Morris Manning & Martin had another good year in 2018, with revenue growing 7.4 percent to $139.4 million on top of an 8.4 percent increase the prior year.
Net income was relatively flat, increasing 0.9 percent to $50.1 million (after a 12.6 percent jump in 2017), but that was enough to push up profit per equity partner (PEP) by 3.3 percent to $1,211,000. Revenue per lawyer (RPL) increased 6.2 percent to $818,000.
Simon Malko, who became Morris Manning’s managing partner in January, said the firm made a significant investment hiring key laterals last year, many in the second half. The expense of paying the new partners and additional hires, while not reaping their receivables, cut into profits, he said.
“We expect to see the benefit this year,” Malko said.
Average lawyer head count for 2018 was flat at 170 lawyers, but Malko said Morris Manning ended the year with about 200 lawyers. The average equity partnership count was stable, decreasing by one to 41 equity partners.
Among notable additions, the firm expanded its Washington office—its only branch outside of its Atlanta base. Morris Manning started a government contracts practice by recruiting partner Andrew Mohr and of counsel C. Kelly Kroll from Cordatis, a government procurement boutique.
The firm landed a D.C. team of three IP lawyers and three patent agents from Andrews Kurth Kenyon (now Hunton Andrews Kurth), led by partners Ping Wang and Michael Ye.
Also in D.C., Morris Manning recruited Christina Hassan as a partner for one of its key practices, real estate and hospitality, from Katten Muchin Rosenman.
It beefed up its international trade practice with William Barringer as special counsel from Curtis, Mallet, Prevost, Colt & Mosle and associate Luke Engan from Ropes & Gray, and it added litigation associate Curtis Arnold Jr. from Eversheds Sutherland.
Those additions give Morris Manning about 45 lawyers in Washington—almost one-quarter of its total lawyer head count.
In Atlanta, the firm lost a five-lawyer employment law team, led by partners Jason D’Cruz, Brian Harris and Mark Zisholtz, to Baker Hostetler, but added four employment lawyers within the month, including Meredith Caiafa, now a partner, from Carlton Fields and Ellenor Stone as of counsel from King & Spalding. Real estate partner Mark Block returned from Seyfarth Shaw.
Morris Manning’s energetic recruiting last year was driven by a strategic growth plan that its partners approved at the beginning of 2018. “We grew, but we grew on our own terms,” Malko said.
The partnership’s buy-in to expand the firm, but “to do it the way we want and not through a merger,” Malko said, was a big part of why he wanted the managing partner job.
Malko, 47, was unanimously elected managing partner last July to succeed Louise Wells, who retired in December after almost a decade in the role. He is only the third leader (and the youngest), after Wells and Robert Saudek, for the 43-year-old firm, which started out as a seven-lawyer real estate boutique in 1976.
Malko, who previously chaired the firm’s litigation practice, is also the first non-real estate lawyer to serve as Morris Manning’s leader, which has become a full-time position.
He said the partnership is ambitious for the firm’s future but also “fiercely protective” of its culture, which he described as collegial, entrepreneurial, consensus-driven and minimally bureaucratic.
One of Malko’s mandates is to expand through lateral recruitment. “It takes a lot more time to grow organically and on our terms instead of just combining with somebody,” he said, adding that he spends a “tremendous” amount of his time on lateral recruiting.
“We get calls [from other firms] a lot. It’s not something we’re interested in,” Malko said. “We want people who fit with our culture, our practices and our economics.”
Entrepreneurialism has been a hallmark of Morris Manning’s culture since its early days. For instance, John Yates launched a corporate practice focused on startup tech companies after he joined as a young lawyer in 1987—long one of its key practices.
The corporate tech practice still focuses on emerging companies in Atlanta’s hot tech-startup arena and elsewhere, Malko said, but it also has added two large private equity clients focused on startups. “It diversifies the food chain,” he explained, noting that Morris Manning advised one of the private equity companies, K1 Capital in Los Angeles, on 15 deals last year and the other, Serent Capital in San Francisco, on seven platform acquisitions followed by several bolt-on deals.
“We are committed to innovating and finding the next big practice area,” Malko said.
Partner Bob Alpert recently launched an e-cigarette practice as an outgrowth of his product liability work—an example of Morris Manning’s willingness to invest in new areas, Malko said. The firm is sending Alpert and several other lawyers to China next month to hold a seminar for e-cigarette and vape companies at the Four Seasons Hotel in Shenzhen.
Even though Morris Manning so far has offices only in Atlanta and Washington, it has national practices in corporate tech, international trade, products litigation and real estate. In fact, the firm’s largest real estate and REIT clients are in California, Malko said.
In two big South Florida hotel deals, Morris Manning advised Canadian private equity fund Brookfield Asset Management on the acquisition and financing of the Hilton Fort Lauderdale for $170.6 million from the Blackstone Group and of the 800-acre PGA National Golf Resort & Spa in Palm Beach Gardens for $218 million from Walton Street Capital, which the South Florida Business Journal called the priciest South Florida hotel deal of 2018.
Back in Atlanta, the firm advised hotel developer Noble Investment Group on its $75 million Midtown project for two Marriott International brands, the AC and Moxy Hotels. The adjoining hotels, next to the Four Seasons Hotel between 13th and 14th streets, opened in January.
Morris Manning is national coordinating and trial counsel for Armstrong Containers in lead-paint suits, with the first jury trial set for May in Milwaukee.
The health care practice also was busy. It advised Augusta University Health on the reorganization of its 450-doctor group from an affiliate into a subsidiary of the health system, and it handled six health care cases before the Georgia Court of Appeals.