Pallas

The Lawyer Who Set Up Her Own City Firm – and Poached Most of Her Old Colleagues

Natasha Harrison guts the London office of US giant Boies Schiller Flexner to establish her own rival law firm.

Celebrity lawyer David Boies, once described as “the Wall Street lawyer everyone wants” and “corporate America’s number one hired gun”, made it clear who his successor was to be at the height of the pandemic. The 80-year-old litigator’s reputation is so renowned that reporters once hummed the Jaws theme tune in court before he crossexamined a witness.

In December 2020, he promoted London lawyer Natasha Harrison from managing partner to deputy chairman of his US firm Boies Schiller Flexner. But his next in line had other ideas.

Undeterred by those who associate him with the Jaws theme tune, Harrison told Boies she instead was going to set up a rival law firm and planned to take almost all of his London staff with her.

The surprise move came at a fragile time for her mentor and boss, famed for his cross-examination of Bill Gates. Boies is also acting for Virginia Roberts Giuffre in the high-profile civil sex abuse trial against Prince Andrew.

“David has been really supportive, he’s a mentor of mine,” she insists, adding that he understands her decision to go it alone given he set up his own law firm in the 1990s. The recent criticism facing the firm also has nothing to do with her decision to leave, she adds.

Instead she felt compelled to do her own thing, encouraged to take the jump now by “a combination of Covid and turning

48”. It is a brave move, given Harrison was right on track to run one of New York’s most powerful law firms.

When Harrison revealed her exit plans last November, Boies’ firm was in the midst of a staff exodus following a slew of criticism over its work with Harvey Weinstein and Theranos, the fraudulent blood-test company. Longstanding client the New York Times Company also fired the firm after it came out that Boies Schiller was involved in hiring private detectives to track journalists and whistleblowers in the Weinstein case.

From a PR point of view, the timing for Harrison’s London raid could hardly have been worse for Boies Schiller. But the plan is going ahead.

Harrison is launching her litigation house this week in a move which will mark one of the largest law firm launches in the UK in recent decades. She has hollowed out Boies Schiller’s London office, taking 27 of 33 staff with her, as well as some major clients.

She will hold on to her high-profile cases, including a lawsuit against Credit Suisse over Mozambique’s $2bn so-called tuna bonds scandal, as well as a potential case against the bank on behalf of investors burnt by the collapse of Greensill.

Yet Harrison doesn’t seem like someone who is about to deliver a blow to one of America’s most feared lawyers. Sitting on the sofa in her Kensington home beside her

Russian Blue cat, Matrix, she appears completely calm just days before her firm’s launch.

“Why take the easy route?” laughs Harrison. “I always ask myself, what’s the worst thing that could happen? And what would I do if I wasn’t afraid? That’s exactly the question I ask at every stage of my career. Take that fear away, and really look at it. If it’s risk-free, would you do it? Without doubt.”

Those close to her will surely place their bets on a name for the firm beginning with the letter M, given that her children are called Max and Mia, her cats Matrix and Mika and her Yorkshire terrier dogs Mimi and Marni.

When it came to choosing, Harrison says her children, aged 16 and 11, helped her to settle on a name. “You’re literally the first person being told this outside the little net of secrecy – [it’s going to be called] Pallas Partners,” she reveals. “That comes from Pallas Athena, the goddess of war, wisdom and – rather randomly – handicraft.”

It is not wildly surprising that Harrison, the oldest of four girls, has named her business after a goddess. She describes one of the most memorable career moments as “commuting to Iceland and back whilst IVFing, and then pregnant with my son” while fighting on behalf of 120 hedge funds following Iceland’s banking collapse in 2008.

She also remembers struggling to fit in after first joining the male-dominated legal sector in the 1990s – and wants to ensure none of her staff ever feel like that.

“I

that could happen? And what would I do if I wasn’t afraid? That’s exactly the question I ask at every stage of my career. Take that fear away, and really look at it. If it’s riskfree, would you do it?

Natasha

always ask myself, what’s the worst thing

Harrison Managing Partner

Natasha Harrison Managing Partner

“I just didn’t fit. [The sector] was predominantly Oxbridge, white male. I was Durham, I was a girl and I was the first in my family to go to university. It’s a very uncomfortable feeling,” she says.

“When I moved into the US system in 2000, that’s when I started to fit. It was utterly liberating – they didn’t care what your qualification was or what school you went to. If you were good, you could really accelerate.”

Harrison wants to make sure her firm channels the same principles. Schools will be blanked out of applicant CVs at the very least, to remove any bias. Harrison – who attended Croydon High School and Sevenoaks School, which are both private – doesn’t want to see any staff miss their child’s sports day or parents evening just because they’re in the office.

This is all about creating a “blueprint for a modern law firm”, she says, her pitch coming at a time when the sector in London is struggling to retain talent.

In her view, it is still a “really old-fashioned industry” in need of a shake-up. Harrison says she wants to gradually phase out billable hours – top law firms are known to charge clients over £1,000 an hour – because it “incentivises people to drag it [work] out for as long as possible”. She also promises to pour 5pc of all her firm’s resources into pro bono work.

Pallas Partners, which will be based on King William Street in the City, will also have an investment committee “just as any corporate or bank would have” that will dedicate money to some of its cases. After months of late nights pulling this together, Harrison is ready to overhaul the sector. But not everyone is convinced. One competitor says: “I am sure she will get work and be successful, she has a number of loyal hedge funds, but I’m not quaking in my boots.

“Boies Schiller was never really that successful in London. It is also going to be a very different experience when you are not backed by a large international firm. Much harder.”

An unknown investor backing Harrison’s firm will “want their piece of silver in return”, the rival lawyer adds.

Harrison received five offers of investment but refuses to reveal the chosen backer as the terms are confidential, she says, leaving the industry to speculate. A spokesman for Boies Schiller says: “We wish our former colleagues well as they embark on the next phase of their careers.

“We are committed to our London office, which means identifying and bringing in new talent to supplement our existing strengths, but also cultivating a London presence that is better integrated with the firm’s core work and clients.” Scrutiny will no doubt be high over the coming months, but Harrison is determined to take the leap. Pallas Athena, typically portrayed holding a spear and wearing a helmet, seems a fitting choice for a lawyer who refuses to take the easy route.

‘A big deal’: Harrison Sets Out Strategy for Building a Thoroughly Modern Law Firm

Undaunted by a hectic few days in which details of Natasha Harrison’s new firm Pallas Partners hit the headlines, the former Boies Schiller leader and litigator has discussed her agenda with Legal Business.

The influential Harrison is taking well-regarded partners Tracey Dovaston, Fiona Huntriss, Will Hooker, Neil Pigott and Matt Getz with her to staff the new firm.

Pallas Partners will take the form of an alternative business structure that will have the potential to allow non-legal members of staff to enter the partnership in the future.

The firm’s King William Street office will open on 10 February under a two-year lease. Harrison, who is managing partner of the new enterprise but will predominantly do fee earning, has outlined a plan to ‘grow carefully but with momentum over the next three years’.

‘We have quite an aggressive growth strategy planned and we’ll be focusing on top quality litigators, arbitrators and investigators – those who can add value to the business in terms of the bottom line but also those whose values are aligned with ours,’ she said.

There are also ambitious targets around ESG. ‘We’ve really looked at who we want to be and we’ve devised three pledges we’re going to deliver on. One is to dedicate 5% of our time to pro bono; second is to have diversity parity by 2025; and the third is to be carbon neutral by 2025. Being a responsible and sustainable company is going to be very important to us. Our clients expect it from their advisers and we ourselves conduct ESG litigation, so we can’t be doing that and not doing it ourselves.’

Harrison also pointed to several longstanding clients from before her Boies Schiller days following her to her new outfit. ‘There’s a big trial we’re doing in the English court at the moment concerning Mozambique bonds; there’s Greensill, a securities class action that we’ll be launching in the next couple of weeks; a very significant international arbitration that we’ve got big hearings for in May. It’s quite a diverse portfolio of work.’

She added: ‘It’s a big deal. It’s a bit like stepping off a cliff into the unknown in some respects. But when you have nearly everyone wanting to come with you, and your clients wanting to come with you, that really helps to drive your confidence.’

Harrison is sanguine about her new venture: ‘Starting from scratch means that you’re not shackled to hundreds of years of practice and bureaucracy and that’s very invigorating and exciting. There is a gap at the top of the market for a disputes firm such as ours.’

Tracey Dovaston Partner

“Tracey is a robust defender of her clients’ interests. She is capable of dealing with any number of issues which might arise during a dispute, both purely legal but also issues to do with reputation, media strategies, forensics and investigations in general.”

Legal 500 UK 2023

Will Hooker Partner

“Will [Hooker] is an outstanding young partner.“

“His work is very high quality.”

Chambers UK 2023

A Law Firm Launch Like No Other –Does Pallas Partners’ Slick London Premiere Herald a Blockbuster?

Natasha Harrison has played a strong hand well as she embarks on her new venture, reports Ben Rigby.

In the Marvel blockbuster Eternals, the character Thena is played by Angelina Jolie, a superhero with seemingly unstoppable martial skills, indefatigable in her quest to defeat her CGI-generated enemies. She is part of a team whose skills combine to win against a terrible foe of incalculable power.

The character Thena is, of course, modelled on Pallas Athena – the ancient Greek goddess of wisdom and war. She also provides the name for the new London litigation firm Pallas Partners, which launched in a blaze of publicity this week.

Having spearheaded the launch and growth of Boies Schiller Flexner’s London office, Natasha Harrison, only recently tipped to succeed co-founder David Boies as chair of the New York firm, has launched a breakaway practice.

Pallas comprises 27 former Boies Schiller staff in total, including five partners. That leaves her former firm with an on-the-ground London team of two recently made-up partners and an associate.

After a series of trailers in the national press, the firm’s official launch on Tuesday featured a slick video and smartly designed website in muted, classically appropriate tones; the shades of grey and aquamarine complementing a bronze of Pallas Athena herself, redolent in the firm’s smart City offices.

The launch did not lack confidence. Harrison spoke of “challenging the status quo”, agility of approach, and “leveraging bold, winning strategies that will drive value and mitigate risk for our clients”.

“Pallas,” she said, “represents an opportunity to ‘rip up the rule book’ with a new approach, unencumbered by existing protocols and historic processes to create a truly different offering in the market”.

And she promised to foster talent within “an empowering culture” promoting diversity and inclusion and the ESG agenda.

Around 100 clients have reportedly moved across with the firm and it cites a number of existing, high-profile mandates, including representing the Proindicus Mozambique note holders in their litigation against Credit Suisse and class actions representing Greensill investors.

Harrison and her team believe they can exploit gaps in the market for conflict-free dispute resolution. The firm will focus on commercial disputes, principally litigation, arbitration and investigations.

GLP understands Pallas will work closely with litigation funders and employ a range of flexible fee mandates, not necessarily dominated by hourly-rate billing.

The firm will work with clients to devise pricing structures that are most suitable to them, from conventional mandates to damages-based agreements. It will employ a pricing analyst to help devise these, while also building up a portfolio-based approach when working with litigation funders.

It will not, however, take on employment and family litigation cases, or certain types of real estate litigation, choosing to focus on areas in which the existing partnership are well versed.

To this point, it is hard to imagine how Harrison’s new venture could have fared better. And that extends to the apparent lack of rancour surrounding her departure on both sides. When news of the mass defections broke, the New York firm issued a measured but detailed statement wishing the team well and pledging to rebuild the office. And Pallas will co-counsel with Boies Schiller on some ongoing cases, according to Harrison.

While there is a strong element of pragmatism in the US firm’s approach, it does appear that the bond that has formed between Harrison and her mentor Boies in the years that followed her arrival from Bingham McCutcheon in 2013 to set up the office has endured.

Harrison’s move to Boies Schiller proved to be a watershed moment in her career, given her subsequent success in growing the office, which posted revenue of £18.6m in the year ending 2020, up by 5%.

Given the immediate impact of Covid-19 on dampening disputes activity, and the turmoil being experienced by the mothership in the US as it underwent a wave of partner defections in a process it characterised as a repositioning, it was a very respectable performance.

During her tenure, Harrison hired a series of big hitters, notably Wendy Miles QC and Kenneth Beale, from Wilmer Hale, Dominic Roughton, from Herbert Smith Freehills, and Matt Getz, from Debevoise & Plimpton.

Of that roster, only Getz remained at the time of her departure, but the personal loyalty demonstrated by the partners who moved across with her – Tracey Dovaston, Fiona Huntriss, Will Hooker and Neil Pigott – comes as no surprise.

In 2017, she sponsored the candidature of Huntriss – an experienced litigator familiar with banking and financial litigation, restructuring and insolvency disputes – to become a partner; and she helped Dovaston successfully transition into the firm from an in-house role at Barclays.

Hooker, who joined as counsel in 2016, also made partner in 2017, building on opportunities handed to him by the likes of Miles, Roughton and Harrison. Getz forged the office’s investigations practice. Piggott traced a path from senior in-house compliance roles to similar roles at US and UK law firms, heightening his insolvency and special situations nous. For many in London’s disputes community, Harrison was Boies Schiller’s chief advocate; not just the face of the firm, but someone who embodied a strong personal story, a record of achievement, an example to be followed, a woman leader who raised up her team to the same level at which she worked.

‘A living and breathing better-than-textbook dazzling example that people buy from people (and work for people), and they always will,’ is how veteran legal marketer Liz Whitaker put it in a LinkedIn post.

Harrison’s former firm, meanwhile, must embark on a daunting rebuilding programme in London. GLP understands from a source familiar with the matter that Boies will seek to make good the London exits with targeted lateral hires. International arbitration remains a key area of focus, for example, with London’s place in that firmament making further recruitment essential.

For now, however, all eyes are on Pallas Partners. Harrison has a lot to live up to, but she has played her hand expertly to this point. A blockbuster might well be on the cards.

New Firm Pallas Partners Takes on Osborne Clarke in Wise Dispute

Pallas Partners, recently launched with a team from Boies Schiller Flexner, has taken the lead in a data protection dispute between the founder of a cryptocurrency exchange and payment tech titan Wise.

BitMEX cryptocurrency billionaire Ben Delo was previously represented by Boies Schiller partners Matthew Getz and Prateek Swaika, with the help of associate Rekha Rogers.

The mandate, however, followed Getz as he moved from Boies Schiller to Pallas Partners earlier this month. The litigation rival was launched by Boies’ former deputy chair and London managing partner Natasha Harrison, who managed to poach five partners and several associates, including Rogers, from the US firm’s City base.

5RB’s Adam Speker QC is still instructed by Getz, both of whom must face Osborne Clarke’s Ashley Hurst, who represents Wise.

According to court documents seen by The Lawyer, the dispute centres around allegations that Wise has refused to disclose personal information held on Delo, which it claims is in breach of data protection law.

The wrangle dates back to 2018, when Wise agreed to provide a non-interest electronic money account that Delo would use to facilitate foreign exchange conversion.

The parties clashed as Delo made two transfers into the Wise account from his account at HSBC Hong Kong in November 2020. The first payment of £30,000 was converted to Hong Kong dollars by Wise and moved to Delo’s Bank of China account, per Delo’s instructions.

Following the second payment of £270,000, Wise then asked Delo to clarify the source of his funds and purpose of transfer.

Delo quickly revealed he was exploring ways to use Wise, then named TransferWise, not only to move significant sums between his Hong Kong and UK accounts but to get better foreign exchange rates.

Wise is said to have closed the account soon after without prior notice, allegedly in breach of its 2018 service agreement.

The fintech company has since submitted three suspicious activity reports regarding Delo to the National Crime Agency.

Delo claims that Wise continues to breach its obligations under the General Data Protection Regulation by failing to disclose any of the activity reports, documents explaining the account closure and any related internal correspondence – all of which are said to contain the crypto-tycoon’s personal details.

Wise is also accused of failing to state which GDPR exemptions it relied on after disclosing limited documents in response to Delo’s repeated data subject access requests.

In his claim filed at the Queen’s Bench Division (Media and Communications List), Delo now seeks a court order requiring Wise to comply with its GDPR duties, which would involve delivering all his personal data held by the payments company.

Delo also claims damages due to loss suffered, including £948 in foregone interest on the second payment which allegedly took 135 days to refund.

A spokesperson for Wise said: “We are confident that we have complied with our regulatory obligations in this case, and so intend to defend the claim.”

Matt Getz Partner

“Matt is very client-friendly. He is also very good tactically and looks around corners to see what might come next.”

Chambers UK 2023

Green Investing: the Risk of a New Mis-selling Scandal

ESG funds are popular, but research has found the sector is rife with greenwashing. Lawyers warn a reckoning is coming.

When Lucy Carraz moved her investment account to online wealth platform Nutmeg in November, she wanted her money invested in the most environmentally-friendly companies possible.

But after selecting the platform’s ESG investment option, which prioritises companies and bond issuers with high environmental, social and governance standards, she was shocked to discover that, rather than the wind and solar companies she had been expecting, her new portfolio’s biggest holdings were bank stocks.

“I thought they [Nutmeg] would be looking to invest in specific companies or funds that are part of the solution” to climate change, said the London-based business development director, “rather than just [companies] having an ESG policy.” Her relationship with Nutmeg was “very short once I saw where the money was actually invested”. Carraz’s experience reflects a growing realisation among retail and other, larger investors in the UK, the US and across Europe that some of the vast sums of money they have poured into green and ethically-labelled investment products in recent years may not have been invested in quite the way they had imagined.

A series of high-profile scandals, most notably regulatory probes into fund firm DWS over whether it misled clients about its sustainable investing efforts, has now raised fears that some of the bolder green claims made by asset managers could amount to mis-selling. Some industry insiders believe they are on the brink of a mis-selling scandal in the mould of payment protection insurance, mortgages or diesel cars.

“It’s a bit like history repeating itself,” says Fiona Huntriss, a partner at law firm Pallas Partners, who focuses on financial litigation and has worked on previous mis-selling cases.

“Words are being used in a very vague way” by fund companies, she adds. “Inconsistency, omissions, lack of clarity — that’s prime territory for mis-selling claims.”

Carraz does not think Nutmeg misled her, but she does believe the process for setting up new investors should have been more clear. Nutmeg said “we have always challenged the often confusing language used by the investment industry, alongside the lack of clarity that over simplified labels — like green or ethical — and a lack of true data points brought to investment products labelled as ‘sustainable’ or ‘responsible’.”

Launching ESG-themed products has been a much-needed area of growth in recent years for asset managers, many of whom are under pressure from low-cost index trackers. Branding funds as green or ethical allow them to tap into a huge wave of investor demand and better justify the fees they charge for selecting stocks.

Investors globally poured $142.5bn into sustainable funds in the fourth quarter of last year, 12 per cent up on the previous quarter, according to financial data provider Morningstar. That took total worldwide sustainable assets to $2.7tn across more than 5,900 funds, three-quarters of which were in Europe. The data group noted that “asset managers also continued to repurpose and rebrand conventional [fund] products into sustainable offerings”.

Much of the asset flow has come from retail investors wanting to make a positive difference to the planet or society, who have usually made these investments in their pensions or savings accounts based at least in part on the claims made in a fund’s documentation or adverts. In the UK last year, one out of every three pounds in net sales of retail funds went to “responsible” products, according to data from the Investment Association.

With a huge array of different, and often contradictory, ESG metrics on offer in different markets and regulators still feeling their way in this new area, fund firms have often relied on a mixture of third-party ratings and their own research. To promote the funds, seemingly vague words such as “sustainable” and “green” have been widely used.

But a number of scandals have rocked the industry, sharply increasing the scrutiny on such claims. Last year, US law enforcement authorities and German regulator BaFin began investigating DWS after the firm’s former head of ESG, Desiree Fixler, alleged it had misled clients about how much of its assets were invested along sustainable lines.

And an FT investigation published in July found that some fund firms with strong rhetoric about tackling human rights issues were also lending money to regimes carrying out abuses.

Such incidents have raised fears among fund firms of greater legal scrutiny of the claims they have made. Executives at one of London’s biggest fund firms are now “petrified” about how it had been selling ESG funds and the wording it had been using, one senior employee said.

Tariq Fancy, former global chief investment officer for sustainable investing at BlackRock, made headlines last year when he said ESG investing too often boils down to little more than “marketing hype” and “disingenuous promises.” Fancy, who now runs an education technology non-profit, told the FT, “I do think there will be more scandals to appear, and it’s going to come to light soon.”

What it Means to be Green

Terms widely used in labelling and marketing ESG funds may carry more legal weight than many firms may have initially thought, some lawyers argue.

Luke Fletcher, a partner at London-based law firm Bates Wells who has been looking into funds’ sustainability claims, says that the 2015 Paris climate accord will be the legal standard against which words used to promote ESG funds will be judged.

Under the legally-binding treaty, 193 parties agreed to limit global warming to well below 2C, and preferably to 1.5C, compared with pre-industrial levels. At November’s COP26

climate summit in Glasgow, signatories committed to new greenhouse gas emissions targets by the end of this year, to meet the Paris goals.

While the Paris accord is technically binding on nations rather than individual companies, there are already signs that it is being interpreted by judges as the standard that companies must adhere to. In a landmark ruling in May last year, a court in The Hague referred to the Paris agreement when ruling that Shell had to make greater cuts to its emissions targets than it had planned.

Fletcher argues that the word “sustainable” — defined in the Cambridge dictionary as “causing, or made in a way that causes, little or no damage to the environment and therefore able to continue for a long time” — should be considered “a seriously high bar”. Legally, he adds, “if you’re not aligned with the Paris goals, you probably can’t say you’re sustainable, in any true sense of the word.”

Much of this area of the law is still new and unexplored. But, if borne out, this would have far-reaching implications for an industry that has freely used such terms.

In August, a report by climate think-tank InfluenceMap found that 421 out of 593 ESG equity funds it assessed had portfolios that were not aligned with the Paris climate targets. The research, which used widely accepted Pacta (Paris Agreement Capital Transition Assessment) methodology to measure alignment, further found that 72 out of 130 climatethemed funds were not in line with the Paris goals. That included three out of four funds marketed as “Paris-aligned”.

The report found climate funds frequently held investments in the likes of oil companies Chevron and ExxonMobil and pipeline company Kinder Morgan. Chevron and ExxonMobil, for instance, are both rated as not being aligned to the Paris goals, according to research group Transition Pathway Initiative.

The asset management division of French investment bank BNP Paribas, which calls itself “the sustainable investor for a changing world”, owned Chevron bonds in its Sustainable Global Corporate Bond and Sustainable US Multi-Factor Corporate Bond funds as of last summer, according to fund documents.

Climate themed-funds run by investment bank UBS and asset managers State Street and BlackRock, and assessed by InfluenceMap, were on average rated as not being Parisaligned.

Funds which advertised themselves as “fossil fuel restricted”, including State Street’s SPDR S&P 500 Fossil Fuel Reserves Free ETF and BlackRock’s iShares Developed World Fossil Fuel Screened Index fund, both owned shares in refiners Marathon Petroleum and Phillips 66. While neither own fossil fuel reserves, both companies have, according to InfluenceMap, been involved in lobbying against policies designed to tackle climate change.

UBS said it took issue with the InfluenceMap research and said its own approach “results in funds with a significantly lower carbon intensity and reduction of carbon risk”. It added that “sustainability means different things to different people”.

BNP said it was committed to “use our influence and investments to push towards a more sustainable future”. It said it filed a motion in 2020 for Chevron to disclose how aligned its lobbying was with the Paris agreement, and said neither of the two funds mentioned still own Chevron bonds.

State Street said: “To meet differing investor needs and risk profiles, we offer a range of ESG strategies, including funds aligned to the Paris agreement, and funds that meet climate objectives in other ways.”

BlackRock said it is “clear about the investment strategies and sustainable outcomes our funds are designed to achieve”. It added: “BlackRock believes greenwashing is a risk to investors, which is why we support regulatory initiatives to enhance the transparency of sustainable funds’ investment mandates and outcomes.”

Kinder Morgan said that “while we recognise there is more work to do, we are proud of our ESG performance to date.”

ExxonMobil said its “short and medium-term emissionsreduction plans . are aligned with the [Paris agreement’s] goals”. Chevron said that “as the world transitions to a lower carbon future . . . diverse solutions — including oil, products and gas — will also be needed”, along with “well-designed government policies”. Phillips 66 said it is “committed to helping the world address climate change”. Marathon declined to comment.

Morningstar recently cut more than 1,200 funds with assets of $1.4tn from its sustainable investment list after an “extensive review” of their legal documents.

“If you label something [that invests in fossil fuels] sustainable, and there’s a whole body of scientific opinion that new oil and gas or coal production is out of whack with climate [sustainability], then there’s probably quite a good chance that you could label it as unsustainable and therefore the fund is being mis-sold in some way,” said Dylan Tanner, executive director at InfluenceMap.

Writing the Rules

While the ESG funds sector has rapidly ballooned in size in recent years, financial regulators have typically been slower to come up with ways to police the sector.

That has created a “limbo period where consumers are at risk of buying products that say they’re doing something they’re not doing”, according to Catherine Howarth, chief executive of responsible investment charity ShareAction, who believes mis-selling has been going on.

But there are growing signs that regulators are taking a tougher line, with a raft of rules hitting the sector. Such rules could also give investors clearer benchmarks on which to measure funds’ claims.

In the EU, the Sustainable Finance Disclosure Regulation, which is based on achieving the Paris goals, introduces new disclosure requirements for funds, which are placed into different categories depending on how much they focus on sustainability. The European Securities and Markets Authority said in February it was seeking a definition of greenwashing that could be used by lawmakers.

In the UK, the Financial Conduct Authority, which in July said that regulatory applications by ESG funds “often contain claims that do not bear scrutiny”, recently closed a consultation on sustainability disclosures for asset managers.

The Competition and Markets Authority has also issued its Green Claims Code, which lays out in detail principles for how businesses should make claims about ESG. While not specifically aimed at fund firms, some commentators believe it could soon start being applied in the sector.

The Advertising Standards Agency has said that adverts around ESG “will require greater regulatory scrutiny in future”. And in the US the SEC has formed a task force focused on ESG, including examining funds’ disclosure and compliance.

“It is no secret that it [misrepresentation of ESG activities] is on the top of regulators’ agendas to send a strong message and make an example”, said Petra Dismorr, chief executive of ESG consultancy NorthPeak Advisory, which works with fund firms.

The new rules are already highlighting potential issues. Sebastiaan Greeven, manager in ESG and sustainability at consultancy MJ Hudson, said he had seen funds categorised under the EU’s regulations as “Article 9” — meaning they aim for sustainable investment — “where I doubt all the investments in these products can be considered sustainable”.

He gives the example of a fund holding a stock with lower carbon intensity than its peers and questions whether that classifies as sustainable.

Fiona Huntriss Partner

“Fiona [Huntriss] is wonderful –super smart, meticulous and tenacious.”

Legal 500 UK 2023

Shell Directors Sued for ‘Failing to Prepare Company for Net Zero’

Environmental law organisation ClientEarth brings action and urges other shareholders to join.

The directors of Shell are being sued for failing to properly prepare the multinational oil and gas company for net zero.

In what is thought to be a first-of-its-kind action, the lawsuit brought by activist shareholders claims that Shell’s 13 directors are personally liable for failing to devise a strategy in line with the Paris agreement, which aims to limit global heating to below 2C by slashing fossil fuel emissions.

The lawsuit claims the failure puts the directors in breach of their duties under the UK’s Companies Act.

If successful, Shell’s board could be forced by the courts to change its strategy, taking specific concrete steps to align its plan with the Paris deal. But if the claimants lose, they could be liable for the full costs of the case, including directors’ legal fees.

ClientEarth, the environmental law organisation taking the action against Shell, said it was calling for other shareholders to join.

At Shell’s 2021 annual general meeting more than 30% of shareholders voted against the board in support of a resolution calling for Paris-aligned emissions targets.

But other shareholders may be reluctant to join after Shell announced in February an increase in dividends and a plan to buy back shares – increasing the value of those remaining in investors’ hands – after reporting a staggering $19bn profit.

ClientEarth has said it is taking the action against Shell in the company’s best interests. Their claim says the board has failed to properly account for the risks climate change poses to the company. Under the Companies Act, directors are legally bound to act in a way that promotes the company’s success and to exercise reasonable care, skill and diligence.

Paul Benson, a ClientEarth lawyer, said: “It’s the first of its kind, this case. It’s the first time that anyone has sought to hold the board accountable for failing to properly prepare for the net zero transition.”

“It is highly novel, we’re in uncharted territory here but we see real merit with this claim. We think, frankly, the longer the board delays with this the more likely it is that the company is going to have to execute this sort of handbrake turn to retain commercial competitiveness, to meet the challenges of inevitable regulatory developments.”

It will not be the first time Shell has faced action over emissions. In May 2021, a Dutch court ruled the company must reduce its emissions – including those from the fuel it sells – by 45% by the end of 2030.

But Shell’s directors have appealed against that verdict and published an “energy transition strategy” outlining the company’s aim to reach net zero by 2050 – a transition it describes as “in step with society”. ClientEarth’s lawyers say the strategy does not meet the targets scientists say are critical to avoid catastrophic climate change.

“We say in our claim that Shell’s board is mismanaging the material and foreseeable climate risk facing the company,” Benson said.

“Shell is actually really quite exposed to the risks of climate change those are physical risks and transitional risks. They are exposed to what we call stranded asset risk, where their assets – for example their facilities, their physical infrastructure – the value of that is just going to reduce or it will become a liability as the net zero transition progresses.

“And they are exposed to massive write-downs of those assets.”

A Shell spokesperson said: “To be a net-zero emissions business by 2050, we are delivering on our global strategy that supports the Paris agreement. This includes the industry-leading target we have set to halve emissions from our global operations by 2030, and transforming our business to provide more low-carbon energy for customers.

“Addressing a challenge as big as climate change requires action from all quarters. The energy supply challenges we are seeing underscore the need for effective, governmentled, policies to address critical needs such as energy security while decarbonising our energy system. These challenges cannot be solved by litigation.”

Lawyers Debate the Secret Debts That Bankrupted Mozambique

A mega-scandal sparks court cases on three continents.

Lebanese businessman sent an email to Ndambi Guebuza, the son of Armando Guebuza, who was then president of Mozambique. It promised that a chartered flight would soon leave France for Maputo, the Mozambican capital, carrying an unusual cargo: 7,427 bottles of wine. What did the email mean? When the public prosecutor asked about it at an ongoing trial, the younger Mr Guebuza shot back. “Do you, madam,want some wine?” he fumed, before alleging that the whole process is a political stitch-up.

Ndambi Guebuza is one of 19 high-profile defendants on trial in Maputo on charges including bribery,embezzlement and money-laundering (which they deny). The accusations relate to a series of deals in 2013and 2014 which saw state-backed firms borrow more than $2bn, mostly in secret. Although the money was earmarked for fishing boats (pictured) and maritime security, American regulators say that at least $200mwas pocketed by Mozambican officials and bankers from Credit Suisse, which helped arrange the deals. The revelation of the hidden debts in 2016 pushed the country into default and sparked court cases on three continents.

One of those cases is the trial in Maputo, held in a marquee at a maximum-security prison and broadcast on national television. The hearing wrapped up last month, with a verdict expected in August. Between legal minutiae, it offered a lurid glimpse into the lives of Mozambique’s super-rich, and allegations of how they splurged ill-gotten gains on posh flats and fleets of sports cars.

In February the former president, Mr Guebuza, took the stand—as a witness, not a defendant—and used the opportunity to make a subtle dig at his successor, Filipe Nyusi. It was “strange”, he said, that Mr Nyusi claimed to know nothing about how the corrupt deals were made, despite having been defence minister at the time. That is a sign of how politicised the issue has become, as rival factions jostle for influence within Frelimo, the ruling party. “Those groups are fighting to control the party to be able to control the state and take advantage of it,” says Edson Cortez, the director of the Centre for Public Integrity (cip), a Mozambican ngo.

Despite its internal ructions, Frelimo retains a strong grip on power and does not want its dirty laundry aired in public. Mozambique and America are still tussling over who can extradite Manuel Chang, the former finance minister who signed off the deals and currently sits in a South African jail. Activists say he would be more likely to spill the beans in an American courtroom than in his home country.

It would not be the first American intervention. Three former Credit Suisse bankers who cooked up the loanshave pleaded guilty to related charges in a New York courtroom. Last October the bank itself agreed to pay $475m to regulators in America and Britain for misleading investors and violating anti-corruption laws. The ruling said that the bank had ignored warning signs, including a due-diligence report which described the contractor who received the money as “an expert in kickbacks, bribery and corruption”. vtb, a Russian bank which was also involved in the deals, agreed to pay $6m to regulators.

None of that money has gone to the people of Mozambique, although Credit Suisse has said it will waive $200m of the unpaid debt that it is trying to recover. That would be scant compensation for the crisis that the scandal caused. When the debts were revealed in 2016, donors halted aid to the government, the imf packed its bags, the currency collapsed and growth slowed. A study by cip and Chr. Michelsen Institute, a Norwegian research outfit, estimated that if these indirect effects are included, then the cumulative costs of the loans add up to nearly $11bn, almost as much as Mozambique’s gdp in 2016.

The debt itself is still outstanding. Some of it is now in the hands of investors who were not involved in corruption. Fiona Huntriss of Pallas Partners, a lawyer for some of them, says that “innocent lenders” should be paid “what is long overdue to them”. The government of Mozambique counters that it should not have to pay because the state guarantees for the debts were issued illegally. That question will be settled in yet another court case, due to start in London next year, in which virtually every party to the matter is suing everyone else. The legal proceedings may rumble on, but justice remains elusive.

James Newton Associate

Pallas Partners: Paving the Way with Purpose

In our latest blog we speak to trail-blazer and founder of Pallas Partners, Natasha Harrison. As well as triumphantly launching her new elite litigation firm last month, Natasha has been leading the way on innovation and change in the legal sector for years. As such, it was a real pleasure to speak to her about her new firm, plans for growth in the class actions space and the need for lateral thinking when it comes to funding.

“I’ve been a passionate advocate for diversity for years - and as you say, diversity in all its forms, not just gender. There isn’t just the moral obligation in that it’s the right thing to do; in my view it also leads to more creative solutions for clients.“

Q. Welcome Natasha and congratulations on the new firm. What inspired you to set up on your own?

I saw a real gap in the market for a top end litigation only firm and a real opportunity to rethink how, as a new law firm starting from scratch, we can innovate, challenge and improve service delivery to our clients.

Unlike most law firms, we aren’t shackled by systems and bureaucracy that have been in place for decades. We can begin afresh and create a new type of firm fit for the 21st Century.

Q. Whilst lots of firms say they are embracing technology, there can still be a lot of resistance or lip-service, how have you tackled that?

We are a new firm with young lawyers and partners. We are not just open minded about innovation, we actively embrace it, including by partnering with tech companies. We want to challenge the status quo and drive change. We are investing heavily in tech to help us become more efficient, competitive and improve the client experience.

But its more than that - it’s about ensuring that you don’t bore the life out of junior associates or paralegals. We’ve got a lot to learn from the younger generation; they come at it from a different perspective and I’m listening to them closely as we build the technology infrastructure for the firm.

Q. A lot of your clients have come with you - why do you think that is?

We are slightly different from traditional litigation boutiques which act as conflict referral firms. We have built long-term relationships with clients - over ten to fifteen years - rather than just taking one off conflict engagements.

We’re also very careful about who we take on, whether that is hedge funds or banks, and we are selective about who we will and won’t act for.

Our track record with clients and institutional knowledge really adds credibility in the market and that means that from day one we started from a very strong base, hitting the ground running.

Q. In Pallas’ new philosophy, diversity - in all its forms - is a golden thread running through the firm’s culture. Why was this so important to you?

I’ve been a passionate advocate for diversity for years - and as you say, diversity in all its forms, not just gender. There isn’t just the moral obligation in that it’s the right thing to do; in my view it also leads to more creative solutions for clients. By having people from diverse backgrounds, we have diversity of thought and steer away from group think. As our clients become more diverse, they make it a priority to see this reflected in their advisers. ‘That’s why we’ve pledged to reflect society in all its diversity in our firm by 2025.

Q. Is that why ESG is also a clear pillar in your philosophy?

Definitely, ESG in its entirety. ESG is not just about diversity, it’s about giving back to the community and tackling issues that our generation face today. We have an opportunity to really redefine ESG by having it as a strategic part of our business plan from day one.

Looking at the younger lawyers coming up - yes, they want more than good work and good money. They want autonomy and flexibility and they also want to have an impact on society. I remember when I was a junior lawyer that I spent one afternoon a week doing pro-bono work. As large firms have pushed their billable targets higher and higher, that has become impossible to do. That’s why we have pledged to dedicate 5% of our resources to pro-bono and volunteering.

And of course, we can’t forget the environment. As well as pledging to be carbon neutral by 2025 the firm is working with clients to use the law to drive changes that support the environment. For example, we worked with ClientEarth to craft a litigation strategy that resulted in it purchasing shares in a company which it then used to block the building of a coal power plant in Poland. That’s the power of the law.

Q. A lot of commentators are suggesting that ESG will be the focus for dispute lawyers over the next few years, is this something that Pallas Partners is looking at?

Definitely. We’re already exploring the opportunities for ESG class actions against corporates who ‘greenwash’. We tend to act for institutional investors and more and more they are really looking into who and where they are investing. And if parties have mis-sold to those investors, they need to be held to account.

Q. Do you think the class action regime in the UK works at the moment?

If you look at competition claims, and the Competition Appeal Tribunal, that is working well.

However, with regards to extending the scope of opt-out claims, the Lloyd v Google judgement showed that the Courts are not keen to open the door too widely and create a US-style system here. That said, the area is evolving rapidly and it is an exciting time to be in this space. Lawyers are smarter about how they represent group clients, and there are new tools and technology that weren’t there 10 years ago which makes it easier and more efficient to bring these claims.

I think it’s important for London to embrace an efficient and successful class action regime which extends beyond competition claims if it is to retain its position as the best place in the world for dispute resolution.

Q. Should London be worried about the growth of other European class action jurisdictions?

I think what the Netherlands has done is really smart. They have English speaking courts, innovative ways to structure claims and a fast system. However, I am not convinced any other European countries have made any meaningful progress. The Netherlands are the only ones that are getting it right.

Q. With several other litigation boutiques opening offices in the Netherlands, is that something you are looking at?

We’re watching the regime there closely. It’s still nascent in its development and it will be interesting to see how it evolves. But jurisdictions like the Netherlands are one of the reasons why the Courts here can’t rest on their laurels and need to get smarter on the class action regime.

Q. Finally, we know that a lot of firms are using flexible fee-arrangements now, and that many class actions can’t get going without external funding. Alternative funding is another key tenet of Pallas’ philosophy - why is that?

I fundamentally think that the billable hour is an anachronism which drives the wrong behaviours. By paying lawyers to take more time to do their work, work drags on, it impacts the length of litigation, and costs clients more and more. I’ve seen lawyers on the other side do this time and time again. This is why flexible fee arrangements are important. There isn’t a one size-fits all but you can have a menu for clients, whether that is by having skin in the game such as Damage Based Agreements, or through external funding. By using these different types of funding structures and taking a portfolio approach to cases, you also balance your risk. This allows us to be more creative in the cases we take on but also - and most importantly - it’s about delivering added value to the client in the long term.

Why Lawyers Want to go Solo: It’s ‘Very Difficult’ to Change the Culture in a Law Firm

Pallas Partners managing partner Natasha Harrison: ‘Do I wake up at three in the morning and go ‘goodness, I have launched a law firm’ — yes I do’

Pallas Partners’ Harrison: ‘I can really set the culture and values. It is very difficult to change those in an existing firm.’

Nearly 40% of lawyers want to launch their own firms, new research showed, butt hose who have taken the plunge warn it is “not for the faint of heart”.

“Do I wake up at three in the morning and go ‘goodness, I have launched a law firm’ —yes I do,” said Natasha Harrison, managing partner of London disputes firm Pallas Partners, which launched in February as a breakaway from US litigation law firm Boies Schiller Flexner.

“Setting up a new firm is not for the faint of heart. Pursuing a vision from a sheet of paper to reality is not easy,” said Jonathan Bloom, a former Jones Day partner who launched his own firm, Avonhurst, in 2019.

Despite the challenges of going solo, it is a widespread aspiration among lawyers —39% of 200 law firm partners surveyed by Censuswide on behalf of litigation funder Harbour said setting up their own firm is a current career ambition.

Marc Keidan, who launched disputes firm Keidan Harrison in 2020, having previously been a founding partner of litigation boutique Cooke, Young and Keidan in 2009, said he was not surprised so many lawyers want to strike out by themselves.

“The freedom and independence and ability to do interesting and diverse work, without significant risks of conflicts, are big attractions,” he said.

For litigators, launching a boutique can be especially attractive as it avoids the conflicts that come with being part of a large law firm with a long list of major clients who are off -limits as opponents in disputes.

Graham Huntley, who co-founded Signature Litigation in 2012, said escaping the constraints of big law firms was another motivation for lawyers to launch boutiques.

There was, he said, “a recognition by many partners, perhaps relatively late in professional life, that the quality of working experience can be replicated and often improved outside big law”.

“In a sense, theirs was a reaction to the perception of increasing constraints within ever-growing international and full-service law firms,” he added.

For others, it is a chance to set the strategy and cultures of their businesses that motivates them to make the jump.

Harrison was heir apparent at Boies Schiller, but stepped back from her managing partner role in September 2021, before leaving with a 26-strong team to set up Pallas Partners earlier this year.

“I can really set the culture and values. It is very difficult to change those in an existing firm,” she said.

Meanwhile, Avonhurst’s Bloom said his plan for a law firm that also provided clients with political and economic advice was initially greeted with scepticism in some quarters.

“I had many people tell me the vision of Avonhurst would have massive challenges ahead,” he said.

As well as lawyers, the firm counts among its advisers the likes of Pippa Malmgren, the ex-UBS deputy head of strategy and a former adviser to US President George W Bush,and Gavin Barwell, ex-chief of staff to UK Prime Minister Theresa May.

Aviva Will: Earlier this year, you launched your own litigation boutique, which you called a different kind of law firm. Tell me why Pallas Partners is different, and why is that important?

Natasha Harrison: We’re different because we’re starting from scratch, and we’re not shackled by years of bureaucracy or ways of doing things in a certain way. I took a blank piece of paper and wrote, “What should the modern law firm look like if you’re starting from scratch?” and brought it from there. For example, we put diversity and inclusion at the very heart of the firm and pledged to have diversity parity by 2025. We’ve invested heavily in technology to improve client service and client delivery. And we’ve also put the environment at the heart of the firm with pledges to become carbon neutral by 2025.

It’s about creating an environment in which associates, partners and business support staff can thrive and deliver outstanding service to clients, an environment where clients have best-in-class teams who are operating at the very highest level.

AW: That’s very inspiring to me, having started Burford 13 years ago with really a blank sheet of paper also and saying, “What kind of place do I want to work in?” Talk about how you think about training and developing the next generation of lawyers and what kind of change is needed from “old law” to what your new version of litigation looks like.

NH: Training in black letter law is very important and always will be important. But there is an increasing need for lawyers,and litigators in particular, to be educated in the business of law; to understand how a law firm works, the financial cycle and business development; and how to bring in clients and maintain client relationships; and to understand technology. Because whether we like it or not, technology is becoming increasingly important within the legal field. It’s understanding the opportunities that technology can provide to a law firm practice. In addition to black letter law, all those aspects are important.

Most important though, is making sure our young lawyers understand the commercial dynamics and the business case involved in any piece of litigation. They’re not just turning through step after step in the ordinary way; rather, they are doing solution-led litigation, which delivers the right results for the client.

Alessia de Quincey Counsel

AW: That is so important. In my part of the legal landscape, in legal finance, we talk to lawyers all the time. They are so smart and capable as lawyers, but don’t always understand the commercial side of how to address client needs by getting the results that clients want and not just getting a good judgment.

NH: Agreed. Very rarely does a client want to go to the Supreme Court, and I don’t imagine you want to, either. And the first question I always ask my clients is, “What is success to you?” They’ll tell us what success is, and we’ll work back our strategy from there.

AW: That’s such a brilliant question to ask. I hope that the trend is that lawyers ask that as the first question and not the last question. Along the lines of commerciality, tell us why you decided to structure Pallas Partners as an alternative business structure? How does outside ownership help the firm and how does it help clients?

NH: I structured Pallas Partners as an ABS to give us maximum flexibility as we grow. There are several reasons why it’s attractive to me. First, business support or nonlawyers can be partners in an ABS. Non-lawyers play an increasingly important part in the operations of a law firm. To be able to give non-lawyers career development and the route to partnership is really important. Second, it enables me, to the extent I need it, to attract outside investment because there may be times when we are accelerating our growth or there may be times when we want to hedge some of our risk by attracting that investment. Again, by having an ABS structure, we can grant equity to an outside investor. Those are the two business reasons that we looked to structure it that way and to have Malmgren, theexUBS deputy head of strategy and a former adviser to US President George W Bush, and Gavin Barwell, ex-chief of staff to UK Prime Minister Theresa May.

“One global pandemic and an international war later, and the market recognises the importance of having access to policymakers and decision-makers as well as the relevance of having top-tier lawyers that understand the needs of clients,” he added.

Huntley said that launching a small, niche firm gives partners “a unique and sometimes once-in-a-lifetime opportunity to build something that was different.

“Doing it with a reliable group of like-minded colleagues is one of the best professional endeavours that a lawyer could want,” he added.

In addition to the stress of worrying about the profit and loss account, other challenges of going it alone include losing the infrastructure that a large law firm provides.

“I know more about financial systems than I ever want to know,” Harrison joked. “It is not just about being a good lawyer; there is a lot more to it than that.”

Despite the challenges, Keidan said co-founding two law firms had been “the right move for me”, and encouraged other lawyers to take similar steps.

“Very few who make the move ever look back with regret,” he said.

Echoing his thoughts, Harrison said setting up her own firm “has been the most exciting step in my career.

“It is challenging, but if you have a very clear vision for what you want to achieve and a very clear strategy to execute, it can be done,” she said.

An Interview With Pallas’ Natasha Harrison

In an exclusive interview, Lawyer Monthly speaks with Pallas’ Founder and Managing Partner Natasha Harrison about the challenges of establishing a new law firm, the importance of sustainability in the legal sector, and her vision for Pallas across the next 3 – 5 years.

What were the greatest challenges you faced when founding Pallas? How did you overcome these challenges?

Setting up your own business from scratch is challenging, but if you have a very clear vision for what you want to achieve and a very clear strategy to execute – it can be done. One of the biggest challenges was to ensure that we had the right infrastructure and systems in place so that we could hit the ground running from launch with confidence. I now know more about technology and financial systems than I imagined possible!

It’s certainly not an easy undertaking but where I was particularly fortunate was that most of my team from Boies Schiller Flexner elected to come with me, as did all of our clients. When you have nearly everyone wanting to join you, that really helps drive your confidence in what you are doing and the ability to make the business a successful venture. Do you feel that being a woman made the process harder?

There is no doubt that the legal world is still a challenging place for women to succeed, as shown by the limited number of women who are Managing Partners of major law firms. One of the major challenges is trying to achieve a sensible work-life balance and COVID provided a meaningful lesson to me in that regard. For the first time, I was able to have lunch and dinner with my children and I am now very strict about being back for supper as much as possible. I continue working in the evening thereafter, but that time is important to me. Therefore, at Pallas, I want to create an environment which recognises that people have real-life pressures and families or friends that they want to see. I don’t want people to miss out on a parents’ evening, for example, and have created a culture where quality of work is prioritised over facetime.

What excited you most about establishing your own firm?

Starting from scratch means that you’re not shackled to hundreds of years of practice and bureaucracy and that’s very invigorating and exciting. The founding of Pallas represents an opportunity to ‘rip up the rule book’ and

challenge the status quo of what a modern law firm should be. I can set the culture and values for the firm and look at ways we can improve the client experience, for instance creating optionality around how they want to be charged.

Pallas is committed to an ambitious responsibility and sustainability strategy. In your opinion, why is it important that law firms establish genuine sustainability policies? And what can firms do to reduce their carbon footprint?

In my view it’s crucial, that’s why responsibility and sustainability are at the heart of everything Pallas does. All our staff have been involved in shaping our approach and what we want to achieve and stand for – and we’ve set some challenging targets for ourselves. We’ve pledged to achieve diversity parity, reflective of wider societal composition by 2025; pledged to increase our community support every year to 5% of our resources by 2025 and have pledged to be carbon neutral by the same year.

These are important drivers of our business and represent our culture and our values. They recognise that law firms have a wider responsibility to the community and world in which we work, which is why it is at the top of our agenda.

In order to reduce our carbon footprint, we are working closely with a consultancy to take meaningful steps, including in relation to travel, our premises and our day to day working practices.

What is your vision for Pallas across the next 3 – 5 years?

I’d like to think that we would have also successfully filled the gap in the market for a high-end litigation firm and that our clients recognise the improved client experience that they receive. My goal is to grow the firm in a strategic way, by blending organic growth with key lateral hires. We want to continue to develop the client base and take on important and complex cases – all whilst challenging the status quo and creating a very modern law firm.

“The founding of Pallas represents an opportunity to ‘rip up the rule book’ and challenge the status quo of what a modern law firm should be.”

Pallas’s Natasha Harrison: ‘I Felt Completely Like an Outsider Going Into Law’

The British-born lawyer was set to take over from David Boies, one of the world’s most famous litigators, but instead quit to start her own firm.

She was poised to take over from one of the world’s bestknown lawyers, veteran litigator David Boies. But Natasha Harrison was not too much in awe of her mentor to strike out alone.

Despite being named heir apparent at Boies’ powerhouse New York law firm Boies Schiller Flexner less than a year before, the Surrey-born litigator quit in November. Her mission: to set up a rival outfit in London, creating a modern law firm from scratch.

Harrison, 49, had been promoted to deputy chair of Boies Schiller in December 2020 by Boies, widely seen as one of the best trial lawyers of his generation. Boies, now 81, helped strike down the legal prohibition on gay marriage in California, as well as representing the justice department in its antitrust victory over Bill Gates and Microsoft in 2001.

When the pandemic hit, Harrison helped lead Boies Schiller as its co-managing partner during a difficult period of transition. But last year she quit in a shock exit to launch a rival litigation firm, taking a group of Boies Schiller’s London staff with her. Pallas Partners opened its doors in February. Her exit came at a difficult time for Boies Schiller. The firm has been dogged with controversy over David Boies’ seat on the board of blood-testing start-up Theranos, whose chief executive Elizabeth Holmes was convicted of fraud, and his past work for Harvey Weinstein. It has also been undergoing a tricky restructure focused on urgent succession planning. More than 80 lawyers have left Boies Schiller since 2020, including Harrison and 26 staff in London who chose to go with her.

Despite that, she says Boies was supportive of her move. “David is a highly intelligent — intellectually and emotionally intelligent — man, and when I mapped out what I wanted to do, he understood it,” she explains. “He did the same thing when he left Cravath [Swaine & Moore, to found his own firm]. David is also someone who likes to challenge the status quo,” she adds.

Harrison says her aim is to disrupt the stuffy and “clubby” culture that pervades the British legal industry, by carving out a more inclusive culture and moving away from the billable hour in favour of models from the worlds of hedge funds and finance.

“The law firm model hasn’t changed for a few hundred years and as someone who comes from a non-traditional background, I’m much more inclined to challenge things,” she says.