The two partners at the centre of Deacons’ successful Hong Kong High Court action against White & Case are being forced to fund the longstanding lawsuit with their own money.
A capped indemnity that White & Case gave to former Deacons insolvency lawyers Mark Fairbairn and Edward Cairns, who joined the US firm in mid-2002, to cover the cost of the litigation has expired.
As a result, Fairbairn and Cairns are now having to pay the legal fees in the appeal against last October’s High Court ruling against the pair and White & Case.
To slash costs, the duo replaced Herbert Smith last December for Johnson Stokes & Master partner Nick Hunsworth, who is also acting for White & Case. It remains unclear exactly how much the legal fees amount to so far, but a source said they are several million Hong Kong dollars.
As first revealed on www.thelawyer.com (24 October), White & Case lost out in the bitter court battle started by Deacons after the US firm recruited Fairbairn and Cairns two years ago.
The High Court ruled that the pair breached their partnership contract, illegally tried to persuade Deacons clients to follow them and passed confidential information to White & Case while at their former firm. The judge also held that White & Case encouraged the pair in the first two offences.
An appeal by both sides will be heard by the High Court on 3 November. White & Case is appealing against the ruling. Deacons is appealing for exemplary damages.
White & Case declined to comment. Fairbairn and Cairns were unavailable for comment.