Consulting bigwig McKinsey & Co. finds itself sparring with a competitor — inside the courtroom and out. That rival accuses the company of ethical conflicts, which McKinsey rejects. Its statement about this is pretty strong and raises some good points about crisis and litigation communications.

Jay Alix, founder of bankruptcy consultancy AlixPartners, accuses McKinsey — in litigation and otherwise — of unethically and illegally not disclosing conflicts it has in working with certain clients in reorganizations. McKinsey strongly denies this. The feud has gotten a fair amount of coverage.

The latest was a May 27 New York Times story alleging that McKinsey has ignored its own document, referred to as a primer, explaining how bankruptcy conflicts should be disclosed. (TheTimes has been laser-focused on McKinsey, doing several large stories lately; in a previous post, we noted the company’s response to one about its in-house hedge fund.)

In its statement, McKinsey says the news stories arise from Alix’s “meritless claims and a media campaign.” Its theme is that Alix is trying to vanquish a competitor (he’s retired but on AlixPartners’s board and he owns about a third of the stock). It refers to his “anticompetitive efforts,” and bemoans that the media “blindly adopt” Alix’s narrative.

In addition to the strong language, the document invokes the numbers-based fact that McKinsey has gotten court approval to represent debtors 13 out of 13 times.

The statement also shows the company taking action. When the U.S. Trustee, the government arm that oversees bankruptcies, asked it to change its approach to disclosures, it did so.

Legal Compliance

“To be clear: there has never been any court that has held that our disclosures did not comply with the law or that McKinsey or any employees engaged in misconduct, and McKinsey continues to defend those disclosures in courts where they have been challenged by Jay Alix,” McKinsey writes.

Some criticisms: The statement is a little puffy about McKinsey’s apparently selfless work helping companies get through the bankruptcy process. And it includes this elusive sentence:

“Earlier this year, McKinsey and the U.S. Trustee’s office agreed to fully resolve recently surfaced disagreements between McKinsey and the U.S. Trustee regarding McKinsey’s past disclosures.”

Finally, the statement isn’t dated, which is especially unfortunate since it starts with the words “over the last year.” It appears it was posted before the recent Times article because it makes no reference to the primer. However, the same reporter, Mary Williams Walsh, did a major Sunday business-section story on the feud last month.

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