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Several East Coast and Midwestern suitors have approached San Francisco litigation mainstay Sedgwick, Detert, Moran & Arnold about a possible merger. But the firm’s chairman, Kevin Dunne, says the chats haven’t led to anything near a commitment and that Sedgwick is on the receiving end of the inquiries. It hasn’t made an affirmative effort to find a partner. “I don’t expect a merger anytime soon,” he said, but then hastily added, “We are not discouraging inquiries.” Though he confirmed that firms have approached Sedgwick, Dunne wouldn’t comment publicly on who had made inquiries. Two sources knowledgeable about Sedgwick say that Philadelphia’s Pepper Hamilton has shown interest in merging with the San Francisco firm. Pepper Hamilton Executive Partner Robert Heideck would only say that his firm never comments on such discussions with law firms or lawyers. “In general, we are always looking for opportunities,” Heideck said. Among other possibilities, said an industry expert who spoke on condition of anonymity, is Chicago’s 600-lawyer Sonnenschein Nath & Rosenthal. But the source said discussions have fallen off. Sonnenschein lawyers, through a spokeswoman, declined comment. Dunne, too, refused to comment about Sonnenschein. However, in a past interview, Dunne said that his firm had explored a merger with an unnamed, national, 600-attorney firm. The recent round of offers are much more preliminary than those earlier talks, Dunne said this week. Sedgwick has 330 lawyers and outposts in Dallas, Chicago, New York, Los Angeles, Irvine, Newark, N.J., London, Paris and Zurich, Switzerland. Dunne said it’s that mix of branch offices in strategic markets that makes the firm an attractive mate to East Coast and Midwest firms looking to expand. It also has a strong litigation focus — and that has bolstered the firm during the economic downturn. Sedgwick logged $130 million in revenue and $600,000 in profits per partner in 2002, according to The Recorder‘s annual survey of law firm finances. That was a significant jump from the $104 million revenue and $490,000 profits-per-partner numbers in 2001. Sonnenschein’s rumored interest in Sedgwick would fit in with the efforts by it and other national firms to ramp up their presence in California. The last year has brought a spate of big-firm moves into the Bay Area market. Philadelphia’s Morgan, Lewis & Bockius picked up much of the now-defunct Brobeck, Phleger & Harrison’s legal team; Pittsburgh’s Reed Smith joined forces with Oakland’s Crosby, Heafey, Roach & May; and Boston’s Bingham Dana combined with San Francisco’s McCutchen, Doyle, Brown & Enersen. In 2002, Sonnenschein grossed $287 million. Partners took home an average of $560,000 each. Sonnenschein already has an office in San Francisco with 65 lawyers. It also has outposts in Kansas City, New York and Washington, D.C. A combination with Pepper Hamilton would give Sedgwick four offices in Pennsylvania and additional muscle in New York, Wilmington, Del., Cherry Hill, N.J., and Detroit. One sticking point in merger talks might be Pepper Hamilton’s financial performance. In 2001, the firm grossed $160 million and logged profits per partner of $365,000 — more than $100,000 less than the average per-partner profits at Sedgwick.

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