Troutman Sanders Merges With D.C. Firm

Meredith Hobbs

Daily Report

Troutman Sanders will merge with a 100-lawyer Washington firm, Ross, Dixon & Bell, gaining offices on the West Coast and in Chicago.

The deal, effective Jan. 1, will make Troutman Sanders a 750-lawyer firm, with about 1,700 total employees. Troutman's chairman, Robert W. Webb Jr., said it will double the size of the firm's Washington office, from 58 to 105 attorneys.

This is Troutman's third major combination with another firm in seven years, following the 2005 acquisition of a 91-lawyer New York office from Jenkens & Gilchrist and the 2001 acquisition of 150-lawyer Mays & Valentine in Virginia. The New York addition made Troutman the third-largest firm in Atlanta, based on revenue. Its revenue last year was $349 million, according to the Daily Report's annual survey of the city's highest-grossing firms.

Ross Dixon's revenue last year was just under $50 million, said the firm's managing partner, David M. Gische, and the firm anticipates revenue of $56 million for this year. Webb declined to state Troutman's budgeted revenue for this year, but projected 2009 revenue to be $460 million for the combined firm.

The deal with Ross Dixon accomplishes Webb's long-stated goal of establishing a West Coast presence for his firm. Ross Dixon opened an office in 1993 in Orange County and another in San Diego in 1999.

Webb said Troutman's acquisition of a sizable New York office three years ago, which does a lot of work on the West Coast, increased the urgency for an office on the other coast.

"Part of our business plan on this deal is to quickly and substantially grow Chicago, Orange County and San Diego," Webb said. Ross Dixon has 15 lawyers in Chicago, 22 in Irvine, Calif., and 16 in San Diego.

Webb said his firm also needs West Coast offices to support its multifamily housing, environmental and energy practices. He said lawyers in the multifamily housing practice, which is very active in the California market, are currently billing the most hours of anybody in the firm. Troutman does almost all of the outside counsel work for a number of West Coast energy companies, he said, adding that Tucson Electric, New Mexico Power, PacifiCorp and California Independent System Operator are clients he can name publicly. The environmental practice's West Coast work includes cases over western water rights, he said.

Troutman's Hong Kong and Shanghai offices also have work on the West Coast, Webb said. "It's not a matter of choice for us -- it's a matter of necessity."

The deal makes Troutman the only major Atlanta-based general practice firm with an office in Chicago. "We are aware of that and we like that," said Webb. Having a Chicago office will allow the firm to recruit Chicago partners with transactional business, he said, explaining that the city's financial markets make it an important location. An office there had been part of the firm's long-range plan, he added.

"They have the locations and we have the platform. We are very confident that we can grow those offices very quickly, and in the meantime, we are picking up a world-class litigation practice," Webb said.

Ross Dixon's core practices are complex commercial litigation and insurance coverage, particularly for directors and officers (D&O) and environmental and mass torts issues, said Gische. He declined to name clients but said the firm represents "almost all of the major insurance companies in the D&O area.

"We've been involved in just about every corporate blowup, including Enron, Tyco and HealthSouth because there are massive amounts of D&O insurance and issues that arise out of how that is dealt with," said Gische.

Ross Dixon's only transactional practice, in real estate, is in San Diego, where Michael J. Whitton has a resort and golf course development practice that Gische said has been busy, despite the down market for real estate.

Gische said the deal gives his firm transactional capabilities as well as Troutman's larger platform and noted that the new Washington office will be one of the 50 largest in the city.

He said his firm has received numerous overtures from larger firms. "We're a 100-person law firm with offices in Washington, Chicago and California," he noted. But until now, the firm had not found a match.

With Troutman, said Gische, he and his partners felt the people and culture were right. "We spent a lot of time talking to the Mays & Valentine folks and the folks in New York. They could not speak highly enough about the integration that was done and the warmth they felt," he said.

Webb said the two firms had been talking since January, adding that it's particularly important in a deal of this size to "get people you like and trust."

"I've spent a good six months making sure I've got that. I feel like they're Troutman people already," he said.

Both firms' partnerships voted unanimously to approve the combination Tuesday, said Webb and Gische.

Gische and Whitton will join Troutman Sander's executive committee. The combined Washington office will be led by Kevin C. Fitzgerald, who is currently the managing partner of Troutman's Washington office.