California Firms Throughout the Am Law 200 Coasted in 2019
Across the state, most firms outpaced the industry average for growth last year.
May 18, 2020 at 09:52 AM
4 minute read
It seems like an eternity ago now, but 2019 proved to be a banner year for the blue-chip law firms with roots in Southern California and the San Francisco Bay Area.
The two highest-grossing firms with historic ties to Los Angeles—Latham & Watkins and Gibson, Dunn & Crutcher—both posted double-digit revenue increases. Latham grew by 11.3%, while Gibson Dunn grew by 10.4%.
"Across practice groups, across offices, it was a fabulous year," says Gibson Dunn's Los Angeles-based chairman and managing partner Kenneth Doran, whose firm crossed the $2 billion mark for the first time.
Two other large SoCal-based firms, Sheppard Mullin and Lewis Brisbois Bisgaard & Smith, also had years to be proud of, with the former showing a 13% boost in revenue and the latter hitting 16.3%.
The news was also good for the biggest players in Northern California, with their strong ties to the Bay Area's tech economy. Wilson Sonsini Goodrich & Rosati led the way with 12.1% growth, followed by Orrick, Herrington & Sutcliffe at 10.8%, Morrison & Foerster at 10%, Fenwick & West at 9.8% and Cooley at 8.4%. All of this came in a year in which the average Am Law 200 firm grew its revenue by 5%—a strong result that was buoyed by the major steps forward among the California elites.
Cooley CEO and chairman Joe Conroy calls 2019 an "amazing" year on the corporate side, pointing to high demand for work on venture financing and big-time deals involving tech businesses.
Success also accrued to a range of other California firms with widely differing characteristics. San Francisco-based Gordon Rees Scully Mansukhani, which has offices in every state in the country, jumped into the Am Law 100 with an 11.9% climb in revenue.
In the Second Hundred, Los Angeles-based Buchalter posted its second straight year of growth in excess of 15%, hitting 17.3%. Orange County-based intellectual property specialists Knobbe Martens grew revenue by 12.1%. And 170-attorney, San Francisco-based Hanson Bridgett was one of three firms to spring onto the Am Law 200 for the first time.
"It was the strength of the economy and, particularly, California's position within the global economy," San Francisco-based recruiter Avis Caravello says. "Tech, private equity, venture capital, biotech—it was just a perfect alignment."
While most firms delivered growth in 2019, both nationally and especially in California, Los Angeles' Irell & Manella saw revenue and head count contract for a fourth straight year. The firm's top line dropped by 12% to $151.6 million, while its 87 lawyers are a fraction of the 199 who called the firm home in 2009. This February, the firm announced a strategy that put the declines in context: It was largely abandoning transactional work to focus on high-value litigation.
With the economic consequences of the COVID-19 pandemic still unfolding, it wouldn't be shocking to see other firms make similar bold strategic choices. But Caravello believes the largest firms in California are well positioned to withstand the stresses of the moment, particularly in comparison to the experience of the dot-com bust in the early 2000s.
"These California firms are global firms now," she says. "I think they are on much stronger footing, much like their New York counterparts have always been, to weather the economic instability that we're currently facing."
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