Brent Rigging Suit Firms Fight for Lead: Business of Law

Attorneys for four oil traders suing over alleged manipulation of crude prices copied much of their complaint and violated federal court rules in an attempt to control the litigation, a rival group of lawyers claimed.

The traders, represented by the New York-based law firm Kirby McInerney LLP, sued last month in Manhattan federal court claiming some of the world’s biggest oil companies, including BP Plc, Statoil ASA and Royal Dutch Shell Plc, conspired with Morgan Stanley and energy traders including Vitol Group to manipulate spot prices for Brent crude oil for more than a decade. The benchmark is used to price more than half the world’s crude and helps determine what consumers pay for fuel.

Kirby McInerney has asked U.S. District Judge Andrew L. Carter Jr., who’s overseeing a dozen class-action cases targeting alleged Brent crude price rigging, to appoint it lead counsel. A group of three law firms, led by New York’s Lovell Stewart Halebian Jacobson LLP, claimed in court papers filed Nov. 26 that Kirby McInerney “suffers from an experience deficit” in litigating similar commodity manipulation suits.

Lovell Stewart, Minneapolis-based Robins, Kaplan, Miller & Ciresi LLP and White Plains, New York-based Lowey Dannenberg Cohen & Hart PC are urging Carter to name them as lead counsel, with Lovell Stewart as chair.

In their complaint, the traders alleged they paid “artificial and anticompetitive prices” for Brent futures. They claim the defendants artificially drove the Dated Brent spot price up or down to allow them to profit on swaps.

The traders said the oil company and energy-trading house defendants, which include Trafigura Beheer BV and Phibro Trading LLC, submitted false and misleading information to Platts, an energy news and price publisher whose quotes are used by traders worldwide.

Kirby McInerney claimed in court papers that it has devoted the most resources to investigating the case. Its complaint contains the “most substantial and particularized allegations,” including claims against New York-based Morgan Stanley, Vitol and other energy traders not named in other lawsuits, Kirby McInerney said.

“You just have to look at our complaint to see that our work is original,” David Kovel, the lead Kirby McInerney lawyer on the case, said Nov. 26 in a phone interview. “It’s a compliment that Chris Lovell wants to claim credit,” he said, referring to the Lovell Stewart partner.

The Lovell Stewart group claimed Kirby McInerney broke court rules in filing material directly with the court without first seeking permission.

The lawyers also said Kirby McInerney’s complaint made use of “extensive copying” of material from earlier-filed lawsuits and from the Platts Crude Oil Marketwire, an industry publication. Platts isn’t a defendant in the lawsuits.

The case is McDonnell v. Royal Dutch Shell Plc, 13-cv-07089, U.S. District Court, Southern District of New York (Manhattan). The multidistrict litigation is In Re North Sea Brent Crude Oil Futures Litigation, 13-md-02475, U.S. District Court, Southern District of New York (Manhattan).

Clifford Chance’s Layton Elected to Succeed Childs

Clifford Chance LLP partners elected global corporate head Matthew Layton as the new managing partner. His four-year term will begin May 1 when he succeeds David Childs.

“David has made a tremendous contribution to our strategic development and the delivery of our global ambitions,” Malcolm Sweeting, Clifford Chance senior partner, said in a statement. “I know that Matthew shares David’s passion for Clifford Chance, and I look forward to working with him.”

Layton, a partner at Clifford Chance since 1991, previously led the London office’s corporate finance and mergers-and-acquisitions group.

His practice has an emphasis on domestic and international leveraged buyouts and private-equity transactions, as well as general mergers and acquisitions and corporate finance work, according to his firm biography. His clients have included Citigroup Inc., which he represented on the disposal of interests in EMI Group Ltd.

Clifford Chance, the highest-grossing U.K. law firm, said in July that revenue fell slightly to 1.27 billion pounds ($1.9 billion) because of slower growth in Asia. The firm has about 3,400 legal advisers at 35 offices in 25 countries.

“The evolution of global markets is creating new opportunities and risks for our clients,” Layton said in a statement. “For these organizations, Clifford Chance’s well-established ‘one firm’ approach that combines expertise and deep experience across sectors, practices and geographies around the world is of huge value.”

Deals

CVS to Buy Apria’s Infusion Treatment Unit for $2.1 Billion

Sullivan & Cromwell LLP is corporate counsel and Dechert LLP is antitrust counsel for CVS Caremark Corp., which agreed to buy Coram LLC from Apria Healthcare Group Inc. for about $2.1 billion to add specialty infusion services.

The deal is the biggest in five years for CVS, the largest provider of prescription drugs in the U.S. Simpson Thacher & Bartlett LLP is representing Apria and Apria’s owner, Blackstone Group LP.

Sullivan & Cromwell corporate partner Matthew Hurd worked on the deal for CVS along with partners Neal McKnight, finance; Matthew Friestedt, executive compensation and employee benefits; and Ronald Creamer Jr., tax.

Dechert antitrust partner Mike Cowie also worked on the deal for CVS.

Simpson corporate partner Bill Dougherty is leading the team for Apria. Additional Simpson partners included Alden Millard, credit; Igor Fert, capital markets; Gary Mandel, tax; Gregory Grogan, executive compensation and employee benefits; and Joe Tringali, antitrust.

The acquisition won’t have a material impact on 2014 results and will add adjusted earnings of as much as 5 cents a share in 2015, Woonsocket, Rhode Island-based CVS said Nov. 27 in a statement. CVS said the unit will have about $1.4 billion in revenue in the first 12 months after the deal is completed.

For more, click here.

Moves

Minter Ellison Adds Partners Li, Silli in Beijing, Hong Kong

Minter Ellison added two former managing partners of international law firms in Asia including Jem Li, a New York qualified corporate lawyer who has practiced in China for the past 10 years. Li was previously the managing partner of Winston & Strawn LLP in Beijing.

The firm also hired Rebecca Silli, a major projects and infrastructure lawyer with 13 years’ experience in Asia. Silli was the former managing partner of French firm Gide Loyrette Nouel in Hong Kong.

“Asia will continue to play an increasingly important role in the global economy,” Mark Green, Minter Ellison’s managing partner-international, said in a statement. “It’s where the greatest growth opportunities are for our firm and for our corporate clients.

Li returned to China from the U.S. in 2004 and handles mining rights and investments in Europe, North America, Latin America, Central Asia and Africa, the firm said.

Li’s practice focus is cross-border transactions, including mergers and acquisitions, private-equity investments, joint ventures, international equity capital markets and Chinese inbound and outbound investment.

Silli’s infrastructure and projects practice spans sectors including environmental services, transport, construction and other infrastructure projects. She has led project teams across Asia, most recently in mainland China, Hong Kong, Myanmar, India and Indonesia, the firm said.

Minter Ellison has lawyers at offices in Australia, Asia, New Zealand and the U.K.

Cozen O’Connor Adds Subrogation and Recovery Partner Markovich

Cozen O’Connor expanded its subrogation and recovery department with the addition of a member and four other lawyers.

Virginia Markovich joins the firm as a member in the New York office. She was previously with Clausen Miller PC.

Markovich has experience in managing and handling subrogation matters from investigation through trial, including coordinating experts, handling inspections, preparing discovery and participating in depositions and court conferences.

‘‘Clients have been turning to Cozen O’Connor’s Subrogation & Recovery Department since the early 1970s, and our practice has grown to more than 100 attorneys,” Elliott R. Feldman, co-chairman of the department and co-chairman of the firm’s litigation section, said in a statement.

Cozen O’Connor has 575 attorneys at 23 offices in the U.S., Toronto and London.

Litigation

Kamala Harris Bruises Banks, Burnishes Image With Mortgage Deals

Nine months into her job as California attorney general, Kamala Harris found herself across the table from lawyers for five of the nation’s biggest lenders, trying to hammer out a deal to help mortgage holders weather the foreclosure crisis.

She quickly concluded the proposed terms were too easy on the banks.

“I don’t think we’re going to be able to work this out,” she told one bank’s general counsel at the 2011 talks. Recounting the gamble years later, she said her decision to forgo a $4 billion settlement wasn’t made in haste. “I didn’t walk out of there in a huff and a puff without reflection,” she said. “But it didn’t take long for me to be very clear in my mind.”

Her bet paid off. Five months later, the banks agreed to pay $14 billion more. This month, Harris secured another victory, getting her own $300 million chunk of the landmark $13 billion JPMorgan Chase & Co. mortgage settlement.

Harris hasn’t let up on her effort to chase down wrongdoing tied to the 2008 financial collapse. She is pursuing Standard & Poor’s, accusing it in a $1 billion lawsuit of falsifying ratings on mortgage-backed securities, a claim that may result in triple damages.

A former county prosecutor renowned for going her own way, and the sister-in-law of Tony West, the No. 3 official at the U.S. Justice Department, Harris is wrapping up her third year with a resume that some see as a solid foundation for a leap to higher office.

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J&J May Pay $1 Billion in Medical Costs Under Hip Settlement

Johnson & Johnson may pay as much as $1 billion to insurers who covered the medical costs of removing its recalled hip implants under a settlement announced last week, according to a lawyer involved in the accord.

J&J, the world’s largest seller of health-care products, said Nov. 19 it would pay patients at least $2.47 billion to settle about 8,000 lawsuits against its DePuy unit. J&J will also reimburse insurers for some costs of hip-removal surgeries known as revisions, Michael Kelly, a San Francisco-based lawyer who represents hip patients, told other plaintiffs’ lawyers in a Nov. 22 letter.

“The amount being paid by DePuy across the United States to satisfy medical-lien claims under this proposed program has been estimated to be between $500 million and $1 billion,” Kelly said in the letter, obtained by Bloomberg News. The letter was marked as “confidential communication for plaintiffs’ attorneys only.”

Paying $1 billion for hip surgeries, along with other expenses related to J&J’s push to resolve cases over DePuy’s ASR implants, will drive the cost of the accord to more than $4 billion, said Carl Tobias, who teaches product-liability law at the University of Richmond in Virginia.

The ASR settlement, which doesn’t require the judge’s approval, was the second multibillion-dollar accord in November for J&J. The company, based in New Brunswick, New Jersey, agreed Nov. 4 to pay $2.2 billion to resolve criminal and civil probes into the marketing of Risperdal and other medicines.

The consolidated federal case is In re DePuy Orthopedics Inc., ASR Hip Implant Products Liability Litigation, 10-MD-02197, U.S. District Court, Northern District of Ohio (Toledo).

For more, click here.

Audio

Feinberg Sees Tension in America Between ‘Haves and Have-Nots’

Kenneth Feinberg, founder of Washington law firm Feinberg Rozen LLP and former executive pay special master for the U.S. Treasury, says the difference in compensation between Wall Street and Main Street “is guaranteed to foster tension.” Feinberg talks with Bloomberg’s Tom Keene, Scarlet Fu and Cristina Alesci on Bloomberg Radio’s “Bloomberg Surveillance.”

This is a Bloomberg podcast. To listen, click here.

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