At about 5 p.m. on Wednesday, Dec. 16, 2009, real estate lawyer Chad Key learned he had been elected a partner in Kelly Hart & Hallman. The partnership held its annual meeting and then invited the rest of the firm’s lawyers to a conference room. Management announced that five associates, including Key, all of whom are in the Fort Worth office, were promoted to the partnership.

“I was actually fairly busy that day, so that was probably a good thing to keep my mind off the meeting,” he says.

Unlike many real estate lawyers, Key says his practice did not slow down dramatically during 2009.

“I’ve been fortunate to be able to work with some good clients, strong companies that have remained fairly busy,” he says. Those companies include Oklahoma City-based Chesapeake Energy Corp., which he has helped purchase natural gas drilling sites, and Fort Worth-based Hillwood Properties, which he has assisted with land sales and leasing, he says.

The 2001 graduate of Southern Methodist University Dedman School of Law declines to identify his billable hours for 2009, but he estimates that his hours were down about five percent when compared with the previous year.

“I think it’s probably not as big a hit as some [lawyers] took,” he says. But despite the fewer billable hours, Key says he was not concerned about being considered for partnership during a recession.

“Our firm does a good job of making those types of decisions based on an entire volume of work,” he says. “Those decisions are not necessarily only contingent on the recent economy and so forth but a fairly long-term view.”

Key was one of 69 lawyers promoted to shareholder or partner for 2010, the third year in a row that the largest firms in Texas promoted fewer new partners and shareholders in the Lone Star State.

The 69 lawyers promoted to partner or shareholder are at 23 of the 26 largest firms in Texas. The 26 firms are the biggest on Texas Lawyer ‘s “The Texas 100″ list, which ranks Texas-based firms and Texas operations of out-of-state firms by the number of lawyers in the state. The promotions represent a 33.7 percent decrease from the 104 promotions at the same firms for 2009. Lawyer counts decreased at many of the firms during 2009. [See "Headcount at BigTex Firms Dropped 5.7 Percent Over Last Year," Texas Lawyer, Feb. 8, 2010, page 1.]

But lawyers at several of the firms say the decrease (and, in some cases, the increase) in the number of promotions is not driven by the economy as much as it is by a change in partnership tracks that created gaps in election years and by lateral recruits who became eligible for promotion in 2009 or 2010, thus expanding or shrinking the size of the groups of lawyers eligible for promotions for this year and last year.

The number of partner and shareholder promotions declined at 17 of the 23 firms, increased at five of the firms and stayed the same at one. Three of the 26 firms — Brown McCarroll, Gardere Wynne Sewell, and Hunton & Williams — announce new partners and shareholders after Texas Lawyer ‘spresstime on March 25.

“I don’t think it’s bad news having fewer partners, just a change, a different set of criteria,” says firm consultant William C. Cobb of Houston. Many large Texas firms extended partnership tracks during the past several years to guarantee that those promoted to the partnership not only would have legal skills but also business-origination capabilities and client relationship skills, he says. Of those promoted this year, 44, or 63.7 percent, obtained their law degrees in 2000 or 2001, so they were 8.5 to 9.5 years out of law school.

[See "Getting the News" and charts: "New Texas Partners in 2010," "New Texas Partners' Practice Areas," "New Texas Partners' Law Schools" and "New Texas Partners' Graduation Years."]

Fort Worth-based Kelly Hart & Hallman saw the greatest percentage increase in partner promotions, 400 percent, with five lawyers elected for 2010, compared with one for 2009. Managing partner Dee J. Kelly Jr. says five is an unusually large new partnership class for the firm, which has 130 lawyers. He says the numbers are driven by the firm’s decision a few years ago to extend the partnership track from 7.5 to 8.5 years.

That decision meant the group that would have been considered in 2008 for 2009 partnership was pushed back a year and evaluated during 2009 for 2010 promotions. He says the firm’s partners were not reluctant to add lawyers to the partnership, despite the slow economy.

“We think we really had five exceptional lawyers, and it was very important that we recognize them,” he says.

In addition to Kelly Hart, the five large firms that increased the number of partner and shareholder promotions for 2010 compared to 2009 are Austin-based Clark, Thomas & Winters; San Antonio-based Cox Smith Matthews; Dallas-based Munsch Hardt Kopf & Harr; and Houston-based Vinson & Elkins.

Clark, Thomas &Winters promoted five lawyers to shareholder for 2010, an increase of 150 percent when compared to the two shareholders the firm named in 2009.

The firm generally considers lawyers for shareholder about 7.5 years out of school, says Jay Breedveld, a shareholder in Austin who chairs the firm’s recruiting committee. The group of newly promoted shareholders includes two who werelateral of counsel hires, which increased the number of lawyers at the firm eligible for promotion for 2010.

“From our perspective it made sense to make these individuals partners because of their contribution to the firm,” Breedveld says.

With six partner promotions, Houston-based Vinson & Elkins has the largest new partner class among the large firms in Texas, 20 percent more than the five partners elected for 2009.

“We made decisions on new partners as to whether they will add strength to the firm going forward in the future, not based on current economic conditions,” says Joseph Dilg, managing partner of the 759-lawyer firm.

The firm’s partnership admissions committee considers the impact the economy might have had on people’s billable hours when considering lawyers for partnership, generally 8.5 years after law school graduation, he says. The committee considers lawyers’ leadership roles and significant roles in transactions or litigation to get true understanding of their ability, Dilg says.

“We’re really looking forward to the strength the individual will provide to the firm over the next 10 years, rather than what they’ve done in the last year,” he says.

Cox Smith Matthews promoted three lawyers to shareholder for 2010, compared to the zero lawyers promoted to shareholder for 2009. The firm’s managing director, James B. “Jamie” Smith, did not return a telephone call seeking comment before presstime on March 25. Neither did Glenn Callison, chief executive officer and shareholder in Munsch Hardt Kopf & Harr, which named four new shareholders, a 33.3 percent increase over the three named by the firm in 2009.

New partner and shareholder promotions at several of the large firms decreased more than 50 percent when compared with the number of partner and shareholder promotions at the same firms the previous year. At Miami-based Greenberg Traurig, which has 105 lawyers in Texas, the firm promoted no new shareholders in Texas for 2010, compared with five shareholders promoted in 2009.

“We just happened to have a gap last year and didn’t have anybody up [in Texas],” says Ralph Santos of Dallas, the firm’s regional operating shareholder. He says lawyers are eligible for consideration as shareholders at Greenberg when they are 7.5 years out of law school but 8.5 years out of school is the typical track for most lawyers. The firm’s Dallas office has been open for six years, Houston for five years and Austin just over one year, he says.

“A lot of associates in the offices have come to us as lateral hires, rather than growing up through the ranks of law school classes,” he says. “We don’t have people in each class.”

Weil, Gotshal & Manges, which is based in New York City and has offices in Dallas and Houston, also elected no new partners in Texas for 2010, a 100 percent decrease from one partner elected for 2009. Glenn West, managing partner of the firm’s Dallas office, did not return a telephone call seeking comment before presstime on March 25.

Jackson Walker elected five partners, a 64.3 percent decrease from the 14 partners elected for 2009, but the size of the 2009 new partner class was unusually large, says managing partner C. Wade Cooper.

The large class in 2009 included seven lawyers who had joined the firm laterally in 2007 or 2008 as senior counsel with seven-plus years of experience, former managing partner T. Michael Wilson said last year. [See "BigTex Firms Make Fewer Partners for Second Year in a Row," Texas Lawyer , March 30, 2009, p.1.]

“Looking at the list of associates, we just actually had a smaller associate list this year,” Cooper says.

He notes that the firm made a decision about seven years ago to decrease the size of its incoming first-year associate classes and that reduced the number of people in the pipeline for partnership.

“We didn’t want to get into the numbers trap where we had more people than we had good work for,” he says. The firm considers lawyers for partnership seven years out of law school.

“We try to be conscientious about reviewing our associates twice a year, so they are getting feedback pretty regularly and understand where they stand with the firm,” he says. “If somebody is still here at seven years, it’s obviously somebody with talent and capability.”

K&L Gates elected one partner in Texas, compared with seven partners last year, a decrease of 85.7 percent. Craig Budner, the firm’s administrative partner in Dallas, did not return a telephone call seeking comment prior to presstime on March 25.

Also among the firms with more than 50 percent decreases in the number of lawyers promoted to partner or shareholder this year is 383-lawyer Thompson & Knight, with an 80 percent decrease from five new partners in 2009 to just one this year.

Like Kelly Hart, the firm changed the length of its partnership track. While at Kelly Hart the change meant there were more candidates considered for promotion, at Thompson Knight the partnership track change resulted in fewer candidates this year. Managing partner Jeffrey Zlotky says the firm only had one candidate because it had changed the partnership track a few years ago — from eight to nine years out of school — which first affects the group that would have been considered in 2009, he says.

“We would never let the economy stand in the way of making qualified persons partner,” says Zlotky. He says the firm’s associate layoffs earlier this year did not affect the process. [See "Layoffs Hit T&K," Texas Lawyer, May 18, 2009, page 3.]

“It was not due to the economy, or downsizing,” he says. “It happened this year that people are not eligible because we changed the track.”