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Fried, Frank, Harris, Shriver & Jacobson is not yet in the big leagues of antitrust firms. But it’s at least in the game now, as witnessed by its recent win against General Dynamics Corporation. The firm scored a direct hit in the fight over Newport News Shipbuilding Inc., one of two suppliers (along with General Dynamics) of nuclear submarines to the U.S. Navy. General Dynamics staked its claim to Newport News first. Back in April, it reached a merger agreement with a $2.6 billion cash tender offer. But Fried Frank’s client, Northrop Grumman Corporation, crashed the party on May 9 with a hostile $2.6 billion stock and cash bid. The battle was on for the next half a year. Fried Frank corporate lawyers handled Northrop’s tender offer. A second group of antitrust lawyers, led by Washington, D.C., partners Charles “Rick” Rule and Bernard Nigro, Jr., tried to persuade the Departments of Defense and Justice that a General Dynamics-Newport News merger would create a monopoly. On October 23 the Pentagon bought the antitrust argument, calling General Dynamics’ bid for Newport News anticompetitive and Northrop’s pro-competitive. Several days later, General Dynamics dropped out of the running, a dramatic turn of events, considering that it had enjoyed the inside track. Until now, New York-based Fried Frank has been like many Wall Street powers: They’re the dealmakers of choice, but can get shoved aside when heavyweight antitrust problems arise. This sort of bifurcation can represent a significant loss of billables. Last summer, for example, Fried Frank had more than 20 lawyers working around the clock for weeks on one aspect of the Northrop antitrust effort. The Northrop deal doesn’t vault Fried Frank to the first tier of antitrust overnight, alongside the likes of Arnold & Porter; Howrey Simon Arnold & White; Jones, Day, Reavis & Pogue; and Clifford Chance Rogers & Wells. Those top antitrusters can still regularly steal deal-related antitrust work from the corporate firms of record. But Fried Frank has moved up at least a notch. In two years the firm has grown from two to 13 antitrust attorneys and captured work that it would have lost in the past. The first step came in 1999, when it hired Nigro from Collier, Shannon, Rill & Scott, a premier D.C. antitrust boutique now known as Collier Shannon Scott. Nigro brought two associates with him. This year Fried Frank scored another coup by hiring Rule from D.C.’s Covington & Burling, where he was head of antitrust. At press time Rule, a former Justice Department antitrust chief under President Ronald Reagan, was the lead negotiator for Microsoft Corp. in its antitrust settlement with the Justice Department. In March, Rule brought over Deborah Garza, who had replaced him as the head of antitrust at Covington. Rule’s hiring turned heads in the antitrust bar. In recent years, a number of Wall Street firms, such as Milbank, Tweed, Hadley & McCloy and Cadwalader, Wickersham & Taft, have been headhunting for top-flight antitrust talent for their D.C. offices, but they’ve had little success, say D.C. antitrust veterans. “If you want to do the really big transactions,” says Rule, explaining his move, “there are a lot of synergies with a New York-based platform that has established relationships with the financial community and a well-known M&A practice.” Fried Frank has handled M&A work for Northrop for years, but never antitrust work. In 1998, for example, the firm represented Northrop in its failed merger with Lockheed Martin Corporation. (The merger was blocked for antitrust reasons.) Northrop used Gibson, Dunn & Crutcher for the antitrust issues. Gibson has also done M&A work for Northrop in the past, but it was conflicted out of the Newport News deal. Stephen Yslas, Northrop’s vice president and deputy general counsel, says the company considered splitting the Newport News matter between Fried Frank and another firm. Yslas will not say which other antitrust firms he considered. Northrop, though, had worked with Nigro at Collier Shannon, and it was impressed with Rule. So Fried Frank didn’t have to share this one. “We’ve hired different firms in the same transaction, and we’d do it again,” says Yslas. “But it is a nice combination to have it all at one firm.” Sometimes monopolies are not such a bad thing.

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