David Goodwin, who joined Heller in 1986 and helped found and later chair two practices, and Lawrence Hobel, who joined in 1989, both begin work at Covington's San Francisco office today. They join office managing partner Donald Brown, the only other local partner in the Washington, D.C.-based firm's insurance recovery group, which now includes 27 partners nationwide.
In about 30 years, Covington has recovered $10 billion for its insurance policyholder clients, according to its Web site. Heller, which has 23 partners in its practice without Goodwin and Hobel, has recovered $5 billion in just the last five years, according to its site.
"Covington has an outstanding coverage practice," said David Steuber, the Los Angeles-based co-chairman of Howrey's insurance recovery practice.
"There are a limited number of firms that do what we do in terms of representing policyholders, so it will certainly strengthen Covington's practice," said Steuber, who has known Brown and Goodwin for 30 and 20 years, respectively.
As for Heller, Steuber added, "that's a tough loss for them."
A longtime Heller leader spoke well of the departing partners but played down the loss to the firm. "While we're sorry to see them go, our coverage practice remains quite strong both here in California and throughout the country," said Barry Levin, a former chairman of Heller, the firm's litigation department and the firm's insurance recovery practice.
Goodwin said one reason he was attracted to Covington was the firm's strong East Coast presence. "For what I do for a living ... [Covington's] always had the best practice in the country," he said. "At the same time, it's a chance to build up a really first-rate practice [here]."
Goodwin was the founder of Heller's appeals and strategy group and a co-founder of the insurance recovery group. He served one three-year term as co-chairman of each. He said he plans to continue to work with all his clients, which include BP, Health Net, Hewlett-Packard Co. and Pacific Gas & Electric Co.
Brown, their new colleague at Covington, said he and Goodwin both count Wells Fargo as a client as well.
Hobel said he also expects to bring clients with him and both said they will continue to work as co-counsel with teams at Heller for some clients, which, Goodwin said, includes BP and Health Net.
Hobel said he was glad both to be making the move and to have a longtime colleague making it with him.
"I've known David since 1980, so having an opportunity to not only move to Covington but for David to move as well, makes it an even more exciting opportunity for me," he said. "I think it will be a very energizing experience."
Heller and Covington, along with Morgan, Lewis & Bockius, have the nation's highest-ranked policyholder practices, according to Chambers & Partners. Brown, listed as California's "star performer," and Goodwin are among the top 12 policyholder practitioners in the country, while Hobel is ranked in the top 30.
The insurance policyholders practice, which is among Heller's core practices, is an uncommon one among big firms -- most firms with insurance practices represent insurance companies. As such, industry watchers say the practice will likely be a key consideration in any merger considerations.
Most recently, the firm, which has lost about 35 partners in the last year, has been rumored to be in talks with Baker & McKenzie. A firm spokesman denied that the firm was considering such a merger late last week, but would not rule out that the firms were discussing such a merger. Before that, the firm was rumored to be in talks with Winston & Strawn, but the buzz around that has since subsided.
Covington is ranked 61 on the 2007 Am Law 100 rankings. Heller is ranked 56. Covington's $880,000 revenue per lawyer and $1.2 million profits per partner edge Heller out by $75,000 and $170,000, respectively.
Covington has offices in Brussels, London, New York, San Francisco and Washington, D.C. Including Goodwin and Hobel, there are now 38 lawyers, including 12 partners, in the firm's San Francisco office.