Sullivan & Cromwell. (Photo: Jason Doiy/The Recorder)

Sullivan & Cromwell hit back this week at a former Skadden, Arps, Slate, Meagher & Flom associate who accused the firm of double-dealing in an international arbitration matter in which a partner served as chair of the panel, saying his $13 million lawsuit offers a "tortured and illogical narrative" that's not supported by the facts.

Andrew Delaney sued the firm in New York state court in December, contending that after an arbitration panel chaired by a Sullivan & Cromwell partner awarded $56 million to his client, a Thai company whose coal-fired power plant in Laos was later expropriated by the country's government, the firm then represented the government of Laos to fight the award.

But Sullivan & Cromwell litigation practice leader and general counsel David Braff, along with partner Matthew Porpora, responded Monday that the suit should be thrown out in its entirety, contending the allegations underpinning each of Delaney's claims are false.

"In an attempt to collect a fee to which he is not entitled under the alleged contingency fee arrangement (because the arbitral award was vacated as legally infirm and no fee is collectable), plaintiff misstates the factual record and makes illogical arguments to try to manufacture 20 causes of action against S&C," the Sullivan & Cromwell attorneys said in a filing.

Delaney worked in Skadden's foreign practice group in New York and Hong Kong after graduating law school in 1988, and in 1992 began representing several arms of a Thai company that sought to develop an 1,800-megawatt coal plant in Laos.

Those two businesses, Thai-Lao Lignite Co. Ltd. and Hongsa Lignite Co. Ltd., later inked a joint venture agreement with Thailand's largest private energy company, Banpu Public Co. Ltd., which then allegedly terminated the agreement and used confidential and proprietary information to take over the project.

In his initial complaint as well as an amended version, Delaney said that he advised the two businesses on contingency in an investor-state arbitration against the Laos government, chaired by Sullivan & Cromwell partner James Carter, now senior counsel at Wilmer Cutler Pickering Hale and Dorr. In 2009, the panel awarded the businesses $56 million.

Eight years later, however, the highest court in Malaysia, where the arbitration was seated, overturned the award, concluding the arbitrators had erred. Delaney contended that Sullivan & Cromwell's legal work on behalf of Laos' central bank played a role in the decision to vacate the award.

But in the firm's response, it pointed to two "fundamentally and facially faulty propositions:" Delaney's allegation of a conflict of interest by the firm, and his theory that the firm's conduct robbed him of fees to which he was "entitled."

In the first instance, Sullivan & Cromwell noted that Carter had left the firm a year after the arbitration panel issued its decision, saying this was before it took any action on behalf of the Lao central bank.

"Firms do not act as arbitrators, individuals do. And the conflicts rules that apply in such circumstances do not bar subsequent representations by a law firm with which the arbitrator was formerly affiliated," the lawyers said.

And, to the second point, the firm said the Malaysia decision vacating the arbitration award meant that Delaney could not claim any entitlement to a share of the money.

"After the award was vacated (on grounds entirely unrelated to any argument the firm made), there was, of course, no award to enforce," they said.

In addition to asking that the suit be dismissed with prejudice, Sullivan & Cromwell wants Delaney and his counsel, Christopher Beres, sanctioned for bringing forth a lawsuit based on "facts" they claim are demonstrably false.

Beres—a Florida-based solo practitioner who, like Delaney, has a long history in Southeast Asia—declined to comment on the filing Wednesday, but said he would be responding in court.