Legal Business

Disputes Eye: Enyo goes to ground – what next for the pioneering disputes shop?

Disputes Eye: Enyo goes to ground – what next for the pioneering disputes shop?

It has been the question raised over wine by many seasoned litigators for months now: what’s going on at Enyo Law? At the beginning of last year, the litigation boutique hit the headlines thanks to surprise merger talks with fellow disputes specialist Stewarts Law, but since the discussion was abandoned the influential outfit has gone to ground.

Formed by ex-Addleshaw Goddard partners Simon Twigden (pictured), Pietro Marino and Michael Green, Enyo was launched in 2010 with a post-Lehman preoccupation of litigating against banks. The concept was simple: pick up the big-ticket work that larger firms were conflicted out of. It proved an immediate success, as the firm’s founders drew profits within a year thanks to some high-profile work. The firm won an instruction against an investment bank and lucrative work for Russian oligarch Boris Berezovsky, as well as representing claimants in a widely-reported case between North Shore Ventures and Anstead Holdings.

Despite equity being tightly held, associates were paid well, with generous bonuses for hitting billing targets and firm-wide performance. Enyo became hugely profitable, with revenues climbing 38% to £20.8m in 2016, while remuneration among the firm’s members hit £12.6m.

Aside from the hire of a tax disputes specialist and an insolvency specialist from Deloitte and Olswang respectively, 2017 was a relatively quiet year. Part of that was a reaction to what was felt to be overblown coverage of the Stewarts talks, a first-date discussion presented almost as a trip down the aisle (Twigden and Stewarts managing partner John Cahill go back years).

The shift of the firm’s practice even further towards international clients and arbitration also contributed to the lower profile.

That in part speaks to the challenges of handling complex litigation, which grows ever more work-intensive and can strain the logistics of considerably larger firms. Lovells, for example, was felt by many to have taken years to get back into stride after the end of the long-running BCCI dispute.

With Enyo distinguished for handling complex cases, the question is always how easy it will be to move on after major cases like the Libyan Investment Authority (LIA)’s long-running court battle with Société Générale and businessman Walid Giamhi, which settled last May. LIA was advised by Enyo.

The firm would counter that the model was always predicated on handling a small number of big-ticket disputes that, by definition, can settle at any time. Under this reading, there is no hedge beyond low fixed costs, a strong balance sheet and focusing on what you are good at (the firm’s accounts confirm the first two qualities are present). The firm is also still a natural referral choice for the Bar and Magic Circle.

Enyo’s most recent LLP accounts, filed in January, suggest at the least that growth has paused during 2016/17 – with revenue dipping from £20.8m to £20.4m. Operating profit was down from £12.5m to £12.1m, though the firm’s highest-earning member received £3.5m over the year, up on last year’s £3m remuneration.

Despite its small size, Enyo had huge influence in the City’s litigation market in helping to popularise the disputes boutique.

That is obviously an impressive margin though the results look softer benchmarked against the explosive growth recently seen by a range of disputes specialists, including Quinn Emanuel Urquhart & Sullivan, Stewarts and Signature Litigation.

Enyo’s lawyers still have a strong reputation, with the veteran Twigden a particularly respected player. Yet young law firms always face a challenging period when they try to move beyond a handful of influential founders. A merger is the obvious answer from a logistical perspective but culturally a much tougher sell for such firms that engage their lawyers precisely because they want to work in nimble disputes-focused outfits.

How this plays out will be closely watched in the Square Mile. Despite its small size, Enyo had huge influence in the City’s litigation market in helping to popularise the disputes boutique. The emergence of such firms did much to challenge a notion that litigators must always play second fiddle to transactional colleagues.

Meanwhile, Enyo maintains its belief that its model is as effective as ever – given the proliferation of quality dispute boutiques it is hard to argue. Growth will remain conservative beyond a desire to bring in a quality contentious IP partner.

What is conceded is that in the next few years the minds of founders will need to turn to an orderly succession to position it for independence. The only obvious alternative being an acquisition by a quality US brand with disputes at its core.

Either way, let us hope that process is taken seriously. Many clients were poorly served by the pre-2009 climate in which no decent commercial litigator would challenge the banks. It would be a shame if an institution that did so much to redefine the business of law failed to renew itself.

tom.baker@legalease.co.uk

Legal Business

Disputes Eye: Enyo goes to ground – what next for the pioneering disputes shop?

Disputes Eye: Enyo goes to ground – what next for the pioneering disputes shop?

It has been the question raised over wine by many seasoned litigators for months now: what’s going on at Enyo Law? At the beginning of last year, the litigation boutique hit the headlines thanks to surprise merger talks with fellow disputes specialist Stewarts Law, but since the discussion was abandoned the influential outfit has gone to ground.

Formed by ex-Addleshaw Goddard partners Simon Twigden (pictured), Pietro Marino and Michael Green, Enyo was launched in 2010 with a post-Lehman preoccupation of litigating against banks. The concept was simple: pick up the big-ticket work that larger firms were conflicted out of.

Legal Business

Major LIA mandate for Enyo ends as SocGen settlement reached

Major LIA mandate for Enyo ends as SocGen settlement reached

The Libyan Investment Authority (LIA) represented by Enyo Law, has settled its longstanding dispute against Herbert Smith Freehills (HSF) client Societe Generale (SocGen) and Mishcon de Reya client Walid Giamhi.

The LIA had sued Libyan businessman Walid Giahmi in 2014 in connection with an alleged $58m bribe paid to him by SocGen. The LIA has been fighting a number of cases to recoup losses made on deals during the financial crisis, including a separate action against American bank Goldman Sachs, which was dismissed after a two month trial last year.

But the LIA has now withdrawn its case against SocGen and Giamhi, and is liable for Giamhi’s costs. The LIA’s case was discontinued on the second day of trial, before oral openings could take place.

Giamhi was represented by Mishcon’s head of fraud defence Kathryn Garbett, with Enyo Law’s Simon Twigden acting for the LIA. HSF advised the French bank with a team led by Rupert Lewis.

Garbett, who described the LIA’s case as a ‘baseless conspiracy theory’, commented: ‘Giahmi provided full disclosure of all of his financial records and telephone communications dating back to 2006, which showed no illegal payments at all. Giahmi was also forced to seek confidentiality protection for the identities of other individuals in Libya giving evidence in the proceedings because of the risks to their lives and the lives of their families. The court agreed to impose these protective measures in the face of opposition from the LIA.

‘Giahmi is relieved that these proceedings, which had been brought in breach of Libyan Law, have come to an end.’

The LIA has been a key client for Enyo Law, which has advised it on this claim as well as LIA’s failed $1bn claim against Goldman Sachs over nine large financial derivative transactions that lost over 90% of their value.

In a statement Societe Generale said: ‘Societe Generale and the Libyan Investment Authority (LIA) jointly announce that they have signed a confidential settlement agreement that resolves all matters between both parties concerning five financial transactions entered into between 2007 and 2009 that have been the subject of legal action in the English High Court. The terms of the settlement are confidential. Societe Generale wishes to place on record its regret about the lack of caution of some of its employees. Societe Generale apologises to the LIA and hopes that the challenges faced at this difficult time in Libya’s development are soon overcome.’

Twigden’s team on the case consisted of Brick Court Chambers’ Mark Howard QC, Roger Masefield QC, Richard Blakeley and Craig Morrison. Lewis instructed 3 Verulum Buildings’ Adrian Beltrami QC, Nathaniel Bird and Emmanuel Sheppard alongside One Essex Court’s Sandy Phipps QC and Anthony de Garr Robinson QC. Garbett was supported in her defence of Giahmi by fellow fraud Mishcon defence partner Claire Broadbelt, and instructed Maitland Chambers’ Paul Girolami QC.

tom.baker@legalease.co.uk

Legal Business

‘What we really needed’: Enyo Law launches tax and insolvency practices with Deloitte and Olswang hires

‘What we really needed’: Enyo Law launches tax and insolvency practices with Deloitte and Olswang hires

Litigation specialist Enyo Law has announced the creation of tax and insolvency practices, following the hires of Fiona Walkinshaw and Louise Bell as partners.

Walkinshaw, a commercial and tax litigation specialist with 30 years’ experience, spent the period between 2009 and 2015 as head of corporate tax disputes at Deloitte.

Prior to her tenure at Deloitte, Walkinshaw had a broad commercial disputes practice encompassing civil fraud, banking and finance litigation, shareholder and partnership disputes, and professional negligence. Walkinshaw qualified with Withers, before working at Theodore Goddard, Garetts and Reynolds Porter Chamberlain throughout her career.

Bell joins from Olswang ahead of the firm’s tri-partite merger with CMS Camerona McKenna and Nabarro, has a particular expertise in insolvency disputes. It is understood she was able to exit the firm ahead of the union due to client conflicts.

One of her recent cases, Jetivia SA & Another v Bilta (UK) Limited & Others, is now a leading authority on the illegality defence. Before Olswang, Bell qualified with Wedlake Bell and subsequently worked as a partner at Gateley. Key clients include FRP Advisory, Grant Thornton UK, Griffins and KPMG.

Enyo Law partner Simon Twigden told Legal Business: ‘We’re a specialist dispute firm that mostly does big ticket arbitration and litigation in the financial space. What we haven’t done is any tax litigation, and increasingly those cases are vitally important to the clients.’

Twigden (pictured) added: ‘Tax seemed like a natural fit, insolvency as well. If you asked me for a list of what we really needed going forward, it was those two. We’ve filled them both, we’re delighted about that.’

Earlier this month Legal Business revealed that an £80m deal for fellow litigation specialist Stewarts Law to buy Enyo had been scrapped. The acquisition was due to be finalised before the end of the financial year. Details surrounding the transfer of lawyers and staff to Stewarts were not disclosed.

In a statement, Stewarts said: ‘Following very preliminary and exploratory discussions both firms have decided not to pursue matters further.’

tom.baker@legalease.co.uk

Read more on litigation boutiques in: ‘Focal points – Law boutiques and the art of focus’

Legal Business

Called off: Stewarts Law deal to acquire Enyo scrapped

Called off: Stewarts Law deal to acquire Enyo scrapped

A deal for Stewarts Law to merge with boutique Enyo Law to create an £80m disputes specialist has been called off, Legal Business can reveal.

The unexpected acquisition was due to be finalised before the end of the financial year. Details surrounding the transfer of lawyers and staff to Stewarts were not disclosed.

In a statement, Stewarts said. ‘Following very preliminary and exploratory discussions both firms have decided not to pursue matters further.’

Stewarts managing partner John Cahill (pictured): ‘Our preference is to continue down the path of organic growth and selected lateral hires. Our record growth over the last five years has been impressive and has not been driven by merger or acquisition.’

He added:’The expansion of our commercial disputes offering is a priority and we anticipate being active in the lateral hire space over the next 24 months, seeking out the very best new talent to join Stewarts Law, as well as promoting our rising stars from within.’

City litigation partners had mixed reactions to the merger news; Herbert Smith Freehills head of international arbitration Craig Tevendale saw sense in the collaboration: ‘Both firms have some very good people and have made a success of the litigation boutique model.’

Ted Greeno, commercial litigation partner at Quinn, Emanuel, Urquhart & Sullivan was less convinced: ‘I’m surprised that they were prepared to give up their independence but no doubt they had good reasons for it.’

Enyo was founded in 2010 by former Addleshaw Goddard partners Simon Twigden, Pietro Marino and Michael Green. A profitable outfit, Enyo posted strong financial figures over the last couple of years with revenue growing 27% to £21m in 2016. Remuneration among members stood at £12.5m.

Stewarts Law, which generated £62.1m in fees last year, has also seen positive financial growth in recent times, with the firm’s highest paid member pocketing £1.7m for the 2015/16 financial year, a 20% increase from the previous figure. The litigation specialist also saw a consecutive year of double digit revenue growth, with revenue jumping 17% to £61.3m.

Stewarts represented a number of retailers including Asda, Morrison, New Look and Next in a £1.2bn claim against MasterCard which was ruled on in January. The High Court decided in favour of MasterCard amid claims that the card issuer overcharged consumers due to controversial interchange fees.

tom.baker@legalease.co.uk

Read more on litigation boutiques in:‘Focal points – Law boutiques and the art of focus’

 

Legal Business

Boutique boost: Stewarts in talks to pick up Enyo to create £80m firm

Boutique boost: Stewarts in talks to pick up Enyo to create £80m firm

Litigation boutique Stewarts Law is in discussions to buy Enyo Law in a deal which will see about £20m added to Stewarts’ revenue.

It is believed the deal to acquire Enyo Law will be finalised before the end of the financial year in April, although it is currently unknown how many lawyers and staff will be transferred to Stewarts.

The disputes boutique was founded in 2010 by former Addleshaw Goddard partners Simon Twigden, Pietro Marino and Michael Green.

The financial outlook for Enyo had been healthy, with revenue increasing by 27% from £15m in 2014/15 to £21m in 2015/16. Remuneration among members was also up significantly from £8.1m in 2015 to £12.5m in 2016.

A key mandate for the firm has been acting for sovereign wealth fund, the Libyan Investment Authority (LIA), in a $2.1bn claim for rescission of a series of trades purportedly entered into with members of the Société Générale Group; as well as LIA’s $1bn claim against Goldman Sachs over nine large financial derivative transactions that lost over 90% of their value. Enyo lost the Goldman Sachs case last year.

Stewarts Law, which generated £62.1m in fees last year, has also seen positive financial growth in recent times, with the firm’s highest paid member pocketing £1.7m for the 2015/16 financial year, a 20% increase from the previous figure. The litigation specialist also saw a consecutive year of double digit revenue growth, with revenue jumping 17% to £61.3m.

At Enyo, the highest paid member took home £2.9m last year, an increase from 2015’s amount of £1.8m.

Stewarts Law represented a number of retailers including Asda, Morrison, New Look and Next in a £1.2bn claim against MasterCard which was ruled on in January. The High Court decided in favour of MasterCard amid claims that the card issuer overcharged consumers due to controversial interchange fees.

tom.baker@legalease.co.uk

Read more: ‘Focal points -Law boutiques and the art of focus’

Legal Business

Enyo hires Eversheds partner and intelligence duo to tackle business in ‘unusual jurisdictions’

Enyo hires Eversheds partner and intelligence duo to tackle business in ‘unusual jurisdictions’

In a sign of the travails facing law firms doing business in ‘unusual jurisdictions’, Enyo Law has established an in-house business intelligence unit to help conduct due diligence and build business while it has also bolstered its ranks after partner Annabel Thomas exited for Mishcon de Reya earlier this week, hiring Eversheds partner Jonathan Brook.

Brook is joining Enyo in early July after just a year at Eversheds, having joined from Freshfields Bruckhaus Deringer in 2014. Experienced in domestic and international disputes, and investigations by regulatory and law enforcement authorities, his most recent work includes advising London reinsurers in connection with losses in Ukraine.

The firm also broadened its offering with the hire of Paul Austin, former operations director of business intelligence and corporate investigations outfit Pelican Worldwide, who has been recruited to spearhead the firm’s new in-house business intelligence unit.

Having joined London-based Pelican as a partner in 2011, Austin has previously worked as a consultant to KPMG and served in government as a deployed civilian expert for the Department of International Development. He joins alongside Pelican research analyst Jan Daniel Grozdanovic.

Austin will act as an internal resource to conduct due diligence on clients, often from unconventional background and locations, before the firm engages with them and supervise, where appropriate, third-party investigatory services that the firm currently uses. Speaking to Legal Business, Enyo Law co-founder Simon Twigden (pictured) said: ‘It struck me this is something no one else really does at a law firm. We have clients in odd jurisdictions at times and do high profile disputes – it’s sometimes difficult to know who your client is – is it the person in front of you or is there a person behind them? So before we take on a client in an unusual jurisdiction, we have someone to help defend us from something we may not want to get into.’

‘We all deal with the Krolls of this world – and they have a lot of experience in the private investigator realm dealing with governments, informants and so on, but sometimes it’s difficult to understand the limits of what they can and cannot do. So we’ve someone in-house to control that process.’

The new unit is also being designed to help win pitches and clients through intelligence gathering. Twigden said: ‘When you’re pitching to people in different jurisdictions we can offer to do private investigator work on their opponent, find out where their assets are – so before you press the trigger, whether it’s a worldwide freezing injunction or simply issuing proceedings and before incurring massive costs, we can do the work confidentially in-house.

The firm is in good stead to invest, having enjoyed substantial financial growth for the 2013/14 year with revenue jumping 61% to over £14m from £8.8m while profits effectively doubled to £9.6m from £4.8m. The news also follows the departure of Enyo partner Annabel Thomas who is set to return to full service firm Mishcon de Reya.

sarah.downey@legalease.co.uk

For more on the rise of boutiques, see: Go your own way – legal boutiques and the seductive appeal of being your own boss

Legal Business

Mishcon de Reya hires Enyo Law partner in ongoing disputes push

Mishcon de Reya hires Enyo Law partner in ongoing disputes push

After having left Addleshaw Goddard in 2010 to join high-end disputes boutique Enyo Law, partner Annabel Thomas (pictured) is returning to a full service LB100 firm and joining Mishcon de Reya’s disputes practice.

Thomas was part of the 11-strong team that departed Addleshaws in 2010, alongside founders Simon Twigden, Pietro Marino and Michael Green, at Enyo Law‘s launch. She specialises in commercial disputes, in particular civil fraud, and has worked on cross-border litigation, arbitration and mediation.

The Herbert Smith-trained lawyer’s major case work has included the high profile court battle between Russian oligarchs Boris Berezovsky and Roman Abramovich, a $6.5bn English contract law case. She has further acted in a London arbitration concerning a shareholders dispute in a Kazakhstan law firm, as well as acting for a company in relation to an ex parte worldwide freezing order, including successfully applying for the order to be discharged and for indemnity costs.

Commenting on the appointment, Kathryn Garbett, head of Mishcon de Reya’s fraud defence team, said: ‘Annabel is an experienced litigator with a strong background in civil fraud, competition law, partnership disputes and financial regulatory litigation.

‘Her experience – and her connections to the industry both in London and abroad – complements our growing Fraud Defence practice and we’re very much looking forward to welcoming her to the team.’

Her move to Mishcon is indicative of the firm’s strategy to boost its disputes offering. Last summer the firm recruited heavyweight former director of public prosecutions (DPP) Sir Keir Starmer QC as a part-time consultant in its business crime unit. Qualified as both barrister and solicitor, Starmer joined his former colleague Alison Levitt QC, the principal legal adviser to the DPP, who moved to Mishcon in April 2014 to head its business crime group.

Earlier this year, the firm’s managing partner Kevin Gold revealed to Legal Business the firm had kick-started its strategy review and would continue its focus on private client and litigation work as part of that.

Just weeks ago, the firm also made an effort to broaden its M&A and private equity capability with the hire of corporate partner Michael Nouril from Proskauer Rose.

tom.moore@legalease.co.uk, sarah.downey@legalease.co.uk

Legal Business

Comment: Legal boutiques – unheralded, thriving and coming after your lunch

Comment: Legal boutiques – unheralded, thriving and coming after your lunch

The rise of boutiques has been yet another development shaping the legal industry that no-one predicted. Conventional wisdom for years held that law firms should go global or specialise but that was largely in the context of mid-tier players becoming more tightly defined around a handful of profitable practice areas (which pretty much hasn’t happened either).

What we have seen instead – as we address this month – is a flourishing of highly specialised and lean law firms launched or expanded since the financial crisis reshaped the market. Obviously, much of this is due to the post-

Lehman emergence of litigation shops, among them Enyo Law, Signature Litigation and Volterra Fietta, off the back of a disputes boom and the stifling conflicts stored up by global law firms. And these firms have been very successful in a short space of time, in some cases generating levels of profitability comparable to elite City practices and eye-watering top-line growth.

But perhaps it was the 2014 launch of arbitration super-boutique Three Crowns that demonstrated the ambition of this new breed.

Since boutiques have proven that they can operate in a number of areas profitably with considerably lower costs than corporate law firms, the pitch is starting to look very attractive for clients, who benefit from more partner time and relative value.

The appeal for departing partners is obvious: they escape the conflicts and compromises of Big Law and regain the autonomy City leaders in reality only grant to the 20% of their partnerships viewed as strategically key. This attraction is further magnified if you are practising in one of the expanding range of product lines deemed secondary or surplus to the business.

But the appeal goes way beyond pounds and pence. Malcolm Gladwell’s celebrated book on over-achievers, Outliers, puts forward a great criteria for what makes work meaningful for individuals in the context of high performance. The book suggests meaningful work has complexity, to provide mental stimulation and sense of achievement; autonomy, which grants the individual a feeling of dignity and control of their own life; and has a strong link between effort and reward, which speaks for itself.

Well, you only have to look at those three factors to see how major law firms can fail to provide meaningful careers for many partners on at least two criteria and the seductive appeal of the boutique in comparison. Throw in the fact that partners have substantial resources to invest and the low start-up costs and you almost wonder why we haven’t seen more legal launches.

A question remains as to whether the boutique model can be applied to deal work as has happened in investment banking. There are obvious factors playing against that but I’m not sure they’re insurmountable. Perhaps the biggest barrier is that the kind of M&A veterans who might be inclined to strike out on their own are joining the City arms of US practices instead. But even if the specialist M&A shop never really emerges in law, boutiques are surely more than just here to stay, they look set to thrive.

alex.novarese@legalease.co.uk

For more analysis of the growth in boutique law firms see: Go your own way – legal boutiques and the seductive appeal of being your own boss

Legal Business

Boutique banquet: profits double at Enyo as dispute specialist’s income surges 61%

Boutique banquet: profits double at Enyo as dispute specialist’s income surges 61%

Enyo Law enjoyed major financial growth for the 2013/14 year, as LLP accounts filed at Companies House reveal revenue jumped 61% to over £14m from £8.8m while profits effectively doubled to £9.6m from £4.8m.

Notably, the limited liability partnership had no loans or bank overdrafts.

Profit attributable to the highest-paid LLP member rose to £1.8m from £752,000, while the average number of members increased to 16 from 14. Sums due to creditors within one year totalled £2.4m, a 15% increase from the previous year’s figure of £2.1m.

In the published accounts, the disputes boutique stated the members ‘consider that the LLP has performed well during the year and that the financial position… is good’.

Founded by partners Simon Twigden, Pietro Marino and Michael Green in late 2010, the boutique spun out of Addleshaw Goddard with the aim of providing a conflict-free service focused exclusively on contentious work, and has grown to house over 50 staff.

Said Twigden (pictured): ‘The financial position is robust. This year won’t be any different. We have come a long way since we started Enyo four-and-a-half years ago, both financially and as a business with both a credible and focused offering. We are single-minded in what we do, the high-end product we offer, and – most importantly – how we execute it in the best interests of our clients.’

Ongoing instructions for the firm include acting for the Libyan sovereign wealth fund, the LIA, over a $2.1bn claim for rescission of a series of trades purportedly entered into with members of the SocGen Group; as well as LIA’s $1.2bn claim against Goldman Sachs regarding nine large long-dated complex financial derivative transactions.

It is also advising the shareholders planning to sue the Royal Bank of Scotland’s global restructuring group (RBS-GRG) for allegedly forcing small companies out of business. Fellow boutique Quinn Emanuel Urquhart & Sullivan had initially taken the mandate but said in a statement it had ‘stepped down from this engagement in late November 2014, having not been put in funds by the client’.

Specialist disputes boutiques continue to perform strongly. This includes Signature Litigation, which was founded by former Lovells partners Graham Huntley and Helen Brannigan, saw revenue surge by 70% from £4.82m to £8.17m in 2013/14, despite having only launched two years ago, while the profit margin is estimated to be around 50%.

Quinn Emanuel Urquhart & Sullivan also boasted impressive financials for its London office for 2014, last week announcing a 33% increase in revenues to £26.2m and 44% for profits to £17.9m, marking a major rebound from its sharp drop in turnover in 2013.

sarah.downey@legalease.co.uk

For more on the role of boutiques in the UK disputes market, see our analysis Martial law: Can the disputes boom continue? (£)