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June 29, 1998 THE TOP 20: THE NEWS IS GOOD A year ago, law firm leaders and consultants in the D.C. area predicted that 1997 was shaping up as a strong year for legal business. Those prognostications proved right on the money, as D.C.’s legal elite, powered by corporate work and an effervescent economy, racked up impressive returns for the fourth year in a row. Last year, the total gross revenues earned by the city’s Top 20 law offices amounted to $2.15 billion, an increase of 11.4 percent over 1996. Total profits increased by 10 percent, from $772 million in 1996 to $859 million in 1997. Notably, 1997 ushered in a new leader in the race for revenue. Hogan & Hartson overtook Arnold & Porter as the city’s top-grossing firm, ending the latter firm’s eight-year domination. Hogan became the first home-grown firm ever to gross more than $200 million in a year from legal work. Top Grossing Firms Ranked by Gross Revenues 1. Hogan & Hartson: $201 million 2. Arnold & Porter: $192 million 3. Covington & Burling: $143 million 4. Howrey & Simon: $139 million 5. Wilmer, Cutler: $118 million 6. Akin, Gump: $112 million 7. Morgan, Lewis: $108 million 8. Skadden, Arps: $102 million 9. Steptoe & Johnson: $96 million 10. Williams & Connolly: $94 million Jan. 25, 1999 JOINING THE Y2K PARADE Call it pre-millennial anxiety, but it seems you can’t take a step these days without hearing about Y2K this or Y2K that. And it’s no different at D.C.’s top law firms. Within the last 18 months, virtually every shop in town that considers itself full-service has cobbled together a Year 2000 task force or practice group. But whether this sound and fury represents any distinctive mix of skills or has generated much in the way of actual legal business is another question. Seminars and newsletters, yes; but at least so far, lawsuits, trials, and court decisions have been scarce. The reason, of course, is that most of the problems will not become evident until Jan. 1, 2000. If that date is read by computer programs as Jan. 1, 1900, the glitch could crash systems worldwide, spawning litigation in which, some experts predict, more than a trillion dollars could be at stake. Even though not everyone is convinced of this doomsday scenario, most big law firms aren’t taking any chances when numbers like that are being kicked around. As the millennial midnight approaches, firms are jockeying for position, vying to emerge as leaders in this new and potentially lucrative field. June 14, 1999 BRAND RECOGNITION Lately, it seems that the larger a firm’s marketing budget, the smaller its name. This month, D.C.’s Shaw Pittman Potts & Trowbridge joins a growing cadre of syllable-trimming law firms, shortening its official name to just Shaw Pittman. The new name will appear on firm letterhead, business cards, and door signs. The change came about as part of an ongoing campaign to brand Shaw Pittman as the local leader in high-technology law, and has been solidly backed by founding member Ramsey Potts, who, at 82, is still an active presence in the firm. “When the management committee voted on the name change, Ramsey was the first to stand up and say that he supported it,” says managing partner Paul Mickey. “He understands that for us to portray ourselves as a part of the high-tech community, the change was inevitable.” On the firm’s new Web site, which launches June 21, as well as in the firm logo, the name will run together � ShawPittman � but at least for now that space will remain in text. June 28, 1999 SUBURBAN SPRAWLING Northern Virginia continues to act as a powerful magnet, attracting lawyers and firms that hope to grab a piece of the legal market in the booming high-tech corridor. D.C. lobbying and legal powerhouse Patton Boggs, the latest but surely not the last to join the race, plans to open an 18- to 20-lawyer office this fall near Tysons Corner. Meanwhile, two of Silicon Valley’s leading tech law firms are quickly gaining momentum in the Washington area. Palo Alto’s Cooley Godward has already doubled the size of the office it opened just two months ago in Reston. And San Francisco’s Brobeck, Phleger & Harrison, while not yet cracking into Northern Virginia, has gone from four lawyers to 12 since opening March 1 in downtown Washington. July 19, 1999 CLIENT INVESTMENT POOLS MAKING WAVES It’s a high-tech jungle out there. Northern Virginia’s blooming “dot.com” sector is roiling the already competitive Washington area legal market. New businesses are sprouting up every day, drawing Silicon Valley law firms with a track record for representing emerging companies. And many firms are already finding it difficult to attract and hold on to the best and brightest young lawyers. To compete with the newcomers from Silicon Valley, area firms are coming to accept one of their competitors’ more exotic business practices: taking equity investments in clients. So-called venture capital arms are controversial because many lawyers are uncomfortable striking up a direct financial relationship with the companies they advise. But it’s standard procedure for Silicon Valley firms � a signal of a firm’s faith in its startup clients, proof that it has joined the Internet revolution. Some firms have decided these venture funds can be a great recruiting tool. They are spreading the wealth by inviting associates and paralegals to participate in the investments. Piper & Marbury partner Edwin “Ned” Martin Jr. says he felt some pressure from his partners to create a venture capital fund. “I’m hearing from them that they’d like to see this happen, and I’m getting it done,” he says. Aug. 2, 1999 WISING UP AND DRESSING DOWN When local law firm managers agreed recently to meet and share ideas, the plan was to talk to one another about issues ranging from sexual harassment to associate training to hiring and firing personnel. But when Frank Eisenhart, of the D.C. office of Dechert Price & Rhoads, walked into the June gathering of the Managing Partners Forum, he sparked an off-the-agenda debate � without uttering a word. “I had on khakis and a dress shirt with no tie and Docksiders. Everyone else was in lawyer clothes,” says Eisenhart, whose firm has adopted a casual dress code for the summer. “Jess Stribling of King & Spalding took one look at me and said, ‘I see we have another agenda item.’ “ Indeed, with more than a third of Washington’s 25 largest firms implementing week-long “casual Friday” dress codes during the summer months for the first time ever, everyone is looking over his or her shoulder to see what the next lawyer is wearing. The D.C. office of Morgan, Lewis & Bockius is the latest to jump on the bandwagon, announcing July 23 that it will be business casual for the month of August. Sept. 13, 1999 MERGER MOVEMENT PICKS UP THE PACE It’s not exactly Viacom and CBS, but two local law firms had big merger announcements of their own last week. Howrey & Simon is joining forces with Houston-based intellectual property specialists Arnold, White & Durkee to form an as-yet-unnamed 470-lawyer firm, while Venable is picking up D.C.’s 50-lawyer Tucker Flyer, helping shift the Baltimore firm’s center of gravity to the District. For Howrey, best known for its strength in antitrust litigation, the merger provides national prominence in IP. As for the union of Venable and Tucker Flyer, it comes at a time when keeping afloat a broad-based firm with fewer than 100 lawyers has become increasingly untenable. “What this all speaks to is that Washington is no longer seen solely as a legal market for the federal government,” says D.C.-based legal recruiter Ann Director. “With all the California firms coming here and the British firms coming here, it’s absolutely clear that the concept of D.C. as a town of administrative lawyers and litigators is gone.” [ The "as-yet-unnamed" firm is now called Howrey Simon Arnold & White.] Oct. 18, 1999 THE YEAR OF GROWING GENEROUSLY Neil Siegel knows he shouldn’t complain. But the tech boom that has rained cases on his intellectual property boutique has created a dilemma: Either grow uncomfortably fast and risk destroying the firm’s culture, or turn away work. “It’s a sad commentary when you say your plate is too full,” says the managing partner of D.C.’s 98-lawyer Sughrue, Mion, Zinn & Seas. Siegel’s firm had one of the highest rates of growth in Legal Times’annual survey of the largest law offices in the D.C. metro area � a leap of 43.2 percent over last year’s numbers. And it’s not alone. A seemingly insatiable demand for corporate, high-tech, and intellectual property work fueled growth throughout the metro area. Some of the most dramatic surges were reported by boutiques specializing in IP, like Sughrue, Mion, and by the local offices of New York-based transactional firms. Says Jacquelyn Finn, a recruiter at D.C.’s Finn & Schneider Associates: “Every firm we have visited has had its best year ever.” Top 10 Largest Firms 1. Hogan & Hartson: 422 2. Arnold & Porter: 316 3. Covington & Burling: 301 4. Morgan, Lewis: 277 5. Shaw Pittman: 273 6. Akin, Gump: 271 7. Howrey & Simon: 268 8. Wilmer, Cutler: 254 9. Arent Fox: 234 10. Steptoe & Johnson: 232 Nov. 8, 1999 INSIDE THE ERNST & YOUNG DEAL One day this spring, Ernst & Young approached William McKee with an audacious proposal: Leave King & Spalding and we’ll help you start an independent law firm that would have your name � and Ernst & Young � on the letterhead. Other people were talking about the ethics and merits of merging a Big Five accounting business with a full-fledged legal practice. But Ernst & Young actually wanted to do it. McKee was taken aback, but he listened. And on Nov. 2, after months of mostly top-secret negotiations and close scrutiny of the ethics rules, Ernst & Young announced the formation of McKee Nelson Ernst & Young. “The reason we’re doing this is we think this is the future,” says McKee. [ In 2001, the law firm shortened its name to McKee Nelson, citing regulatory constraints. The firm remains "allied with" Ernst & Young.] Feb. 7, 2000 CAN THEY AFFORD TO KEEP UP? It’s a wonder D.C. lawyers got any work done last week. Across town, partners and associates alike were grabbing colleagues in the corridors, calling emergency meetings, and swapping gossip by phone and e-mail. The urgent topic: When would the latest fusillade in the salary wars engulfing law firms coast to coast strike Washington? Late last year, Silicon Valley’s Gunderson Dettmer Stough Villeneuve Franklin & Hachigian increased associate salaries 40 percent across the board. The move essentially guaranteed first-year associates an unheard-of $145,000 a year. Palo Alto, Calif.’s Cooley Godward soon matched, followed domino-style by Wilson Sonsini Goodrich & Rosati; Brobeck, Phleger & Harrison; and a dozen other San Francisco Bay area firms. New York fell next: Davis Polk & Wardwell and Skadden, Arps, Slate, Meagher & Flom announced similar raises last week. Now the issue has hit D.C. firms � squeezed between the new Northern Virginia ambitions of Cooley and Brobeck, and their historical rivalry with New York firms. Local partners are waiting to see who among them will be the first to announce salary increases. “Either everybody matches, which will put increasingly fierce pressure on the partner economics of most law firms, or they don’t, which will cause a sharp divide in the U.S. legal scene,” says Brobeck chairman Tower Snow Jr. Feb. 21, 2000 PRESSURE POINTS For three weeks, D.C. partners have been sitting on the sidelines as law firms coast-to-coast announced dramatic increases in associate pay. But last week, Shaw Pittman, Howrey Simon Arnold & White, and Hogan & Hartson broke the stalemate, announcing raises of their own and pressuring other D.C. firms to follow. At Shaw Pittman, new salaries start at $125,000 for first-year associates, with total compensation, including possible bonuses, reaching $160,000. At Howrey, increases were more modest locally: First-year associates will earn $110,000 base salary in Washington. In the firm’s California offices, however, associate salaries will start at $125,000. Hogan announced an intermediate plan in which associates billing 1,950 hours will be paid base salaries ranging from $125,000 to $210,000. Associates wishing to work fewer hours will be paid less. March 27, 2000 REALITY OF GIANT RAISES HITS HOME First came denial. Followed by anger and resentment. And now, finally, a mood of inevitability has washed over D.C. law firms. All the lawyers in Washington, and not one could find a loophole in the law of supply and demand. Now, firm leaders and associates are starting to adjust to life in a market where first-years command $125,000. One thing is very clear: Billable hour “goals,” “targets,” and “benchmarks” will soon be quaint remnants of a bygone era. Under new regimes, the billable hour is king. “I view this with a lot of trepidation,” says one senior associate at a large D.C. law firm. “Billable hours have always been an important part of law firm life, but they’ve never been front and center the way they are now.” At Hogan & Hartson and Wiley, Rein & Fielding, for instance, the solution has been to create two tiers of associate pay � one starting at $110,000 for those working 1,800 hours and a second one starting at $125,000 for a more vigorous 1,950-hour year. June 12, 2000 RISKY BUSINESS Every Wednesday morning at eight, the business and technology partners in Shaw Pittman’s Tysons Corner office sit down with a list of potential clients and try to figure out which ones to bet on. Picking tomorrow’s success story in today’s fickle investment climate, says partner Steven Meltzer, is like aiming at a moving target. In the shadow of what looks like an industry shakeout, taking a more discriminating approach to screening dot-com businesses has never been more crucial. But even among firms with the most industry experience, methods for evaluating new clients run the gamut � from near scientific exercises to gut-level reactions. “We talk to the venture capital community about their level of interest in certain sectors and basically try to identify clients that we think will be successful,” says Meltzer, co-chairman of Shaw Pittman’s corporate technology group. For firms courting business along Northern Virginia’s high-tech corridor, the Nasdaq’s recent volatility is a sobering reminder of the risk in choosing poorly. “It’s going to be like any other shake-out,” says Paul Rogers, a partner at Covington & Burling. “The really successful companies will continue to do well. The people who are representing the best companies are going to be fine.” June 26, 2000 THE D.C. 20: THE CAPITAL’S CASH CROP More than 10 years ago, Steven Brill � then-editor of The American Lawyermagazine � penned an essay on the coming decade for U.S. law firms. By the year 2000, Brill predicted, the market would be dominated by a group of 20 mega-firms. Just two native Washington firms made his list of contenders for top-tier status: Covington & Burling and Hogan & Hartson. It’s hard to say that Brill’s predictions have come to pass � scores of Washington firms still compete for sophisticated work nationally and internationally. Arnold & Porter, for instance, is one firm conspicuously left out of Brill’s calculation. Still, Covington and Hogan, two of the oldest firms in Washington, remain industry leaders. But while the two firms had similar profiles in 1990 � each with about 300 lawyers and in the early phases of European expansion � their paths have diverged dramatically since. Covington has grown cautiously, ending fiscal 1999 with 320 lawyers � just 50 more than it had 10 years earlier. Meanwhile, Hogan more than doubled in size and opened offices in 14 additional cities. Top Grossing Firms Ranked by Gross Revenues 1. Hogan & Hartson: $194 million 2. Arnold & Porter: $185 million 3. Skadden, Arps: $150 million 4. Covington & Burling: $144 million 5. Akin, Gump: $140 million 6. Howrey Simon: $139 million 7. Wilmer, Cutler: $132 million 8. Morgan, Lewis: $120 million 9. Williams & Connolly: $117.5 million 10. Shaw Pittman: $117 million Sept. 17, 2001 LAWYERS WHO LOST THEIR LIVES IN THE TERROR With emergency workers still sifting through the rubble at the Pentagon and in Manhattan, it is impossible to fully measure the loss of life from the Sept. 11 air attacks. However, the deaths of at least four members of the legal community in Washington, D.C., have been confirmed. •� Karen Kincaid.Wiley Rein & Fielding lost Karen Kincaid, a partner in the firm’s telecommunications practice and passenger on American Airlines Flight 77, which was crashed into the Pentagon. Kincaid, 40, joined Wiley Rein in 1993 after four years at the Federal Communications Commission. In a first-generation firm that takes pride in its sense of community, her loss is likened to that of a family member. Colleagues remember Kincaid for her kindness, team spirit, and deep love of animals. •� Lisa Raines.The city’s close-knit group of biotech lobbyists is mourning the death of Lisa Raines, who also died in the crash of Flight 77. Raines, 42, was chief lobbyist for the Genzyme Corp. and an officer of the company � a rare position for a corporate lobbyist. She was also one of the industry’s most important Washington advocates. “She was doing biotech before anyone else even knew what biotech was,” says Michael Werner of the Biotechnology Industry Organization. •� Barbara Olson.The most public figure lost on Flight 77 was Barbara Olson, Washington mainstay and political commentator. Recognizable from countless appearances on CNN, Olson, 45, had worked in the policy arena in the District since 1995, when she left the U.S. Attorney’s Office for Capitol Hill. Her critical commentary throughout the Bill Clinton administration made her a media presence, and in 1996 she married Theodore Olson, now U.S. solicitor general. She is remembered foremost as a vibrant, assertive woman who remained courageous to the very end. •� Todd Reuben.Venable partner Todd Reuben was also on Flight 77. Reuben, 40, is remembered for his straightforward nature and lack of pretension. “He had all his priorities in order,” says partner Stefan Tucker, whose previous firm, Tucker Flyer, hired Reuben out of law school in 1989. Also a certified public accountant, Reuben headed straight into tax law at Tucker Flyer, which merged with Venable in January 2000. Dec. 10, 2001 A GRIM TOLL ON FIRMS The economic pain in the legal market continues to mount, as more lawyers fall victim to a sharp drop in corporate legal work. Layoffs, once rare, are now part of the D.C. landscape: Two of the city’s leading firms let go a total of nearly 30 associates over the past few weeks. And the pain is not limited to layoffs. Several firms cut their partnership classes in half this year. Last week, Shaw Pittman laid off 19 associates firmwide along with a smaller number of administrative staff. The move came days after the firm announced just four new partners in its D.C. and Northern Virginia offices, down from eight in 2000 and seven in 1999. “We added over a hundred lawyers in 2000,” says managing partner Paul Mickey Jr. “Client demands for our services just haven’t grown as much as the firm has grown.” Shaw Pittman is not alone in going to uncomfortable lengths to shore up the bottom line. After initially shying away from statements that the economy has played into associate and partner decisions, managing partners are starting to publicly acknowledge the effects of the nationwide recession on their firms. Says Jeffrey Liss, chief operating officer of Piper Marbury Rudnick & Wolfe: “Certainly the economy is something that could affect individual decisions.” Sept. 16, 2002 FIRMS FOCUS ON VETTING PARTNERS The reverberations are continuing from the surprising Sept. 4 announcement by Pillsbury Winthrop that a corporate partner who was leaving for Latham & Watkins had been accused of sexual harassment while at Pillsbury. Whether the allegations are true or false, the fact that they were made � and that Latham’s managers, by their own account, hadn’t heard about them before making the hire � has sparked discussion among law firm leaders nationwide. The key question: Can this happen to us? “We have never done formal background checks [ of prospective laterals], but after reading these stories, there’s a part of me that says perhaps we should,” says Carter Phillips, D.C. managing partner of Sidley Austin Brown & Wood. But no reasonable due diligence process can prevent all embarrassments, many law firm leaders acknowledge. Says Tower Snow Jr., the former chairman of Brobeck, Phleger & Harrison who took dozens of Brobeck lawyers with him to Clifford Chance earlier this year: “Every law firm in the world has brought in a lateral who was a mistake.” [ The former partner, Frode Jensen III, sued Pillsbury Winthrop for defamation. The suit was settled earlier this year; the terms were confidential.] Oct. 28, 2002 THE LEGAL TIMES 100: BACK TO THE OLD ECONOMY Covington & Burling is breathing a sigh of relief for having resisted the temptation of following the crowd to Northern Virginia, says partner Mark Plotkin. “There were times when all those high-flying IPOs made me jealous, while we were all sitting here with our decades-old clients,” he admits, and then adds, “But those clients are still here and doing things.” For many firms that went after telecom, dot-com, and other emerging technology work, the punishment has included layoffs, hiring freezes, and stepped-up pressure to produce. Also caught in the downturn are firms with transactional practices focusing on mergers and acquisitions. Overall, Legal Times’annual survey shows a reduction in force at 46 firms; in 2001, only 36 firms shed lawyers. “There are certainly lots of firms that are sending the message to nonproductive partners that they need to look elsewhere,” says Stephen Nelson of the McCormick Group in Arlington, Va., a headhunting and counseling firm. Top 10 Largest Firms 1. Hogan & Hartson: 455 2. Arnold & Porter: 433 3. Covington & Burling: 364 4. Wilmer, Cutler: 360 5. Morgan, Lewis: 304 6. Dickstein Shapir 282 7. Howrey Simon: 270 8. Akin Gump: 265 9. Steptoe & Johnson: 241 10. Shaw Pittman: 239 Feb. 24, 2003 FIRMS BULLISH ON TIDE OF REGULATION As barometers of legal business, recent events at two firms offer unmistakable readings. On Jan. 30, San Francisco-based Brobeck, Phleger & Harrison voted to dissolve, its ranks of dot-com clients decimated, its costly offices half-empty, its balance sheet weighed down with debt. Two weeks later, on Valentine’s Day, Wilmer, Cutler & Pickering signed off on a lease for new headquarters in downtown Washington. The collapse of Brobeck’s New Economy souffl� is an outsize symbol for an obvious fact: Corporate deal work remains very hard to come by. And forget about emerging companies. But Wilmer’s bullish investment in 524,000 square feet of office space, with an option on 120,000 more, reflects a bright spot in the legal market. Indeed, for several firms in the nation’s capital, the legal business is thriving. “We’re in a period of unprecedented corporate regulatory activity,” says David Becker, a securities partner at Cleary, Gottlieb, Steen & Hamilton’s D.C. office. “These practices are probably more active than they’ve been in 20 years.” March 31, 2003 BOOM TOWN Acres of empty space in Northern Virginia and a soft real estate market in the District have some law firms on the move � and others nervous. In the Central Business District, the vacancy rate is 8 percent. In the Dulles Corridor, vacancies are at a staggering 23.3 percent. At the same time, law firms have taken on an even more important role as tenants. Three of the 10 largest leases brokered in the District last year, and the biggest private lease in the city’s history, were signed by law firms. While firms are landing big leases, they are doing it as frugally and efficiently as possible. “The objective is to have a sharp-looking space, but not one so over the top that clients would wonder what they’re paying for,” says Alan Parver, D.C. managing partner at Powell, Goldstein, Frazer & Murphy. Barbara Brown, D.C. managing partner of Paul, Hastings, Janofsky & Walker, says that her firm is proceeding cautiously. “Obviously, it’s always better to be a little crowded and a little cozy than to find yourself with a lot of empty space,” says Brown. June 30, 2003 TO EVERYTHING, TURN, TURN, TURN Litigation. Bankruptcy. White collar crime and corporate scandals. Over and over again this year, firms that made the D.C. 20, Legal Times’annual ranking of the top revenue-producing offices in the D.C. area, cited these three practice areas as being instrumental in their ability not only to survive in an economic downturn, but to thrive. Finnegan, Henderson, Farabow, Garrett & Dunner, for example, profited handsomely because of its work in litigating intellectual property disputes. Dickstein, Shapiro, Morin & Oshinsky made many of its millions from insurance litigation. Steptoe & Johnson and Williams & Connolly soared thanks to their white collar crime work. And the D.C. offices of Skadden, Arps, Slate, Meagher & Flom; Latham & Watkins; and Jones Day saw revenues balloon due to their substantial litigation practices. Skadden also benefited from major bankruptcy work, as did Akin Gump Strauss Hauer & Feld, which beefed up that practice several years ago in anticipation of the burst of the economic bubble. Two D.C. offices � Piper Rudnick and Sidley Austin Brown & Wood � appear for the first time on the top 20 list. Both offices relied heavily on � you guessed it � litigation, as well as well-timed acquisitions. In 2002, Piper Rudnick absorbed Verner, Liipfert, Bernhard, McPherson and Hand. And Sidley Austin snatched a cadre of international trade lawyers with a $30 million book of business from Powell, Goldstein, Frazer & Murphy. Overall, the firms on the D.C. 20 combined to make $3.4 billion in revenue in 2002. � Compiled by intern Laura LacciPart 1: June 19, 1978 – July 27, 1987Part 2: Sept. 28, 1987 – Nov. 17, 1997

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