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Call it love, Silicon Valley style: Barely two years after eloping with Wall Street firm Shearman & Sterling, Carmen Chang has returned home to the waiting arms of Wilson Sonsini Goodrich & Rosati. The newly crowned head of Wilson Sonsini’s China practice, Chang will be spearheading the firm’s official foray into China, making it the first major indigenous Silicon Valley firm to open an office outside of the U.S. Intense, outspoken and clearly ambitious, Chang pioneered a China-focused practice when she was just a third-year associate at Wilson Sonsini in the mid-’90s. “I was doing it before it was fashionable,” says Chang in her raspy voice. “I used to be the only one who would talk to the Chinese venture capitalists.” Chang, who estimates “conservatively” that she’s already generated $10 million in billings for the first six months of this year, is expected to give Wilson Sonsini a much-needed jolt in the competitive China market. She brings with her an enviable roster of clients, including Semiconductor Manufacturing International Corp. of Shanghai (she handled the company’s $1.8 billion IPO in 2004 when she was a Shearman partner), UTStarcom Inc. and Spreadtrum Communications Inc. And it’s no secret that Wilson Sonsini’s China practice needs help: Last May one of its China strategists, partner Kurt Berney, left Palo Alto for O’Melveny & Myers’ Shanghai office. Berney says, “I’m a big fan of Wilson’s, but the question for me was whether you start from the ground floor or be part of a firm with an infrastructure in China.” O’Melveny, he says, is the “perceived market leader” in China. Jeffrey Saper, Wilson Sonsini’s vice-chair, says, “Kurt was an outstanding partner, and we wish him the best.” In the insular, gossipy world of Silicon Valley, Chang’s return to Wilson had long been rumored � some say since the day she stepped over the threshold of Shearman’s Menlo Park office in July 2003. One reason is that Chang has always been perceived as more in tune with Sand Hill Road than Wall Street. Another is that she stayed cozy with her old Wilson Sonsini pals. Says Chang: “It’s a very small community. I see [Wilson people] at barbecues, on deals. � Larry [Sonsini] and I even share the same hairdresser. They were always open about my coming back.” Indeed, Larry Sonsini, the firm’s patriarch, seems not in the least surprised that Chang has returned to the fold. “Carmen didn’t need to be seduced,” he says dryly. The reason Chang left for Shearman, explains Sonsini, was that she felt her clients needed a China platform, and Shearman had it. “We weren’t ready to go to China [in 2003]. I told her we had other priorities,” Sonsini explains. This time around, Chang got what she’s always wanted from Wilson Sonsini: an office in Shanghai. Though she plans to remain Valley-based, she says she needs a full-fledged China office to support her deals: “I wanted the commitment that they would put resources in the Shanghai office to make it competitive with other firms.” Chang admits she had been skeptical about Wilson Sonsini’s readiness to go to China until February. That’s when those darlings of Silicon Valley � the venture capitalists and tech companies � actively started playing Cupid. “They were calling me up and saying, ‘We’d like you to go back,’” says Chang. “And these were major clients [we shared]. They told me they would hold Wilson [partners] accountable if they didn’t live up to their word to open a China office.” At the same time, these clients � some already in China, others eyeing that market � were arm-twisting Wilson Sonsini partners to rehire Chang. “Clients pushed us to get Carmen back,” says Boris Feldman, a litigation partner and member of the firm’s executive management committee. “They told us we would get all their China business if Carmen came back.” He adds, “Carmen is the Larry Sonsini of China.” (Neither Chang nor Feldman would name the clients.) This summer, things moved quickly. In late July, in a matter of days, Chang says she and her former firm hammered out a deal. By Aug. 1, Chang was sitting at her Wilson Sonsini office on Page Mill Road. But there’s a flip side to the romance � and that’s the aborted union between Chang and Shearman. Some Valley lawyers were less surprised by her return than her departure for Shearman in the first place. “Firms like Shearman & Sterling are better for capital market work, and not so good for the venture capital work that Carmen handles,” says Howard Chao, a partner at O’Melveny & Myers’ Palo Alto office. “Many of the Wall Street firms don’t do VC work at all.” The reason, explains Chao, is that Wall Street firms seek work with big profit margins because their billing rates are so high; startups, on the other hand, expect lower, more flexible fee structures � something New York firms find anathema. Moreover, say several Silicon Valley lawyers, Wall Street firms are not used to the “messiness” of the early stage, venture-backed Chinese deals. “Chinese clients conduct themselves differently from what people expect out of U.S. companies,” says one Asian-American lawyer in Silicon Valley. “Things are done informally and quickly. Traditional firms like Shearman have difficulty with these deals because there’s less formality.” Shearman partner John Wilson, Chang’s former colleague, agrees that “it was a challenge for us to provide the support for Carmen’s early-stage companies. They need a different kind of service that we weren’t set up to deal with. � So the fit was not as easy as it might have been.” Shearman’s post-Chang strategy, he adds, is to “stay focused on more mature companies. I don’t see us investing in early stage companies.” And though Wilson admits that Chang’s billings were “substantial,” he notes that “our China businesses are very busy.” The split, he says, was “very amicable. We are all good friends.” Chang has no regrets about her Shearman stint: “It gave me a chance to work with their people in China. Their passion for China was inspiring.” All very civilized. What’s more, Chang insists she was not bought off. “I will not be making more money at Wilson, although I should be,” she says with a chuckle. A bit of an iconoclast, Chang lives in faculty housing with her husband, a Stanford University law professor. “I essentially lead the life of a professor’s wife,” she says demurely. Except when she’s in Shanghai. Vivia Chen is a reporter with The American Lawyer, a Recorder affiliate based in New York City.

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