Risk Update

Law Firm DQ & Conflicts News — Re-disqualified in Russian Bank Matter, Insurer Calls Conflict on Bankruptcy/Abuse Matters

Posted Dan Bressler

“Federal Judge Disqualifies Baker McKenzie From Representing Russia’s VUZ Bank” —

  • “Attorneys from Baker McKenzie have been disqualified from representing Russia’s VUZ Bank after a federal judge in Virginia determined a conflict of interest was present.”
  • “The court granted both Deniz Bahceci’s and Alettin Bahceci’s motions to quash the subpoenas and to disqualify Baker McKenzie counsel from representing VUZ Bank due to a conflict of interest.”
  • “Dillon said Baker McKenzie attorneys violated Virginia Rules of Professional Conduct when attorneys from the firm met with Kroll, an agent of Hakan Agro, concerning the company’s insolvency and possible liquidation in June 2021 while representing VUZ Bank in a similar matter.”
  • “Dillon rejected the bank’s argument that the intervenors do not have standing, saying Deniz and Alettin Bahceci are ‘clearly implicated,’ with Deniz Bahceci representing the minor children and Alettin Bahceci being the potential target of criminal proceedings in Dubai. Attorneys Brian Lee Whisler, Jacob Kaplan and Robert Edward Duffy III of Baker McKenzie previously represented VUZ Bank. A request for comment from the attorneys went unanswered.”
  • “Dillon noted that a nearly identical scenario occurred in the U.S. District Court for the Northern District of Georgia when VUZ Bank sought information from Georgia resident Ashley Anderson Bahceci, the ex-wife of the now-deceased Hakan Bahceci, who founded Hakan Holdings.”
  • “The Georgia court determined that Baker McKenzie should be disqualified from representing VUZ Bank pursuant to Georgia Rule of Professional Conduct 1.18(c), which says ‘that [a] lawyer [who has learned information from a prospective client] shall not represent a client with interests materially adverse to those of a prospective client in the same or a substantially related matter if the lawyer received information from the prospective client that could be significantly harmful to that person in the matter, except [if both the prospective client and current client have given informed consent in writing].'”
  • “Just like in the Georgia case, Baker McKenzie failed to obtain informed consent in writing regarding the conflict of interest for the Virginia case, Dillon said.”
  • “All Baker McKenzie attorneys are disqualified due to a Virginia rule not allowing representation from any lawyer at a firm in which a disqualified lawyer is ‘associated,’ the filing said.”

“Camden Diocese Insurer Wants Cole Schotz Out Over Conflict” —

  • “One of the Diocese of Camden’s insurers has called foul on the diocese’s plan to hire Cole Schotz PC as special counsel in its bankruptcy case on the grounds that the firm is already representing one of the sex-abuse claimants against the diocese.”‘
  • “The diocese’s main attorney, Richard Trenk, filed on Oct. 21 to bring on Cole Schotz as special counsel to defend him during a court-directed deposition. Century called the move ‘improper,’ as Cole Schotz is also the counsel of record for one of the claimants, confidential claimant No. 532.”
  • “‘While the Debtor goes on to say that this representation is solely in connection with a motion to allow a late-filed proof of claim, it offers no evidence to confirm that is the case but even if it did, it would not matter,’ Century wrote in its objection.”
  • “That claimant’s motion is still pending, and representing both the claimant and the diocese is a conflict of interest under New Jersey’s Rules of Professional Conduct, Century wrote.”
  • “Warren Usatine, the co-managing shareholder of Cole Schotz who Trenk proposed to hire, acknowledged the connection with confidential claimant No. 532 in working on the late-filed proof of claim, but maintained in his application to represent Trenk that it wasn’t a conflict of interest. ‘Insofar as I have been able to ascertain after diligent inquiry, neither I, nor Cole Schotz, nor any member, counsel or associate thereof have any connection with, or have an adverse interest to, the parties on the Entity List except as set forth herein,’ he wrote.”
  • “Century was not convinced. ‘To be clear, this is not a mere technical conflict,” it wrote. “The information Mr. Trenk may discuss with counsel should not be disclosed to counsel for claimants. And, by allowing this concurrent representation, such disclosure is possible.'”