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GAR 100 - 11th Edition

McDermott Will & Emery

05 April 2018

Defending Germany in a controversial ICSID case worth €4.7 billion

People in Who’s Who Legal 1
People in Future Leaders 3
Pending cases as counsel 30
Value of pending counsel work US$15 billion
Treaty cases 3
Current arbitrator appointments 5 (of which 3 are as sole or chair)
Lawyers sitting as arbitrator 2

McDermott Will & Emery (MWE) was working on international arbitrations as far back as the 1990s, representing French, Korean and US clients at the ICC. But attempts to make the transition from the intellectual property field (where it’s very successful) into more of a mainstream international arbitration brand haven’t always run smoothly. A bolt-on team in London seemed poised for success, then splintered.

Since then, the firm has taken steps to return to the main arena with some solid partner hires that have restored know-how and credibility. In 2012, it welcomed English barrister Jacob Grierson in Paris (formerly of Jones Day and an authority on the new ICC rules).

In the same year, it recruited a duo from K&L Gates who specialise in investment arbitration: Sabine Konrad in Frankfurt and Lisa Richman in Washington, DC. Konrad is one of Germany’s nominees to ICSID’s roster of arbitrators as well as the founder of the Frankfurt Investment Arbitration Moot, now in its 11th year.

Konrad and Richman brought with them one of MWE’s weightiest instructions – the defence of Germany in a €4.7 billion Energy Charter Treaty claim brought by Swedish state-owned power company Vattenfall. The closely watched ICSID case, which concerns Germany’s decision to hasten the phase-out of nuclear power in response to the 2011 Fukushima crisis in Japan, went to a hearing in 2016 and a final award is now awaited. Some have suggested the outcome of the case may determine the EU’s future approach to investor protection.

Network

The main offices for arbitration are Paris, Frankfurt, Washington, DC and New York, though it also has partners with international arbitration experience in Milan, Rome and Boston. The firm has an affiliated office in Shanghai, MWE China Law Offices, led by John Huang.

Who uses it?

Besides Germany, the firm’s ICSID clients include Poland, Taiwan’s Chinese Petroleum Company, German airport operator Fraport and Sweden’s Lundin Petroleum. German banks LLBW, HSH Nordbank, Helaba and Nord/LB are using the firm for an Energy Charter Treaty claim against Spain concerning reforms to renewable energy subsidies. Italian waste management company ASA International retained it for an investment treaty dispute with Egypt that settled in 2016.

Other names to have used MWE include Honeywell, Blackwater Security Consulting, private equity funds Patriarch Partners and Ewing Management Group, German electrical-goods maker Schwabe, German chemical company Evonik Degussa and Senegal’s Wari Group.

A lot of clients are from IP-rich fields such as life sciences and pharmaceuticals.

Track record

In 2011, the firm helped Bionol Clearfield obtain a US$230 million award against Getty Petroleum Marketing in a dispute over an ethanol plant in Pennsylvania. The award included US$47 million in damages and over three times as much in future damages.

At ICSID, the firm helped Swedish oil company Lundin win a US$25 million award against Tunisia in 2015 in a dispute over tax. It has also helped two German eco-tourism investors win a US$4 million award against Costa Rica in 2012. While at K&L Gates, Konrad and Richman helped Poland to defeat a US$35 million claim brought by US investors in a blood plasma laboratory.

In China, the firm succeeded in enforcing two SIAC awards before the Wuxi courts in 2013 – no mean feat. It also gained the upper hand in a dispute between a US medicine company and its Taiwanese joint venture. The Taiwanese side handed over control of a Chinese pharmaceutical company to the US party, following a multi-pronged assault that saw MWE obtain ex parte attachment orders over personal residences in Taipei.

Recent events

A team led by Jacob Grierson was instructed by the Wari Group to bring an ICC claim against Luxembourg telecoms group Millicom relating to the sale of Senegal’s second-largest mobile operator, Tigo. Two other related ICC cases are also reportedly under way.

Arne Fuchs, a member of the team on the Vattenfall case, was promoted to partner in the Frankfurt office.

An effort to relaunch the firm’s London international arbitration group with the hire of partner Damian Watkin from Jones Day in Dubai in early 2017 ran aground when Watkin departed for US firm Bracewell later in the year.

In Miami, partner Effie Silva left the firm for Duane Morris.

Client comment

A German client that turned to the firm for an investment arbitration commends the team’s “responsiveness, dedication and clear and practical advice”. Sabine Konrad and Arne Fuchs work well together and “do not back down even in critical phases”.

Another German company that has received training from the group on investment protection calls it “outstanding with respect to its research of the facts and legal issues.” Konrad is the “driving force” and brings “brilliant intellect, analytical capacity and rhetorical skill.” Lisa Richman gives a “useful” US perspective while Fuchs is a “very promising next-generation arbitration counsel.”

Esa Kaikkonen, counsel at Finnish forest industry company Metsä Group, hired McDermott Will & Emery for a case that eventually settled and says the team’s desire to “understand the business case thoroughly” was critical to achieving that end.

Kevin Norman of German chemicals group Evonik Degussa says that McDermott lawyers managed to negotiate a settlement on the eve of arbitration that made his business “extremely happy”.

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