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GAR 100 - 9th Edition

DLA Piper

18 February 2016

Acting for Gazprom in a US$50 billion feud with Ukraine’s Naftogaz

People in Who’s Who Legal 3
Pending cases as counsel 139
Value of pending counsel work US$82.3 billion
Treaty cases 11
Current arbitrator appointments 16 (of which 7 are
as sole or chair)
Lawyers sitting as arbitrator 9

DLA Piper has had various guises over the years but dates back to 1821. The DLA brand was created at the turn of the millennium in the UK, while the incarnation of the firm we know today is the product of various mergers with US law firms in the second part of the 2000s.

The result of these mergers – and a seemingly relentless expansion – is the world’s largest law firm by revenue, with lawyers nearly everywhere and financial results that are the envy of many.

That kind of business model generates plenty of scope for cross-border disputes work, and the firm has indeed developed sizeable arbitration teams in London, New York and Hong Kong, among other places.

The current global practice group began to take shape in 2001 with the arrival of Matthew Saunders, who was hired to develop a wider group in the area. He became co-chair of the international arbitration practice in 2006 alongside Claudia Salomon, who joined the New York office in that year from Squire Sanders but left in 2013.

The team expanded as it took over new operations and made lateral hires aimed at gaps in its coverage. One of those hires was former Debevoise & Plimpton high-flyer Michael Ostrove in France, to help deal with an increase in work under ICC rules.

The group also enjoyed a whole new level of visibility in 2010 when it became adviser to the Russian side in arbitrations that flowed from the Russia–Ukraine gas wars of 2008 and 2009. It has recently followed this up with a stream of cases for Gazprom against Ukraine’s Naftogaz.

Matthew Saunders announced his departure for Ashurst in early 2016, meaning the global practice is now chaired by Michael Ostrove in Paris. Yu Jin-Tay (who joined from Shearman & Sterling in 2013) coordinates the practice in Asia, while partner Henry Quinlan in Dubai handles the Middle East. The group’s co-head for the Americas, Camilo Cardozo, also moved to Paul Hastings in 2016, meaning that arm of the practice is now led by Cedric Chao in San Francisco.

Network

Almost too big to cover here. In arbitration terms, the more important offices are London, Paris, New York, Singapore and Dubai – but it’s in a whole lot of other places too. In Australia, for example, a merger with Phillips Fox added a Perth-based mining disputes team. It also has an arrangement with Venezuelan law firm InterJuris Abogados, giving it a presence in Caracas.

It’s continued to expand in the Americas in the past year, completing tie-ups in Canada, Mexico, and Colombia. It has a foothold in some 15 African jurisdictions, most recently adding Mozambique.

Another recent merger is with Czech firm Haškovcová & Co, whose former partner Petr Šabatka now leads the combined arbitration and litigation teams in the Prague office.

Who uses it?

As mentioned, the firm has had regular business from Russian gas suppliers – especially Gazprom for whom it is acting in a set of SCC cases against Ukraine’s Naftogaz worth over US$50 billion. It also advises one of China’s largest shipbuilders, Jiangsu Rongsheng Heavy Industries, and is involved in five disputes for state-owned oil company Sinopec.

Work in 2003 for the Indian government on a BIT case (the Dabhol dispute) was leveraged into a treaty arbitration practice. DLA Piper’s government clients now include Georgia (in several matters), Thailand, Ghana, the Czech Republic, Hungary, Kyrgyzstan and Oman, Kenya and East Timor.

On the investor side, the firm acted for Turkish telecoms company Turkcell in a US$2 billion claim against Iran.

Lawyers from the firm’s Dubai and London offices are reported to have been acting for the Forbes-listed Hiranandani family in a high-profile dispute at LCIA India. It is also representing Spanish Egyptian Gas Company in a debt claim arising from an LNG tolling contract.

The firm is generally popular with any client that prefers its lawyers to be locally based rather than “fly in, fly out”. Energy and telecoms firms can be particularly hot on this.

Track record

DLA won two substantial payouts for Gazprom subsidiary RosUkrEnergo. The first award, worth US$2.6 billion, against Ukrainian state entity Naftogaz, concerned ownership of gas that was held in storage in Ukraine and allegedly acquired by the Tymoshenko regime. DLA Piper fielded a team from Moscow, London, Kiev and Stockholm. The case spawned litigation in the courts of Ukraine and New York.

The other award, worth US$500 million, was against Hungarian gas distributor Emfesz. That was worked on by DLA lawyers from London, Moscow, Kiev, Warsaw and Budapest, assisted by members of Swedish firm Setterwalls.

DLA Piper also secured a victory for the Czech Republic, after successfully defending a claim brought by a German investor in a championship golf course. In another case in 2014, it helped Ghana knock out all but US$12 million of a US energy company’s US$3 billion UNCITRAL claim.

The firm also helped Rusal – the aluminium producer owned by Oleg Deripaska – settle a pair of LCIA claims in 2014, which had challenged the validity of supply contracts worth US$48 billion.

In 2013, the firm won a large gas-pricing dispute for Italian utility Edison in an ICC arbitration in Paris, worth €300 million to the client. It also achieved a favourable settlement for Albania’s former state-owned telecoms operator following a €120 million ICC claim involving issues of Albanian, Greek and German law.

Recent events

DLA Piper achieved a major win for Oman in the state’s first investment treaty case, knocking out a US-Emirati investor’s US$273 million claim over a limestone concession. The state also received US$5.7 million in costs.

Madrid partner Javier Santos was part of a team that helped EDF subsidiary Edison win US$1 billion in a gas price review arbitration against Italy’s Eni. Quinn Emanuel Urquhart & Sullivan was lead counsel on the case.

Guinea has retained the firm to defend a pair of ICSID claims worth US$5 billion brought by companies linked to Israeli businessman Beny Steinmetz, over the revocation of mining licences following a bribery probe. Another new African state client is Kenya, which retained the firm to defend a claim by UK-registered mining investor Cortec.

On the commercial side, it is acting for French engineering group Technip in a high-value claim against Algerian state oil company Sonatrach; and for Chinese TV client Star Times in a US$200 million ICC claim against Ghana over the termination of a national TV network contract.

Ongoing court-related work includes helping Moldova to resist enforcement of a US$49 million Energy Charter Treaty award in favour of Ukrainian energy company Komstroy. It continues to act for Thailand in resisting enforcement of a €29 million award in the German courts.

In the past year, DLA Piper made up a new partner in London, former barrister James Carter. London partner Simon Palmer and legal director Suzannah Newboult moved to Dubai to bolster the firm’s presence there. In Singapore it promoted a new of counsel, Matthew Shaw. Apart from the departures of Matthew Saunders and Camilo Cardozo (see above), the firm also lost two other partners: Ioannis Alexopoulos to Bryan Cave in London; and Nick Marsh to Quinn Emanuel in Singapore. Marsh had been lead counsel in the US$48 billion Rusal matter mentioned above.

Client comment

One client, who instructed DLA in a dispute of maximum importance to his company, says it was the team’s dedication that impressed him the most. “No stones were left unturned until they had found the angles and issues that made the case what it ended up being, giving us the leverage we were looking for in a complicated dispute against very experienced opponents,” he notes. DLA Piper’s fees are still below those of their competitors, with the lead partner providing “an impressive billing discipline”, the same client points out.

London partner Kate Cervantes-Knox has also received strong praise as somebody that a third client “was grateful to have on side”. “She is extremely responsive to client concerns and priorities,” he says. “She had to do some difficult oral arguments before a very difficult arbitrator and she killed it, aggressively staying on top of the issue and arguing the points effectively.”

London partner Kate Cervantes-Knox has also received strong praise as somebody that a third client “was grateful to have on side”. “She is extremely responsive to client concerns and priorities,” he says. “She had to do some difficult oral arguments before a very difficult arbitrator and she killed it, aggressively staying on top of the issue and arguing the points effectively.”

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