Biglaw Firm Gets Benchslapped Over Conflicts
Which Biglaw firm got blasted for ignoring its ethical obligations in a hostile takeover bid?
Mergers and acquisitions are getting juicy. Teva Pharmaceutical Industries Ltd is making a bid — of the hostile variety — to acquire competitor Mylan NV. Teva lawyers in the matter? Kirkland & Ellis — if only there wasn’t the slight issue of Kirkland’s previous work for Mylan.
Mylan sued Kirkland in May, seeking to have them disqualified from their representation of Teva. Kirkland contends that the terms of their engagement letter with Mylan, which allows the firm to work on matters adverse to Mylan as long as they aren’t related to Kirkland’s work for Mylan, means they are free and clear to represent Teva.
It’s a fair argument, but Magistrate Judge Lisa Lenihan disagrees. In Lenihan’s Report and Recommendation on Plaintiff’s Motion for Preliminary Injunction, she takes the Biglaw giant to task for violating their ethical obligations. As the American Lawyer reports:
Is The Future Of Law Distributed? Lessons From The Tech Adoption Curve
Lenihan blasted Kirkland for ignoring conflicts related to its past work for Mylan, finding that the firm breached its ethical duties. Kirkland immediately vowed to contest Lenihan’s findings, saying in a statement that it rejected Mylan’s conflict of interest claims.
Still, Lenihan’s unsparing, 61-page report, which heavily cites the opinions of Harvard Law School professor and former Wachtell, Lipton Rosen & Katz partner John Coates, makes Kirkland out to be the clear villain in the dispute.
That’s no good, at least if you’re Kirkland. Her report makes quick work of the argument that Kirkland’s previous representations of Mylan were unrelated to the current takeover.
“It would be hard to imagine a representation more opposed to a current client’s interests, more in breach of a fiduciary duty toward those interests, than one in which the client’s counsel sells his professional services to advance the interests of a competitor in a hostile takeover attempt of the client’s entire corporate affiliate group,” Lenihan wrote.
And Lenihan has no sympathy for Kirkland’s claim that an injunction would be an unfair ding to their reputation.
Sponsored
Navigating Financial Success by Avoiding Common Pitfalls and Maximizing Firm Performance
Is The Future Of Law Distributed? Lessons From The Tech Adoption Curve
The Business Case For AI At Your Law Firm
Generative AI In Legal Work — What’s Fact And What’s Fiction?
“K&E has brought any resulting harm to its reputation upon itself,” she wrote.
Kirkland’s vow to fight the Magistrate’s finding may be a day late and a dollar short, as Teva announced Sullivan & Cromwell will now be representing them in the matter.
(Read the Magistrate’s full decision on the next page.)
Kirkland Loses Round in Mylan Conflict Fight [Litigation Daily]
Kirkland’s Conflict Woes Worsen in Teva Takeover Case [American Lawyer]
Sponsored
Generative AI In Legal Work — What’s Fact And What’s Fiction?
