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A&O duo at risk of SRA investigation after criticism of Dahdaleh conduct

Two senior litigators from Allen & Overy (A&O) face the possibility of an investigation by the Solicitors Regulation Authority (SRA) following allegations of misconduct during a high profile fraud case.

A hearing on Wednesday (26 March) at Southwark Crown Court revealed that the Magic Circle firm had referred itself to the SRA due to a controversial meeting attended last year by two of its partners, David Esseks and Peter Watson.

The lawyers attended the meeting with their client Victor Dahdaleh, a Canadian businessman facing trial for his alleged involvement in bribes to secure contracts in Bahrain. Dahdaleh and the two partners had met a witness for the prosecution ahead of a first trial, which was aborted.

Following criticism of the meeting and allegations that the A&O lawyers had put pressure on the prosecution witness, the firm was replaced by Norton Rose Fulbright as counsel to Dahdaleh. A second trial saw Dahdaleh acquitted in December.

At the latest hearing on Wednesday, Judge Nicholas Loraine-Smith said that partners Esseks and Watson will not be referred to the UK Attorney General for a potential contempt of court proceeding but that he may raise the matter with the SRA. During the hearing, A&O’s counsel Alex Cameron QC conceded the meeting was ‘extraordinarily ill-advised’.

A&O said in a statement: ‘We welcome Judge Loraine-Smith’s decision not to refer the matter to the Attorney General, following counsel’s representations in Southwark Crown Court yesterday. We are ready to co-operate with the SRA and believe there were good grounds to justify the action that was taken at the time.’

An SRA spokesperson said: ‘We are aware that the judge will be making a referral and, now that proceedings have concluded, we will consider the referral and act accordingly. The firm has kept us advised of this matter.’

Any further action would likely be complicated as Esseks is a US lawyer, while veteran civil litigator Watson retired from the firm last year.

Whatever the outcome, the case will be regarded as embarrassing for the City giant at a time when most UK advisers are seeking to demonstrate their capability in handling white-collar crime work.

This week’s hearing is the latest twist in a saga that has seen criticism of the Serious Fraud Office (SFO) for overly relying on Akin Gump Strauss Hauer & Feld, which was representing prosecuting party Aluminium Bahrain (Alba) in the US in relation to the bribery claims.