The probe comes from the Solicitors Regulation Authority and follows a lawsuit seven years ago in 2010 by Excalibur Ventures against Texas Keystone and Gulf Keystone claiming to be cheated in a valuable Iraq oil field exploration and production deal.
'Shopped' the claim and raised $39.42m
Excalibur’s principals, brothers Rex and Eric Wempen, were represented by lead Clifford Chance partner Alex Panayides, who then proceeded to ‘shop’ the claim to various funders, according to court filings. A group of private investment funds signed on with outside investors collectively putting in some $39.42 million to back the UK suit based on a loser pays system.
'No interest' ruling closes case
However, in an unexpected turn for the firm a London Commercial Court judge ruled Excalibur had no interest in the claimed oil assets and ordered investors to forfeit millions posted as security for the defendants' legal fees bringing the case to an abrupt end.
More worries
The judge later ordered Excalibur's funders to pay an additiona £5.5 million in legal fees at the same time deriding the suit which he said was ‘replete with defects, illogicalities and inherent improbabilities’. Then,in more bad news for Excalibur, an appeals court panel affirmed that decision last year – and brought Clifford Chance into the spotlight for ‘an acute conflict of interest’ stemming from one of the funds and a contingency deal under which it would reap 140 per cent of its usual fees plus a bonus if the suit succeeded.
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