Branching Out

Morgan, Lewis & Bockius Total lawyers: 1,200 Total offices: 19 (in the U.S., Brussels, London, Paris and Tokyo) California lawyers: 242 (148 in Bay Area) California offices: 4 (San Francisco, Palo Alto, Irvine and Los Angeles) Profits per equity partner in 2003: $825,000 Revenue per lawyer in 2003: $595,000 Morgan, Lewis & Bockius partner Jami Wintz McKeon was in San Francisco on business the day of the ’89 earthquake. “It was the Big One,” recalls McKeon, 48, who had spent her whole career in Philadelphia. “Everybody went running from the building into the streets.” McKeon escaped from the city on one of the few flights out of town the next morning. Relaxing at last into an airplane seat, she vowed she’d never return. But last summer, the career Morgan, Lewis litigator was tapped to lead the firm’s West Coast expansion. So, in September, she moved here with her husband and two youngest children. She sat for the California Bar exam last month. Philadelphia-based Morgan, Lewis now has 148 lawyers in the Bay Area — more than most out-of-town firms — thanks largely to its acquisition of the then-collapsing Brobeck, Phleger & Harrison. And in a tight lateral market, it’s hung on to most of that group. McKeon’s job basically boils down to this: adding lawyers and holding on to the ones already hired. It’s a role that seems a natural for McKeon, who lawyers say has a knack for quickly bonding with just about anybody. She is known inside the firm for learning things about the people around her — the names of summer associates right when they start, the number of kids a particular partner has and which Washington, D.C., partner can answer an obscure tax question. She even knows that partner Franklin “Brock” Gowdy played college ball at Stanford. “She is a big reason we have been so successful in the lateral market,” says partner Molly Moriarty Lane, who handled recruiting at Brobeck before going to Morgan, Lewis. “She has a sense for putting people together and making them comfortable.” McKeon was among the Morgan, Lewis leaders in California to negotiate with partners at Brobeck, Phleger & Harrison just before — and after — that firm’s spectacular collapse. After a few weeks, she returned to Philadelphia but stayed involved with Morgan’s California offices by making frequent trips to the West Coast. LAYING THE FOUNDATION On the day of the 1989 quake, McKeon befriended three stranded college-aged women she met outside her hotel. She said she later received a bottle of wine from them. “When I opened it, it wasn’t very good. Still, it was a nice gesture, and in a moment of crisis it is important to reach out.” To hear McKeon tell it, her firm’s offer to the Brobeck lawyers was also outreach. McKeon and partners James Pagliaro, David Pollak, Steven Wall and Thomas Sharbaugh arrived in California days after the two firms called off merger talks and Brobeck announced it would close its doors. Lawsuits filed in the wake of Brobeck’s collapse have accused Morgan, Lewis of triggering Brobeck’s demise once merger talks ended. Morgan leaders say that’s ridiculous — if the firm had been intent on cherry-picking all along, it would have worked harder to capture key rainmakers who ended up at other firms. Morgan has paid $10.2 million to avoid litigation with Brobeck’s bankruptcy trustee over issues related to hiring the Brobeck lawyers. However, the firm still faces a lawsuit by former Brobeck employees in Alameda County. “As a corporate lawyer, I sometimes see cases where a predator strings out an acquirer until they don’t have any options left,” says Hayden Trubitt, who left Brobeck for Heller Ehrman White & McAuliffe. “I don’t think that was what was going on here.” Within two weeks of Brobeck’s collapse, Morgan, Lewis, which until then had 63 lawyers in L.A., added about 140 lawyers in California and three new offices — a merger-sized addition. “There were a lot of people trying to get Brock Gowdy and one or two of the big names,” McKeon recalls. “Our philosophy involved talking to a larger group.” Gowdy, now managing partner of the firm’s San Francisco office, said he’d struck a better deal with another firm for himself and 17 other partners. But, he said, he and the others opted for Morgan, Lewis because the deal offered the possibility of saving jobs. “Eighty percent of the Palo Alto-San Francisco office joined out of a sense of obligation,” estimates former Brobeck partner Roderick McLeod, who initially went to Morgan, Lewis, but has since moved to Jones Day. “We brought over 98 percent of the associates.” Sharbaugh said Morgan told the Brobeck partners they wouldn’t need to make capital contributions until 2005. Morgan also offered partners interest-free transition loans, worth up to 15 percent of their compensation, to be repaid in two installments — in January 2005 and January 2006. Partners who left before then would have to pay the money back; those who remained would receive a bonus equal to the amount owed. “We were aware that these people were in a period of turmoil and trauma,” said McKeon. “You try and find a way to ease those burdens on people.” One partner remembered how, when a vendor hauled Brobeck’s coffee machines away, McKeon handed out Starbucks gift cards. “I began referring to her as our den mother,” said Ronald Moskovitz. “A lot of us were reeling from the collapse of Brobeck and feeling a little needy at the time. She helped us figure out Morgan, Lewis and its system.” Two years later, Morgan, Lewis can brag that only four lawyers from the original 140-lawyer Brobeck group opted to go to other firms, a record that had startled recruiter Charles Fanning, of Major, Hagen & Africa. “We [had] assumed they were going to be a firm that was going to be exporting talent onto the lateral market given the circumstances of their arrival,” Fanning said. “Within a year of having talked to a fair number of their partners in an attempt to recruit them, we realized that our assumption was wrong.” Fanning then started working to recruit lawyers into the firm. It hasn’t all been warm and fuzzy. McKeon said some of the Brobeck refugees have since left in what she described as “involuntary — e.g., performance-related — departures.” She won’t say how many. McKeon said Morgan lost five of the Brobeck lawyers to death, disability or retirement, one to the government and five left for clients. Another 13 from Brobeck left the law — either for another career or for family obligations. Morgan has seen perhaps 15 non-Brobeck lawyers leave for other firms, McKeon said, including involuntary departures. She said that’s to be expected when a firm shifts its strategy. “Sometimes people who fit within our original structure maybe don’t fit with the new structure.” BRINGING ON TALENT Even before she arrived in California, McKeon worked with recruiters like Fanning to attract laterals to Morgan, Lewis. She says the value the Brobeck lawyers placed on working together made her task easier. These were the lawyers from the “old Brobeck group,” said Gowdy, “people who had practiced together as a firm for a long time, who maybe felt a greater affinity, as distinguished from the free agents.” Indeed, Morgan, Lewis prefers to recruit groups of laterals already accustomed to serving a client together for this very reason, and that cohesion is attractive to lateral prospects. “It’s easier to have people who have been working together a long time,” says firmwide Chairman Francis Milone. “It is faster and more effective.” McKeon played a key role in bringing on group laterals — from Zevnik Horton and Pennie & Edmonds — and individual laterals, such as recent hires Joan Haratani, from Shook, Hardy & Bacon, former Enron prosecutors Leslie Caldwell and John Hemann from the U.S. attorney’s office, as well as Lance Director Nagel and A. James Vazquez-Azpiri from Cooley Godward. Haratani says Morgan’s leadership — she is a former Philadelphia Bar Association president — played a part in her coming to the firm. Haratani particularly admired McKeon’s ability to juggle family and professional responsibility. “I feel very fortunate to have her in my life,” Haratani says. The greater challenge has been adding IP and corporate lawyers to complement the large group of litigators, labor and employment and real estate lawyers the firm had landed from Brobeck. Many of Brobeck’s high-profile IP and corporate lawyers ended up at other firms. And while the firm has been successful at bringing on impressive candidates — among them Thomas Kellerman, from Brobeck, Hale and Dorr in London, Rahul Kapoor from O’Melveny & Myers and the Pennie group — firm leaders say they still need to bulk up those practice groups in California. From parts to whole Integrating the new recruits into the larger firm fell to McKeon. As a leader in the firm’s litigation group and a member of Morgan’s advisory board, she worked with the Brobeck lawyers from the start. “Within three weeks, we had a firm retreat out there where a whole bunch of people from the East helped us integrate out here,” said Gowdy. “A series of smaller retreats followed, organized by practice groups, or summer associate gatherings. There have been, in two years, 10 to 15 of those.” Some say these efforts weren’t enough. “There were valiant attempts to introduce West Coast partners to East Coast partners,” says McLeod. “But it could have happened on a quicker timeline.” But McKeon said there have been other steps at integration. Morgan, Lewis has also dispatched to California seven lawyers from its other offices. These include Peter Hurtgen, former director of the Federal Mediation and Conciliation Service, and Anne Brafford, a labor partner originally from the firm’s Washington, D.C., office. And the firm has put Brobeckians in leadership roles, including three spots on the firm’s 18-member advisory board. All four California offices are led by ex-Brobeck partners: Gowdy manages the firm’s San Francisco office and Kellerman heads up Palo Alto. And even though the firm doesn’t break down its financials by office, firm management contends the California offices are profitable. At the end of the 2003 fiscal year the new California partners made a substantial contribution. “We expected that it would be a drain [at first], and we were all pleasantly surprised,” says McKeon. Since arriving in September, McKeon has continued to act as what one partner calls “the office concierge” — planning dinners, vetting laterals, making introductions. And all of this has been done in between making trips back East, managing her practice, studying for the Bar and finding sufficient shelving in her office to display the 110 photographs of her four children that she’s amassed over the years. Lane said she mentioned once that she was taking a trip to Philadelphia and D.C., and McKeon fired off e-mails to lawyers there that she thought Lane should meet, who then showered her with invites to breakfast, lunch and dinner. “You can e-mail her any time of the day or night,” says Lane. “I don’t think the woman sleeps.”