International Law Firms Exit Russia Amid Confusion Over Spinoffs

Since February, every large international law firm operating in Russia has announced plans to exit, citing the invasion of Ukraine and the resulting waves of sanctions. But these exits sometimes have led to confusion when newly independent Russian “spinoff” practices tout their connection to an exiting international firm. Such a case happened in late April when new Russian firm Birch Legal highlighted their association with 4,000-lawyer Eversheds Sutherland. Some media coverage then suggested that Eversheds had not really left Moscow. In response, Eversheds issued a statement that called Birch Legal simply one of its international referral partners and asserted that Eversheds will not benefit financially from any work done by Birch Legal. An Eversheds spokesperson also stated that language on Birch Legal’s website referring to Eversheds as its “official partner” was inaccurate.

According to Vitaly Mozharowski, a Partner at the newly formed, Moscow-based Alumni Partners, “The international law firms offering on the Russian market has literally collapsed and practically almost disappeared.” In addition to Eversheds Sutherland, international firms leaving Russia include Bryan Cave Leighton Paisner, Baker McKenzie, Dentons, DLA Piper, and CMS. Tony Williams, a legal industry advisor with Jomati Consultants who once ran the Moscow office of law firm Clifford Chance, described Russian legal work as a “much more marginal play” for big firms in recent years. Williams said moral and reputational factors were involved along with financial factors.

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Since 2014, sparked by sanctions that followed Russia’s invasion of Crimea, the country’s legal market has steadily become more Russian. Mozharowski predicted in early April 2022 that more small and boutique spinoff practices would be formed by ex-partners of exiting international firms. And because of the record revenues they’re currently posting, large U.S. and international firms are unlikely to be interested in returning to Russia anytime soon, at least as long as the current regime remains in power.