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When Gianni Origoni Grippo & Partners’ managing partner Francesco Gianni told Parmalat administrator Enrico Bondi he would only take the job if it didn’t entail suing global financial institutions, he was obeying one of the 10 commercial commandments: “Thou shalt not sue the investment banks.”
To be fair to Gianni, he was open with Bondi about this from the outset, as was US firm Weil Gotshal & Manges. But it was obvious that Bondi would, at some point, turn on the international investment banks.
Citibank is not a client of Gianni Origoni, but many other potential targets are. Gianni Origoni could have had an actual, rather than merely a commercial, conflict.
On the €290m (£191.6m) claw-back launched against UBS in Parma last Friday (6 August), Bondi turned to litigation boutique Studio Legale Lombardi Molinari, and specifically name partner Guiseppe Lombardi, who is gaining quite a reputation as a bit of a Rottweiler. Lombardi has no affiliation with the Italian banking establishment, which is obviously why Bondi chose him. Either that or none of the more established Italian litigation firms felt they could take on the investment banks.
Law firms on the UBS claim are not yet on the public record, but Clifford Chance, Chiomenti and Paul Weiss Rifkind Wharton & Garrison are advising Citigroup against a US action brought by litigation specialist Quinn Emanuel Urquhart Oliver & Hedges.
When you look at the names involved, it starts to take on ‘David versus Golliath’ proportions. But Bondi should thank his lucky stars that he doesn’t have to bring an action in London. Here nobody will touch the banks. When the Brascan consortium considered action against the Royal Bank of Scotland in the Canary Wharf bid, not one firm would take the instruction, and Brascan went straight to the bar.
Driven at the outset by the investment banks’ desire to deepen relationships with core panel firms, the situation has now crystallised into a scenario where it is virtually impossible to instruct a top litigator if you want to sue an investment bank.
Have law firms overreacted to the investment banks’ demands? Maybe, maybe not. As one banker said: “When a law firm puts in a conflict search, it goes to the relationship partner, who is probably a senior corporate partner.” Strangely, senior corporate partners tend to like the investment banks, even if they don’t already work for them.