Kirkland Defends Work in Chinese Company Case Critiqued by Judge

Kirkland & Ellis on Thursday defended its work for a Chinese property company in response to scrutiny by a British Virgin Islands judge, saying that the firm’s brief involvement ended before a controversial financing transaction that was later undone by the court.

Bloomberg Law reported on Wednesday that Kirkland and Latham & Watkins were recently reprimanded by Judge Adrian Jack of the Islands’ Commercial Court for their work on behalf of Nam Tai Property Inc. The company has been involved in a fight for control of its board of directors between U.S.-based shareholders and a Chinese real estate company, Kaisa Group Holdings Ltd.

Jack said the law firms’ work could have subverted the interest of Nam Tai’s shareholders, who alleged the company’s directors were under the sway of Kaisa Group. The judge also unwound a $170 million financing transaction that he found could have prevented the calling of a special meeting which would likely have seen a number of Nam Tai directors replaced.

“Kirkland & Ellis was only engaged by Nam Tai for seven days, our engagement ended prior to any decisions being made regarding the disputed financing transaction,” Kirkland spokeswoman Kate Slaasted said in a statement.

“The firm was not involved in any of the court proceedings, nor was it consulted by the parties to these proceedings at any time during the pendency of these proceedings,” Slaasted continued. “As always, Kirkland adhered to the highest standards of professional ethics and integrity and we stand behind the unimpeachable conduct of our colleagues who worked on this matter for seven days.”

Latham & Watkins served as Nam Tai’s legal advisor on the deal. In his judgment, Jack criticized an e-mail he said involved lawyers from Kirkland, which stated a preference to avoid discussing some questions in writing for discovery-related reasons.

A Latham spokeswoman, Jamie Zuieback, said on Wednesday the firm “respectfully, yet adamantly” disagreed with any suggestion the firm acted improperly in connection with the matter.

Nam Tai has said it intends to appeal the ruling.