After a breakfast meeting Monday at Howrey's San Francisco office, the bulk of Thelen's construction group chose to join the 750-lawyer, Washington, D.C.-based litigation firm.
Howrey announced Wednesday that more than 40 lawyers from the dissolving Thelen would be joining Howrey by Dec. 1.
The group -- which Howrey characterized as "most of the construction practice" from Thelen -- includes Thelen Chairman Stephen O'Neal, construction practice head John Heisse II, D.C. office managing partner Andrew Ness, San Francisco partner David Buoncristiani (who handles matters for client Bechtel), Los Angeles partner Robert Thum and D.C. partner David Dekker. Most of the 18 partners and about 25 associates and of counsel are in San Francisco and D.C., and the rest are in New York and Los Angeles.
The Thelen partners voted to join Tuesday evening.
Howrey's executive committee made its decision Wednesday and a partner vote will take place between now and Monday, Henry Bunsow, Howrey's managing partner for Northern California, said Wednesday.
Legal observers have in recent weeks wondered why Howrey -- which is known for high-end complex commercial litigation, including antitrust, intellectual property and patent litigation -- would desire to add a construction litigation practice.
Bunsow said that construction litigation isn't foreign to the firm. Its global commercial litigation group has handled construction litigation and insurance coverage cases in the past. "We think construction litigation is going to be one of the few major growth areas over the next five to 10 years," Bunsow said. "I don't think anybody would argue that replacing and refurbishing the infrastructure in this country is not going to be a top priority of the new administration."
Howrey firmwide managing partner and CEO Robert Ruyak said that partners discussed taking advantage of energy technology developments at a retreat last spring. And energy technology requires "tremendous investments" in pipelines, wind farms, plants and offshore drilling rigs, among other infrastructure projects, Ruyak said. The potential for litigation and arbitration coming out of these projects was something Ruyak wanted the firm to be better positioned to handle. "We didn't know this was going to happen with Thelen, but when we did find out that the firm was probably going to dissolve, then we certainly made contact to see if they'd be interested."
Thelen's construction practice is ranked in the top California tier by Chambers USA.
O'Neal declined to list most of the clients he expects to follow, but did name Fluor Corp. and Hunt Construction.
Ruyak told partners in an e-mail that the incoming group has annualized billings of more than $30 million, and revenue per lawyer on par with Howrey's.
In 2007, Howrey's revenue per lawyer stood at $755,000, according to the annual Am Law 100 survey.
Bunsow said the decision to take on the Thelen group came after a long and arduous process "to convince both sides that this was a match in everybody's benefit," during which Howrey weighed the business and quality of the group and the longevity of its client base. "The concerns were who wanted to come, what was their historical performance, how much do they work, what is their capability on client retention," Bunsow said. "Howrey is a firm that very much values client retention and high-quality work as much as rainmaking."
For the Thelen partners, staying together was "very important," O'Neal said. "We all have worked closely together," he said. "Many of us have grown up together in the profession."
O'Neal said that the group was looking for a new home with a geographic reach that would cover Thelen's current scope plus Europe and Texas, and with an insurance practice that was on the policyholder side of coverage and recovery matters. "Firms that had large insurance carrier practices would've posed conflict problems for us," he said. It was also important to land at a firm where the partners' practices could grow, he added.
There are some New York and Hartford, Conn., partners and associates in the group who will not be making the move to Howrey, O'Neal said, though he did not specify how many. Legal staff positions are still being worked out.
O'Neal would not comment on what other firms the group held discussions with.
Howrey's Ruyak said that intense discussions began with the core 10 or 12 partners in the last week of October. Last week, the firm invited younger Thelen partners in D.C. to a meet-and-greet there. Monday, it did the same in San Francisco, so lawyers there could ask questions and learn more about what it would be like to transition into and work at Howrey, Ruyak said.
Added Bunsow: "We had a very frank and open discussion about life at Howrey, and apparently we said the right thing."
The Thelen construction partner vote Tuesday evening was unanimous, O'Neal said.