Focus: Greenberg Traurig Maher
22 June 2009 | By Catrin Griffiths
Finally, Maher gets to run his own show - with his name on the door. The best thing about setting up Greenberg Traurig’s European operation, says Paul Maher, is the autonomy.
“I’ve got a massive opportunity to start with a blank piece of paper in London,” he declares. “[Greenberg] wanted to do something transformational.”
As The Lawyer revealed last week (15 June), Maher now has his name on the door. Greenberg’s UK arm will be known as Greenberg Traurig Maher (GTM) - an unprecedented move by a US firm, underscoring how much it has bought into Maher’s vision.
The news of Maher’s move provoked much debate about the relative pecking order between Greenberg and Mayer Brown on TheLawyer. com. “Greenberg is most definitely a third-tier firm in the US and rarely gets attorneys from the top 25 law schools,” reads one. “We will see if Maher can make something different and better.”
“Greenberg isn’t a ‘top-tier’ firm in the sense of prestige or massive deals,” counters another. “But it’s a large and very fast-growing firm in the US in terms of overall size; and more importantly, it’s a place someone like Maher - talented, ambitious, but not exactly a team player - can build a practice unfettered by the rest of the firm.”
Greenberg president Richard Rosenbaum candidly admits that his firm is not part of the white-shoe Wall Street establishment. “The fact that we have our roots in the mid-market, and entrepreneurs, we’re not embarrassed about that,” he says. “In the US we went through a period when everything was about Wall Street. But now it’s all about Main Street. If you were only in New York, you’d be laying off hundreds of lawyers right now. Being connected to the middle market is a positive.”
Greenberg’s rise has not gone unnoticed in the US. “They’ve traditionally been seen as a very rough and ready firm,” says a prominent New York headhunter. “It’s kind of like where Latham [& Watkins] or Weil [Gotshal & Manges] were 10 years ago.”
Greenberg is structured as a corporate; partners are termed shareholders and office leaders have the freedom to adapt to local market practice - so long as they meet the targets agreed with Greenberg CEO Cesar Alvarez and Rosenbaum. What Maher has bought into is the freedom to run things his way.
The autonomy that has been granted to Maher will affect the firm’s relationship with Olswang. It is impossible to see how it could do otherwise.
Greenberg’s alliance with Olswang was announced in 2005, but it never fully entered the consciousness of the UK market. To the surprise of sources close to Greenberg, however, Olswang maintains that its relationship with the US firm is entirely “unchanged” post-Maher.
Such a stance flies in the face of normal practice. If, as Olswang maintains, the relationship remains the same, then Greenberg would be in the highly unusual position of referring work to both GTM, an organisation with which it shares profit, and to Olswang, an organisation with which it does not (see box).
Certainly, Olswang would expect to benefit from referrals while GTM is still in embryonic form. But both sides are downplaying the value of referral business, which is hardly an endorsement of the success of the alliance. Indeed, the only way Olswang can maintain this level of referrals is if GTM remains a tiny outpost - and it is clear from speaking to both Maher and Rosenbaum that GTM has major growth targets.
“We’d like to build a substantial pan-European practice to sit beside a substantial US practice,” insists Maher.
“We go to places to ultimately be a full-service firm with a strong local, committed office that’s connected to a large platform. A full-service operation probably means several hundred lawyers over time. We want to have one of the pre-eminent top-tier practices in M&A. We have a very strong corporate practice generally and therefore want to include capital markets, real estate, competition.”
These are not the words of a man who would be happy with a boutique player in London.
GTM already has three partners in London. Along with Maher, there is Cate Sharp, former head of environmental law at Mayer Brown London, and corporate partner Fiona Adams. Both have joined as co-managing partners. Their arrivals led to comments bordering on the sexist on TheLawyer. com - some posters branded them as female acolytes, with Maher as puppetmaster.
Adams and Sharp dismiss such talk. “It’s easy, if you’re looking to make a snidey comment, to say that,” says Adams. “But it’s clearly written by people who don’t know who we are.”
“Maybe people are surprised that it’s two women who were the first to join, and that two women will manage the London office,” adds Sharp. “It just shows that Paul isn’t a sexist person.”
Greenberg is helped by the fact that launching in a recession is paradoxically easier than in a boom when it comes to partner recruitment - something that Gareth Quarry, whom Maher retained as his agent after his decision to leave Mayer Brown, is clearly relishing. All recruiters talk up interest in their clients, but Quarry claims that Greenberg is a little bit different. “This isn’t a typical law firm paying lip service to the Brits,” he argues. “So many US firms say that their London partners have a voice. Then you talk to Brits in the London office and they’d snort with derision.”
There is a slight difference here. There will only be one UK voice that matters at a management level - Maher’s. Instead, Alvarez prefers to dwell on what he and his colleagues regard as the “unique” Greenberg culture. “The important thing to us in London is that Paul’s able to attract enough lawyers to London and create a culture of self-empowerment without politics or bureaucracy,” he says.
Fast decision-making has been the key to Greenberg’s development into to a $1.2bn (£738.4m)-turnover firm and is the reason it has hired no fewer than 30 partners since January.
“People dislike politics, committees, an inability to get what you want done,” says Alvarez. “We don’t have committees, we have human beings who you can talk to and get an answer from. We’ve never imposed a practice strategy on any office.”
However, such velocity has got Greenberg into hot water in the past, as documented by the US media. Most notoriously, it hired now-disgraced Washington DC lobbyist Jack Abramoff, who helped con Native American tribes out of millions of dollars. Since November 2006 he has been languishing in a federal jail in Maryland.
In 2007 The American Lawyer claimed Greenberg had paid up to tens of millions in fines and settlements to clean up the messes made by a series of unchecked individuals.
Calling the shots
The lack of bureaucracy underpins another major feature of Greenberg’s culture: the closed compensation system. No partner, or shareholder, knows how much anyone else is paid. For Maher, who was paid more than £1m at Mayer Brown, it is an essential component in his attempt to refashion the modern law firm. “What drives law firms mad in my experience is people’s obsession with their differentials,” says Maher. “If you can create the right trust between management and your shareholders, a closed system gets rid of a lot of that nonsense.”
All of this suits Maher, whose impatience with the management shenanigans at Mayer Brown has been well documented. At GTM he gets to call all the shots - and that’s just the way he likes it. Whether Greenberg’s lack of transparency will be attractive to London lawyers is another thing.
The Olswang response
Upon publication of The Lawyer’s story last week (15 June), an Olswang spokesperson insisted that Greenberg would not be ditching its alliance and that its relationship was “unchanged”.
So The Lawyer put the following questions to Olswang:
•Does ‘unchanged’ have a time limit? Is this seen as a relationship unchanged in perpetuity or in the short term? What are Olswang’s future expectations of the alliance?
•What level of work does Olswang still expect from Greenberg following its launch in London?
•What does Olswang understand to be Greenberg’s strategic intentions in London?
•Given that Maher will be running London, has Olswang made any overtures to Greenberg’s London operation, known as GTM? Does Olswang have any guarantees?
•As GTM grows, what would be the economic interest in Greenberg referring work to an organisation with which it does not share profits?
Olswang declined to answer any of the questions, which were emailed to the firm on 17 June.
But then, on 18 June, managing partner David Stewart emailed his firm about the Greenberg story, a copy of which leaked to website RollOnFriday. In it, he noted that the alliance was in any case due to expire this December, that referral business was small and that Olswang wants to continue its ‘friendship’ with Greenberg.
Speaking to The Lawyer, Greenberg president Richard Rosenbaum said: “As a technical matter the alliance continues. But in six to 12 months we’ll have to have important discussions with Olswang about whether and how we go forward together. How we deal with this and how we build the office is ultimately going to be led by Paul.”