Global law firm to drop Russian bank client in sacred Jewish texts case - Reuters
A nameplate of the Freshfields Bruckhaus Deringer LLP office is pictured in Frankfurt, Germany December 16, 2019. Picture taken December 16, 2019. REUTERS/Ralph Orlowski
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(Reuters) - In a long-simmering U.S. lawsuit over the return of historic Jewish manuscripts from Russia, Freshfields Bruckhaus Deringer said on Tuesday it was ending its legal work for a Russian state bank that had been fighting a subpoena in the case.
The London-founded law firm's move to disengage from VEB.RF comes about two weeks after the bank was hit with U.S. sanctions for Russia's invasion of Ukraine and just as the lawsuit over the religious texts was set to reach the U.S. Supreme Court.
Freshfields on behalf of VEB had planned to ask the Supreme Court to block a subpoena from a U.S. Jewish organization that is hunting for assets that might be seized to satisfy a $150 million judgment against Russia. The country has defied a 2010 U.S. federal court order to return thousands of religious letters and manuscripts to the group.
The move to end legal work for VEB, among the largest financial institutions in Russia with a $53 billion asset portfolio according to U.S. officials, marked the latest retreat by a major law firm away from a sanctioned entity in the aftermath of Russia's military attack on Ukraine. Russia has called its action a "special operation."
Freshfields with 2,800-lawyers said in a statement on Tuesday it was "moving swiftly" to exit its "mandate with VEB."
A message left for VEB seeking comment on Tuesday was not immediately returned.
Freshfields also is ending court work for VTB, Russia's second largest bank, according to a statement posted on the law firm's website on Monday. The statement said the law firm was "deeply concerned by the loss of life and unfolding humanitarian crisis in Ukraine."
U.S. Treasury authorities on Feb. 22 imposed a package of sanctions on Russian banks, including VEB and VTB. The Treasury said U.S. sanctions were intended to target the "core infrastructure of the Russian financial system."
Freshfields said in court papers filed on Monday night in Washington, D.C., that VEB was looking to find a new lawyer to represent it in the subpoena fight involving Agudas Chasidei Chabad of United States, the umbrella organization of the Hasidic Chabad-Lubavitch group.
Law firms generally cannot withdraw from client representation in the middle of litigation without approval from the court.
In this case, Freshfields asked the U.S. Court of Appeals for the D.C. Circuit to pause the proceedings until the bank hires new counsel. The law firm in its public statement said "our professional obligations – including duties to the court" required it to make such a court filing.
The D.C. Circuit did not immediately act on VEB's request on Tuesday.
Chabad sued Russia in 2004 claiming it was the rightful owner of books and other materials that fell ultimately into the hands of the Russian government after being left for safekeeping in a warehouse in the early 1900s. The Soviet Army seized the material from the Nazis during World War II.
A Washington, D.C., federal judge in 2013 held Russia in contempt for defying his court order to return the texts, and the court imposed a $50,000 daily fine that now tops more than $150 million. Russia had participated earlier in the case but withdrew in 2009.
VEB was not a defendant in the lawsuit, but Chabad won a court order, upheld on appeal last December, requiring the bank to turn over information about assets. Plaintiffs in some U.S. cases pursue assets when a party has refused to pay a court-ordered penalty. The full scope of what might be revealed was not immediately known.
VEB's lawyers have argued in court filings that the bank was immune from the reach of the U.S. judiciary.
Chabad's lawyers said the U.S. government's sanctions were "another arrow in our quiver" to convince the courts to compel VEB to reveal assets.
"Ultimately, our goal is not to get the assets. It's to get the books back," Robert Parker of Rothwell, Figg, Ernst & Manbeck, representing the plaintiffs suing Russia, told Reuters last week.
Manuscripts and letters that are the centerpiece of the court case are in the Russian State Library and the Russian State Military Archive. Other parts of the collection are in Moscow's Jewish museum.
The case is Agudas Chasidei Chabad of United States v. Russian Federation, U.S. Court of Appeals for the D.C. Circuit, No. 20-7080.
For plaintiffs: Robert Parker and Steven Lieberman of Rothwell, Figg, Ernst & Manbeck
For VEB.RF: David Livshiz of Freshfields Bruckhaus Deringer
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source: https://www.reuters.com/legal/government/global-law-firm-drop-russian-bank-client-sacred-jewish-texts-case-2022-03-08/
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