Merger, they wrote? Conflict of interest claim leads to combination confusion
When is a combination not a merger? That's the question being asked of Norton Rose Fulbright as the firm for once attracts attention without adding a single partner to its sprawling empire.
September 22, 2014 at 07:40 AM
3 minute read
When is a combination not a merger? That's the question being asked of Norton Rose Fulbright as the firm for once attracts attention without adding a single partner, let alone a firm, to its sprawling empire.
While most eyes are currently on Bingham McCutchen through its involvement in not one but two effective merger stories (most of its UK arm splintered to Akin Gump this week, while its US headquarters is continuing to negotiate with US rival Morgan Lewis about a firmwide tie-up), Norton Rose has been embarking on some uncharacteristic back-pedaling.
Barely a year has passed without Norton Rose adding a firm to its Swiss verein since it first formed the Norton Rose Group with the addition of Australia's Deacons in 2010.
We have become accustomed to the firm proclaiming a succession of high-profile mergers as it positions itself as a global practice able to provide consistent, high-end legal advice to its multinational clients.
But now it has emerged that the firm is fighting claims of a conflict of client interest between legacy Fulbright & Jaworski and Norton Rose Canada, with the firm defending its position by arguing that its June 2013 union has been "mischaracterised" as a merger.
Now according to conflicts specialists, legally speaking the firm probably has a point – operating under a verein structure encompassing separate legacy entities with separate profit pools it could justifiably argue that there is no conflict of interest between the two parts of the business as there is no risk of confidential information being shared.
But in other senses this argument raises more questions than it answers, to the point where some would question whether it's an appropriate line for a firm keen to be seen as a single operation to continue pursuing.
Exactly what the difference between a merger and a combination is remains unclear but what is certain is that at no stage since Norton Rose embarked on its ambitious growth strategy has it attempted to correct how the unions have been reported in the press.
Unsurprisingly, the firm has been keen to be seen as a single firm, with a single revenue figure and the ubiquitous seamless service that goes alongside it. In fact, along with Hogan Lovells, it has been Norton Rose which has gone a long way in changing how verein firms without shared profits have been viewed both in the market and the press. Let's hope the firm's desire to get the best of both worlds doesn't undo its good work.
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