Sullivans launches press leak inquiry

HIGH-FLYING US litigator Steven Holley is the subject of an internal investigation at his firm Sullivan & Cromwell after he handed over sealed court papers to a reporter.

Holley, a partner with the prestigious New York firm, last month provided Business Week legal editor Linda Himelstein with documents relating to Sullivan's client, Bankers Trust.

The documents, filed under seal by Procter and Gamble, included a proposed amended complaint and related papers in support of a $196 million claim against Bankers Trust.

Holley has since claimed he was unaware the papers, which detailed a case he was not involved with, were sealed.

However Himelstein alleges she discovered the words 'filed under seal' on the fifth or sixth page of the documents on the day she received them. She says she immediately telephoned Holley and told him of the error. Despite telephone records to support her claim, he denies the conversation took place.

Holley is currently not returning press calls, while Sullivan & Cromwell's senior partner Ricardo Mestres refers callers to a written statement.

The statement says the disclosure of the papers “resulted from a communication failure within our firm and a clear departure from firm procedures”.

“We have expressed our profound regrets to Bankers Trust and told them how distressed we are by these events,” it says. “The firm maintains the highest standards of confidentiality and has procedures to ensure they are met. We have begun an immediate review of those procedures to ensure that this type of exceptional breakdown never occurs again.”