Judge tells ENRC, Dechert to consider mediation

Judge tells ENRC, Dechert to consider mediation

A London judge tells Kazakh mining company ENRC, Dechert and Fraud Office SFO to consider mediation to end bitter litigation over events that led to a near 10 year criminal investigation.

Despite rulings in May that former Dechert partner Neil Gerrard had grossly betrayed his own client and former SFO officers had behaved with bad faith, High Court Judge David Waksman suggested that all sides call for a truce.

Notwithstanding what's happened in the past and the serious allegations, I can certainly see the sense in which someone looking at all of this may say there needs to be closure, he told a two-day hearing about legal costs.

I think the parties need to turn their minds to the question of possible mediation. The SFO and Dechert didn't want to say anything. Representatives for ENRC and Gerrard, who represented ENRC between 2010 and 2013, did not immediately respond to requests for comment.

Eurasian Natural Resources Corporation alleged Gerrard leaked confidential information to the SFO, so he could expand an internal investigation and milk the company for hefty fees, and that the SFO encouraged him to try and claim a high-profile corporate scalp.

The SFO opened a criminal investigation into allegations of fraud, bribery and corruption linked to ENRC's purchase of mineral assets in Africa in 2013 but no charges have been brought against the company or suspects. ENRC denies wrongdoing.

After an initial trial to establish liability last year, Waksman found Gerrard breached his duty of care to the ENRC, leaked privileged material to the media, engaged with SFO officials without authority in a reckless breach of duty and leaking to reporters. The judge dismissed the other allegations against the SFO, including misfeasance in public office, deliberate destruction of evidence and leaking to reporters.

Gerrard said in May that he remained convinced of the appropriateness of his actions, his advice to his former client and his personal and professional integrity.

Dechert said it acknowledged the seriousness of the judge's findings regarding Gerrard's conduct, and that it acted in good faith in reliance on the assurances given to us by Mr Gerrard ENRC and that it is seeking multi-million pound losses against both Dechert and the SFO, and that a further trial will determine whether the wrongdoing caused any loss.

Dechert agreed to pay ENRC 20 million pounds $24 million for interim costs and says its insurers stand by the firm.