Richard Hays, Alston & Bird, Atlanta. (John Disney/ ALM)
Alston & Bird posted solid revenue and profit gains while increasing head count last year, powered by several big litigation matters and a steady stream of transactional work.
Revenue increased 6.2 percent, reaching $730.5 million. Net income rose 7.9 percent to $267 million, pushing up average profit per equity partner (PPP) by $65,000 to $1.81 million.
Increased head count, coupled with sustained demand boosted 2016 revenue, said managing partner Richard Hays, adding that total billable hours increased by 2.7 percent. The firm’s realization rate on collections was about the same as for 2015, he said. Even with more lawyers, revenue per lawyer increased 2.2 percent to $935,000.
Hays said transactional work was not quite as busy for Alston as in 2015, but litigation activity increased.
He added that he was pleased with the firm’s performance, especially given the headwinds facing the industry. “2016 was another year of modest growth for law firms generally, with uncertainty both domestically and abroad,” he said, citing the U.S. presidential election and the Brexit vote in the U.K. “Our view is that to grow in this environment requires more than ever a focus on staying close to your clients, understanding their current needs and anticipating their future needs.”
He noted that some issues in the political spotlight right now, such as tax reform, trade, cybersecurity and data privacy, intersect with busy practice areas for the firm.
The firm’s revenue and net income increases were on par with those for 2015, but total lawyer head count grew last year by a net of 30 lawyers, reaching 782, and the equity partnership added five partners, for a total of 147. By comparison, in 2015 head count decreased slightly and the firm shed four equity partners.
Hays said the firm has no plans to bolster its international presence with more offices or through mergers. Beyond its eight U.S. offices, Alston opened a small Beijing office in late 2015 to provide an on-the-ground presence for Chinese clients, and it has a four-lawyer outpost in Brussels focused on payments and data privacy work.
“We’re willing to be wherever our clients need us to be,” Hays said. “That’s what took us to Brussels and Beijing, and it may take us to other markets.”
Alston added 16 lateral partners last year, up from 14 the year before and seven in 2014. It promoted 20 lawyers to partner at the end of 2016.
The firm continued adding to its financial services and finance practices, both key areas. In Dallas, Alston added a five-lawyer group led by Sandy Brown and Michael Tankersley from Bracewell to the financial services and products group. In Atlanta, the firm recruited Michael Parisi as a partner and Jordan Myers as counsel from McGuireWoods for the finance practice.
It also added several litigation partners, including Adam Kaiser and John Aerni from Winston & Strawn in New York, who handle class action defense. Thomas Walker rejoined the firm after a stint as U.S. attorney for the Eastern District of North Carolina.
Three Atlanta partners departed. Bankruptcy practitioner Jason Watson joined Womble, Carlyle, Sandridge & Rice. IP litigator Angela James went to Goldman Sachs as chief of staff for the technology division, and Hunter Holliday became the general counsel for consultancy North Highland.
Among departures elsewhere, energy deal lawyer Brian Betancourt joined King & Spalding’s New York office.
On the deal front, Alston represented First Cash Financial Services in its $994 million acquisition of Cash America International. The all-stock transaction created First Cash, the largest pawn shop operator in Latin America and the United States.
Hays said Alston served as counsel for investment banks on 25 deals during the year with a combined value of more than $100 billion, including for Credit Suisse, Wells Fargo and JPMorgan Chase.
Alston advised Credit Suisse, Canadian oil and gas company Enbridge’s financial adviser for its proposed $28 billion acquisition of Spectra Energy Corp. It was also counsel to Credit Suisse for the financial adviser’s engagement with Isle of Capri Casinos on its $1.7 billion acquisition by Eldorado Resorts.
Alston was counsel to Nasdaq’s financial adviser, Wells Fargo Securities, for its $1.1 billion acquisition of the International Securities Exchange, which operates three electronic options exchanges, from Deutsche Borse of Germany.
Several large class action defenses kept Alston’s litigators busy. The firm represented Dell in shareholder litigation over the company’s $67 billion merger with EMC, which closed in September. It also defended Dell in an ongoing shareholder appraisal action over Michael Dell’s 2013 buyout of his computer company for $24.9 billion. A Delaware Chancery Court judge ruled in June that Dell and his partners underpaid by more than $6 billion.
Alston continued defending Home Depot in a data breach class action, which settled last year, and in December obtained the dismissal of a separate shareholder derivative suit over the data breach claims.
In other data breach litigation, Alston represented Wendy’s in the dismissal of a proposed class action of a 2016 data breach that affected 1,025 of the fast-food chain’s U.S. franchises.
It defended Porsche Cars North America Inc, a subsidiary of Volkswagen, in class action litigation which settled in October, alleging almost 600,000 diesel cars had illegal devices installed to override their emission control standards, causing air pollution that violates EPA standards.
In a new engagement, longtime client Nokia has renewed its global patent war with Apple. Apple filed an antitrust suit in California in December against entities to which Nokia has sold phone patents, alleging they conspired with Nokia to “extort” excessive royalties. Nokia responded the next day with suits in the United States and Germany, followed by suits in China and Japan and seven European countries, alleging infringement of 40 patents. That prompted an Apple spokesperson to call Nokia a patent troll.
The two companies settled a massive earlier round of litigation in 2011 when Apple agreed to pay patent licensing fees worth about $720 million to Nokia. While Nokia sold its cellphone business to Microsoft in 2014 to focus on network equipment, it maintains interests in the underlying patents.