Rank

Firm

2008

2007

1 Baker Botts 1.66 1.59
2 Vinson & Elkins 1.52 1.39
3 Akin Gump Strauss Hauer & Feld 1.45 1.41
4 Thompson & Knight 1.43 1.41
5 (tie) Beirne, Maynard & Parsons 1.38 1.40
5 (tie) Susman Godfrey 1.38 1.43
7 Kelly Hart & Hallman 1.35 1.25
8 Bracewell & Giuliani 1.32 1.17
9 Locke Lord Bissell & Liddell* 1.31 1.04
10 Andrews Kurth 1.23 1.23
11 Haynes and Boone 1.22 1.27
12 (tie) Winstead 1.20 0.99
12 (tie) Porter & Hedges 1.20 1.22
14 Gardere Wynne Sewell 1.19 1.17
15 Jackson Walker 1.18 1.18
16 Chamberlain, Hrdlicka, White, Williams & Martin 1.15 1.18
17 Fulbright & Jaworski 1.13 1.12
18 Munsch Hardt Kopf & Harr 1.04 1.22
19 Cox Smith Matthews 0.88 0.95
20 (tie) Carrington, Coleman, Sloman & Blumenthal 0.86 0.89
20 (tie) Strasburger & Price 0.86 0.94
22 Brown McCarroll 0.84 0.79
23 Thompson, Coe, Cousins & Irons 0.83 0.80
24 Clark, Thomas & Winters 0.70 0.77
25 McGinnis, Lochridge & Kilgore 0.65 0.75
* 2007 numbers are consolidated for Locke Liddell & Sapp and Lord Bissell & Brook, which merged in October 2007 to form Locke Lord Bissell & Liddell.

Methodology Explained

To calculate a firm’s profitability Texas Lawyer uses the profitability index, a mathematical formula. The formula, developed by our affiliate The American Lawyer , is this:

Profitability =
Profits Per Partner/
Revenue Per Lawyer

The formula takes some of the variables — although not all — out of gross revenue, net profits, leverage or even profit-margin comparisons. It shows whether the equity partners in a particular firm are taking home more or less than the average revenue their respective lawyers are bringing into the firm.

Essentially, if the profits per partner are more than the revenue per lawyer, the firm is producing profits for its partners. If not, the firm may need to take a hard look at its expenses or its leverage.

Using the profitability index as a measure, 18 of 25 firms were profitable in 2008, compared to 19 of 25 in 2007. Seven firms were unprofitable in 2008, compared to six in 2007. Profitability improved at 12 of the firms in 2008, declined at 11 and remained the same at two firms. The firm showing the greatest improvement in profitability in 2008 was Locke Lord Bissell & Liddell, the Dallas firm formed in October 2007 by the combination of Texas firm Locke Liddell & Sapp and Chicago’s Lord Bissell & Brook. Locke Lord’s 2008 profitability of 1.31 compares favorably to 2007 profitability of 1.04, a number based on consolidated 2007 financials from the two firms. Profitability dipped the most in 2008 at Munsch Hardt Kopf & Harr of Dallas.

Brenda Sapino Jeffreys