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Piper Rudnick has finally cracked San Francisco’s legal market with a deal to swallow 32-lawyer, 100-year-old Steinhart & Falconer. Steinhart partners voted in mid-December to accept a merger proposal. Beginning Thursday, the combined firm will operate as Piper Rudnick, with the Steinhart name lost to history. Steinhart partners said the firm was still performing well financially. But, like other small local and regional players, it was feeling the squeeze from the gathering momentum of national firms, with their greater geographic reach and financial resources. “One of the considerations was balancing out this sort of sense of responsibility as a head of a 100-year-old firm,” said Steinhart partner Robb Scott, “and, on the other hand, making sure the opportunities are going to be there for the people who were coming up behind us.” With 12 offices and 950 lawyers, Piper Rudnick grossed $455 million in 2002 and logged $675,000 in profits per partner, according to The American Lawyer magazine. The acquisition is the latest in a series for Piper aimed at expanding its national reach. The firm was created by the 1999 merger of Baltimore’s Piper Marbury and Chicago-based Rudnick & Wolfe. In 2001, Piper was wooing what was then McCutchen, Doyle, Brown & Enersen. Merger talks fizzled, though, and McCutchen went on to merge with Boston’s Bingham Dana. Since then, Piper had put out feelers to acquire a group of lawyers from within an established local firm. But instead, the search turned up Steinhart. The firms had been in talks since October. Larry Watanabe, a law firm recruiter and consultant, said the deal gives Piper an instant presence in Northern California. Steinhart lawyers will help Piper serve clients with local matters, a need that drove it into talks with McCutchen. The firm’s 19 partners focus on litigation, real estate and media law, and clients include LucasFilm, PricewaterhouseCoopers, BP Arco Co. and the San Francisco Chronicle. But the firm has had trouble landing business as more out-of-town firms opened up shop locally, said George Gnoss, a Steinhart partner. The firm had traditionally received referrals from East Coast firms. But as those firms opened offices here, they held on to the work, Gnoss said. Scott added that the firm was also losing high-stakes cases to firms with greater resources. “It is the case that when we compete for work, there are times when it’s a bet-the-company transaction or piece of litigation, [and] clients are more comfortable hiring a national firm,” Scott said. “This is neither new nor alarming. But is it frustrating? Yes, it’s frustrating.” Scott said the firm wasn’t officially on the block, but had been listening to suitors looking for a deal with a San Francisco firm. The partners were encouraged by Piper’s track record of incorporating new arrivals, Scott said. The Steinhart team queried lawyers who had worked for firms like Boston’s Hill & Barlow, which saw 17 of its lawyers join Piper earlier this year.

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