New York's Cravath, Swaine & Moore has never been known for aggressive overseas expansion. Among its closest New York rivals, only Wachtell, Lipton, Rosen & Katz has been more conservative about venturing away from its Big Apple roots. So when Cravath announces that it is moving one of its most senior New York litigators, John Beerbower, to London, the shift is worth attention.
The first point of interest is Cravath's steady buildup of its now 15-lawyer London office. Although the firm shows little appetite for broadening its offering beyond U.S. law, London's rivalry with New York for status as the world's financial capital has led Cravath to reassess its sole overseas outpost.
Until recently, Cravath was more than happy to station a couple of partners for a few years each in London, where they typically handled a range of M&A, finance and capital markets work. Now the firm has signaled that it's prepared to increase those numbers and keep partners in London for the long haul.
Finance expert George Stephanakis, for instance, is expected to stay in London beyond the usual five-year stint. In addition to Beerbower, corporate partner David Mercado will transfer to London this summer, bringing the number of Cravath partners stationed in London to five. For the last few years Mercado has spent much of his time handling Latin American deals, but with the flag of Spanish soccer team Real Madrid already hanging in his New York office, he seems more than ready for his European move.
But adding another corporate partner in the United Kingdom is not wholly unexpected. Moving a senior litigator like Beerbower is more surprising. "London is important, and we want to make sure that the firm is covered in the city -- and by that we mean the whole firm," Mercado says of Beerbower's move. For the first time, Cravath's powerful litigation department will have a representative on the ground in London.
A partner at the firm for 27 years, Beerbower is a classic product of the Cravath system, boasting a broad level of experience in commercial litigation and arbitration. His work for European corporations such as German telecom giant Deutsche Telekom AG, oil major Royal Dutch Shell plc, and aerospace company BAE Systems plc reflects the healthy share of international companies on Cravath's client list.
The very fact that Beerbower will be an American litigator in London means that he's joining a rather exclusive club. Among Cravath's closest U.S. competitors, Simpson Thacher & Bartlett is one of the few to have a U.S. litigation partner on the ground in London. Paul, Weiss, Rifkind, Wharton & Garrison typically has at least one of its senior New York courtroom operators visiting the U.K. at any one time, but none are permanently based there. Sullivan & Cromwell has the most established litigation presence of the lot, having had a partner in London for the last 20 years.
There is a clear logic in moving senior U.S. litigation expertise to London. Thanks to Sarbanes-Oxley and an uptick in Foreign Corrupt Practices Act enforcement, European companies with a New York listing or business in America continue to fall under the demanding glare of U.S. regulators and prosecutors. While litigation or a regulatory investigation involving a European company may take place in the United States, the evidence and a majority of the witnesses are usually to be found overseas.
In addition, America's class action plaintiffs' bar casts a growing shadow across Europe, especially after Royal Dutch Shell's $352 million settlement last year with non-U.S. shareholders over its restatement of oil reserves. Being on a client's doorstep to advise on the American litigation threat makes more sense than parachuting in a partner from the U.S. when a suit is filed.
Although Beerbower's move may not signal a sudden stampede of U.S. litigators across the Atlantic, prepare for a few of his compatriots to follow suit. U.S. litigators may be reluctant travellers, but their view of the world now appears to extend a little beyond the shores of Manhattan.