Kramer Levin Naftalis & Frankel logo (Lauren Welles)
Kramer Levin Naftalis & Frankel saw a double-digit percent increase in net income in 2016, with its revenues also rising and partner profits growing to nearly $2 million.
The 320-lawyer firm reported $352 million in gross revenue, a 6 percent increase over the $332 million it posted in 2015. The bump led to a 4.8 percent increase in revenue per lawyer, which rose to $1.1 million in 2016.
Kramer Levin also saw an uptick in its profits per equity partner, which came in at $1.985 million in 2016, an 8.5 percent increase over 2015. The firm’s net income in 2016 totaled $139 million, 11.6 percent more than the $124.5 million Kramer Levin posted the prior year.
“We were very pleased with our year in 2016,” said Kramer Levin managing partner Paul Pearlman. “Our biggest practice areas all saw increased demand.”
The firm finished 2016 on a high note, Pearlman said, as its inventory was up roughly 25 percent year-over-year.
“We were in a strong position coming into 2017,” he said.
While Pearlman described 2016 as a busy year for the firm’s corporate, restructuring and litigation practices, he noted that its real estate and land use practices in New York have been “particularly busy” over the past few years. In 2016, the group had a role in the redevelopment of the famed Waldorf Astoria hotel in New York City, as well as in condominium-related work in the Hudson Yards development on Manhattan’s West Side.
The firm also inked a real estate deal of its own in early 2017, signing a 15-year lease renewal for its New York headquarters in midtown Manhattan that will start in 2020 when its current lease expires. Pearlman said the firm has no specific plans to add any new offices to its three current outposts in New York, Silicon Valley and Paris.
Kramer Levin’s bankruptcy and restructuring practice also had a busy 2016, representing a group of senior noteholders in the Caesars bankruptcy. The firm’s litigation group represented H.J. Heinz Co. and other consumer goods companies as plaintiffs in an antitrust case accusing News Corp. of monopolizing the market for in-store advertising promotions. News Corp. agreed to a $250 million settlement that secured final approval in November.
Kramer Levin’s head count stayed relatively flat in 2016. The equity partnership grew from 68 to 70 partners, and the number of non-equity partners remained steady at 34 partners, bringing the total size of the partnership up 2 percent to 104 lawyers. The firm’s overall head count grew to 320 from 315.
In September, Kramer Levin lost a four-lawyer investment management group to Perkins Coie, but it also brought on six lateral partners throughout the year—three in the U.S. and three in the firm’s Paris office.
Among the hires was Richard Farley, who joined from Paul Hastings and now chairs Kramer Levin’s leveraged finance practice in New York. Kramer Levin also made a notable rehire in its white-collar defense and investigations practice: The firm in June brought in new partner Darren LaVerne, who had been a Kramer Levin associate earlier in his career and then spent roughly seven years as an assistant U.S. attorney in Brooklyn, New York.
Pearlman said the firm typically hires only a handful of lateral partners each year, and that those hiring decisions are both strategic and opportunistic. The relatively small size of the firm allows Kramer Levin to offer clients leaner teams that have deep expertise, while also fostering collaboration and strong relationships among lawyers at the firm, he said.
“We like the fact that we’re not too large,” said Pearlman. “We view our size as an advantage.”
Correction: An earlier version of this article misstated the number of partners at the firm. We regret the error.
Scott Flaherty covers the business of law with a special focus on plaintiffs firms. He can be reached at firstname.lastname@example.org. On Twitter: @sflaherty18.
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