K&L Gates LLP, a Pittsburgh-based law firm with 2,000 lawyers worldwide, sued a former partner in Hong Kong after he was charged with theft and forgery in the process of transferring funds to a Macau casino company.
The law firm “will pursue and support any and all measures - administrative, civil and criminal - against any wrong-doer to rectify any harm that has been done,” it said in an e-mailed statement.
The former partner Navin Kumar Aggarwal is in custody after police charged him June 24 with three counts of theft and three counts of forgery. He resigned when confronted with the allegations in mid-June, K&L Gates said. The firm, which itself has been sued for at least HK$250.4 million ($32 million), sued Aggarwal for breach of trust and asked Hong Kong’s High Court to freeze his assets.
Aggarwal, 44, is scheduled to appear in court on Aug. 22 to face the charges related to stealing HK$16.6 million from the accounts of RIM China Co. held with K&L Gates and transferring the funds to Wynn International Marketing Ltd. last year. His lawyer, Gloria Chan, declined to comment when reached by telephone.
K&L Gates said it “immediately” began collaborating with Hong Kong authorities when it learned of the matter, and has hired independent counsel and forensic accountants for an investigation supervised by its Asia Managing Partner David Tang.
The law firm has been expanding in Asia, announcing the additions of a new partner in Shanghai in June, 10 lawyers in Tokyo in May and a new Hong Kong partner in March. Last year it hired Rose Zhu from Allen & Overy LLP for its Beijing office.
Valerie Cheung, a spokeswoman for The Law Society of Hong Kong, said it has imposed conditions on Aggarwal’s law license. She declined to elaborate citing ongoing court proceedings.
Aggarwal breached his duties to K&L Gates and should return the “secret profits” obtained as a result, the law firm said in its June 27 lawsuit.
A 2010 law firm brochure says Aggarwal was part of the firm’s Betting and Gaming practice.
Wynn Macau spokeswoman Reddy Leong wrote in an e-mail that the company doesn’t comment on legal proceedings when asked about the nature of Aggarwal’s transactions.
Wynn Resorts Ltd (WYNN), the indirect owner of Wynn International Marketing, operates two casinos in Macau, a 70-minute ferry ride from Hong Kong.
Smartworld International Ltd. sued K&L Gates on July 6, along with Aggarwal and former Hong Kong managing partner Clifford Ng, demanding the return of HK$44 million held in trust in escrow accounts by the law firm, according to the lawsuit. Ng is now listed as “of counsel” on the firm’s website.
“K&L Gates had failed to follow the usual arrangement which required it to draft and forward the relevant appointment of escrow agent letter,” Smartworld said in its court papers.
Emperor Securities Ltd., a unit of Emperor Capital Group Ltd. (717), accused K&L Gates and its Hong Kong partners on July 12 of being negligent and breaching a contractual agreement after the law firm failed to return HK$40 million, according to its lawsuit.
Hind International Investment Ltd. asked for HK$31.4 million back in a writ filed on Aug. 4.
Penguin Assets Ltd and Silver Vision Ltd. claimed K&L Gates breached their trust and are demanding the return of HK$30 million, the companies said in a lawsuit filed July 7.
The law firm faces two other claims from Wang Qiang and Lam Shu Chung for HK$75 million and HK$30 million held in escrow respectively.
Wang is a “victim,” said Calvin Chow of P.C. Woo & Co. who represents both Smartworld and Wang. He declined to comment further.
The civil cases are K&L Gates v Navin Kumar Aggarwal HCA1061/2011, Hind International Investment Ltd v K&L Gates HCA1352/2011, Smartworld International Ltd. v Navin Kumar Aggarwal & Ors, HCA1136/2011, Penguin Assets Ltd v K&L Gates HCA1142/2011, Emperor Securities Ltd v Navin Kumar Aggarwal & Ors HCA1167/2011, Lam Shu Chung v Navin Kumar Aggarwal & Ors HCA1244/2011 and Wang Qiang v Navin Kumar Aggarwal & Ors HCA1048/2011. The criminal case is HKSAR v Navin Kumar Aggarwal ESC2673/2011.
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