, uh, influence and, and heritage. And I'm, I'm interested in learning about that.

But it reminds me that I know in Germany, and I've seen this in patent proceedings, there is a, there's some type of filing you can make if you're a defendant. And you anticipate that somebody might make a claim. Because I guess in Germany as well, it's possible to go in ex parte and get an order, but there is some kind of filing.

If you anticipate somebody might do something, you can file something that says to the court. Basically. Hey, you know, if somebody starts to seek an injunction against us, here is our position. You know, so there is something of a record, uh, that the court can see as to your, as to the, uh, perspective defendants position on an issue is, does that sound familiar?

Is there something like that in Brazil? 

[00:13:24] JULIO BUENO: No, I'm familiar with that. Some German clients have asked us. But we don't necessarily have this, we, we, what we do is, uh, if we are, of course, aware that there is this risk, we keep, first we prepare everything, we prepare the answer, we prepare this motion that you mentioned.

So once we identify that the case was filed, we immediately act. But we don't have any measure that can anticipate that we, we have, for example, uh, inspiratory claims related to the production of evidence and some ways this may be a strategy, John, for that. Yes. So if I know that something's about to happen, I may file a claim, uh, seeking production of evidence.

And then if this case is filed, we will immediately be combined with the one that I have. So, uh, those are the techniques and to, to protect the clients and to, especially to normalize risks, 

[00:14:28] JOHN QUINN: right? So do you have a, is there a federal court system, both national, what was we have in the U S federal courts?

And also a state court system with not only different judicial systems, but also different laws, national laws and state laws. 

[00:14:44] JULIO BUENO: We, our civil procedure code and also our civil code, they are national. And I would say most of the laws, they are federal laws. Uh, you would have state or municipality laws dealing.

Specific things. For example, uh, you would have a tax system, and then as the the states, they have the ability to, to regulate certain aspects of the tax. They would do that the same for the municipality. But, uh, what we have is that I would say that we, that, that you would have a law that applied to the whole country.

Uh, country. We have a federal system. Uh, this federal system starts with the superior. Courts, the federal Supreme court and the superior court of justice. Also you have regional. ports, federal regional ports, uh, and they are spread, uh, over all over the country. You have six regions for federal, uh, regional ports, and then you have the state level and the municipality level.

Uh, all the states, they have Their own courts appellate courts. They also they manage the each uh lower courts, uh in and have almost every municipality, of course, you have some municipalities that are too small they don't have a court there, but they belong to a uh county that does that so But basically you're dealing and the division of that is based on uh, you cannot choose necessarily you you're based on what your Uh, disputing you is based on the subject.

Uh, I imagine that in us, in certain aspects, you may choose to go federal or state, but in Brazil, uh, you, you only do that if you have, uh, issues that are common to federal and state, but apart from that, you will have to choose. 

[00:16:37] JOHN QUINN: Yes. The federal courts in the U S are courts of limited jurisdiction and that you need either, you need subject matter jurisdiction.

It needs to rise under national law, or you can get into federal court on diversity, which I think is an anachronism. Diversity means it's between citizens or, of course, can be corporations of different states. Um, but there are some laws that you can have jurisdiction, both in the federal court and in the state court.

Although those are, those are kind of unusual. In the U. S. you, as you know, you have to be admitted to practice in a particular state, whether it's California, New York, whatever. How about in Brazil? 

[00:17:20] JULIO BUENO: In Brazil, um, you have to be admitted in the states that you practice. I, for example, I'm admitted in Sao Paulo, Rio and Brasilia.

And also I can act in any other states up to five cases. I see. So if, so there are some limits. Uh, of course, sometimes you have like 10 case or eight case, but, uh, can go, cannot go too much beyond that. That's why it's important in our case to have correspondents that help us with that. I may be part of the case, but also I'll have someone there to guarantee that it is a local case as well.

So, but, uh, basically we, in Brazil, the, the university. Graduation of law in Brazil is, uh, uh, is five years. I know in the States, you have the distinction between BA and, and then afterwards the, the law course as a graduate course in Brazil is five years. And once you finish, you have to pass an exam. It's quite a challenge, this exam.

Uh, I don't recall. Present figures, but I remember when I, when I, uh, present myself before the bar, uh, the, uh, the rate of success was about 10%. Wow. So it was, yeah, so it's, it's something that is really important, especially because Brazil, John, I don't know if you're aware of that, we have the largest number of law schools.

in the world. We have more law schools in Brazil than perhaps in the rest of the world entirely. 

[00:19:01] JOHN QUINN: I didn't know that. To what do you attribute that? Why is that?

[00:19:05] JULIO BUENO: Um, I would say, uh, there are several factors. One, uh, because law school does not demand too much investment in relation to, let's say, medicine or other areas.

Where do you, where do you have, also because, uh, the level of litiosity in Brazil is quite high. Uh, if we, we, if I can tell you the numbers, you'll be shocked. Because of several aspects, uh, Brazil has a large number of case, uh, we'd say in 2023, the full system of case in Brazil comprise 83 million case.

[00:19:47] JOHN QUINN: My goodness, that's a big number.

[00:19:49] JULIO BUENO: Of course, they're, they're including the certain appeals or certain other, but it's a big, a big bulk of case. 

[00:19:57] JOHN QUINN: So I, I spent some time in India last year and spent a lot of time talking with Indian lawyers and learned, uh, about the Indian system of where, of course. India is famous for the time it takes to resolve civil disputes.

They talk about, this is probably a bit of an exaggeration, but they talk about cases being handed down from generation to generation, uh, and that there is a backlog, I've been told, of 50 million cases in India and they can, uh, the civil justice system can take forever. So basically a lot of Most of the business world seems to have opted out of the civil justice system and they rely on arbitration both in India and in Singapore and in London is a similar.

Uh, do you see a similar phenomenon in Brazil? And how long does it take to get a case? You know, a significant business case. How long does it take to get to trial? Is arbitration becoming increasingly popular as a result of a of a backlog? 

[00:21:00] JULIO BUENO: We don't have the trial system that you have in the states Okay So I know that at default system in the states is the trial And then of course the parts they may choose to go to the judge or they may of course Uh, uh accept arbitration and other means in brazil, uh trial As the pure trial system is only for criminal case, uh, so all the burden is on the judges in terms of litigiosity in the civil court.

Uh, it is, it is a fact that some case they tend to Take a lot of time, especially because we have a very open system of appeals Uh, it is in our constitution that every case no matter what you do have The possibility to have the case filed and also to have at least one appeal before the state court. So, uh this for many decades has led people to not be accepting so much the lower court decision and put a lot of pressure on the decisions from the appellate courts.

This has changed, I would say, in the last 15 years. Uh, first because the courts, uh, they have a better system of precedent and, uh, uniform decisions. So, uh, I know what will happen in certain courts because this court has already decided this, this and this in several other cases. So this is also, uh, you have a higher amount to be paid in case you, you file an appeal.

Before I was very low, the amount so, uh, but together with that, we also have the arbitration law in 1996 arbitration was possible in Brazil. Actually, we had arbitration since our colonial times, but it was not enforceable in terms of I could not lead you to arbitration case unless it was enforceable.

you were voluntarily going there. So in 1996, because we were in a moment of a lot of international investments in Brazil, uh, the House of Representatives, uh, passed this law that established, uh, the, once you have the agreement in the contract or the parts have, uh, agreed to that. You have to go to arbitration, and of course, arbitration has no appeal, and, and in certain areas, infrastructure, M& A.

Arbitration has taken a very important role and many, I would say, or most of the most important case are now in arbitration. 

[00:23:51] JOHN QUINN: When you get a new client who doesn't have experience with the Brazilian legal system, and you sit down to explain to them the distinctive features of the system and the things that.

The kinds of practices that you know, they're probably not familiar with if they come from Europe or North America or even Asia. What are the main features that you think it's important to explain about what's different regarding the Brazilian 

[00:24:18] JULIO BUENO: system? Uh, you, you mentioned one that's very important, especially for common law countries, uh, which is the expert communication.

So the fact that I can go to the judge, I can really, uh, do that. But, uh, also we have certain. I would say, uh, procedural distinctions, for example, uh, the discovery process in Brazil is very limited compared especially to the U. S. Uh, in Brazil, in order for me to request a specific discovery system, I really have to identify What I have, who would have that specifically and why I need that.

[00:25:00] JOHN QUINN: I understand the same is true in Germany and it's always been a mystery to me. Yes. How do you describe to the other side what it is that you want when you don't know what's in their files? I mean to an to an American that's just seems really mysterious. 

[00:25:14] JULIO BUENO: Yes, but what has changed is Uh, I would say If you, in arbitration, uh, this may be an agreement between the parts on how they will produce evidence, uh, and also the, the, the way that they, they establish that.

But, uh, recently, John, our, we have a new civil procedure code from 2015. And this code has a lot of, I would say, more similarities with the common law system, but basically what I tell clients, if they are Europeans or if they come from, um, a common law country or not, or Asians, uh, I would say, uh, you have to be prepared for, uh, in court for a longer term that maybe you're a user to, uh, you have to to understand that the level of cases is quite high for each judge.

So we need to be very well objective and didactic and clear in our communication with the courts. And also we have to go there, we have to to do the follow up. So we can, uh, we can really, uh, call the attention of the judge. So you are an expert on that. You know exactly, uh, what, what do you do in your trials?

And it's the same, even if I'm not in a trial, I have to go to the judge and demonstrate that out of those 2000 cases, This is a special and I have all the, all the facts here. I always tell the clients, we have to, we have one shot of communication. We have to, to, we cannot lose any opportunity to make a first good impression.

So we have to be very well prepared. To to do that

[00:27:01] JOHN QUINN: in India was explained to me that on a, uh, what we would in Los Angeles would call a law and motion day. That is to say, you've got a judge who's got a docket of motions, maybe emergency applications, heroes. Uh, you know, sequestration orders, discovery motions, whatever.

And the judge will, in Mumbai, will have maybe 500 of these things. The judge can't possibly deal with all of them, and so the judge somehow tries to decide what seems to be the most important. And there actually is a recognized skill in the Indian Bar for being a really good two minute advocate. You will actually, you may have the lawyer for the case, uh, you know, who you're going to be with for the case as a whole, but for a hearing like this, where you need to make sure you get the judge's attention and you're 1 of those couple of dozen cases, you might retain 1 of these.

Advocates who are regarded as great two minute advocates. That's their stock and trade and their claim to fame and to get the judge's attention when they get only two minutes, 

[00:28:14] JULIO BUENO: this is fascinating. We, we, we don't have that, but we know that, uh, we, we need to be brief brief when we talk to the judge. And also something that I always tell the clients.

When we have an appeal, I have only 15 minutes to defend my appeal, and that's it. Right. So I go there, I have to, what we say, oral arguments before the Court of Appeals, or before the Superior Court of Justice, or before the Federal Supreme Court. Only 15 minutes. That's why a lot of the weight that we put in the case is in the sequence.

in the coherence in the preparation of the document. So we have to be able to communicate the same thing once and ever for the judge to fully understand the path that we are bringing to. And also, uh, the other major difference that We don't have the same level of oral production of evidence as you have in the States.

I remember a case, uh, maybe 10 years or 15 years ago, was a very complex case before the lower court justice. And we had the meeting with the American lawyers and we, they prepared 237 questions for the hearing. And when we came to the, we told them this will not fly. But when we came there, the judge said, okay, each part has three questions.

So, of course, this was exaggerated. Questions for witnesses. Exactly. Like in the States, that you can take four days in a cross examination. In Brazil, this will not happen. Uh, you can take hours, but you have to be very strategic in what you ask, how you ask, etc.

[00:30:02] JOHN QUINN: Will the judge examine witnesses? 

[00:30:04] JULIO BUENO: Yes. Yes. The judge may at any time interrupt the parties.

The judge may say, this is not relevant. Or he can say, okay, go going beyond. I have this and this and this that I would like to know. So they can be quite active in the oral production of evidence as well, but doesn't, doesn't take that long as especially in the States 

[00:30:26] JOHN QUINN: when it comes to arguments. Uh, and I'm, I'm sure that the answer you're going to tell me is it really depends how important is oral argument either before a trial court where you have an issue where you're arguing a legal point to the, to the judge or to an appellate court, how important is oral argument versus what's in the briefs and the papers.

[00:30:48] JULIO BUENO: It's hard to say because I found them both extremely important. I, uh, I would say answering directly your question. Uh, we cannot avoid to have the oral arguments presented because maybe, uh, what I said before has already convinced the judge, but it's quite common. And I've seen this many times that you go to the court, you present the oral arguments, then the reporting judge decides in one way, and the, uh, the second judge says, I, I need to, uh, I need to read again because of what was said here in the oral arguments, et cetera, et cetera.

So I, I've seen many, many times, uh, the oral arguments presenting a very important, uh, place, uh, on the, on this, uh, in that's why in our, um, in our firm, we have what we say a training school for every, uh, several aspects, accountability, uh, other. But we do have also, uh, that we train the associates how to prepare oral arguments when they are able to go to the court of appeals and they have to defend.

So they know exactly what they have to say. They cannot be repeating only the same things that they have written, but they have to add it. The special aspects of the case that we call the attention to the judge. 

[00:32:18] JOHN QUINN: Are there special courts for business cases? Or are the, all the courts of first instance, like in Los Angeles, the Superior Courts, we'll have courts that hear, uh, family law, you know, basically, uh, divorces, matrimonial law.

We have criminal cases. Um, and a few other kind of specialized courts, like mental competency and the like all business cases, all tort cases, like slip and falls in the grocery store, uh, you know, major cases arising out of M and a transactions or fraud. They're all heard by a court, a judge of general jurisdiction, who on any given day can hear just an enormous variety of different kinds of things.

We don't have a specialized business court. Do you have that a specialized business court in Sao Paulo or elsewhere in Brazil? 

[00:33:12] JULIO BUENO: Yes, in the in the major cities, you would have that. So, for example, Sao Paulo, which is the biggest center of disputes in the country. Uh, you would have in the lower court system, judge will deal with, uh, uh, public, uh, contracts judge that you deal mostly with, uh, arbitration or, uh, any other aspects relate to disputes, or they will do only with recovery.

And in the same division or technology. So the same division also happens in the state, in the state court of abuse. So Sao Paulo now has, uh, a large number of, uh, court of abuse judges. And some of them, they only deal with Accepted criminal, of course, but they do also with contracts. The others will do with family law and so on.

So you is not, uh, I would say for all the subject matters, but you have, I would say some. Uh, a good nation of subjects in certain portions in the lower court and also in the state court. 

[00:34:26] JOHN QUINN: I know in many countries, uh, being a judge is a, it's an entirely separate profession from being a lawyer or advocate.

Uh, you know, very early on, you have different training and that's a different, different course of career. I mean, unlike say in the U. S. or the U. K. where a lot of the judges are, are people who, you know, used to be lawyers. It's kind of a natural progression. How is it in Brazil? Is being a judge a separate profession from the beginning or, or, or where, what's the background of the judges in general?

[00:35:01] JULIO BUENO: The lower court judge, they start as lower court judge. They basically come in their twenties or early thirties. They, and most of them. have never practiced law as a lawyer. They did, uh, they have worked in other areas. So, uh, they have the training in the federal public, the public prosecutor's office, or the, even they were assistants or clerks to other judges.

But, uh, this happens because the, there is a very tense and heavy I would say test for them to become judges. So they, they have to spend sometimes three years studying for this test. Uh, anybody can do the test in any state. So if I'm a graduate from Sao Paulo, I can try to be a judge in Minas Gerais or Pará or Rio de Janeiro, et cetera.

So you have the concentration of people doing that. So it's a very challenging test. And then, uh, those are the judges that start. And they start without being a lawyer before what in the court of abuse because of a constitutional request, uh, and you can have a portion of the state court of judges. Uh, that come straight from the, uh, federal or the, the state bar system.

So they, they were, and those are people that have been a lawyer for 30 years or 35 years, and then they get the knowledge and the prestige to be appointed and they have to be selected by the court and then they are finally selected by the government. The same happens for the Superior Court of Judges, uh, and also there is a portion of judges that come straight from the bar.

[00:36:56] JOHN QUINN: What are some of the, um, emerging issues or, uh, types of claims, uh, that you're seeing an increasing number of, uh, in the business world, disputes world in Brazil? What are kind of the hot topics?

[00:37:13] JULIO BUENO: Uh, I would say M& A disputes is always a hot topic. So corporate disputes in general, uh, shareholders disputes, uh, and also association of investors, uh, challenging the way that some level of information was produced or not.

And so this is, is very important. Uh, some of those cases, they go straight to arbitration because there is a requirement in a certain level of, uh, public companies that all the case will go before what we call the B3 chamber. So they, they get separate from the judicial systems, but of course, the others, they go straight to the judicial system, um, technology, of course, uh, it's always a big, uh, important part of what we do, uh, infrastructure, uh, and environmental disputes, ESG.

Um, in Brazil, we have a system of environmental that is a three level system, state, federal, and municipality. So also, of course, this leads, leads to a very important level of disputes. So criminal, uh, we, we have a big criminal team here in the firm as well. And that works closely with the consumer teams.

Uh, so I wouldn't say these are the only areas, but those are the areas that normally you would have a high level of disputes all the time. But, uh, I would say basically, uh, especially the MNA disputes and the corporate disputes, they are quite, uh, important now. 

[00:38:58] JOHN QUINN: When people ask me, uh, in the US, I, I always point to basically two subject matters.

One, Anything relating to big accumulations of data, it seems. Data breach cases, privacy cases, uh, data, uh, as a element and competition and antitrust law as being a, uh, source of market power, uh, are now artificial intelligence and, you know, everything relating to that, whether it's the input training generative AI on copyrighted material, proprietary material, the propriety of that, something a lot of courts, courts are struggling with now, or the output.

Of AI, it seems like data is dominant. I'm dominating is an exaggeration, but it's becoming increasingly important across many different substantive areas of law. And the other thing is our disputes related to climate change, whether it's greenwashing or insurance or real estate. Oceans rising how that's affecting things.

Securities law disclosure. You know, the is very interested in what you say about what you say about whether your environment, your business is environmentally friendly. What's your policy? What's your exposure to environmental change? And you're expected to disclose that and whatever you say, obviously has to be accurate.

Uh, it's going to otherwise be challenged. Would you, are those important emerging areas in Brazil as well? 

[00:40:31] JULIO BUENO: For sure. Um, first, because in Brazil, we face a lot of influence from the U S in terms of new types of claims and new ways to litigate. Uh, for example, our consumer law. From 1990, it's basically, uh, translates a lot of the principles that you have in the States.

So the same happens to other trends. So the, we, we have a new law that deals with data privacy. It's a big issue in Brazil. Uh, and, uh, we represent, uh, I would say most of the tech companies. And we face this, uh, this, this issues. Uh, on a daily basis. So not only data privacy, but, uh, decisions related to the information that is disclosed or not.

Uh, and also some, uh, requests from authorities. Um, uh, who is behind, behind this or that account and things like that. So, uh, it is a big, uh, area in terms of climate change. I wouldn't know exactly if we are in the same base as you are in the States. Uh, we, we do have a very important level of litigation dealing with the environmental, uh, aspects.

Uh, And of course, at the same time, these are, is related to climate change, but, uh, I haven't seen personally any specific case dealing, uh, with climate change. Uh, but we, I will ask my colleagues in the environmental team for sure. They will know better and they will tell me that I'm wrong to answer you.

[00:42:17] JOHN QUINN: Do you have class actions? 

[00:42:18] JULIO BUENO: Uh, not in the sense that you have in the States, which is the rule 23 was amended, it's happening in 66. Uh, we, uh, in our system here, we have what we call collective claims. So claims that can be brought by associations. Uh, or, uh, we have, uh, civil public action, uh, also claims that can be brought by association or entities or the public prosecutor.

[00:42:49] JOHN QUINN: Like in France, France has a similar regime. 

[00:42:52] JULIO BUENO: Exactly. Exactly. So, uh, but now, uh, there is a trend to bring some concepts of class actions to corporate disputes. So, uh, uh, four years ago, there was, uh, uh, report that was prepared by the minister of finance in Brazil together with OECD and. Uh, because of that, there has been some attempts to change the system that we have now in terms of protection of shareholders and to, uh, bring some, uh, aspects of the class action system.

This would be a challenge because you need to change a lot of things. You need to change the law, you need to change the way, uh, that the judges, they behave in relation to those claims. For example, uh, I always find fascinating in the states that. Several law firms can bring, uh, one specific class action on behalf of different, uh, plaintiffs.

And then the judge will decide who is the lead plaintiff and also who is the lead law firm. Maybe you have the lead law firm that's not, uh, the same that file, uh, from, uh, on, on the plaintiff. This is fascinating, and this takes time. You have the technology of PlasX for more than 100 years, uh, and this for us would be a challenge.

[00:44:20] JOHN QUINN: Is litigation a specialization, uh, in the profession in Brazil? I know in many countries, you know, the same lawyers will commonly do transactional work, you know, divorce work litigation. Uh, that's still true in smaller towns, maybe in the US. But in large law firms in the U S as in many countries, you know, you have deal lawyers, you have litigators, and then obviously within that, you'll have all kinds of specializations.

You have antitrust lawyers, securities, lawyers, IP lawyers. Do you have that same degree of specialization and large law firms in Brazil?

[00:44:56] JULIO BUENO: Uh, yes. Uh, I, as you, I start as a transactional lawyer and know that. You, you had the same experience.

[00:45:03] JOHN QUINN: Yeah. That's a secret. Not many people know that. Okay. I started out for two years as a deal lawyer at the Gravath firm.

[00:45:09] JULIO BUENO: Okay. Then you saw the light.

[00:45:12] JOHN QUINN: Yeah. Well, actually people told me I wasn't really cut out for making deals. I'd be much better cleaning up afterwards. 

[00:45:19] JULIO BUENO: Okay. I, I, I started as a transaction lawyer, a trainee, and then a lawyer, and then. I wanted to go to the litigation area because of, uh, I was really interested in the civil procedure, uh, aspects.

And also I was starting my master's degree in civil procedure. Then I did my LLM, uh, in Cambridge, also in comparative civil procedure law. And and so on. So, uh, at the same time, I'm a part of the litigation department. I do mostly with litigation, but I still have a portion. What do I do? Which is transaction, but related to infrastructure.

Because I, uh, I has always had the experience of dealing with, uh, infrastructure contracts. And so I litigate them, but also I negotiate, for example, big construction contracts. So this is something that I. I hold dear. I like to do that. Change the environment from time to time, but you're right. It's quite difficult for someone in a big law firm to do everything.

We have a system here with four areas, corporate litigation, tax and labor. And then we have been emphasizing in the last years, the creation and establishment of practices. So, uh, for example, in technology, you would have people from the litigation department. people from the corporate department. Uh, in the same way with ASG, litigation, corporate, and maybe uh, labor, uh, and tax.

And, and the same happens in a lot of practice. So, uh, although that is the tendency that in the practice, I will know more about all the aspects of the case. I think to be a litigator and you are one of the finest ones in the world, you know that we have a different mindset in terms of approaching risks and in terms of getting what the client needs, maybe what the client wants is a settlement, but to get to the settlement, we need to do the litigation work before.

And so, and you just have to do this in a way. And I remember you explaining the difference between an aggressive lawyer and a feared lawyer. I fully agree with you. And I think you have to be strategic in a way that you do not jeopardize entirely the possibility for your client to have a settlement later on.

[00:47:55] JOHN QUINN: Yeah, I think you're exactly right. I think we litigators live in a world 24 7 where something's gone wrong. That's the world we live in. If things didn't go the way They were intended to go. Yes. So we tend to, I think, have kind of a jaundiced eye. When we read documents, uh, we try to look at them from the standpoint of thinking what might if things go wrong, what might some devious claimant.

Try to make of this deal of this language. What are the vulnerabilities? I, I think litigators look at deal at documents different than deal lawyers, just because of our experience for sure, dealing with things that have. 

[00:48:43] JULIO BUENO: Yeah, we need to have a certain level of paradigm. Yeah. So, uh, to be a litigator. So you have to, uh, be suspicious and to be skeptical in some ways of things, uh, that are happening and at the same time prepared for, uh, any potential crisis management approach that you need for a client.

So, uh, it is a different base than the, uh, deal makers and the corporate lawyers. Because, uh, of course they are, uh, under, uh, a lot of pressure to do things and to close the business, but it's, uh, the, the challenges are different and, and I would say that the mindset also has to be different. We, we put a lot of efforts in the preparation of trainees here in the firm.

And I keep saying this, I have trainees since, I would say, Since as a senior lawyer, or even before, and I always say that we, we easily identify those who are, uh, prepared, uh, and who are able to, to deal and to navigate in this environment and those who are not. So, uh, as you said, you were, you were asked to go to the litigation because they didn't identify, maybe they clearly identify your excuse as a litigator.

[00:50:00] JOHN QUINN: Yeah. Julio, this has been fascinating. Any final thoughts or things that people ought to know about the civil justice system in Brazil? We've covered a lot of territory. 

[00:50:09] JULIO BUENO: John. Um, thank you. It was fascinating to have the experience. Uh, I would say something that's, uh, not many people know, but Brazil, uh, Brazil has the, one of the best banking system in the world because we were a country with one of the highest inflation rates in the world.

So this led to the. To the banking system to be very, uh, uh, sophisticated, the same happens with the court system because we have a lot of case, uh, we have those possibilities of numerous appeals, et cetera. Uh, since 2005, the courts in Brazil have been working heavily in the digital system. So nowadays, 99 percent of all cases in Brazil.

So, uh, and this also permits, uh, that the National, uh, Council of Justice to have clear, uh, information about what's going on in any country. Uh, specific lower court system or state court system. So, uh, this is open. So when you, when you, when a client of ours comes and say, how does it work? How long does it take to have a case in Pará or in Espirito Santo?

I can easily go to this data to say exactly what's happening in which lower courts, judge or in the state court of abuse. So this is. Uh, something that's always when I tell my clients, they get surprised about 

[00:51:42] JOHN QUINN: Amazing. One of the things I appreciate about brazil is there's only one time zone I get so tired of juggling and the confusion between eastern and pacific and central and 

[00:51:54] JULIO BUENO: One language and one time zone.

[00:51:56] JOHN QUINN: Yeah, those are big advantages 

[00:51:58] JULIO BUENO: Going back to what can be an advantage for a foreigner client, I can point out this. 

[00:52:04] JOHN QUINN: Well, thank you, Julio. We've been speaking with Julio Cesar Bueno of the Pinheiro NATO law firm. One of the best, perhaps the best law firm in Brazil. Thank you very much for being with us.

This is John Quinn, and this has been Law Disrupted.

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