Following several lateral hires—and exits—this year, Stroock & Stroock & Lavan announced this week that it was expanding its talent management team to concentrate on partner hiring.
The New York-based firm brought on Regina Robbins in a new role, assistant director of talent acquisition, to focus on lateral partner recruiting as well as associate recruiting. Robbins previously worked at Goodwin Procter and Kirkland & Ellis. Meanwhile, Yakiry Adal, previously director of diversity, inclusion and professional development, became director of talent and inclusion, overseeing on-campus recruiting and summer associate programs and leading diversity and inclusion efforts.
The moves to hone in on talent acquisition follow a bumpy lateral season for Stroock, with six partner departures in April and May. The departures included a 30-year firm veteran, Mayer Greenberg, who moved to Kramer Levin Naftalis & Frankel; entertainment lawyers James Sammataro and Hans Hertell, both of whom left for Pryor Cashman; real estate attorneys William Campbell, Eugene Balshem and Justin Steinmark, who all joined Bryan Cave Leighton Paisner; and corporate and finance attorney Bernhardt Nadell, now at King & Spalding. All six were contacted by ALM for this story, but none replied with comment.
That’s a notable number of departures across practices and locations in a two-month period for Stroock, which says it annually turns over between four and five partners. But sources at the firm said that because of the way partner payouts are structured, most departures do tend to occur within the March to May time frame, and the firm’s leadership says Stroock is confident it will grow in its core areas.
The firm pointed to changes over the previous few years that were designed to strengthen its long-term position in the wake of the financial crisis. Co-managing partner Alan Klinger said the firm recognized that it was going to take some hits in revenue and attorney count as it made a series of fundamental changes, and it stands by its decisions.
Those changes include a 2016 transition in leadership and a 2017 restructuring that tightened the firm’s focus on core practices and created a tiered partnership system, with a nonequity track, leading to the deequitization of 21 partners.
Overall attorney head count has dropped the past three years, standing at 244 last year. Stroock’s gross revenue in 2018 was $251 million, mostly flat compared with 2017. Meanwhile, the latest Am Law 200 rankings, which placed Stroock at No. 123, showed 4.8% average revenue growth last year for firms ranked 101-135.
Klinger said that he was encouraged by the firm’s revenue per lawyer performance in 2018, which he said went up by around $30,000 per lawyer from 2017. And profits per equity partner were significantly higher in 2018 after the structural changes were implemented, up 44% from the firm’s 2016 numbers, according to ALM data, to more than $1.76 million in 2018.
Klinger said the firm’s head count may be akin to a Second Hundred firm, but its profits per equity partner are “more along the lines of an Am Law 50 firm.”
He said Stroock’s strategic reorganization, Stroock 2020, which began in 2017 and had policies implemented in full for 2018, is on course. He said the firm expects the departures of early this year to be its last for a while, and it remains confident that it will continue to grow in its core areas, such as real estate, financial restructuring and litigation.
So far in 2019, while six partners have left, the firm has added five lateral partners and expects that number to grow. The recent additions include Michael McCarthy in real estate lending; employee benefits lawyer David Olstein; Jennifer Recine, a trial litigator; Elsa Ben Shimon, a commercial real estate lawyer; and one partner who will be joining the firm June 24 whose name will not be released until then. Earlier, Stroock promoted one lawyer to partner and six lawyers to special counsel, effective Jan. 1.
In statements released by the firm, the new hires praised its platform to grow their business, particularly in real estate, where the firm is well known. The firm’s real estate team, McCarthy said in a release last month, has “long been well known for sophistication and skill, and I believe the firm will provide an ideal home for me to grow and expand my practice.”
Note: This story has been updated to clarify the way Stroock defines its core practice areas.