Brexit fall ()
Continental Breakfast: your daily update on what’s happening in Europe.
The European Commission has predicted that U.K. economic growth will almost halve from 1.9 percent to just 1 percent in 2017 following the Brexit vote.
In its latest economic forecast (PDF), the EC said that the uncertainty caused by Britain’s decision to leave the European Union would see business investment in the country “decline sharply” next year. It also predicted that U.K. inflation will “rapidly” exceed the Bank of England’s target rate of 2 percent.
The EC is the executive body of the EU, so one might argue that there is a vested interest in it suggesting that seeking to leave the political bloc would damage a country’s economy. But the report also delivered a bleak outlook for the Eurozone as a whole, saying that while the region appears to have “shrugged off” the Brexit result, the “sharp increase” in uncertainty could lead to a “vicious cycle” of investment being stifled by lower growth. “The projected pace of GDP growth may not be sufficient to prevent the cyclical impact of the crisis from becoming permanent,” it said.
The EC’s gloomy prediction clashes with the Bank of England’s more upbeat position. The U.K. central bank recently increase of its GDP growth forecast for 2017 from 0.8 percent to 1.4 percent as a result of an unexpected increase in consumer spending and the resilience of the housing market (PDF).
Rio Tinto Legal Head Leaves Company Amid Payments Probe
Rio Tinto legal and regulatory affairs group executive Debra Valentine has stepped down from the company over payments made to a consultant for helping to secure mining rights in Guinea.
Rio Tinto, the one of the world’s largest mining companies, said in a statement that it launched an internal investigation in August after it “become aware of email correspondence” relating to more than $10 million in fees paid to a consultant advising on its Simandou iron-ore project in the African country. The company has informed the relevant authorities in the United Kingdom and United States and is “in the process” of contacting the Australian authorities, while energy and minerals chief executive Alan Davies has been suspended, the statement added.
Valentine, a former partner at O’Melveny & Myers and general counsel at the U.S. Federal Trade Commission, had previously informed the company of her intention to retire in May 2017.
U.K. Lender Still Chasing Dewey Partners For Loan Repayments
It has now been over four years since Dewey & LeBoeuf collapsed in the largest law firm bankruptcy in history. But is has emerged that U.K. lender Barclays is still chasing former Dewey partners for capital loan repayments, with the bank currently suing the firm’s ex international arbitration head Robert de By for around $180,000 in London’s High Court.
The court filing alleges that De By, who left Dewey in 2009 and is now a partner at litigation boutique Connon Wood, defaulted on the loan after failing to make an interest payment in the days after the firm filed for bankruptcy. The bank is now suing him for full repayment of the loan and is also claiming an indemnity for liabilities, costs and expenses.
De By is being represented by London-based private client specialist Farrer & Co and barrister Khawar Qureshi QC of Serle Court Chambers, while national U.K. midmarket firm Addleshaw Goddard is acting for Barclays. The bank was previously advised on legal action against other Dewey partners by southwest regional U.K. firm TLT, but the lead partner, financial litigator Richard Clayton, took the work with him when he joined Addleshaws in late 2014.
Last year, Barclays successfully sued former Dewey media lawyer Londell McMillan for repayment of his $540,000 loan. McMillan, whose clients have included Michael Jackson, Prince (his Twitter account photo is of the pair together) and Stevie Wonder, left Dewey before its failure to focus on his role as executive publisher of monthly hip-hop music and culture magazine The Source. Three other former Dewey partners chased by Barclays—Charles Landgraf, who served as a member of Dewey’s five-strong office of the chairman group and is now legislative and public policy partner at Arnold & Porter; Elias Farrah, a projects and energy partner at Winston & Strawn; and Lewis Rosenbloom, who now runs his own restructuring boutique—made a private settlement with the bank just days before the trial was due to begin.
(I previously covered these lawsuits in some detail in an article for The American Lawyer, which you can read here.)