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To look at some of the growth statistics in this year’s NYLJ 100, you’d hardly know these law firms were facing the worst downturn to hit the legal profession in a decade. The firms we surveyed started this year just like the last one, growing by leaps and bounds. In the second and third quarters, amid mounting signs of a weakening economy, firms reined in their growth somewhat but still looked set to end the year substantially larger than a year ago. The last three months, however, have been simply brutal. First, the Sept. 11 terrorist attacks rocked New York City and the rest of the country. As the nation reeled in shock from the tragedy, it was clear that business would have to suffer. And suffer it did. The economic slowdown overnight became a full-fledged recession and firms that had appeared to grow boundlessly were suddenly in retreat. Among attorneys, expansive talk of raises and bonuses turned to furtive whispering of severance and buyouts. A gnawing fear lingers that the worst is yet to come. So our charts, for which data is collected that is current through Sept. 30, in many ways reflect happier times and offer a snapshot of law firms on the brink. The continued growth trends evident at the end of September also reveal how quickly and unexpectedly the bad times came. The primary NYLJ 100 chart ranks the 100 largest law offices in the state, regardless of where firms’ principal offices may be located. Some of our figures have already been overtaken by events. Our data shows Shearman & Sterling adding 48 lawyers to its New York headquarters in 2001, an 8.7 percent increase. However, at the end of October, Shearman announced that it would be laying off about 10 percent of its associates, eliminating this year’s and some of last year’s growth at a stroke. Other firms in the NYLJ 100 that have announced New York layoffs in the last two months are Morgan, Lewis & Bockius, Proskauer Rose and Pillsbury Winthrop. Skadden, Arps, Slate, Meagher & Flom remains the largest legal presence in the state, with 781 lawyers working out of Skadden’s Times Square headquarters, up from 741 last year, a 5.4 percent increase. Skadden’s growth rate was down exactly 50 percent from a year ago, when the firm added 72 lawyers for a 10.8 percent gain. Other firms posted slower growth as well. Simpson Thacher & Bartlett added 38 lawyers in 2001, compared to the 51 it added in 2000. Davis Polk & Wardwell also added 51 lawyers in 2000 but showed zero growth in its New York staff for 2001. Fried, Frank, Harris, Shriver & Jacobson added a whopping 72 lawyers last year for a growth rate of 26.6 percent. This year, the firm added 33 lawyers for a 9.6 percent increase. FORGING AHEAD Not all firms eased off the accelerator; some pushed ahead full throttle. Schulte Roth & Zabel added 53 lawyers this year, posting a robust 21.4 percent growth rate. Sullivan & Cromwell added 57 lawyers this year, a 13.9 percent gain. Last year the firm added 30 lawyers for a comparatively mellow 7.8 percent increase. Similarly, Cleary, Gottlieb, Steen & Hamilton added 35 New York lawyers this year, a 10.8 percent increase, compared to last year’s 4.8 percent. Wilson, Elser, Moskowitz, Edelman & Dicker added 32 lawyers this year, a 14.4 percent increase. Last year the firm saw no growth in New York. Some firms managed to reverse downward trends. Cadwalader, Wickersham & Taft saw its New York office decimated by high attrition last year; the firm lost a stunning 59 lawyers in 2000, a 17 percent decline. This year Cadwalader made it all back and a bit more, adding 65 lawyers for a 22.5 percent gain. Proskauer Rose, which declined by five attorneys last year, added 34 this year, an 8.5 percent gain. Other firms continued to shrink. LeBoeuf, Lamb, Greene & MacRae lost nine lawyers this year, up from the six the firm lost last year. Coudert Brothers, which lost 15 lawyers in New York last year, only shed five this year for a 3.4 percent drop. Pennie & Edmonds, which lost 11.1 percent of its New York staff last year, declined another 13.2 percent this year, slipping down the chart from 47 to 57. Dewey Ballantine, which grew by 29 lawyers last year, lost two this year. The smallest offices in this year’s NYLJ 100 (there is a tie for the 100th place) are those of Hunton & Williams and Damon & Morey, each with 71 lawyers. MERGERS The past year saw the merger trend continue with some high-profile combinations taking place. Last December, Dallas-based Jenkens & Gilchrist merged with New York’s Parker Chapin, 59th in last year’s NYLJ 100 with 123 lawyers. The New York office, known as Jenkens & Gilchrist Parker Chapin, is 55th with 127 lawyers. San Francisco-based Pillsbury Madison & Sutro completed its merger with New York’s Winthrop, Stimson, Putnam & Roberts, creating Pillsbury Winthrop Jan. 1. The combined firm, which counts 193 lawyers in New York and 873 worldwide, ranks 35th on our chart. Winthrop Stimson was 33rd last year with 195 lawyers. An even bigger merger was completed in May between Chicago’s Sidley & Austin and New York’s Brown & Wood. With 312 lawyers in New York, Brown & Wood ranked 17th last year. Sidley, at 67th, counted 106 lawyers in its New York office. This year, Sidley Austin Brown & Wood is tied with Paul, Weiss, Rifkind, Wharton & Garrison as the eighth largest law office in New York state. Our chart of the top 25 New York-based firms ranks firms according to their total size rather than the size of their New York operations. It is a useful distinction, as many New York-based firms are increasingly focusing their efforts on national and international expansion. White & Case continues a tear of mostly overseas expansion, adding 274 lawyers this year, only 23 of whom are based in New York. The firm’s 21.7 percent growth overall this year represents an easing down from its growth rate last year of 34.9 percent, when it added 327 lawyers firmwide. Shearman also demonstrated its international bent by adding 137 lawyers outside of New York, largely overseas. Coudert, while contracting in New York, still added 55 lawyers to its offices worldwide. Of course, not everyone was looking for growth far afield. New to our chart of Top 25 New York-based firms this year is Schulte Roth & Zabel, a 301-lawyer firm with its sole office in Manhattan. OUTSIDE NEW YORK The top 25 Manhattan offices of non-New York-based firms showed noticeably less growth than New York-based firms, perhaps reflecting economic difficulties elsewhere or an inability to deeply penetrate the local market. The biggest branch office was that of London-based Clifford Chance Rogers & Wells, which had 461 New York lawyers at the end of September, up only six from last year’s 455. Morgan Lewis, Chicago-based Kirkland & Ellis and Washington, D.C.-based Fulbright & Jaworski all showed zero growth for the year. Though Los Angeles-based Latham & Watkins posted strong growth this year, adding 42 New York lawyers for a 23.4 percent increase, a number of other California firms contracted this year. San Francisco-based Morrison & Foerster and Los Angeles-based Gibson, Dunn & Crutcher both saw their Manhattan presence decline 8.7 percent. O’Melveny & Myers, headquartered in Los Angeles, shrank its New York offices by 19.2 percent. Greenberg Traurig and Washington, D.C.-based Paul, Hastings, Janofsky & Walker both saw declines as well. Boston-based Bingham Dana & Gould grew its New York office enormously, though, more than tripling in size from 35 to 110.

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