There are a lot of moving parts in Microsoft's unsolicited buyout bid for Yahoo. One of the latest arose last week when the software giant switched its legal team back to its old standby, Sullivan & Cromwell, from Simpson Thacher & Bartlett, which dropped out as legal adviser due to a conflict with another client.
It's tempting to start connecting the dots, but one source familiar with the change said the conflict in question had nothing to do with Simpson's client AOL LCC, which the law firm advised on the Goowy Media acquisition. That deal closed on January 30, two days before Simpson's client, Microsoft, announced its unsolicited bid for Yahoo.
Yahoo reportedly is in talks with AOL, News Corp., and others about them coming in as a white knight to outbid Microsoft.
"We hold Microsoft and its team in the highest regard," Pete Ruegger, Simpson's chairman, said in a statement. "However, in order for us to fulfill our ethical obligations to each of our clients, it became necessary for us to withdraw from this representation."
A spokesman for Simpson Thacher declined to comment beyond Ruegger's statement and declined to disclose the name of the client in conflict.
However, the conflict centered on the "timing of a clearance" and the client declining to issue a waiver to Simpson Thacher to continue representing Microsoft, the source said. And because Microsoft's bid was unsolicited, the issue of a potential conflict could not be addressed beforehand, the source noted.
Other Simpson clients include DoubleClick, which the firm successfully represented before the Federal Trade Commission involving the proposed Google merger. And while the FTC cleared the way for the merger, DoubleClick will still be represented by Simpson before the European Commission during the proceedings this year.
Microsoft, from the get-go, however, did not involve Simpson Thacher for any antitrust representation in its Yahoo bid, according to a report in Lawyer.com.