One of Hong Kong's largest law firms, Deacons Graham & James, is to sever ties with its troubled US associate on July 1.
The SAR firm - which will retain the name Deacons - is at odds with Graham & James' merger plans and is instead in talks with other firms, both in the United States and Britain for a potential tie-up.
Silicon Valley-based Graham & James has been hit with high-profile partner defections and office closures over the past two years, and is struggling to maintain its status as a top national firm.
This played a part in Deacon's decision to make the break, according to partner Peter Aherne.
'To a certain extent, yes, we were concerned that they had been getting smaller over a period of time . . . when offices disappeared like that,' Mr Aherne said.
'If you look at the history of it, when we did the original association there were 350 lawyers, now there are 200, it's reduced in size over a period of time, giving rise to difficulties.' Graham & James is also involved in a legal spat with rival firm Oppenheimer, Wolff & Donnelly over partner poachings, trade secrets and competition.
The US firm is also planning to seek a merger.