What does it take to become a national firm? Robert Giles, the long-serving managing partner of Perkins Coie, nods his head and raises his eyebrows when the subject comes up. He answers with bulleted pronouncements that have the inflection of questions at the end of each phrase: "Being able to handle more sophisticated and important matters . . . having a footprint of offices in the country’s leading markets . . . having income numbers that make you attractive to top lateral partners . . . having bench strength in a mix of practices." As he speaks, Giles is sitting on a small veranda at the Biltmore Hotel in Montecito, California, where he is attending the Seattle-based firm’s new partner retreat.

It’s a sunny March afternoon in the Southern California coastal city. The backdrop is filled with palm trees blowing in the breeze and sailboats sauntering across the Pacific. But Giles, with his hard-soled loafers, tan slacks, and button-down blue shirt with a pocket packed with folded papers and a couple of pens, seems a little out of place.

The same could be said about his firm. Perkins Coie has more than 800 lawyers spread across 16 domestic and three foreign offices, as well as an enviable cadre of technology and large public company clients like Amazon.com, Intel Corp., and The Boeing Co. But in an ever nationalizing legal marketplace, it’s not completely clear that Perkins Coie has escaped its label as a Pacific Northwest firm. Part of this is attributable to the firm’s own long-held ambivalence about morphing from what Laura Neebling, chair of the executive committee, describes as a "super regional" into a national firm. "There were fears about losing ourselves [if we expanded]," says Neebling, during an interview in the Biltmore’s lobby. Sporting jeans, sandals, oversized bird figurine earrings, and a matching necklace, she cuts a sort of member-of-the-glee-club figure to Giles’s "Future Business Leaders of America" look. Neebling adds, "There was concern that someday we would look back and feel that we gave up something significant." That something significant, which U.S. Court of Appeals for the Ninth Circuit judge and former partner Margaret McKeown describes as "Perkins’s magic," is an environment that values collegiality, transparency, and consensus.

But expanding (and attempting to go national) ultimately seemed the best course of action and prompted the firm in 2002 and 2005 to adopt successive strategic plans to that end. The "two choices were either get swallowed up or take our destiny in our own hands and grow," says Seattle-based partner Steve Koh. It’s a stark assessment that seemed validated when hometown rival Preston Gates & Ellis merged with Kirkpatrick & Lockhart in 2007.

Still, in many respects Perkins Coie remains a Seattle-centric firm. Despite the hundreds of new attorneys, especially in California, Chicago, and Washington, D.C. (and the two-year-old New York office), it still relies heavily on clients based in the Pacific Northwest like Starbucks Corp., Costco Wholesale Corp., and Puget Sound Energy Inc. (The American Lawyer considers Perkins Coie a Seattle firm because more than 45 percent of its lawyers are based on the West Coast and Seattle is the largest office within that market.) Additionally—clouding the strategic value of this growth—some of its expansion has come from partners fleeing rate pressures at other firms. And—while the error is more ego-deflating than quantifiably damning—attorneys outside Seattle still often hear Coie pronounced "Koo." The correct pronunciation is "Koo-E."

What isn’t subject to any ambiguities is Perkins Coie’s accelerated head count growth—much of it outside of the Pacific Northwest. The firm went from 527 lawyers in 2002 to 823 lawyers in 2012. Its 2012 head count represents a 10 percent increase over 2011—a year when The Am Law 100′s average head count was basically flat. (The past several years haven’t been exclusively a story of lawyer additions. In 2005 the firm closed a Hong Kong office. And in 2009, during the economic downturn, the firm laid off 12 associates and 26 staff members.)

Perkins Coie’s performance in key financial metrics has also improved as the firm has grown. In 2011 its increased workforce helped propel gross revenue up 14.8 percent versus the prior year, to $547.5 million. And, with profits per partner at $1.03 million, the firm broke the million-dollar PPP barrier for the first time. For 2012, Perkins Coie’s gross revenue increased 11 percent versus 2011, hitting an all-time high of $608 million, while PPP declined 1 percent and revenue per lawyer rose a modest 0.7 percent as it took on 32 lateral partners. Stepping back: Since fiscal year 2007, the firm has opened five new offices and increased its head count by 30 percent. RPL has increased an average of 3.4 percent each year (to $740,000 in 2012), while PPP has increased an average of 6.2 percent each year (to $1.02 million in 2012). These averages show that the firm can hold its own against The Am Law 100, including during the recession and recovery. Since fiscal 2007, The Am Law 100 has grown its RPL at an annual rate of 0.4 percent and its PPP at a rate of 2.2 percent.

Perkins Coie’s seven-figure profits and current lofty perch as Washington State’s largest law firm (there are more than 250 attorneys in its Seattle and Bellevue offices) is a far cry from its beginnings in 1912 as a two-man operation, Donworth & Todd. Just four years later, the firm landed what remains an important client relationship when it incorporated what would become Boeing. In more recent decades, as technology companies emerged as an important driver of the Seattle economy, its client roster included video game companies, such as Nintendo of America Inc., software companies like Aldus Corp. (which was later acquired by Adobe Systems Inc.), and ultimately Internet companies including Amazon and RealNetworks Inc. (both of which Perkins took public in 1997). "We bet heavily on technology and start-up companies," says David Burman, a 33-year Seattle-based veteran of the firm, who has served on Perkins Coie’s executive and management committees. And led by McKeown, its first woman partner, Perkins solidified its position as a tech industry–focused firm (and its relationships with tech clients) by diving into the then somewhat nascent area of computer, software, and Internet-related IP litigation. "We very specifically wanted to complement the comprehensive tech practice the firm had on the corporate side," says McKeown, who made partner in 1981.

But the most interesting client relationship has been with Microsoft Corporation. For years Perkins avoided seeking work from the company, because of the software giant’s close relationship with Seattle-based rival Preston Gates (the firm’s name partner William H. Gates Sr. is the father of Microsoft’s cofounder and longtime chairman). "The firm figured it was not going to get a major share of that work," says Giles, "so it made sense to be available to oppose Microsoft." But Perkins Coie never signed on to any major litigation opposing Microsoft, so when the company came calling in 2003 with some small matters to work on, the firm accepted the work. The following year, Perkins Coie won a spot in Microsoft’s preferred provider program and today is the software giant’s main outside counsel in a variety of areas. Perkins Coie has been involved in licensing deals, including one with Nokia Corp., and acquisitions, like Microsoft’s $1.2 billion acquisition of social networking company Yammer Inc. in 2012. And from its Los Angeles office, the firm handles U.S.–based counterfeiting matters. "Perkins is definitely among the three or four most important outside law firms that Microsoft relies on," says Microsoft general counsel Brad Smith. "They’re widely connected with a broad array of things we do across the company, including developing new products and services, meeting regulatory requirements, handling compliance matters, and litigating patent disputes." Even before implementing its 2002 strategic plan, Perkins Coie had demonstrated a willingness to venture into new markets, but without severing its hometown ties. By the close of the 1990s, the firm had well-established outposts, some the result of acquisitions of much smaller local firms, in Denver, Boise, San Francisco, Los Angeles, Washington, D.C., and Silicon Valley. Still, a majority of its lawyers were based in the Pacific Northwest (including a Portland, Oregon, office that dates to 1983). Also, some of the firm’s key expansion moves could most appropriately be described as reactionary, limited, or both. For years, the firm’s Washington, D.C., office was mainly servicing Seattle-based clients. And Perkins Coie’s opening of an office in Chicago in 2002, the same year it adopted its first expansion-focused strategic plan, was prompted by Boeing’s decision to relocate its headquarters there.

Perkins Coie’s most significant expansion, a 2004 combination with 70-attorney Brown & Bain, was initiated by the Phoenix-based firm. Brown & Bain had gained a national reputation handling high-stakes antitrust and IP cases initially for IBM Corp., Apple Inc., and later on for Intel, and it went looking for a merger partner. Hilde­brandt, the legal industry consultancy, conducted a search on Brown & Bain’s behalf that resulted in several potential merger partners. Only Perkins Coie met all eight criteria that Brown & Bain had outlined as top priorities, including a strong patent prosecution practice and a Silicon Valley presence. "Some of our partners told me that they didn’t know a Phoenix office was part of our strategic plan," says Giles of the merger. "It wasn’t, but growing our IP practice was, and our number of IP litigators was instantly doubled."

In the years following the Brown & Bain combination, Perkins Coie became more committed to the idea of becoming a national firm. According to Neebling, the 2005 strategic plan, much more so than the one that preceded it in 2002, "was about pushing the envelope of Perkins becoming a national firm in every way." A key element of this strategy was growing the firm’s presence in the leading legal markets where it had offices, such as Washington, D.C., Chicago, and the San Francisco Bay area. In explaining this plan, Robert Bauer, who founded the firm’s 28-attorney Washington, D.C.–based political law group, says, "We had lawyers with an appetite for the highest-level work, [and that type of work] would be much more likely and possible if the firm built a more national identity." Litigation head Joseph Mais echoes this point: "Big cases allow you to succeed financially and get lawyers excited about coming to work."

In recent years those "exciting" cases have included representing Craigslist Inc. in corporate governance and competition matters against eBay Inc.; former outside directors of Washington Mutual Inc. in a securities litigation class action; Zillow Inc. in its initial public offering; and Intel in two patent portfolio acquisitions valued at nearly $500 million. The firm’s national identity also got a boost in 2008 when one of its clients, Barack Obama, was elected president of the United States. Perkins Coie has handled President Obama’s financial disclosures, and in 2011 it was Washington, D.C.–based partner Judith Corley who traveled to Hawaii to pick up a copy of his "long form" birth certificate. (From November 2009 to his return to the firm in June 2011, Bauer held the position of White House counsel.)

The Washington, D.C., office, which was established in 1979, has been key to the firm’s recent growth. The office now houses more than 80 attorneys, thanks in part to the additions of an IP group from Proskauer Rose, insurance coverage partners from Dickstein Shapiro and Howrey, and government contracts attorneys. In recent years Perkins has added to its Chicago office with pickups in a variety of practices, including real estate, private equity, corporate, IP, and litigation. In San Francisco and Silicon Valley, additions in recent years have included IP litigation, land use, labor and employment, environment, energy, and emerging companies partners. Perkins Coie hasn’t limited its growth to major legal markets. In 2008 the firm added 13 lawyers, mostly IP attorneys, who composed Heller Ehrman’s highly sought-after Madison, Wisconsin, office. Giles was in Chicago when he learned that the Madison outpost might be receptive to joining Perkins Coie, so he drove to Wisconsin and made a three-hour pitch to the whole office. And in March 2011, ending more than a decade of on-and-off debate, the firm opened a New York office with Arent Fox bankruptcy partner Schuyler Carroll. In 2012 Perkins Coie added three IP lawyers and a corporate attorney from Chadbourne & Parke to the office.

In explaining Perkins Coie’s attractiveness to lateral candidates, firm leaders point to its high morale and commitment to lateral integration. Part of the esprit de corps stems from the firm’s focus on a collegial work environment. Fortune Magazine, which has recognized Perkins Coie on its "100 Best Companies to Work For" list for the past 11 years, has highlighted the firm’s party-throwing "happiness committees." Yale Law Women has selected the firm as a 2012 Top Ten Family Friendly Firm on the basis of its family-friendly policies. According to partners, the firm’s high morale is also based on an all-hands-on-deck approach to firm management. A majority of Perkins Coie’s 10 national practice groups are headed by lateral additions, and more than half of the partners on the executive committee hail from outside of Seattle. While the executive committee sets firm policy, power is fairly diffuse, with a long list of committees overseeing the firm. "We pride ourselves on having a welcoming culture," says Neebling, "a transparent culture, a culture that is tolerant of diverse opinions."

More concretely, firm leaders also highlight Perkins Coie’s improved financial performance. (An added bonus has been the firm’s lack of debt, and overall conservative financial management.) "We knew that we needed to get our income numbers up," says Giles, referring to the firm’s thinking in the lead-up to the 2005 strategic plan. In 2005 Perkins Coie’s RPL was $575,000 and its PPP was $610,000, which ranked it 81 and 85, respectively, among the 100 top-grossing U.S. law firms as ranked by The American Lawyer. For fiscal year 2012 the firm’s RPL rank is 66 and its PPP rank is 67.

Several years ago, Giles says, "we had trouble getting lateral partners interested in talking to us because we weren’t going to be competitive with offers from other firms they were considering." The firm’s early lateral success itself became part of the solution to this problem, because as the percentage of its attorneys in higher-billing-rate cities like Chicago, Silicon Valley, and Washington, D.C., increased, its profits and RPL steadily improved, says Giles.

Perkins Coie’s compensation structure is also appealing to many laterals. There are two key aspects: a bonus pool—which in recent years constitutes more than a third of the firm’s net income—and a four-tier partnership. The firm views bonuses, which are set by the 18-member compensation committee and have ranged between $2,500 and $2.7 million, as the great equalizers. The comparatively large bonus pool provides Perkins Coie with the flexibility to quickly and appropriately compensate partners for their contributions, says Giles. The ratio between the highest-paid equity partner and the lowest-paid nonequity partner can reach 23:1.

Perkins Coie’s multitiered partnership structure is also set up to be flexible. Partners in the two lower-level tiers have either 100 percent or 80 percent of their compensation guaranteed. Partners in the two higher tiers have none of their compensation guaranteed. Since 2005, the equity tier has risen a little under 9 percent, to 165, while over the same period the nonequity tier increased around 73 percent, to 240. The practical result is that currently 59 percent of the 405 partners fall into The American Lawyer’s nonequity classification for fiscal year 2012. Perkins Coie’s somewhat elaborate partnership structure also allows it to bring on board partners in practices that have faced rate pressures, such as labor and employment and land use. "Some firms have made a conscious decision to get out of some practices, but we want to be able to provide a full range of services," says Giles, who will end what will be a 28-year tenure as managing partner when his current four-year term expires at the end of 2014.

After essentially a decade of both geographic and practice expansion, Perkins Coie can forthrightly assert that it stacks up nicely when measured against those four bulleted criteria Giles outlined on that patio in Montecito. The firm that less than a decade ago essentially viewed the world from its Seattle offices as a place to lose yourself now sees the value of a broader perspective.