Why is a Fusion GPS attorney risking sanctions?

Fusion GPS appears desperate to settle a potentially catastrophic case.

Fusion GPS attorneys have been accused of violating ethics rules in the case they’re defending against Alfa Bank. What do they want to keep hidden?

Background

In 2017, the owners of Alfa Bank (we’ll call them Alfa Bank for the purposes of this article) sued Fusion GPS and Glenn Simpson for their publication of false statements accusing Alfa Bank of “bribery, extortion, and interference in the 2016 U.S. Presidential Election.”

As a reminder, it was Fusion GPS and Glenn Simpson who, along with others, created and spread bogus Trump/Russia dossiers to government officials and the media. This was then used to justify the Foreign Intelligence Surveillance warrants on Carter Page to spy on Page those associated with President Trump.

We previously reported that Alfa Bank filed a motion to compel, asking the Court to require Fusion GPS and Glenn Simpson to produce documents withheld as privileged. These documents included communications with Glenn Simpson and others concerning the false Alfa Bank allegations.

Fusion/Simpson have fought the production of the documents, arguing that they are subject to the “attorney-client privilege” and otherwise privileged and not subject to production. We observed these are extremely weak arguments, as the dossiers were political research not subject to the protections afforded by attorney-client privilege. Alfa Bank argued the same to the Court:

Latest Developments

Things have taken a strange turn. Today, attorneys for Plaintiffs (Alfa Bank, et. al) informed the Court that Bill Taylor, an attorney for Fusion GPS, was contacting third parties to establish back-channel lines of communication to start settlement talks.

I’ll let them explain:

Specifically, it is alleged that this settlement overture was made by the Fusion GPS lawyer before discovery allowed each side a look at the other’s “internals.”

As Alfa Bank makes clear, it is against the DC Court’s local rules, as well as the DC Rules of Professional Conduct, to establish such back-channel lines of communication.  

Why this matters.

This development is quite significant. During litigation, settlement offers are conveyed through the parties’ attorneys – not through back-channels. It seems that the Alfa Bank Plaintiffs are not willing to settle. By reaching out to the third party, the Fusion GPS attorney seems to be desperate to change their minds.

This leaves us with a question: why would the Fusion GPS attorney violate the rules of conduct – and risk sanctions by the Court?

We have a feeling that Fusion GPS (or its attorneys… or both) are feeling the heat. There are nearly 500 critically important documents that Fusion GPS has allegedly improperly kept from the other side.

What will those documents show?

May 2016 correspondence among Fusion GPS employees/principals, including Glenn Simpson, regarding their early work on Trump/Russia.

August 2016 between Fusion GPS and DNC lawyers Perkins Coie.

The early work on the Carter Page research from July 2016.

Final Thoughts

Fusion GPS has experienced lawyers. They must realize their attempts to withhold these important documents are futile. They must also realize, though, that there was an ethics violation in trying to establish back-channel communications.

Are the internal Fusion GPS communications so damaging that the risk of sanctions was worth the reward of settlement?

It appears so.