Ex-Client Loses TRO Bid to Ban Cravath in $5.1B Deal, But Could Win Next Round Next Week
Posted Feb 9, 2010 3:40 PM CDT
By Martha Neil
Caught in the crossfire between current and former clients, Cravath Swaine & Moore can continue representing Air Products & Chemicals Inc.—at least until next week—in a $5.1 billion takeover bid for Airgas Inc., a Pennsylvania judge ruled today.
While Judge Albert Sheppard Jr. rejected a request by Airgas for a temporary restraining order against the renowned New York law firm, he scheduled a hearing next week in the Philadelphia case to hear a motion to disqualify Cravath, reports Bloomberg.
“This is quintessential adversity your honor,” argued attorney Jeffrey Weil, who represents Airgas. “You cannot represent two clients at the same time who are adverse.”
Cravath represented Airgas in at least 25 financing matters between 2001 and 2009, the news agency reports. Then the firm bowed out, citing a conflict.
Weil serves as litigation chair for Cozen O'Connor; the firm's chairman, Steven Cozen and another litigation partner, Thomas Wilkinson Jr., also are working on the Pennsylvania case, American Lawyer reports.
A copy of the Court of Common Pleas complaint (PDF) that alleges Cravath breached its fiduciary duty to Airgas is provided by the Am Law Daily. It was filed Friday.
Cravath, which is represented by John Guernsey and Nancy Gellman of Conrad O'Brien, said the case is "without merit," but declined to comment further to the legal publication.
Meanwhile, the two Pennsylvania-based companies are also at battle in Delaware Chancery Court, where Air Products—represented by Cravath, as lead counsel, and Morris Nichols Arsht & Tunnell as local counsel—filed suit Thursday contending that Airgas failed to give proper consideration to earlier Air Products offers to purchase the smaller company.
A copy of the Delaware complaint is provided by Scribd.
Airgas has reportedly retained Daniel Neff and David Katz of Wachtell Lipton Rosen & Katz to fight the takeover bid.
Wall Street Journal Law Blog: "Is Cravath One Step Closer to Getting Out of Conflicts Lawsuit?"
Updated on Feb. 10 to link to subsequent Wall Street Journal Law Blog post.