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March 19 (Reuters) - International law firm Squire Patton Boggs has been sued in New York for allegedly refusing to pay rent for its former office in Moscow, which the firm shuttered after Russia's 2022 invasion of Ukraine.
R.D. Project Development, a Dutch company that subleased space to the law firm in Moscow, filed papers.
in New York County Supreme Court on Monday seeking a judgment against Squire Patton Boggs for about $138,000 plus interest to satisfy a December 2022 judgment from a Moscow arbitration court.
A spokesperson for Squire Patton Boggs declined to comment on Tuesday.
Squire Patton Boggs first opened in Russia in 1995, according to the firm's website. It was among the international law firms that said in March 2022 that they would close their Russia offices following the February Ukraine invasion.
Many multinational companies rushed to leave Russia or cut business ties after the West imposed unprecedented sanctions on Moscow. Squire Patton Boggs said in a March 2022 disclosure that it had ended a long-running U.S. lobbying contract with Gazprombank, one of the Russian financial institutions affected by the sanctions.
According to court filings, R.D. and Squire Patton Boggs' Moscow affiliate entered into a 70-month sublease agreement in January 2020. The law firm on April 4, 2022, sought to get out of the lease, citing the geopolitical situation and new economic sanctions against Russia.
The firm's Moscow affiliate wrote at the time that it "effectively is prohibited, as a US company, from engaging in business activities within and with the Russian Federation," allowing it to end the lease agreement, according to a document filed in the case.
R.D. submitted a claim in Moscow's arbitration court in July 2022 and the next month unilaterally terminated the lease, according to court papers. The Moscow court entered judgment in favor of R.D. in December 2022 for several months of rent and expenses from that year, R.D. said.
Squire Patton Boggs has failed to heed multiple demands to honor the award, according to Monday's filings.
Lawyers not involved in the dispute said it was difficult to draw conclusions about the case based on the limited filings. Thad McBride, a specialist on economic sanctions at law firm Bass, Berry & Sims in Washington, said he had not had client queries about Russian rent obligations specifically, but uncertainty about the scope of sanctions liability was widespread in 2022.
"The biggest companies in the world were at a complete loss about what to do," he said.
Hope Greenberg, a New York-based commercial debt collection lawyer representing R.D., had no immediate comment. Another attorney for R.D., Yury Babichev of Moscow-based Alumni Partners, a firm that was spun off by Russian attorneys formerly with Bryan Cave Leighton Paisner, declined to comment.
The case names Squire Patton Boggs Moscow, Squire Patton Boggs International Associates and Squire Patton Boggs US, which R.D. said does business in New York. The law firm operates under a Swiss verein structure in which its regional entities operate under a shared banner.
Sourced from Reuters
