A UK-based investment group has filed a negligence claim against international firm Baker McKenzie in the US, claiming the firm failed in its effort to recover a Siberian coal mine.
London-based Lehram Capital Investments Ltd and its owner Daniel Rodriguez filed a complaint last month at the Circuit Court of Cook County, Illinois, the state where Baker McKenzie was founded.
The complaint alleges that the firm failed to detail connections in Russia that might have affected its advice. The firm is also alleged to have misled the company into a proposed deal with a client who had been convicted of a violent crime, which it is claimed caused reputational damage.
Rodriguez is seeking undisclosed damages.
A spokesperson for Baker McKenzie said the claim had no merit and would be contested vigorously. ‘A UK-based company filing a claim in Cook County, Illinois, for work carried out in Russia is a blatant example of forum shopping,’ it added.
According to the complaint Lehram bought the Gramoteinskaya coal mine in Siberia’s Kemerovo region in 2013. It was reportedly valued at £133m.
Lehram director Igor Rudyk was subsequently detained by Russian authorities in Kemerovo and allegedly forced to sign documents transferring ownership of the mine to a family with close ties to local politicians.
That prompted Rodriguez to enlist the help of Baker McKenzie to help recover the mine. But, according to the complaint, the firm did not reveal that it had a number of clients in the Kemerovo region, including the original seller of the mine, and others who relied on the ‘patronage’ of the governor.
The client convicted of a violent crime was Gavril Yushvaev. The complaint submits that Baker McKenzie suggested a litigation financing deal could be struck between Rodriguez and Yushvaev, but did not mention Yushvaev's criminal past.
According to the complaint: ‘Had Baker McKenzie disclosed to Rodriguez and Lehram the true background, Rodriguez would have refused to even consider entering into any conversations, discussions, arrangement or meeting.’