Denton Wilde Sapte’s depleted competition department has lost one of its most important clients: the group of major high street banks being investigated by the Office of Fair Trading (OFT) over MasterCard fees.
The loss of this high-profile instruction compounds the problems of a competition practice that lost its two biggest stars last month when Suyong Kim defected to Wilmer Cutler & Pickering and head of department Polly Weitzman announced a move to Ofcom.
Lovells, which was recommended by one of the banks, picked up the work following a competitive tender. Dentons and Slaughter and May also pitched for the work.
Wilmer was not asked to tender, possibly because as yet the firm has insufficient capacity in London to handle such a large instruction.
The Lawyer understands that the banks decided to review their external counsel once they found out that Kim, who has been advising on the investigation, was leaving. The firms pitched two weeks ago and were informed of the decision early last week.
The OFT said this February that it believed banks charge retailers an unjustifiably high fee for processing MasterCard transactions; the fees are then passed on to consumers.
Barclays, HBOS, HSBC, Lloyds TSB and the Royal Bank of Scotland are all involved, together with nine other high street banks.
The inquiry will drag on until next year with an appeal a real possibility should the OFT rule against the banks. The European Commission is carrying out a parallel investigation into MasterCard’s main rival Visa, and the OFT has hinted that it may also look at Visa. Dentons could therefore have lost out on millions of pounds worth of fees.