KWM drops lawsuit against ex-partner and Goodwin with deal to take on 26-strong team


Goodwin Procter is to take on a team of 26 King & Wood Mallesons (KWM) lawyers in London, with the team hire granted as part of a deal that also saw KWM drop litigation against the firm and corporate partner Richard Lever.

Fifteen associates joined the US firm today alongside the six partners whose moves had already been announced, with five trainees expected to join shortly.

The team hire required a special vote of KWM’s partnership because of the strained relationship between the two firms, with the litigation dropped as part of the same deal. It is understood that around 100 KWM partners voted in favour of the deal, with seven partners voting against the acquisition.

KWM launched claims against Goodwin and Lever in the Queen’s Bench Division of the High Court earlier this year, in response to Goodwin’s hire of a six-partner private equity team from KWM’s Paris office in April this year.

Goodwin hired five partners from KWM in November, including UK investments funds head Michael Halford, having hired KWM’s former corporate co-head Lever in April 2015.

Goodwin and Lever instructed Hogan Lovells to defend the claims, with employment partner Stefan Martin leading the firm’s team, while KWM turned to Mishcon de Reya, which fielded a team headed up by employment head Daniel Naftalin.

KWM is thought to have spent between £500,000 and £1m in fees relating to the claims.

DLA Piper and Reed Smith are among the firms still in discussions to take on teams of lawyers from the legacy SJ Berwin business in addition to partner moves already announced, but their acquisitions will not require a KWM partner vote.

KWM Europe filed a second notice of intent to appoint administrators this week and is widely expected to enter administration later this week.

The court documents show that restructuring company Quantuma has replaced AlixPartners as proposed administrators to the firm, with Andrew Hosking and director Sean Bucknall named on the documents.

KWM European and Middle East managing partner Tim Bednall sent an email to all staff yesterday (10 January), stating that this change occurred because AlixPartners was concerned about funding. His email also confirmed that staff will not receive any salary payments in January, after Barclays refused to release any more funds to the firm.

The bulk of KWM Europe’s partners have now found homes at other firms. KWM’s China arm is in talks to keep a number of European partners, including banking partner Vanessa Docherty and corporate partners Joseph Newitt, Greg Stonefield and Wang Lianghau, who are among those in discussions to join KWM’s Chinese arm, along with a 10-lawyer City litigation team.

It is thought that KWM China could retain partners in eight out of nine KWM European offices – London, Paris, Frankfurt, Madrid, Milan, Dubai, Brussels and Luxembourg. The firm’s Munich office is expected to close this month.

Earlier this week (9 January), Mishcon de Reya and Simmons & Simmons became the most recent firms to take on KWM partners, with Reed Smith also set to take at least three more partners across Europe following its recent hires of City tax head Gareth Amdor and financial regulatory partner David Calligan.

Last week, McDermott Will & Emery announced that it is hiring KWM UK, Europe and Middle East senior partner Michael Cziesla as a corporate partner in Germany.

Numerous other firms have picked up partners including Baker McKenzie, Fieldfisher, Debevoise & Plimpton, Stephenson Harwood, DLA Piper, Greenberg Traurig, Macfarlanes, K&L Gates, Winston & Strawn, Orrick Herrington & Sutcliffe, Fieldfisher, Addleshaw Goddard, Covington & Burling, Keystone Law, Proskauer and Goodwin Procter.

KWM and Goodwin declined to comment.