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Europe continues to be a powerful magnet for Washington, D.C.-based law firms intent on following clients into global markets, as well as signing up new ones. Business in London, Berlin, and Moscow has been especially good over the past year, lawyers say, particularly for transactional work, debt restructurings, and arbitration. In just the last two months, three Washington firms have opened offices in Europe. Two of them, Steptoe & Johnson and Howrey Simon Arnold & White, are newcomers to the foreign market. Howrey is starting out slowly with a three-lawyer office in London, hoping to augment its strengths in intellectual property, antitrust, and international arbitration. “We are planning a second office in Brussels,” says Howrey’s managing partner, Robert Ruyak. Ruyak hopes eventually to have 10 or 15 lawyers in London. “We felt that a lot of our clients, intellectual property in particular, have European issues. And our European clients are much happier to have someone in their time zone,” Ruyak says. Steptoe’s initial move also was a cautious one — a one-lawyer shop in Brussels that opened last year. But in late January, Steptoe took the plunge and merged with London-based Rakisons. Now it has the largest London office of any D.C.-based firm: 43 lawyers with two new international trade partners on the way. “We are still looking at what we want to do with our merger in London,” says Lon Bouknight Jr., Steptoe’s managing partner. “We are just two months into this.” Rakisons has strengths in telecommunications, technology, and corporate transactional work — three areas that are generating a lot of work in the European economy. ICH BIN EIN BERLINER The third firm, Hogan & Hartson, just opened its seventh office in Europe, on the heels of establishing a toehold in Tokyo. In January, Hogan opened a 30-lawyer office in Berlin, becoming overnight the third largest law firm in Berlin. Hogan has been in Europe for about a decade and has offices in London, Paris, Brussels, Prague, Budapest, and Warsaw, as well as Moscow. “We had been looking at Germany for a long time,” says Raymond Batla Jr., managing partner of Hogan’s international offices. The opportunity came last year when a group from Berlin’s Oppenhoff & Radler decided to break off and set up an office for Hogan rather than merge with U.K.-based Linklaters. “We are expecting it to grow significantly,” Batla says. The Berlin practice is broad-based, Batla says, and includes telecommunications, intellectual property, corporate finance, and real estate. Hogan recently represented a subsidiary of Rupert Murdoch’s News Corp. when it invested in German pay television. Last year, Hogan got a tiny office in Tokyo when it brought on a dozen intellectual property lawyers from Los Angeles’ Loeb & Loeb. The one-lawyer Tokyo shop had been helping Loeb & Loeb’s Japanese clients with U.S. patent issues. Hogan immediately added another lawyer and is looking for intellectual property lawyers to add corporate capability to the Tokyo office. “We see the opportunity of using Tokyo as a way to establish a beachhead for the Asian market,” Batla says. Likewise, Hogan hopes that the Miami office it got last year through another merger will serve as a base for more South American business. The firm represents Brazil’s Petrobras, the state-owned oil company, in developing and financing a $2.2 billion gas pipeline with Bolivia. “We are looking quite keenly at Latin America,” Batla says. Both Hogan and Akin, Gump, Strauss, Hauer & Feld have added to their offices in Moscow, where economic woes are generating legal business. Hogan now has 10 lawyers in Moscow, up from about seven a year ago, and has been involved in some high-profile debt workouts. For example, the firm represented the United Export-Import Bank in restructuring nearly $2 billion in foreign debt last year. More recently, the firm was hired by the city of Moscow to help it arbitrate disputes over foreign debts. Akin Gump has the larger Moscow office, with 15 lawyers, three of them added over the last year. Chairman R. Bruce McLean expects business to continue to pick up in Russia, even with a slowdown in the United States. “They need the capital so badly,” he explains. Akin Gump has handled several public offerings, including a $200 million offering for Vimple Communications, Russia’s leading wireless telephone company. Akin Gump also added to its London office last year, while letting its Brussels office shrink to eight lawyers from 12. “We are probably not going to be doing transactional work in Brussels over the long haul,” McLean says. Instead, that work is concentrated in London, where Akin Gump has 14 lawyers, up from 10 a year ago. “Our real growth is going to be in London, and we’d like to be at 25 lawyers by the end of 2001,” he says. “We have a big private equity practice in New York, and we need to be in London for those clients.” The firm also decided it needed to have a presence in Riyadh for some of its Middle Eastern clients. So, last year, it established a relationship with a Saudi firm. McLean says that Akin has assigned two lawyers, one from the United States and one from London, to work in Riyadh. MORE LAWYERS IN LONDON The highly competitive London market is where many firms are focusing their hopes for growth. Of the 11 major D.C.-based firms with offices in Europe, nine have London offices. And only one of those nine, Crowell & Moring, did not add to its London ranks last year. “We have plans to expand” in both London and Brussels, says Crowell’s managing partner, Herbert Martin. The firm has six lawyers in London and three in Brussels, up from two last year. Wilmer, Cutler & Pickering has been in London since 1972. Over the last year, it added six lawyers to that office, for a total of 22. More than half of the office is engaged in international arbitration work. By contrast, the firm’s Brussels office stayed at 23 lawyers; the Berlin office grew by one to 16. Like Akin Gump, Wilmer is looking to London for real growth, and also to Berlin. “I envision 40 to 50 lawyers in the London office over the next two to five years,” says Wilmer chairman William Perlstein. He is projecting even faster growth for the Berlin office — 35 to 50 lawyers within two years. “In Germany,” says Perlstein, “we have the opportunity to do corporate work and litigation, and we need to get bigger to do that.” One of the firm’s significant clients is Deutsche Telekom, whose general counsel, Manfred Balz, is a former Wilmer partner who opened the firm’s Berlin office in 1993. “I don’t think Brussels will get as big because it is focused mainly on regulatory work,” Perlstein says. Antitrust work, handled in the Brussels and London offices, is still the firm’s single largest practice in Europe. Shaw Pittman says its London office, opened just three years ago, is “awash” in work. The firm added eight lawyers over the last year and now has 20 in its cramped London quarters, plus another five from the United States on temporary assignments. “Our strategy is very focused on complex technology transactions,” says Shaw Pittman’s managing partner, Paul Mickey Jr. Clients include WorldCom Inc., the Reuters Group, and AstraZeneca, the pharmaceuticals company headquartered in London. While London is the firm’s only overseas office, Mickey says he is eyeing expansion possibilities. “We are doing work on major transactions in Germany, Switzerland, and France. These are all possible areas for expansion,” he says. Both Covington & Burling and Arnold & Porter added to their London offices in the last year. Arnold & Porter added four lawyers and now stands at 24; Covington added one and now has 28. Like Shaw Pittman, Arnold & Porter’s sole European office is in London. The firm brought in four new U.K.-based partners over the last year, each specializing in a distinct area: biotechnology, telecommunications, intellectual property, and corporate work. Some of the new hires replaced a couple of partners and an associate who left, says Fern O’Brian, partner in charge of the London office, declining to comment further on the departures. “There was no mass problem,” she says. The busiest areas have been biotechnology and information technology, according to O’Brian. For example, the firm is representing the British government in outsourcing information technology services for the Social Services Department. The London office also represented U.S.-based Micron Technology when it was sued for patent infringement by semiconductor designer Rambus Inc. “I anticipate significant further growth,” O’Brian says. Covington has a sizable food and drug regulatory practice in both its London and Brussels offices, representing clients such as Merck & Co. and Schering-Plough. In the last year, it has added an antitrust lawyer and an intellectual property lawyer to its Brussels office, which now has 15 lawyers, down from 17 a year ago. “We foresee growth in competition law in Brussels and continued growth in corporate and transactional work in London,” says Timothy Hester, a member of Covington’s executive committee. Noting that the former U.S. ambassador to the European Community, Stuart Eizenstadt, recently joined Covington’s D.C. office, Hester adds, “That has an important bearing on likely expansion in Europe.” Two firms have bucked the trend to set up shop in London, and continue to practice solely in Brussels. McKenna & Cuneo has had a Brussels office since 1991 and is in the midst of reshaping it. The firm trimmed the office by half last year — from 10 lawyers to five — by letting go of a Belgian banking group. “The mainstay of our Brussels office is our environmental practice, which has been robust and growing,” says Robert Matthews, head of McKenna’s environmental group. He says the firm plans eventually to add to the Brussels office with practices that more closely track the firm’s U.S. work, which is focused on litigation, environmental work, food and drug regulatory work, and intellectual property. Intellectual property firm Finnegan, Henderson, Farabow, Garrett & Dunner has maintained a small Brussels office since 1994. In the past year, it has doubled its size to four lawyers and plans to add one more by May. Its mission remains to provide its European clients with help on their U.S. patent, trademark, and copyright issues. As a result of that nonthreatening focus, Finnegan says, it gets referral work from European law firms. The firm also has hired a consultant, the former chief intellectual property counsel at British Petroleum, to help it develop business in Europe. “We like our location in Brussels,” says Christopher Foley, who will become Finnegan’s managing partner in June. “We aren’t trying to compete with our European counterparts, and that gives us an edge.” Claudia MacLachlan is a free-lance writer based in Washington.

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