Thank you for sharing!

Your article was successfully shared with the contacts you provided.
If you need any more evidence that Bay Area law firms are on a winning streak, look no further than their performance on the 1995 Am Law 100. The 10 Bay Area firms on the list grossed $1.3 billion, average profits per partner were $331,500, and San Francisco’s Cooley Godward inched onto the list for the first time with revenues of $82 million. Fast forward to the just-released list of the nation’s 100 top-grossing firms. The 11 to make the survey from the Bay Area pulled down $2.4 billion, average profits per partner jumped to $601,000, and Cooley Godward’s revenues skyrocketed to $213 million. Compiled by The American Lawyer magazine, the annual list shows Bay Area firms had the highest revenue growth in the nation in 1999. No surprise, Bay Area firms riding the booming technology-driven economy outpaced the competition from New York and Los Angeles in both revenue and profit growth. Bay Area firms beefed up revenues an average 17 percent, and profits per partner climbed an astronomical 33 percent. In all, 15 California firms landed among the top 100, and many of them moved up in the national rankings. Nationally, the largest 100 firms collected $26 billion in revenues in 1999 and profits of $10.25 billion, representing a 12.5 percent and a 15 percent increase, respectively. Law firm revenues grew by 18 percent. New York firms held relatively steady on the list. And three of the four Los Angeles firms to make the cut repeated their 1998 positions. One — Paul, Hastings, Janofsky & Walker — slipped three slots on the survey to No. 31. The top four law firms remained unchanged. The nation’s top-grossing law firm, New York’s Skadden, Arps, Slate, Meagher & Flom, topped $1 billion in revenue, propelling it far ahead of second-place Baker & McKenzie’s $818 million. The $595 million collected by Jones, Day, Reavis & Pogue was good enough for third place, and L.A.’s Latham & Watkins landed in fourth place with $581 million. Among tech-centric firms, Palo Alto’s Wilson Sonsini Goodrich & Rosati bumped its revenues up by 38 percent, to $296 million, propelling forward 17 slots to 29th place from 46th the prior year. Gray Cary Ware & Freidenrich, of San Diego and Palo Alto, grew by 27 percent to $140 million in revenue and moved up five notches to 89th. San Francisco’s Cooley Godward grew by 23 percent to $213 million in revenue, moving up seven notches to 51st place. Brobeck, Phleger & Harrison posted a 25 percent gain, to $314 million, to reach No. 25. The top-grossing Bay Area firm was San Francisco’s Morrison & Foerster, which logged $321.5 million in revenue to land in 22nd place. Profits as well were up dramatically among some Bay Area firms. San Francisco’s Brobeck saw its profits per partner increase by 44.4 percent to $855,000. Wilson’s profits per partner of $835,000 represents a 34.6 percent jump. Senior partners at both firms said they are certain the growth in revenues and profits will continue despite hiccups in the stock market this year that have slowed stock offerings and other securities work. “We’re very confident about the sustainability — we have a diverse client base within a well-defined business model,” said Wilson Chairman Larry Sonsini. Sonsini said the firm’s top 10 clients represent less than 25 percent of the firm’s business and that lineup changes often. In addition, no one client accounts for more than 2 percent of revenue, he added. And while the firm took public 55 of its clients last year and had a hand in 60 more IPOs as underwriter’s counsel, Wilson is not dependent on initial public offerings, Sonsini said. “Firms are still really, really busy,” said law firm consultant Peter Zeughauser, a principle of the Newport Beach, Calif.-based ClientFocus. Firms servicing tech clients have experienced the largest growth in the country and have achieved a new prominence in the legal market, Zeughauser said. The firms’ growth “is sustainable for the short term,” through the year 2000 and perhaps through 2001 as technology industries continue to expand, he said. At Brobeck, where revenues reached $314 million, chairman Tower Snow Jr. said the firm is well on its way to besting 1999 growth in revenue. Further, by instituting better financial controls internally, he’s hoping to exceed the dramatic growth in profits. “I don’t know if it’s in the year 2000 that New York firms will get bumped, but three years out you will see a [Bay Area] firm in the top 10,” Snow said. The Bay Area, with an average profits per partner of $600,000, ranked third as a region behind Los Angeles, with $830,000 profits per partner, and New York, which logged an average profit per partner of $1.6 million. The most profitable firm overall was Wachtell, Lipton, Rosen & Katz, which logged $3.38 million in per partner draw. Overall, the 27 New York firms on the list swelled profits by an average 14 percent, preserving the region’s stronghold as tops in the nation for profitability. Of the top 20 firms with the highest profits per partner, all but three are based in New York. The four L.A. firms on the list increased profits per partner by 11 percent — with Latham & Watkins becoming one of 17 firms to log profits per partner of more than $1 million. The average increase of 33 percent among Bay Area firms is skewed somewhat by Graham & James. The firm’s profits per partner of $775,000 reflected a 157 percent increase because of a large contingency award in a patent suit. Excluding Graham & James, Bay Area firms increased their profits per partner by 21 percent — still a dramatic rise. Individual firms saw some sizable profit increases. San Francisco’s Pillsbury Madison & Sutro swelled its profits per partner by 44.2 percent, to $505,000. Pillsbury Chair Mary Cranston said the firm restructured its ranks to create new tiers, which resulted in fewer full partners as defined by The American Lawyer. And the firm has become more efficient, she said. “We’ve seen about 50 percent in real improvement, and about 50 percent in how we are looking at our ranks and definition,” Cranston said. Wilson’s profits per partner rose by 34.6 percent, to $835,000, landing the firm in 24th place among the most profitable firms. Cooley Godward, which swelled its profits per partner by 17.5 percent to $665,000, inched past Orrick, Herrington & Suttcliffe, whose profits per partner of $660,000 reflects just a 7.2 percent increase. The other Bay Area firms to make the cut include Thelen Reid & Priest, which grew its revenues of $159 million just 3 percent and slipped 16 notches to 83rd place. Heller Ehrman White & McAuliffe grew its revenues by 16 percent, just enough to hold steady at 61st place, and Littler Mendelson grew by 3 percent to $128.5 million, slipping to 94th from 87th place. The ranks of Bay Area Am Law firms are missing San Francisco’s McCutchen, Doyle, Brown & Enerson, which slipped off the list from 94th place in 1998. The firm’s $117 million in revenues in 1999 failed to best the 100th ranking firm, New York’s Winthrop, Stimson, Putnum & Roberts, which collected $124 million. McCutchen Chairman James Hunt said 1999 was still a good year for the firm despite slipping from the bellwether list. “We’re quite pleased,” Hunt said, “with what we’ve done with [revenue growth] while maintaining our core values of commitment to pro bono and the community.”

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.