Big K Street shops will close offices in Russia
Lobbying firms have dropped Russian clients because of U.S. sanctions
Some of K Street’s biggest firms said Wednesday they were winding down, or at least reevaluating, operations in Russia in response to the invasion of Ukraine and sanctions that followed.
Ceasing operations in Moscow are Akin Gump Strauss Hauer & Feld and Squire Patton Boggs, two of Washington’s long-standing lobbying and legal powerhouses, whose rosters include former members of Congress and Cabinet officials.
DLA Piper, another big law and lobbying firm that has offices in Moscow and St. Petersburg, said in a statement that it was “undertaking a strategic review of our presence in Russia.”
The announcements came as lobbying and law firms have terminated clients that would run afoul of U.S. sanctions imposed on Russia.
“As a firm built by Robert Strauss, the last U.S. Ambassador to the Soviet Union and the first U.S. Ambassador to the Russian Federation, Akin Gump is deeply saddened and shocked by the events in Ukraine and the tragic and senseless loss of life of so many innocent Ukrainians,” Akin Gump said in a statement.
“In light of the ongoing crisis, we are suspending operations in Moscow pending further developments. We will do so in an orderly way, as the safety and well-being of our long-time colleagues and ethical obligations to clients in Moscow remain a high priority. We will continue our efforts to provide humanitarian aid and pro bono assistance to Ukrainian refugees and others in need,” the statement continued.
Squire Patton Boggs, whose employees include former Speaker John A. Boehner of Ohio, said in a statement Wednesday that “it has become clear that it is no longer tenable for us to continue our operations in Russia and we have therefore decided to wind down our Moscow office.”
“Our closure will effectively conclude our relationship with a number of clients in adherence with our professional obligations,” the statement added. “All other existing work or new matters we undertake on a global basis will continue to remain in full compliance with all applicable laws and sanctions that are in place. Since the beginning of this crisis, our foremost focus has been on the safety of our colleagues, particularly in Moscow.”
Squire Patton Boggs’ website listed 16 attorneys, including partners and associates, as part of its Moscow office. Some of the firm’s clients there have included the Russian online retailer Ozon, according to the website.
Hogan Lovells, another big legal and lobbying firm, said in a statement that it was “currently able to continue to operate our Moscow office. We’re in contact with our people there daily and offering them any support they need. As this is a fast-evolving situation we are closely monitoring any changes and reviewing our position as required.”
Without specifying, the firm said it was terminating some matters that go against its values and would “continue to evaluate our portfolio of work and to act quickly to comply with the latest sanctions requirements and government guidance.”
Clients in conflict
Several K Street firms have disclosed client terminations, following prohibitions on representing such clients. Sidley Austin terminated its work for JSC VTB Bank, according to filings with the Justice Department, which administers the Foreign Agents Registration Act. “VTB Group is no longer a client of Sidley Austin LLP in compliance with U.S. sanctions,” a statement from a Sidley spokesperson stated. (Sidley does not have a Russia office.)
Mercury Public Affairs also disclosed that it had severed ties with Sovcombank, according to FARA records.
And the lobbying firm BGR Group said in a statement in late February that it was “ending its engagement with the Nord Stream 2 gas pipeline project in compliance with economic and trade sanctions announced by the U.S. government.”
Ivan Adler, a longtime K Street recruiter who specializes in law firms, said there was a distinction between firms dropping clients that they were no longer permitted to represent because of U.S. sanctions and those that were shuttering outposts in Russia.
“I think that if we want to be honest about the situation, there are firms who have clients who the U.S. government has said we can’t do business with and therefore they have to de-register,” Adler said.
By contrast, firms that are closing down their operations are “saying, rightly, that they are not supportive of what Russia is doing in the situation with Ukraine. … Hopefully they’ll be able to restart their operations in Russia at some point,” he said.
DLA Piper’s global leaders, Andrew Darwin, Simon Levine and Frank Ryan, said in a joint statement that “we remain committed to stand with the people of Ukraine and support them, and our people. One way we can do this is to take a position on which entities we are no longer prepared to represent given their connection with the Russian state. We wish to make it clear that we will not act for the Russian government, individuals connected to the state, state-owned enterprises or other prohibited parties from any of our offices globally. We are actively winding down any existing work in accordance with our legal and professional obligations and are refusing new instructions when approached.”
The firm’s statement went on to say that DLA Piper attorneys would “continue to act for our international clients with regard to managing their own responses to the conflict.”
Some firms said they were pledging humanitarian aid for the people of Ukraine.
Greenberg Traurig, which has an office in Poland but not in Russia, said it planned to donate up to $2 million for relief efforts and offer pro bono legal services for Ukrainian refugees.
“Many of us feel powerless or much worse as we watch the daily horrors in Ukraine,” Richard A. Rosenbaum, Greenberg Traurig’s executive chairman, said in a statement.