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Melissa Coade
Eight top lawyers courted from the ranks of Herbert Smith Freehills’ Melbourne and Sydney offices to launch a new White & Case team in Australia are being sued by their former partners.
Eight top lawyers courted from the ranks of Herbert Smith Freehills’ Melbourne and Sydney offices to launch a new White & Case team in Australia are being sued by their former partners.
The walk-out of ten HSF partners to join White & Case, the US-headquartered heavyweight that reached Australian shores last year, made a splash in legal headlines.
Another two, Fergus Smith and Matthew Osborne, were recruited from HSF’s Hong Kong and Singapore offices respectively.
Now, proceedings initiated in the Supreme Court of NSW against the Australian squad of ex-HSF partners, whose combined practice value is worth an estimated $30 million, suggest there may be more acrimony to their departure.
The action against the eight is being pursued on behalf of the 167 remaining HSF partners, reportedly for non-compliance with the firm’s partnership agreement.
White & Case’s decision to break into the Australian market and open in Sydney and Melbourne is believed to have been specifically driven by the location of the ex-HSF high-flyers.
Not only was the global firm looking to gain a better foothold in the greater Asian region, it was eyeing a large team of Australian partners from another top-tier rival with an established local operation. That talented team now faces a court battle with their former colleagues.
Hong Kong-based John Tivey, who heads the mining and metals industry group of White & Case, was recently in Australia to oversee the establishment of the Melbourne and Sydney offices.
In an interview with Lawyers Weekly last December, Mr Tivey said the new HSF hires serviced mutual White & Case clients and would see a “seamless” process of establishing the Melbourne and Sydney shopfronts. He also suggested that experience and talent of the new partners in Australia built on the strong position that White & Case already enjoyed in the greater region.
“We looked regionally for a team that would enable us to strengthen our regional projects practice. And this team was the leading team in the market and so that was the logical path for us to take strategically as part of our Asia-Pacific strategy around strengthening our presence in the region,” Mr Tivey said.
“They deliver a really strong practice in this market that will assist in us strengthening our Asia-Pacific offering.”
White & Case has 39 offices, including its new ones in Melbourne and Sydney, across countries in the Americas, Europe, the Middle East, Africa and Asia.
Speaking exclusively to Lawyers Weekly in September, HSF joint global CEO Mark Rigotti expressed his disappointment about the 10-partner exit. However, he said the resignations were unlikely to impact revenue profits.
“Importantly, the partners in question aren’t going for many months, they will remain with the firm to continue the work they have been doing. They will also assist us in transitioning any longer-term work to another equally skilled partner,” Mr Rigotti said.
As far as the court proceedings are concerned, Lawyers Weekly understands that under HSF’s Australian partnership agreement, a notice period of six months and an additional restraint period of six month follows formal resignation.
According to reports by the Financial Review, the notice period for the new White & Case hires will expire in March. The subsequent six-month restraint period then comes into effect.
Confirmation that HSF partners had been headhunted to establish the White & Case team in Australia came in September last year. At the time, no indication was given as to when the tenure of those HSF partners would end.
Two months later, White & Case officially confirmed the opening of its new Melbourne office on 1 December 2016, and said the Sydney office would commence operations by early 2017.
The firm also used its big November announcement to reveal the poaching of an additional three HSF senior associates Adeline Pang, Ged Cochrane and Michelle Keen. The trio would take on roles as partners to build White & Case’s energy and infrastructure teams, the firm said.
Parties to the current dispute appeared before the Supreme Court on 3 February. Lawyers Weekly understands that a listed date to reappear for directions on Friday, 17 February has been vacated.
A spokesperson for White & Case said the firm is not in a position to make a statement.
“The firm is not able to comment on [the] queries, as it is not party to the litigation,” the spokesperson said.
Lawyers Weekly contacted Herbert Smith Freehills but the firm declined to comment.
