Mylan, Inc. v. Kirkland & Ellis, Llp

Facts

P is a leading global pharmaceutical company, whose affiliates and subsidiaries develop, license, manufacture, market and distribute generic, branded generic and specialty pharmaceuticals. In the event of a hostile takeover of Mylan N.V. by Teva, the ownership and control of P and their products will be in the hands of Teva, and Teva would become the successor in interest to Mylan N.V. D is a law firm and has offices in various locations throughout the United States and the world. Past discussions between P and D culminated in an Engagement Letter fully executed effective January 9, 2013, and since that time, D has represented P in numerous matters, including matters involving important pharmaceutical products. P was fully aware that D had long served as counsel for Teva in a variety of subject matter areas, including regulatory matters and products liability litigation with respect to certain drugs, some of which were matters in which Teva’s interests were directly adverse to P. D was lead counsel in connection with Teva’s $6.8B acquisition in 2011 of Cephalon, Inc. D never informed P of any intent or understanding that under the terms of the Engagement Letter D would be permitted to undertake representation in an adverse acquisition of P corporate affiliate group, including the client subsidiaries and products with respect to which D was being provided confidential, proprietary and attorney-client privileged information. In the course of review and negotiation of the Engagement Letter, P requested, and D accepted and implemented, the removal of the term “substantial” from the D draft which sought P’s consent to D’s “represent[ing] other entities or persons on matters that are not substantially related to the legal services that D rendered to P. The pharmaceutical products as to which D represented P approximated $4 billion in total market revenue last year. D has billed P substantial fees for work performed by dozens of different D attorneys and other professionals on various matters. In early April, D was contacted by Teva and asked to lead a deal team to advise Teva, at which point D followed its standard conflict checks procedures to confirm that it could represent Teva; those procedures confirmed that Mylan N.V. (the holding company formed approximately one month prior) was not and had never been a client of D. D established an “ethical wall” between attorneys who would work on the proposed transaction and those previously, present or prospectively engaged in work for P. The Board of Directors of Mylan N.V. unanimously rejected Teva’s unsolicited offer

Issues

Rule of Law

Holding and Decision

Legal Analysis

© 2007-2024 ABN Study Partner.