Freeman Mathis & Gary has expanded into California, acquiring a seven-lawyer San Francisco litigation boutique, Strazulo Fitzgerald, with an office in Hermosa Beach, Calif.
Ben Mathis Jr., FMG’s managing partner, said the move was driven by its relationships with several national insurance carriers and the three founding partners’ desire to build a firm that outlasts its first generation. Mathis launched the business litigation firm in 1997 with Ted Freeman and T. Bart Gary.
The combination, which took effect June 1, gives FMG 56 lawyers.
The firm has a sizable local government practice and also handles professional liability, employment, construction law, medical malpractice defense and commercial real estate litigation.
Mathis said a large amount of the professional liability defense work is covered by insurance to some degree. "That whole marketplace in the last four or five years has been very good for us, as insurance has penetrated into areas of litigation where it wasn’t before and insurers have more say," he said.
Mathis said that several large national carriers are driving the work for professional liability, directors and officers and other claims. "There is a lot of opportunity if they know you and trust you to be able to take that practice and expand it nationally."
His firm’s clients, like Strazulo Fitzgerald’s, include individuals, companies and insurers.
He said several significant cases have come to the firm because the company being sued had directors and officers’ insurance. "It’s now everywhere," Mathis said, adding that employment liability insurance has also become a common product.
Mathis said the firm’s partners have discussed expanding beyond their Atlanta base for some time.
About five years ago, they decided the firm needed to grow if it was to outlast its first generation of founders, now in their 50s and early 60s. "We had a core group [of younger partners] and wanted to support them and grow, and we also wanted to fill in some gaps that we had," he said.
The firm started adding laterals, growing from just over 20 lawyers five years ago to 56 lawyers with the acquisition of Strazulo Fitzgerald.
"I’d like to see the firm survive our time. It’s another level of challenge and keeps everybody interested," Mathis said. "It would be fun to do the exact same thing I’m doing now for the next 10 years and even more so to do this and see us successfully go to multiple offices," he said.
Once Freeman Mathis & Gary decided to expand, Mathis said, the partners compiled a short list of potential new locations, which included California.
Mathis added that he thinks the firm "has a better shot at keeping our culture" by adding more offices instead of "having one behemoth" and expanding to 150 lawyers at its metro Atlanta location.
Strazulo Fitzgerald’s managing partner, Dennis Strazulo, said his seven-lawyer firm did not go into the deal blindly. "Freeman Mathis & Gary and my firm have been swimming in the same circles for years — the professional liability defense world," he said.
Both firms are members of a national group, the Professional Liability Attorney Network, he added.
"We were looking for an infrastructure that could help support us in our continued growth," Strazulo said. "They are upstanding people, and their culture seemed to fit ours."
"We were comparing notes on running law firms, and then we had a more down-to-earth conversation and it went pretty quickly from there," Mathis said.
Strazulo, who will serve as the managing partner for the California offices, said he welcomes the additional resources for handling administration, client relations and business development, adding that he hopes it will "allow me to have maybe a more normal life," and to focus more on the big picture.
While the deal means more structure, FMG is not too bureaucratic, he said. "They’ve been very good about allowing me a lot of say in how the California operations will be run."
Strazulo Fitzgerald handles commercial litigation, including professional liability defense, and has developed a clientele in the hospitality and restaurant industries, Strazulo said, adding that he shifted his focus to professional liability defense from more general insurance defense 12 years ago.
He explained that employment as well as D&O liability insurance are newer types of coverage that fall under the category of special lines insurance. Companies are buying it in addition to older products such as errors and omissions coverage.
"They are almost a must-have for an employer of any size these days," Strazulo said, explaining that employment liability insurance covers wrongful termination, sexual harassment, discrimination and wage-and-hour claims.
Mathis, who practices law full time while serving as managing partner, said his firm is making some changes to manage its growth, such as creating a formal executive committee for the first time.
"We have some structure, but not too much structure," he said. "What makes us different from some firms is we understand the business of law, but we try to have a firm that’s not all business. It’s still a profession. Let’s not lose sight of that."