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By their own admission, the four name partners of Dallas’ Lynn, Stodghill, Melsheimer & Tillotson have been making money — lots of money. Jeffrey Tillotson earned attorneys’ fees topping the $2 million mark for settling a class action against client Southwestern Bell at the close of 1999. Steve Stodghill helped client Mark Cuban sell broadcast.com for $5.7 billion last year and also helped Cuban spend $280 million for a controlling interest in the Dallas Mavericks basketball team. Not to be outdone, Mike Lynn and Tom Melscheimer ended three years of litigation when they settled Alcatel USA v. Samsumg Electronics Co. on Jan. 12, 2000. Although the details of the Alcatel settlement are secret, a lawyer who has worked with the firm says its fees allowed key employees to receive bonuses up to $60,000. Neither Lynn nor Melsheimer will comment on the settlement or the bonuses, but Lynn does describe 2000 as the most profitable year since the firm opened in October 1994. Yet success has failed to insulate the firm from the fate that often befalls litigation boutiques. On May 17, the firm finally acknowledged what colleagues, clients and observers suspected: Stodghill and Melsheimer were leaving. But Melsheimer and Stodghill weren’t the first to leave the firm this year. Since March, the firm has lost three of its 12 associates, and of counsel Robert Goodfriend is in the process of joining competing Dallas litigation boutique McKool Smith. The firm refused repeated requests for an interview, but in a one-page written statement issued to Texas Lawyer through its public relations company, the firm described the split as amicable and confirmed that both Stodghill and Melsheimer accepted positions “in Dallas with a national firm.” That opportunity may be opening the Dallas office of Fish & Richardson, a Boston-based intellectual property firm. Fish & Richardson human resources director Peggy Ellis says the firm plans to open its Dallas office June 1, pending shareholder approval at a May 19 meeting. The results of this meeting were unavailable by press time. Ellis also confirms that, should the new office open, both Melsheimer and Stodghill will be on the payroll. Fish & Richardson has offices in Boston, New York City, Silicon Valley, Washington, D.C., Wilmington, Del., San Diego and Minneapolis. A Dallas office would represent Fish & Richardson’s second attempt to crack the Texas market. The firm opened a Houston office in 1992, but closed it in 1998 after half of its lawyers split and competition heated up. Fish & Richardson is currently negotiating to take over the downtown office of Carmodys, a Dallas litigation shop. “I am talking to them right now,” says partner William Carmody. “But there are still some things that are up in the air.” The 16,000-square-foot space features a fully wired, glassed-in mock courtroom, a video editing booth, ergonomically designed support staff stations, an exercise facility and sweeping views of the city. Carmody says the deal will even include the furniture. According to Lynn, Stodghill’s statement, Stodghill’s new practice will involve transactional work for Cuban and Todd Wagner, the founders of broadcast.com. Stodghill states that taking on corporate work would have been inconsistent with the firm’s litigation focus. The statement fails to explain Melsheimer’s wanderlust, but the litigation talents of the former assistant U.S. attorney have never gone unnoticed. In fact, just four or five months ago, Steven Zager of the Austin office of San Francisco-based IP firm Brobeck, Phleger & Harrison, says he offered Melsheimer the chance to open Brobeck’s Dallas office, but Melsheimer declined. Perhaps Fish & Richardson — which has won verdicts ranked by The National Law Journal as among the highest in the country three years in a row — simply gave him an opportunity he couldn’t resist. Meanwhile, Lynn and Tillotson plan to keep the firm going. As for the names on their masthead, the firm’s written statement promises only some “exciting additions” in the near future. NO SURPRISE Few were surprised by the news of Stodghill’s and Melsheimer’s departures; most seem to chalk it up to the nature of the practice. “They’re all good guys and good lawyers, but it’s difficult to hold together a firm like that when you’re trying to do two things — be plaintiffs lawyers and defense lawyers,” says Larry Macon, a partner in the San Antonio, Texas office of Akin, Gump, Strauss, Hauer & Feld and opposing counsel in the Alcatel case. “Trying to keep a plaintiffs partnership together is like hurting cats — it just doesn’t happen very often.” “Maintaining a litigation boutique is harder than it looks,” concurs Mark Bramblett, a partner in Dallas’ Haynes and Boone who squared off against the firm in Alcatel. Northern District U.S. Attorney Paul Coggins, a friend of Lynn’s and Melsheimer’s, blames success and big money. “Sometimes the partners make too much money too fast and they’re almost undone by their success,” he says. “I’m pretty confident that whatever happens, they’re all going to land on their feet.” For Steve Susman, of Houston-based Susman Godfrey, most firm splits come down to “personality, time of life and what they’re going though personally.” But W. Mark Lanier, of Houston’s Lanier, Parker & Sullivan, says he had heard lawyers were leaving Lynn, Stodghill, and he thinks it’s a good thing. “They will all have more flexibility to pursue what they want to do and go in the direction they want to go,” he says. “I expect all of them to be even better off a year from now.” Indeed the decision doesn’t seem to be costing the lawyers any clients. Alcatel senior vice president and general counsel George Brunt admits he heard rumblings of a firm split, but says his company plans to continue working with both Lynn and Melsheimer. “We’ve never been constrained to use one firm — we like to use the people,” he says. NextJet general counsel Eric Whitney, a former associate at the firm and now a client, also says he has no plans to go elsewhere for representation, despite the changes. “Since I am now on the other side of the fence, I am hiring lawyers first and firms second,” he says. What no one is clear of yet is the fate of Lynn, Stodghill’s remaining associates. Lynn says he wants the associates to stay and has told them that. He will not comment on which associates have decided to remain at the firm. “That’s the hardest part of restructuring,” Lanier says. “These people take a job because you’ve promised them a good job and a good life — you’re saying come hang a shingle with us and stay for the long run — and now you’re saying the long run is over. And now they’re thinking maybe they should have taken that job at Jenkens.”

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