Baker McKenzie can be sued in Chicago for work performed in Russia by possibly defunct outpost, judge rules
Updated: Baker McKenzie can be sued for malpractice in Chicago for work in Russia on behalf of a client seeking to reclaim a Siberian coal mine said to be worth more than $200 million, a Cook County, Illinois, judge has ruled.
In a Jan. 23 decision, Judge James E. Snyder of the Cook County Circuit Court ruled against arguments by Chicago-based Baker McKenzie that Cook County, Illinois, is not the proper location for the lawsuit. Baker McKenzie initially maintained that the suit should be tried in Russia but now backs London as a proper forum.
The plaintiffs were London-based Lehram Capital Investments, which specializes in distressed assets, and principal shareholder Daniel Rodriguez, according to prior coverage of the case by the Wall Street Journal, Law360 and Law.com.
The suit claims that shortly after Lehram Capital Investments bought the Gramoteinskaya Mine in 2013, Lehram Capital Investments’ representative was detained, supposedly due to issues with his passport, in what was actually an extortionist plot. While in jail, the representative transferred Lehram Capital Investments’ interest in the mine to another party. The mine ended up in the hands of an entity controlled by a politically connected family.
Defendants in the suit are Baker & McKenzie International, Baker McKenzie and Baker & McKenzie LLP. But Baker & McKenzie LLP maintains that the plaintiffs hired a legally distinct law firm, Baker & McKenzie CIS-Limited.
The plaintiffs, on the other hand, claim that the firm is “one unified body of thousands of lawyers in dozens of domestic and international offices.”
It is not clear whether Baker & McKenzie CIS-Limited still exists, Snyder said. Baker indicated that it no longer operates in Russia.
Snyder did not appear to think that the international firm was protected by its global structure.
“It is not the case that because a law firm is nearly everywhere, with offices and capacity around the globe, that they are ultimately present nowhere,” Snyder said. “This claim regards the defendants’ work as an international law firm but work which has been anchored in Chicago for generations.”
In considering the forum for the litigation, Snyder said Illinois is “not a particularly convenient forum for these litigants,” but “no location is convenient.”
He acknowledged that the mine is in Russia “nearly 6,000 miles from Chicago” but said the parties don’t have to visit the mine. And while the case involves the conduct of government officials in the Kemerovo region, travel there or anywhere in Russia is impractical following the Russian invasion of Ukraine.
“This litigation regards parties of different nationalities and different national residencies,” Snyder wrote. “It regards events taking place thousands of miles from Chicago and thousands of miles from London. It regards events in Russia, a country that is involved in a foreign war of aggression, which all parties agree is not a proper forum. There is nowhere in the world where this litigation can be conducted with easy convenience. It can be tried before a jury of the Circuit Court of Cook County.”
It’s not the first time that Snyder has ruled that Chicago is a proper forum. He previously ruled for Lehram Capital Investments before the Russian invasion of Ukraine. The invasion happened while an appeal was pending. The appeals court remanded for further proceedings.
Baker McKenzie gave this statement to the ABA Journal: “We continue to believe this claim has no merit. A foreign U.K. company and a Spanish citizen filing a claim in Cook County, Illinois, to complain about work carried out in Moscow by Russian attorneys, arising out of a mining project in central Russia, in which none of the alleged events took place in the United States, constitutes forum shopping. We are continuing to review our appellate options.”
Updated Feb. 2 at 4 p.m. on to add the statement by Baker McKenzie.