Airgas wants Pa. to rule first on law firm suit

* Airgas accuses Cravath of conflict of interest

* Asks Del. judge to defer to Philadelphia federal court

* Air Products wants Del. to consider matter first

By Ernest Scheyder

NEW YORK, Feb 16 (Reuters) - Airgas Inc (ARG.N) has asked a Delaware judge to let a federal court in Pennsylvania be the first to decide a conflict-of-interest case against a law firm representing Air Products and Chemicals Inc (APD.N).

The request is the latest act in a quickly unfolding drama between Airgas and Air Products, which earlier this month bid $5.1 billion for its smaller rival. [ID:nN09119866]

Airgas has accused the law firm Cravath, Swaine & Moore LLP of conflict of interest, saying it represented Airgas from 2001 until last October, when it dropped Airgas like a "hot potato" to work for Air Products.

Cravath "is in possession of material, nonpublic information and has betrayed its longtime client," Radnor, Pennsylvania-based Airgas said in a statement.

A spokesperson for Allentown, Pennsylvania-based Air Products declined to comment.

The original conflict-of-interest case was set to be heard in a Pennsylvania state court on Tuesday, but Air Products and Cravath were able to move the case to a federal court in Philadelphia.

Then on Monday, Air Products and Cravath filed with a Delaware court to hear the case, prompting Airgas's request to Chancellor William Chandler III to let the matter play out in a Pennsylvania courtroom first.

The Pennsylvania case is Airgas Inc v. Cravath, Swaine & Moore LLP, 10-612, U.S. District Court Eastern District of Pennsylvania. The Delaware case is Air Products & Chemicals Inc. v. Airgas Inc, CA5249, Delaware Chancery Court.

Elsewhere, Germany's Linde AG (LING.DE), the world's second-largest industrial gas maker, is unlikely to make an offer for Airgas, a source familiar with the matter told Reuters. [ID:nLDE61F1G8]

Shares of Airgas fell 56 cents to $61.25 on Tuesday afternoon, while shares of Air Products rose $1.19 to $69.72. (Reporting by Ernest Scheyder, editing by Gerald E. McCormick)