April 13, 2012 5:36 PM
Wilmer, Robins Kaplan Caught Up in Best Buy Probe of Ex-CEO
Posted by Brian Baxter
Best Buy, the country’s largest consumer electronic retailer, announced the resignation of CEO Brian Dunn this week, as the company's board of directors hired outside counsel to launch an investigation into allegations of personal misconduct by its former leader. (Following the news of his resignation Tuesday, allegations emerged that Dunn, who is married, was having a relationship with a 29-year-old woman who worked at Best Buy.)
Wilmer Cutler Pickering Hale and Dorr securities practice chair William McLucas, a leading adviser on corporate governance, and regulatory and government affairs partner Thomas Strickland are heading a team from the firm advising an audit committee of Best Buy’s board investigating allegations into Dunn's personal conduct.
Wilmer spokeswoman Molly Nunes told The Am Law Daily that the firm was hired because of its “history of playing a central role in prominent investigations” and its reputation for “having seasoned lawyers” work on complex matters. “[Best Buy is] a relatively new client for the firm,” Nunes added.
McLucas is a former director of enforcement at the SEC and a seasoned veteran of internal investigations. Strickland, a former managing partner of Hogan & Hartson’s Denver office, joined Wilmer last year after serving as chief of staff to Interior secretary Ken Salazar. Between 1999 and 2001, Strickland served as U.S. attorney for Colorado, having been sworn in to the post the day after the massacre at Columbine High School.
The Am Law Daily reached out to Best Buy general counsel Keith Nelsen to see whether the company has retained separate outside counsel of its own over the allegations, but didn’t immediately hear back from Best Buy. Bruce Hight, an outside spokesman working for the company, told us he was looking in to the matter at Nelsen’s behest.
Best Buy employs several firms as regular outside counsel on various matters, according to a database maintained by sibling publication Corporate Counsel. Minneapolis-based Am Law 200 firm Robins, Kaplan, Miller & Ciresi has the closest ties to Best Buy.
Name partner Elliot Kaplan began serving on Best Buy’s board in 1971. Kaplan, who served as primary external general counsel to Best Buy, retired from the board at the end of his term last June. Best Buy subsequently gave Kaplan its “Lifetime Award” to honor him for his 40 years of service to the company.
Proxy statements filed by Best Buy in previous years reveal that Kaplan’s daughter, Jane Kirshbaum, is employed by the company as senior corporate counsel. Kaplan’s stepson, Michael Stillman, is a former vice president for Best Buy Connect. Best Buy also disclosed in securities filings that it paid Robins Kaplan approximately $12 million in legal fees during its 2011 fiscal year.
Robins Kaplan advised predecessor company Sound of Music on the change of its name to Best Buy in 1983, as well as on its $8 billion initial public offering on the NASDAQ two years later.
The firm has also become embroiled in other matters for its longtime client, including a class action suit that accused Microsoft of paying Best Buy to collect and use customers' credit card information without their permission. Several years into the suit, former Robins Kaplan partner Timothy Block admitted that he'd tampered with documents in the case, according to a story at the time by sibling publication The National Law Journal.
Neither Robins Kaplan name partner Kaplan, managing partner Steven Schumeister, or chairman of the board Martin Lueck responded to requests for comment on whether the firm was advising Best Buy in regards to the Dunn probe.
Aside from Robins Kaplan, another firm that has handled labor and employment work for Best Buy is Morgan, Lewis & Bockius. A spokeswoman from that firm did not immediately return a request for comment on whether it had been retained by Best Buy in the Dunn matter. (Dorsey & Whitney, which handles only M&A work for Best Buy, advised the company last year on its sale of Napster.)
Best Buy’s probe into Dunn’s conduct calls to mind a similar scenario two years ago at Hewlett-Packard, when former CEO Mark Hurd resigned following an internal investigation that found that he had falsified documents in order to conceal an illicit relationship with a former female contractor.
Covington & Burling and Skadden, Arps, Slate, Meagher & Flom helped HP manage the legal fallout from Hurd's departure, according to our previous reports. (Last month former Morgan Lewis partner and HP general counsel Michael Holston, who stepped down from the company in December, was named chief ethics and compliance officer at pharmaceutical giant Merck.)
As potential private equity bidders circle Best Buy, it remains to be seen whether Nelsen and the company’s outside lawyers will be able to deftly manage any legal issues that could emerge from Dunn's abrupt departure. Best Buy has named board member G. Michael Mikan III, the son of Hall of Fame basketball player George Mikan, as its interim CEO while it conducts a search for a successor to Dunn.Make a comment