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Duane Morris, which has made no secret about its ambitions to grow aggressively into a national firm, took a big step forward Wednesday when it announced its merger with San Francisco-based Hancock Rothert & Bunshoft, which will be effective Jan. 1. And, in what may come as a surprise to some, the firm’s leader said there might be more mergers to follow. The move, which was rumored to be in the works for at least the last two weeks, will push Duane Morris’ San Francisco office close to 100 lawyers. In addition, the firm also announced it was opening a Los Angeles office with former Coudert Brothers partner Russell Roten, bringing four other Coudert attorneys to join with the existing attorneys from Hancock Rothert’s Los Angeles office. The firm is looking to expand the L.A. office, focusing on commercial litigation and intellectual property. According to Duane Morris Chairman Sheldon Bonovitz, the merger should be worth “a little north of exceeding $35 million” to the firm. The firm’s official statement said the combined firm would have “in excess of 600 lawyers in 19 offices and is projected to generate revenue approaching $350 million in 2006.” Combined with its existing 30-lawyer San Diego office, the merger and additions will give Duane Morris 130 lawyers in California, which Bonovitz said was crucial to positioning the firm better on the national stage. “It gives us more credibility as a national firm,” he said, pointing out that the firm will now have a strong West Coast presence to go along with the East Coast and Chicago. The other news was that Duane Morris — which has typically expanded with small offices — might not be through with mergers. Bonovitz said New York, Washington and Chicago were all markets where the firm would be interested in conducting other mergers. “If we can do a merger in ’06, we’ll do it,” Bonovitz said. “We could do one or two mergers with 50- to 100-lawyer firms, or one large 200- to 300-lawyer firm” within a year. To do more than that though, “takes too much time and resources,” he said.Michael Coleman of Coleman Legal Research said other firms might see Duane Morris’ acquisition as a signal that the firm is looking to merge. “I think there are a lot of brokers out there looking to do deals and when they see a firm do something like this, they might see it as a sign that the firm has an appetite for mergers,” he said. It might cause some brokers to change their view of Duane Morris, he said.Asked if there were firms with any particular specialties that Duane Morris would be interested in merging with, Bonovitz said Duane Morris would be interested in “transactional, corporate, intellectual property and health care.” “We have about 300 litigators and we’d like to balance that” with those other areas, he said. Bonovitz said in terms of growth, the firm has always been on a “dual track” — growing via groups of partners and lawyers as well as through mergers — but that until now it hadn’t found the right merger partner. But Coleman said the merger was a departure from the firm’s history.”It’s really a change from their track record,” he said. Frank D’Amore of Attorney Career Catalysts said it was in line with what’s going on in the market. “I think it’s pretty consistent with what a number of firms of their size are doing,” he said. Firms that are looking to establish a national presence are finding it more efficient to add whole practice groups or merge with other firms rather than just grow a few lateral partners at a time, he said. “From an integration perspective it’s easier” to grow a firm that way, D’Amore said, although he added that a merger like Duane Morris’ “ups the ante.” Bonovitz said he expects the firms to be fully integrated by the time the merger takes effect and that the lawyers “will not miss a beat.” He confirmed that not all of Hancock Rothert’s attorneys would be making the move. The official press release said 60 attorneys would be making the jump with the merger. News reports prior to the official announcement put the number of lawyers at Hancock Rothert at 75. “There will be some attrition,” Bonovitz said, adding that they would be mostly associates. Hancock Rothert has long been known for its insurance coverage work, especially its representation of Lloyds of London, but there has been less work in recent years. Hancock Rothert has steadily gotten smaller even as it has attempted to branch into other areas. Most of Hancock Rothert’s lawyers are in San Francisco, but the firm has smaller, satellite offices in Las Vegas and Lake Tahoe, Nev., and Los Angeles, plus a two-lawyer office in London.At the end of 1998, it had 120 lawyers. In 2002, it had 100. In that year, the last for which figures are available, Hancock Rothert had revenue of about $56 million. Earlier this year, the firm lost Patrick Cathcart, one of its Los Angeles rainmakers, who took four others with him to start Cathcart Collins & Kneafsey. Duane Morris, on the other hand, is a 480-lawyer firm that’s been on a growth campaign — three years ago it was just half its current size — fueled by individual and small group hires. Bonovitz has said he wants to grow to 1,000 lawyers. The firm landed at No. 72 in The American Lawyer‘s 2004 list of the top-grossing firms, with profits per partner of $570,000. “In addition to an excellent insurance coverage practice, Hancock has outstanding litigators with a strong presence in such areas as commercial litigation, technology, professional liability, construction, appellate, health care and product liability,” Bonovitz said in a prepared statement. “The merger will provide the opportunity to offer a full range of legal services to Hancock’s client base in areas other than litigation and also will provide Duane Morris with the ability to offer more broad-based litigation services to its clients in California.” The statement went on to say the merger would provide the firm “an ability to serve and develop its insurance and reinsurance clients in Europe, Bermuda and the United States.” Bonovitz said the seeds for the merger were sown several months ago when Eric Sinrod — a partner in Duane Morris’ San Francisco office who had worked at Hancock Rothert — and Hancock Rothert attorney Richard L. Seabolt were “bemoaning” the fact that they couldn’t work together and cross-sell to each other’s clients. That led to talks between the two firms, he said, and the two sides realized there was a “great cultural fit.” Things accelerated during the summer and culminated with all the principal partners from Hancock Rothert meeting with Duane Morris’ management and partners. Marie-Anne Hogarth of the Recorder, a publication of ALM, contributed to this report.

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