Three large Am Law firms representing Russian banks that were sanctioned following Russia’s invasion of Ukraine—White & Case, Debevoise & Plimpton and Latham & Watkins—will be able to withdraw from the case provided that substitute counsel file notices of appearance this month.
White & Case and Debevoise & Plimpton were granted permission to withdraw provided that substitute counsel file a notice of appearance by June 24. Latham & Watkins, which already missed one deadline to get substitute counsel to file an appearance notice, has been given until June 15.
The three firms represent two separate Russian banks in a lawsuit that revolves around the 2014 downing of Malaysia Airlines Flight 17 in Ukraine. The parents of an American who was one of 298 people killed after the plane was shot down are suing the banks, alleging they helped fund those responsible for the attack. The defendants have denied the claims.
White & Case and Debevoise & Plimpton, which represent Sberbank, had been trying to extricate themselves from the lawsuit for some time. In March, Sberbank filed a motion asking that the court stay action in the case, explaining that its lawyers from White & Case and Debevoise & Plimpton intended to end their relationship with the bank and were “actively seeking substitute counsel to represent Sberbank in this action.”
Latham & Watkins, which represents VTB Bank, also has been trying to get the court to release it from the case. In early May, U.S. Magistrate Judge Gabriel Gorenstein gave it permission to withdraw if substitute counsel for VTB Bank file a notice of appearance by June 2. That date passed without any notice of appearance being filed.
But last week, Latham & Watkins asked the judge to extend the deadline until June 15. Latham & Watkins’ lawyers told the court that VTB Bank had come to an agreement in principle with lawyers at the New York boutique defense firm Brafman & Associates, but that the sanctions imposed have caused delays.
“Due to the current Russia-related sanctions regime in the United States, the logistics of finalizing the engagement are taking longer than anticipated,” Latham & Watkins’ lawyers wrote. “But VTB anticipates this process to be concluded shortly.”
The judge agreed to the extension but warned that he will not grant future extensions without a sworn statement from those involved detailing efforts to hire a new attorney.
The Brafman & Associates lawyers who are expected to appear for VTB Bank are criminal defense lawyer Marc Agnifilo and Zach Intrater. Agnifilo has represented many high-profile clients, including former pharmaceutical executive Martin Shkreli, who was convicted of defrauding investors; disgraced Hollywood producer Harvey Weinstein; and former International Monetary Fund chief Dominique Strauss-Kahn, who was cleared of all charges related to several sexual scandals. More recently, he, along with Intrater, represented former Goldman Sachs banker Roger Ng, who was convicted of fraud in a trial related to the 1MDB scandal.
Ever since Russia invaded Ukraine and countries began imposing sanctions, it has become clear that dropping a Russian client in ongoing litigation is not easy.
Freshfields Bruckhaus Deringer has submitted a request to the U.S. District Court in Washington, D.C., in a different case, asking that it allow another lawyer to take over its representation of VEB Bank—another sanctioned bank tied to the Russian state. It provided the name of a lawyer as substitute counsel, but that lawyer, who is based in Connecticut, has not yet been admitted in Washington and has not submitted a notice of appearance.
And in March, a British Virgin Islands court refused to grant offshore law firm Ogier permission to withdraw from its representation of VTB Bank. The judge in that case famously told Ogier that “even pariahs have rights.”