July 25 (Reuters) - 3M Company sued Covington & Burling on
Tuesday, claiming the firm breached its legal duties by dropping
the tech giant as a client and then taking on an environmental
lawsuit against it for the Minnesota attorney general.
Filed in U.S. District Court in Minneapolis, the lawsuit
comes on the heels of an attempt by 3M to disqualify Covington
from representing the Minnesota attorney general in her suit
accusing 3M of polluting the state's ground and surface water.
"Covington switched its position from arguing (truthfully)
on 3M's behalf that environmental exposure to FCs do not pose a
risk to humans, to now arguing on behalf of the State that
environmental exposure to those very same FCs are toxic," 3M
said in the complaint. FCs refer to fluorochemicals. "The breach
of loyalty could not be more sharply drawn."
The lawsuit alleges breach of fiduciary duty and breach of
contract. It seeks consequential and compensatory damages and
the return of any legal fees it has paid Covington since 1992.
It also seeks an injunction preventing the law firm from
"further jeopardizing 3M's confidential information."
A spokeswoman for Covington had no immediate comment.
According to its complaint, the company behind Scotch Tape
and Post-it Note Pads has a relationship with Covington that
stretches back to the 1980s.
Among other matters, the firm advised 3M in its attempts to
convince the Food and Drug Administration that two of its
food-packaging products under the Scotchban brand were
3M said it continued to turn to Covington through the 1990s
for work relating to the fluorochemical business that had to go
before the FDA and the Environmental Protection Agency.
"On behalf of 3M, Covington forcefully advocated that, as
both 3M-funded and independently-conducted science shows, PFCs
are not unsafe for humans as a result of environmental
exposure," 3M said in the complaint.
From 2000 to 2006, Covington also advised 3M as the company
began phasing out the use of perfluorinated chemicals, or PFCs.
In 2010, though, 3M said Covington began talking to the
office of Minnesota Attorney General Lori Swanson about
representing the state in an environmental lawsuit against 3M
claiming the company's fluorochemical waste polluted state
At the time, the only active legal matter the complaint
mentioned Covington handling for 3M involved the company's
employee benefits program. The contract for that engagement,
signed in May 2010, stipulated that the law firm needed to alert
3M immediately if Covington even considered taking on a client
adverse to 3M.
Instead, 3M received a letter in December 2010 from
Covington partner Seth Safra asking for written confirmation
that its engagement on the employment matter was done. The
letter did not disclose that Covington had been consulting with
Swanson's office, the complaint said.
Eight days later, Swanson's office hired Covington. The
state filed the lawsuit later that month.
"As detailed in the complaint, 3M believes that Covington &
Burling betrayed the most fundamental principles of the
attorney-client relationship -- the duties of loyalty and
confidentiality," William Brewer III, a partner at Bickel &
Brewer and lead counsel for 3M, said in a statement.
The Minnesota lawsuit, filed in Hennepin County District
Court in December 2010, could be lucrative for the firm. A copy
of Covington's contract with the state shows it would earn 25
percent of the first $75 million recovered, 20 percent of the
next $75 million and 15 percent of anything over $150 million if
the case settles before trial.
The case is 3M Company v. Covington & Burling, U.S. District
Court for the District of Minnesota, No. 12-cv-01800
For 3M: William Brewer III, Bickel & Brewer.
For Covington: Not immediately known.
(Reporting by Nate Raymond)
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