Author Archives: Hanover Legal

Happy New Year and Full Steam Ahead

As we head into 2015, our major law firms are by and large optimistic with respect to their revenue and profitability, and eager to take opportunistic gambles on lateral talent as well as ventures into new markets.   This optimism is tempered however with the still-fresh memories of the brutal financial crisis of 2008 and the unprecedented law firm layoffs that followed, coupled with heightened sensitivity to the reality of the ongoing avalanche of major law firm collapses at a rate of one every year-and-a-half since the year 2000.

As such, while law firm managers are eager to grow strategically, they do so  with heightened due diligence and caution;  no firm wants to be the next Bingham McCutcheon, Dewey & LeBouef, Howrey, Heller Ehrman, Wolf Block, McKee Nelson, Thacher Profit, Thelen, Dreier or Brobeck.  Similarly, no attorney wants to be on board the next Titanic as it starts to sink.

As we enter our fifteenth year in business, Hanover Legal remains constantly vigilant of the health of our major law firms both financially and culturally and prepared to assist our finest attorneys in their efforts to secure spots at those most likely to provide enhanced stability as well as financial and cultural well-being to them going forward, and reciprocally to our finest firms in the increasingly fierce competition for top talent on the lateral attorney market.

We wish all our firm and attorney clients a healthy, happy and prosperous 2015!

One-Stop Shopping and the BigLaw Balloon

We are quickly approaching the end of Q2 2014 and heading into summer, but the open sky in which BigLaw flies is not likely to provide much rest and relaxation during the warmer months ahead. Relentless market winds offer constant opportunity to our stronger firms to increasingly distance themselves from their less healthy competitors, in particular those simply getting bigger.

A cursory comparison of the AmFlawed 100 ranking chart of America’s top-grossing law firms for the years 2009 and 2013 shows that while only two firms in 2009 exceeded gross revenue of $2 billion (Baker & McKenzie at $2,112,000,000 followed closely by Skadden at $2,100,000,000), five firms surpassed the $2 billion gross revenue mark in 2013: DLA at $2,481,000,000, followed by Baker & McKenzie at $2,419,000,000, Latham at $2,285,000,000, Skadden at $2,235,000,000 and Kirkland & Ellis at $2,016,000,000 — DLA’s jump to the lead of the pack in 2013 representing a more than doubling of their 2009 13th place finish of $1,014,500,000. Moreover, while in 2009 a total of 13 firms enjoyed gross revenue in excess of $1 billion, by 2013 almost double that number or 23 firms had surpassed the $1 billion barrier.

These gross revenue figures indicate an unabated urge to grow bigger presumably based on the premise that one-stop global shopping is an attractive marketing tool in the increasingly interconnected global business environment. While that may be true, big of course is not necessarily strong or healthy; the five most productive firms based on purported revenue-per-lawyer figures ranking only between 13th and 54th on the gross revenue chart, namely: 1) Wachtell, first in RPL at $2,310,000 but only 54th in gross revenue at $601,000,000; 2) Sullivan & Cromwell, second in RPL at $1,590,000 but 13th in gross revenue at $1,278,000,000; 3) Quinn Emanuel, third in RPL at $1,445,000 but 26th in gross revenue at $972,5000,000; 4) Cravath, fourth in RPL at $1,430,000 but only 52nd in gross revenue at $614,000,000; and 5) Simpson Thacher, fifth in RPL at $1,350,000 but 20th in gross revenue at $1,128,500,000.   While the saga of Dewey & LeBoeuf – which ranked towards the top of the AmFlawed chart in all categories across the board the very year they collapsed – dictates that the chart need be taken with salt, it also evidences the fact that big sometimes means dangerously obese but never in and of itself healthy.

That said, we at Hanover Legal always caution our candidates considering a new firm to focus on its health – not its rankings on the AmFlawed 100 chart.

37 Signs That Your Firm May Be Sinking

It does not take a legal market expert to know that the landscape of major law firms is changing like that of the polar ice caps. Since 2000 at least nine firms have collapsed from their perches amidst the Am-Flawed 100 directly into oblivion, namely: Dewey & LeBoeuf, Howrey, Heller Ehrman, Thacher Proffitt, McKee Nelson, Wolf Block, Dreier, Thelen, and Brobeck — or on average one firm every one and a half years.

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BigLaw Transparency: Kalis v. the Am-Flawed 100

Whatever one’s personal opinion of K&L Gates’ Chairman Peter Kalis, few can dispute his marketing genius. A master of the in-your-face quote who relishes the spotlight and misses no opportunity to place himself front and center for the legal market media, he deserves a lion’s share of the credit for taking a once relatively unknown law firm languishing under the radar in a small market town and turning it into one of the world’s greatest in terms of numbers of lawyers and offices as well as gross revenue and brand-name recognition.

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Happy Holidays from Hanover Legal!

As we fast approach the edge of the fiscal cliff and our first peek into 2013, Hanover Legal urges our clients to proceed cautiously.

Despite the enormous market uncertainty ahead, we are hopeful that our Congress will agree on a budget in the nick of time and our economy will be spared free-fall and the consequent unfathomable market casualties. On the flip side, if the storm is even nearly as dramatic as many fear, our strongest, most agile and best managed firms will enjoy a lateral feeding frenzy the likes of which the legal market has never before witnessed.

No matter how severe or not 2013 turns out to be, we promise to stay by your side offering our assessments and advice as we have done continuously since our founding in 2000 and during each and every market cataclysm we’ve encountered along the way.

May good karma be with us in 2013 and our market gods gentle. With that, please accept our warmest wishes for a happy, healthy and prosperous 2013!