A total of 10 partners are leaving K&L Gates and Womble Carlyle Sandridge & Rice to launch the Morningstar Law Group, a full-service shop offering reduced hourly rates to potential clients in North Carolina’s Research Triangle that is the latest new law firm to open in 2012.
 
Four partners from Womble Carlyle and six partners from K&L Gates are joining forces to form Morningstar, according to the Triangle Business Journal in Raleigh, which first reported news of the spin-off on Friday. Morningstar will be based in Morrisville, North Carolina, which is sandwiched between Chapel Hill, Durham, and Raleigh.
 
Kenneth Carroll, a Morningstar cofounder and the former managing partner of Womble Carlyle’s Research Triangle office, tells The Am Law Daily that the discussions about creating the firm began some four months ago as a series of separate conversations between different partners who eventually decided to do something collectively.
 
The Morningstar name, Carroll says, was chosen to symbolize what he calls “the dawn of a new day in legal services.” The new firm, which has taken office space down the road from K&L Gates’s Research Triangle hub, has about four associates to go along with the 10 founding partners, Carroll adds. 
 
As with many regional firms, the idea to form Morningstar grew out of a desire to meet the demands of clients seeking streamlined or reduced billing rates. Large firms like K&L Gates and Womble Carlyle often raise hourly rates to absorb the massive overhead that goes along with their expansive operations—something that Carroll says had become harder to justify to clients seeking more affordable legal services.
 
Carroll believes that Morningstar’s smaller size will allow the firm to offer clients—predominantly in the chemical, life sciences, manufacturing, and pharmaceutical industries—more flexible pricing options for their legal bills, whether through reduced hourly rates, flat fees, or other alternative billing arrangements.
 
“I think at many big firms these days there is a bit of an everyman for himself mentality, where individual financial statistics become all important,” says Carroll, who spent 27 years at Womble Carlyle and has nothing but praise for his former firm. “We wanted to practice in an environment where we invest in our colleagues as well as ourselves, and I think that’s becoming increasingly difficult to do in big law.”
 
Joining Carroll at Morningstar are corporate partners Jennifer Collins, Gene Jones Jr., and W.H. “Kip” Johnson III, all of whom were Womble Carlyle lifers. K&L Gates real estate partners Jason Barron, William Brian Jr., Patrick Byker, Mack Paul, and Stephanie Powell, and corporate partner Grayson Hale are also now part of Morningstar. Several of the new firm’s partners have additional litigation and public policy expertise.
 
A spokeswoman for K&L Gates, which entered North Carolina four years ago after merging with 175-lawyer Kennedy Covington Lobdell & Hickman, did not immediately respond to a request for comment on the six partner departures. (Most of the partners joining Morningstar from K&L Gates are Kennedy Covington alums; K&L Gates also expanded into South Carolina in December by picking up seven partners from Parker Poe Adams & Bernstein in Charleston, according to our previous reports.)
 
Womble Carlyle’s Johnny Loper, the managing partner of the firm’s Raleigh office, praised his former colleagues, who left on good terms to launch Morningstar. Loper also told The News & Observer in Raleigh that he anticipates referring some work to the start-up firm.
 
“These four [partners] are tremendous attorneys and good friends—and will remain so,” Loper said in a statement provided by a spokesman for Winston-Salem, North Carolina-based Womble Carlyle, which has also recently expanded its presence elsewhere in the Carolinas. “We appreciate all of their contributions to Womble Carlyle and wish them nothing but the best in this new endeavor.”
 
Morningstar is the latest new firm to make its maiden voyage this year with Am Law alums.
 
New York City has seen several new startups in 2012, such as when three former Kasowitz, Benson, Torres & Friedman partners and former federal judge Richard Holwell opened the litigation boutique of Holwell Shuster & Goldberg in January, and a white-collar boutique launched on May 1 in the memory of late litigator Robert Morvillo by his three sons and their uncle Richard, a former Schulte Roth & Zabel partner, according to sibling publication the New York Law Journal.
 
The overseas legal market has also seen its fair share of new shops spinning off from larger firms this year. A five-partner team from Baker & McKenzie in Amsterdam took 20 other lawyers from the world’s largest firm in January. The new corporate boutique recently changed its name to Van Campen Liem after picking up another  10-lawyer group last month from Baker & McKenzie led by partner Edwin Liem.
 
In April the entire labor and employment team from Magic Circle firm Freshfields Bruckhaus Deringer‘s Frankfurt office broke away to start its own firm as a result of conflicts and concerns about billing rates, according to U.K. publication The Lawyer.
 
Meanwhile, in Mexico City, the Latin Lawyer reports that a group of four White & Case partners left the firm last month to form their own shop focused on administrative litigation. This month, White & Case also lost the executive partner of its Monterrey office, Eugenio Sepulveda Cosio, to a local finance boutique formed in 2010 by another former partner at the firm.