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Cooley Corporate Stars Switching to Dewey
The Recorder
July 08, 2009
In a lateral move that can only be compared to an earthquake rocking Silicon Valley's legal world, Cooley Godward Kronish's two leading M&A lawyers and the head of its busy tech transactions group are leaving for Dewey & LeBoeuf.
The announcement that rainmakers and longtime Cooley leaders Richard Climan and Keith Flaum plus tech practice leader Eric Reifschneider, were moving to Dewey's small East Palo Alto office shocked lawyers all around the Valley.
"Actually, I am quite surprised -- I wouldn't have predicted it," said Alan Mendelson, veteran corporate partner at Latham & Watkins and Cooley alum. "I think it's a coup for Dewey and a big blow for Cooley."
Climan, who is on Cooley's management committee and heads the firm's M&A practice group, said the move wasn't because of dissatisfaction at Cooley.
"We weren't looking to leave Cooley -- it's a fantastic firm, it has matured significantly since we arrived, and our practices have thrived at Cooley," he said. "Dewey, with its global platform, is simply a better fit for us at this stage in our careers."
It's a huge score for Dewey, which has struggled to even maintain a presence in Silicon Valley. The incoming trio will add a corporate practice to the office.
"Obviously they're highly considered M&A lawyers -- some of the pre-eminent ones in the Bay Area," said Robert Townsend, an M&A partner at Morrison & Foerster. "It's certainly a loss for Cooley. ... I wish them luck building a franchise for Dewey."
Climan said he couldn't comment on whether the three-man team would be bringing over any associates or clients.
All three have worked consistently for some of Silicon Valley's biggest companies. Flaum, named a Dealmaker of the Year by Recorder affiliate American Lawyer magazine, has been a favorite at eBay Inc., doing most of the online auctioneer's biggest deals. Flaum also represented Adobe Systems Inc. in its $3.4 billion takeover of Macromedia Inc. in 2005. Climan was a Dealmaker of the Week earlier this year after advising Gilead Sciences Inc. in its $1.4 billion acquisition of CV Therapeutics Inc. His recent big deals also included Brocade Communications Systems' $3 billion acquisition of Foundry Networks Inc. Reifschneider led Cooley's team in Qualcomm Inc.'s $891 settlement of patent litigation earlier this year. The three often had roles on each others' deals.
"Climan and Flaum together control a lot of business," said legal recruiter Alan Miles of Alan Miles and Associates. "You're ripping out the core of that corporate practice when you're doing that,"
At Dewey, Climan will be on the executive committee and be heading up the strategic expansion of the firm's global M&A practice. Flaum will also be taking a leadership role there. Climan said that Dewey had been after the group for a while, but that things got serious in the last month.
The difference between Cooley and Dewey is striking. Cooley is a Valley stalwart whose corporate practice has thrived on startups and tech companies. Although the firm has expanded across the country and diversified its practice, it has continued to add startup lawyers. Last year the firm added 30 lawyers from the now-defunct Heller Ehrman's Venture Law Group.
Dewey's corporate practice is much more of the Wall Street variety, representing banks and the like. But Climan said that won't be an issue for his team.
"Most of what we do is for large corporations," he said. "It's not for emerging or venture-backed companies."
Cooley spokeswoman Ashley Kanigher said the firm will be in good shape without the three stalwarts.
"While we will miss our former partners' contributions, with 60 M&A and 30 [technology transactions group] attorneys firmwide, we retain broad experience and talent in both practices, and remain committed to offering clients premier capabilities both domestically and internationally," she said in a written statement. "We are confident that we will continue to grow in these market-leading areas."
All three Cooley partners have been at the firm for more than a decade. Climan joined from Pettit & Martin in 1994. Flaum joined in 1995 and Reifschneider in 1996. They gave Cooley notice on Tuesday, and Climan said they should be joining Dewey within 30 days.
Dewey had profits per equity partner of $1.5 million last year, a bit higher than Cooley's $1.42 million. But Dewey has not had an easy go of it in recent years. Recorder affiliate The Am Law Daily reported in March that one in five of the firm's 350 partners had had their pay cut by as much as 80 percent in the last 15 months.
Despite that and the size of Dewey's Valley presence, Latham's Mendelson said he can understand the allure the New York firm has for the M&A lawyers.
"My guess is at this stage Rick and Keith and Eric wanted to move up the food chain and do bigger deals," he said. "I guess Dewey is sort of logical because some of the other firms from New York are much less receptive to taking lateral partners."
