X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Three Washington, D.C., area law firms announced expansions last week, demonstrating the continued pressure on local firms to tap into new markets in the United States and abroad. Washington’s Steptoe & Johnson finalized merger plans with London’s approximately 45-lawyer Rakisons. Meanwhile, partners at Washington-based Dickstein Shapiro Morin & Oshinsky approved a merger with New York’s Roberts, Sheridan & Kotel, a 23-attorney tax and corporate boutique. And 840-lawyer Piper Marbury Rudnick & Wolfe, aggressively pursuing a larger presence on the West Coast after completing its merger last year, launched a new Los Angeles office with five attorneys from that city’s defunct Troop Steuber Pasich Reddick & Tobey. Law firm consultant Peter Zeughauser says firm leaders see expansion as a way to woo both clients and recruits. Acquiring an existing practice is the easiest way to quickly build critical mass, he adds. “Firm leaders have concluded there are essentially two ways to build attractive platforms — increase size and geographic reach or increase profitability,” Zeughauser says. “Firms that have struggled with getting into the top tier with profits are pursuing the size-and-reach model.” For approximately 220-lawyer Steptoe and 250-lawyer Dickstein Shapiro — two firms relatively slow to expand outside the nation’s capital — the moves realize longtime goals. Indeed, with the completion of one of the few transatlantic mergers since last year’s marriage of the U.K.’s Clifford Chance and New York’s Rogers & Wells, Steptoe acquires its first overseas office and the largest London presence of any D.C.-based firm. Steptoe also has offices in Los Angeles and Phoenix. “We had been thinking about and looking at London for several years when a recruiter introduced us to Rakisons,” says Steptoe chairman Lon Bouknight Jr. “Very quickly, we concluded that we liked the people and that this was a very appealing combination.” According to Bouknight, Steptoe partners were attracted to Rakisons’ reputation in telecommunications and technology law, an area many U.S. firms have been targeting internationally. And Rakisons was openly looking for a U.S. partner, after failed negotiations with Philadelphia’s Morgan, Lewis & Bockius and New York’s LeBoeuf, Lamb, Greene & MacRae. The introduction to Steptoe came in early 2000, and by midsummer the two firms had hammered out a blueprint for the financial elements of the deal. Initially, firm leaders expected to finalize the merger by Oct. 1, 2000, says Bouknight. But working through the accounting and tax ramifications of merging Rakisons’ accrual accounting system into Steptoe’s cash-based system took months. “The systems are so different. You’re always going to find one more thing that has to be dealt with,” says Steptoe partner Stewart Baker, joking, “Basically, it’s like going to a field, turning over every rock, and cataloguing what’s under it.” Already, Steptoe and Rakisons partners have begun collaborating on client matters, says Alfred Mamlet, head of Steptoe’s telecom group. Recently, the two firms represented Stratus Global, a Canadian telecom company, in a $250 million acquisition of British Telecom satellite properties. “That’s just the kind of transaction we hope this merger will allow us to do more of,” Mamlet says. MOVING FAST In contrast to the protracted courtship of Steptoe and Rakisons, Dickstein’s acquisition of Roberts Sheridan was a whirlwind romance. Dickstein Shapiro tax partner Ira Polon first crossed paths with the six-year-old Cravath spinoff as opposing counsel on a 1995 deal. Polon introduced firm chairman Angelo Arcadipane to Roberts Sheridan co-founder Todd Roberts in February 2000. At first, there were few sparks. But last November, Roberts called Arcadipane with renewed interest. For Dickstein, the combination ends a long search for additional corporate strength and increased heft in New York, where the firm has maintained a small office for years. “We believe, in order to hit the next milestone in our profitability, we need to expand our corporate and tax capability,” Arcadipane says. “I’ve probably talked to about 40 firms in the past two years, which for one reason or another did not appear to be an appropriate fit for us.” As the nation’s financial center, New York has been a tempting locale for many D.C. firms looking to build corporate practices, and Dickstein’s merger comes on the heels of similar moves by D.C.’s Covington & Burling and Hogan & Hartson. Washington, D.C.’s Arent, Fox, Kintner, Plotkin & Kahn, which currently has about 30 lawyers in New York, is also rumored to be looking for a Manhattan merger partner. One attraction is the city’s high billing rates. “If you want expansion to be additive and not dilutive, you want to expand into markets where you can charge more than the rates you’re charging,” Zeughauser explains. D.C.’s Swidler Berlin Shereff Friedman, the first Washington firm to capitalize on a Washington/Wall Street connection, boasts the highest profits per partner of any local firm. But not all Washington firms are out shopping. D.C.’s Wilmer, Cutler & Pickering has been striving to grow its New York office for the past 18 months, but managing partner William Perlstein says the firm is not interested in a merger. “We started off with three people and now we have 17. What we’ve done is bring people in one at a time,” Perlstein says, adding that the firm expects to have more than 30 lawyers by the end of the year. Robert Ruyak, chairman of Washington-based Howrey Simon Arnold & White, says New York is not a critical city for his firm’s strategic plan, which emphasizes litigation, intellectual property, and antitrust law. “We get a lot of calls from recruiters and consultants about New York firms interested in merging, but the truth is, New York is not a hotbed for our practice areas,” Ruyak says. “If there were an appealing opportunity to combine with a firm that fits into our strategic plan, we would consider it.” WESTWARD EXPANSION Another domestic market drawing attention from D.C. firms is Southern California. And Piper Marbury is not the first to benefit from the December 2000 unraveling of Los Angeles’ 120-lawyer Troop Steuber Pasich Reddick & Tobey. The firm’s approximately 60 corporate, entertainment, and high-tech lawyers joined the Los Angeles office of Akin, Gump, Strauss, Hauer & Feld, while 25 Troop Steuber insurance and corporate litigators joined the local office of D.C.’s Howrey Simon Arnold & White. According to Jeffrey Liss, Piper Marbury’s D.C. managing partner, the five lawyers joining the firm were introduced by an existing client. “We are looking to establish a major presence in California, and we’re exploring opportunities right now,” Liss says. “This is just the first installment of our being on the ground in California.”

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

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 © 2020 ALM Media Properties, LLC. All Rights Reserved.