“Former Allianz Fund Manager Accuses Firm and Its Lawyers of Double-Crossing Him” —

• “A former Allianz SE fund manager who was blamed for losses the firm suffered during a market meltdown sparked by the Covid-19 pandemic has accused federal prosecutors of committing ethical breaches by turning his own lawyers against him.”
• “Gregoire Tournant, who was a chief investment officer for one of Allianz’s U.S. investing divisions, said prosecutors encouraged lawyers that were acting both for the firm and for him personally to later switch sides and use his privileged communications to help build a false narrative against him.”
• “At the time of Mr. Tournant’s arrest, Allianz agreed to pay about $6 billion in penalties and restitution to investors as part of a deal with the government. The firm admitted to having deficient internal controls but said criminal misconduct was limited to a handful of individuals who no longer worked at the company. “
• “The breach described by Mr. Tournant allegedly arose as a result of an arrangement under which lawyers from the firms Sullivan & Cromwell LLP and Ropes & Gray LLP agreed to represent both Allianz and Mr. Tournant amid the investigations by the Justice Department and the U.S. Securities and Exchange Commission. Mr. Tournant was also represented by a third firm that wasn’t jointly retained by Allianz, according to his motion.”
• “Sullivan & Cromwell and Ropes & Gray said a joint representation would be more efficient, said Mr. Tournant. The arrangement appears to have been made at a time when both parties anticipated that their legal interests would be similar. The firms’ agreements required them to inform Mr. Tournant in the event that a conflict of interest arose, according to his motion.”
• “Allianz’s posture toward Mr. Tournant changed after Mr. Bond-Nelson broke ties with the firm’s defense team and began shifting blame to Mr. Tournant, according to his brief. Company lawyers continued meeting with Mr. Tournant in their capacity as his lawyer, but Sullivan & Cromwell had begun to conduct an investigation that would lead them to suggest to the government that he had committed wrongdoing, he said.”
• “Representatives for Allianz and Sullivan & Cromwell declined to comment. Ropes & Gray didn’t respond to a request for comment.”

And from Diana C. Manning, managing principal at Bressler, Amery & Ros [no relation]: “Serving 2 Masters? Conflicts of Interest in the Representation of Closely Held Entities” —

• “Among those issues are the challenges of representing closely held corporate entities and the conflicts that may arise from actual or perceived representation of the organization’s constituent members. A typical situation involves a lawyer being asked by a client to form an entity, and then at some future point, being asked to represent either the company or the member in a dispute with other equity holders. These situations are fraught with peril that can easily lead to disqualification, disciplinary action or potential malpractice liability. This article examines conflicts of interest in the organizational setting and discusses potential consequences from a failure to spot and adequately address such conflicts.”
• “The lawyer’s primary duty, therefore, is to the corporate entity and not to its directors, officers, employees or other constituents… Depending on the type of business entity and the jurisdiction, the representation of an organization itself may per se constitute representation of the individual constituents. This has increasingly been the case with respect to unincorporated business partnerships.”
• “The best defense in situations that present these potential conflicts is to be clear from the outset about who you do and do not represent, both with the client and others who may mistakenly assume they are a client. If approached by a client to assist in the creation of a business entity, the lawyer should be clear in his engagement agreement about who is the client. Is it the individual who approached the lawyer? Or is it the entity to be created? Clarifying this issue will assist in resolving conflicts down the road.”
• “Being clear about these issues will also help avoid future conflicts in the event you are asked to represent the individual member in a dispute with the company and its members.”
• “Although a lawyer who has represented an individual stakeholder in an entity is not per se precluded from later representing the company in litigation or other business transactions, considerations of actual and potential conflicts must be continuously assessed.”
• “Using the example of an attorney that had prepared operational documents on behalf of an individual client and who is then asked to represent the organization in litigation filed by a third party, the following, among other things, should be kept in mind: Will the representation of the entity implicate a conflict or perceived divided loyalty with the original client? Perhaps it would if the lawsuit arises from the original client’s conduct. But if the lawsuit presents a simple contract dispute with a customer, the risk is substantially less. Does the lawsuit present issues that would place the individual constituents at odds with one another? Under such circumstances, representation of the entity should likely be declined.”
• “Given the stakes, careful consideration of the potential conflicts arising from the representation of a closely held corporation must be taken in all instances. An opinion from ethics counsel can assist in determining the appropriate course of action and identifying potential circumstances that may require later withdrawal, the necessity and form of potential conflict waivers or other disclosures, and appropriately drawn engagement agreements.”

“Biglaw Firm To Dump Kanye West As Client By Publishing Ads About It In Local Newspapers” —

• “What’s a Biglaw firm to do when it wants to part ways with a celebrity client who’s completely MIA? It looks like the answer here is to treat that celebrity like an average joe and take to the local newspapers to dump him.”
• “That’s what’s currently going on between Greenberg Traurig and Ye (fka Kanye West).”
• “‘According to legal docs, obtained by TMZ, Greenberg Traurig, LLP claims there’s been ‘a breakdown in communication’ with Kanye, as they attempt to let him know they’re off of the case. They say Ye apparently deactivated the phone number they previously used to get in touch with him.'”
• “‘As a result, the docs say the company’s looking to use ‘alternative means’ to reach him … which includes putting ads out in 2 L.A.-based newspapers, and publishing the order from the judge, which allows them to withdraw from the case, for all to see.’
• “‘The docs say the goal is to inform the rapper about the order — and seeing as he’s incommunicado, this is the best option left to give him notice. The firm says it’s aware the publication would ‘likely garner significant media attention, resulting in broader publication.””