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Proskauer Rose has withdrawn as defense counsel in an employment discrimination suit that charged the U.S. subsidiary of a Japanese corporation with engaging in a pattern of discrimination based on race, sex and national origin. The New York law firm has acted as regular outside employment counsel to Marubeni America Corp., a subsidiary of Marubeni Corp., a large Japanese general trading company with a wide variety of businesses. Two former executives of the company, both white males, sued the company and several of its executives in January, alleging they were entitled to millions of dollars under lifetime employment contracts Marubeni allegedly granted them. The plaintiffs, Kevin Long and Ludvic Presto, claim they were forced out in breach of these agreements because they protested the company’s discriminatory treatment of female and non-Asian staff. The company has denied the discrimination allegations and stated that it believes the agreements cited by Long and Presto are fraudulent. The lawyer for the plaintiffs, Kenneth Thompson of Thompson Wigdor & Gilly, had moved to disqualify Proskauer earlier this month on the grounds that, if the defendant intended to assert the agreements were fraudulent, lawyers at the firm, particularly chairman Allen Fagin, would be necessary witnesses. The plaintiffs claim Proskauer lawyers advised the company on the agreements. Plaintiffs also said they wanted Fagin to testify on a statement allegedly made in an e-mail by one of the defendant executives that, over the years, Fagin had done “a masterful job” and “was always available” to protect the company from various minority groups. The complaint alleges the executive, an American named Joe Van Dorn, frequently used racial and ethnic slurs in his interactions with employees at the company. Proskauer did not oppose the disqualification motion before withdrawing from the case. Howard L. Ganz, a partner at the firm, wrote to Thompson yesterday that the firm would be replaced in the matter by Pillsbury Winthrop. Ganz did not return a call seeking comment yesterday. Kenneth W. Taber, the Pillsbury partner handling the matter, declined comment. Michael Starr, an employment lawyer with the New York office of Hogan & Hartson, said employment lawyers regularly defend companies that they had previously advised on employment contracts. But he said it was unusual for the validity of an agreement, rather than its interpretation, to be at issue in an employment case.

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