Thank you for sharing!

Your article was successfully shared with the contacts you provided.
In the 1990s, the top Southern California firms were obsessed with crossing the million-dollar profits-per-partner mark. Now they’re closing in on that mark in a more telling—and exclusive-metric: revenue per lawyer. Three Los Angeles firms—Gibson, Dunn & Crutcher; Irell & Manella; and Munger Tolles & Olson—hauled in more than $900,000 per lawyer last year. Latham & Watkins edged above $800,000. The revenue-per-lawyer figures are among the most striking results of an annual survey of Southern California-based firm finances carried out by The Recorder, a sister publication of The National Law Journal. As a whole, the region’s highest-grossing firms posted strong revenue gains and, in most cases, even stronger gains in profitability. “These are firms with strong management, focused on high utilization and with very high billing rates,” said Newport Beach, Calif.-based management consultant Peter Zeughauser. Firm leaders said billing rates and hours were up, while head count wasn’t. “Our rates went up in 2004 consistent with the market,” said Gibson’s managing partner, Kenneth Doran. “Many of our practice groups and offices were more engaged in 2004 than in 2003, resulting in higher hours.” Latham & Watkins leads Latham & Watkins once again led the way with revenue of $1.2 billion, an increase of 17% over 2003. O’Melveny & Myers, with $697 million in revenue, edged out Gibson Dunn for second place for the second straight year. O’Melveny and Gibson Dunn were the only two of the 10 firms to record single-digit increases in revenue. The growth and profits-per-partner leader was Los Angeles-based Quinn Emanuel Urquhart Oliver & Hedges, which saw revenue increase by 25%. Profits per partner, meanwhile, leapt by 9%, to a staggering $1.9 million. All told, seven of the top 10 firms recorded profits per equity partner above $1 million. Irell & Manella saw average partner profits increase by 32%, to $1.54 million. Gibson Dunn was right behind, with $1.5 million, a 7% increase. The rest of the firms saw per-partner profits increase by between 2% and 19%. O’Melveny, which saw just 2% growth, to $1.31 million, pruned its partner ranks in 2004 with early retirement packages. But O’Melveny’s chairman, Arthur Culvahouse Jr., said the effect of those departures won’t be felt until the numbers for 2005 are in. Consultant Ward Bower of Altman Weil, noted that New York firms still lead the profit pack. But some California and Chicago firms are catching up-due in part, Bower said, to their success in New York and London.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.