Credit: ALM

Firms headquartered outside of Texas have been the fastest-growing firms inside the Lone Star State in recent years, but that trend was splintered in 2016 as some midsize homegrown firms beefed up their lawyer ranks in Texas.

More than half of the firms on the Texas 100 chart, which lists the firms with the most lawyers in Texas, increased their lawyer head counts in 2016 compared with 2015. While 38 firms on the chart reduced their lawyer head counts in 2016 compared with 2015, the majority of the declines were less than 10 percent.

Kirkland & Ellis, which opened an office in Houston in April 2014, grew by 79.5 percent in 2016, with 70 lawyers in 2016 compared with 39 the year before. Other out-of-state firms that grew dramatically in Texas in 2016 include Polsinelli, which grew by 50 percent in 2016; Holland & Knight, up 33 percent; and Lewis Brisbois Bisgaard & Smith, which increased its lawyer headcount in Texas by 28.6 percent.

Those big increases in headcounts at Texas operations of national firms are a sign that Texas remains a hot market for expansion-minded firms.

Andrew Calder, a Kirkland & Ellis partner in Houston who is a member of the firm’s global management committee, said his firm is adding lawyers in Texas to be able to respond to client demand. “We want to make sure we have a deep enough bench to make sure we are servicing all of our clients,” he said.

Kirkland & Ellis’ lateral hires in 2016 include M&A partner Doug Bacon, a former partner in Freshfields Bruckhaus Deringer who returned to his hometown of Houston after 13 years of practice in New York City. Calder said others include Adam Larson , a corporate partner who joined from Vinson & Elkins, and litigator Anna Rotman, who came from Yetter Coleman. The firm also launched an investment funds group in Houston because of the volume of M&A work in the energy industry, led by partner Matthew Nadworny, who moved to Houston from the firm’s San Francisco office.

Calder, who said Kirkland & Ellis has continued to grow in Texas in 2017, said the lateral market for highly skilled lawyers is tight because of the interest in Texas. “There’s more competition than ever before. We are continuing to see that trend of firms moving into the Texas market,” he said.

But three midsize Texas firms also posted significantly large headcount increases in 2016, according to the Texas 100. Hartline Dacus Barger Dreyer, which has offices in Corpus Christi, Dallas and Houston, grew by 44.4 percent in 2016, expanding to 78 lawyers compared with 54 in 2015. Houston-based Coats Rose grew in Dallas at the beginning of 2016 when it merged with Wright Ginsberg Brusilow. The firm grew by 31 percent in 2016, moving to 93 lawyers from 71 in 2015. Also, Langley & Banack of San Antonio grew by 25 percent, jumping to 80 lawyers in 2016 compared with 64 in 2015.

Only two firms among the 100 with the largest operations in Texas lost more than 10 percent of their lawyer headcounts in Texas in 2016. Litigation firm McKool Smith of Dallas shrank to 87 lawyers in Texas, down 11.2 percent compared with 98 in 2015; Martin, Disiere, Jefferson & Wisdom of Houston, another trial firm, dipped to 53 lawyers in 2016, down 18.5 percent compared with 65 the year before.

Nine of the 10 firms with the most lawyers in Texas in 2016 were based in Texas. The outlier is Norton Rose Fulbright, which was created in June 2013 when Houston-based Fulbright & Jaworski combined with U.K. firm Norton Rose. The firm had the most lawyers in Texas in 2016 with 463.

The other firms in the top 10 are either based in Houston or Dallas. The firms kept their same spots in the rankings as last year, except Thompson & Knight, which was ninth in 2016, moved up from the 10th position, trading places with Bracewell.

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