Business Irish

Friday 19 September 2014

Blackstone's law firm worked with Michael O'Flynn

Arthur Cox has advised Nama and the State

Published 17/08/2014 | 02:30

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MICHAEL O’FLYNN: Won his case against Blackstone at the High Court in Dublin last week. Photo: Gerry Mooney

Michael O'Flynn's legal showdown with US buyout fund Blackstone over its attempt to gain control of the O'Flynn Construction Group brought him face to face with a former adviser - law firm Arthur Cox.

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The Magic Circle solicitor firm, which represented Blackstone subsidiary Carbon Finance in the High Court case, had worked for Mr O'Flynn in the past. They had acted for one of his companies in a judicial review as recently as June of this year.

The Dublin solicitors represented one of the companies in Mr O'Flynn's property group, Elysium Management Ireland, in a judicial review aimed at reversing a planning decision on a €45m office block at One Albert Quay.

A team led by Arthur Cox partner Deborah Spence won the judicial review on behalf of Elysium, an O'Flynn-owned management company behind Cork's tallest building and the most high-profile asset in his group, Elysium Tower.

Mr O'Flynn recently raised his dissatisfaction with Arthur Cox's representation of Blackstone in affidavits presented to the High Court as part of his dispute with Blackstone.

His case against Blackstone was successful. On Wednesday, a judge reversed his and other directors' removal from four group companies and the appointment of receivers.

When contacted for comment, Mr O'Flynn said: "It's disappointing when a professional firm acts against you so recently after acting on your behalf, particularly given the nature of this case."

Arthur Cox declined to comment.

Mr O'Flynn primarily relies on Cork solicitor firm PJ O'Driscoll, who advised him on his case against Blackstone. But his group has worked with Arthur Cox in the past.

The law firm's decision to represent Blackstone in its vicious legal dispute with Mr O'Flynn, designed to oust him as a director and wrest control of his construction group, has severed those ties.

A further personal relationship between Arthur Cox and Mr O'Flynn existed beyond a lawyer-client relationship.

Mr O'Flynn sat on a board responsible for advising the HSE's health strategy for the south-west. Arthur Cox's former managing partner, Padraig O'Riordain, also sat on that board.

Arthur Cox has previously denied suggestions that it faced potential conflicts of interests, having acted for the banks, developers and other state bodies in major cases.

It has provided advice to the Government and state bodies, including Nama and the Department of Finance, on issues such as the bank guarantee scheme, the nationalisation of Anglo Irish Bank, the restructuring and recapitalisation of the banks and the State's engagement with the EC/ECB/IMF Troika.

Its private clients have included many parties who played a role in these issues, including Anglo Irish Bank, BoI and developers Paddy McKillen and Derek Quinlan.

Other conflict of interest accusations, which the law firm has denied, relate to work carried out for companies who count its former managing partner as a board member.

Arthur Cox has earned at least €2.6m in fees from the Dublin Airport Authority since former managing partner Mr O'Riordain was appointed to its board. The law firm had been an adviser to the DAA prior to his appointment to the board.

Mr O'Riordain is also a board member at Paddy Power, which paid Arthur Cox €318,894 in fees last year, on top of €659,418 the previous year.

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