The Connecticut Law Tribune reports that several high-profile cases have raised the alarm for law firms. President Barack Obama blocked Chinese machinery manufacturer Ralls from buying four wind farms in Oregon, claiming national security concerns, while his Republican presidential challenger Mitt Romney claimed that, if elected, he would label China as a currency manipulator on his first day in office.

Caught in the middle

And lawyers are increasingly caught in the middle of this commercial and political sabre rattling. ‘If you take one view and not the other, there could be serious ramifications for lawyers,’ says Michael Preston, a Hong Kong partner with Cleary Gottlieb Steen & Hamilton. ‘Nobody wants to be on the wrong side of US or Chinese authorities.’
Indeed, according to the report, US lawyers have already been caught in the crossfire. Last week the US House Intelligence Committee labelled two Shenzhen-based telecoms companies -- Huawei Technologies and ZTE -- as threats to American national security because of alleged ties to the Chinese military. Anglo-US firm DLA Piper had already completed unspecified work for ZTE, and was thoroughly criticised by committee member Sue Myrick of North Carolina and congressional colleague Frank Wolf of Virginia.

Cyber security

‘By publicly representing and advising the ZTE Corporation your firm is indicating it values the retainer of one contract over the legitimate cyber security and supply chain concerns of the United States government,’ the Republican politicians wrote in the letter addressed to DLA’s Washington DC managing partner Frank Conner and international trade partner Richard Newcomb.
In a similar letter Mr Wolf urged Sidley Austin chairman Carter Phillips to drop Huawei as a lobbying client, citing the company’s sales to Iran and, earlier, Saddam Hussein’s Iraq and Afghanistan under the Taliban.
‘How can an American firm like Sidley Austin represent a company that has provided our enemies with equipment?’ wrote Mr Wolf.

Courage

DLA Piper and Sidley Austin both declined to comment, but other lawyers involved in China were quick to support the firms.
‘I am definitely with DLA Piper and Sidley Austin on this,’ commented Thomas Shoesmith, the Palo Alto-based China practice leader for Pillsbury Winthrop Shaw Pittman. ‘A law firm has to decide whether or not a company is worth spending time with. Once that decision is made, lawyers need to have the courage to stand by its independent professional decision.’