Jerry K. Clements (Margaret Licarione)
Locke Lord, whose lawyer head count declined in 2016, saw its gross revenue drop by 6.4 percent in 2016. But net income at the Dallas-based firm rose by 11.1 percent compared to 2015—partly because of its booming energy practice.
“Even though commodity prices were down, there was still a lot of activity at a lot of companies,” said Locke Lord chairwoman Jerry Clements. “While in the first part of 2016, things started out slow in energy, by summer things really picked up, and by the end of the year we had really made up for the slowness at the first of the year.”
Gross revenue at Locke Lord came in at $559 million for 2016, down from $597 million in 2015, while net income totaled $175 million, an increase from the $157.5 million recorded the year before. Revenue per lawyer was $745,000, up 5.7 percent compared with $705,000 in 2015, and profits per partner hit $950,000—up 6.7 percent from $890,000 the previous year.
Clements, a partner in Austin who chairs the firm, said a number of other practice areas were also exceedingly busy during 2016, including litigation, international arbitration, privacy and cybersecurity, insurance regulatory and transactional, health care, public finance, private equity, and real estate finance. In particular, Clements said that health care lawyers were busier than they’ve ever been, and she expects that to continue with joint ventures and work related to changes to the Affordable Care Act.
“The good news is across the firm we are seeing improved demand and improved activity on the part of our lawyers,” she said.
Locke Lord, merged in January 2015 with Edwards Wildman Palmer, creating a firm that at the time had 1,014 lawyers. But today it is much smaller. The firm had 749 lawyers on a full-time-equivalent basis in 2016, down 11.6 percent from 847 full-time equivalent lawyers in 2015. According to Clements, some of the net loss is due to attrition, some to “practice management to make sure all of our partners are busy so we don’t have excess capacity,” and some just the natural result of a big merger.
The firm benefited in 2016 from the merger, she said, and it exceeded budget by about 7.5 percent. The firm added some practice areas in 2016, including an asset finance leasing practice in London, a student loan practice as part of the firm’s consumer loan practice, and an art law practice for clients who invest in art, she said.
Locke Lord raised associate salaries as of July 1, 2016, to the Cravath big-firm market rate of $180,000 in its offices in large markets and to $155,000 at offices in smaller markets. “Despite that, we still had a really great year,” she said.
Locke Lord opened a small office in Cincinnati to do public finance work in 2016, but closed offices in Istanbul and Tokyo. The political turmoil in Turkey was a concern, Clements said, adding that the personnel from the Toyko office moved to the firm’s office in New York.
“I was very happy with 2016. I couldn’t be more pleased. It wasn’t easy … when you have so much competition, when demand continues to be generally flat, so I think by comparison we did really well,” Clements said. “We also had the benefit of the 2015 merger.”
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