US fees and profits: more, more, more

Jones Day and White & Case clear 20 per cent growth; Latham joins $1bn club; Kirkland enters AmLaw top 10 for first time

US firms have had another bumper year, according to the latest AmLaw 100 figures.

Seven firms out of the US top 10 posted double-digit increases in turnover, with both Jones Day and White & Case increasing revenues by more than 20 per cent. Jones Day grossed just over a billion dollars, while White & Case turned over $811m (£446.6m) – on track for breaking the billion-dollar revenue barrier in 2005.

Latham & Watkins’ turnover rose by 14 per cent to $1.03bn (£568.8m), putting it in the billion-dollar category for the first time, joining Baker & McKenzie, Jones Day and Skadden Arps Slate Meagher & Flom.

Meanwhile, Kirkland & Ellis made the AmLaw top 10 for the first time, displacing McDermott Will & Emery with a revenue increase of 18.7 per cent.

Kirkland’s figures were underpinned by a strong performance in private equity and bankruptcy; it worked on the restructurings of Conseco and United Airlines and handled a series of deals for Bain Capital and Vestar Capital Partners, among others.

Other major movers were Reed Smith, with a turnover leap of 40.6 per cent to $441.5m (£243.1m), taking it into the top 50 for the first time, and Greenberg Traurig, whose 23.1 per cent rise to $572.5m (£315.3m) propelled it into the top 20. Both firms have aimed for growth, with Miami-based Greenberg hiring from Wilson Sonsini to open in Silicon Valley and launching practices in Switzerland and the Netherlands.

Reed Smith’s revenue figures are almost entirely boosted by a series of aggressive mergers. Having already taken on teams in New York and Virginia, it merged with 215-lawyer California firm Crosby Heafey Roach & May in January 2003.

The Wall Street elite had a less spectacular year in revenue terms. Sullivan & Cromwell recorded a strong 10.1 per cent rise to $687m (£378.3m), but Davis Polk & Wardwell and Simpson Thacher & Bartlett only managed 3 per cent to $587m (£323.2m) and 6.1 per cent to $576.5m (£317.5m) respectively.

Two new entrants to the AmLaw 100 recorded big jumps in turnover. IP specialist Fish & Richardson translated an 18.7 per cent rise in headcount into a 20.1 per cent revenue rise, to $197.5m (£108.8m), which placed it 95th in the table. Litigation boutique Preston Gates & Ellis – home of Bill Gates’ father – posted a 25.6 per cent increase in turnover to $189m (£104.1m), at 100th in the table.

New York firms inevitably still dominate the profits per equity partner charts. Wach-tell Lipton Rosen & Katz still has the richest partners in the US, but it did not equal last year’s record-breaking figures. Profits were down 11 per cent to a mere $2.6m (£1.4m).

One of the most astounding performers in the profits tables was leveraged finance specialist Cahill Gordon & Reindel. Its revenue per lawyer increased 23.5 per cent, which helped take profits up 30.4 per cent to $2.4m (£1.3m) – second in the table.

But even Cahill was outperformed by litigation specialist Dickstein Shapiro Morin & Oshinsky, which saw its revenue per lawyer shoot up 34.7 per cent – powering an astonishing profits rise of 58.6 per cent to $1.9m (£1m).

Top 20 US firms by turnover
Firm 2003 gross revenue $m (£m) % change in gross Profits per partner $K (£K) % change in PPP Lawyers
1 Skadden Arps 1,330.0 (732.4) 1.5 1,600 (881) -0.3 1,650
2 Baker & McKenzie 1,134.0 (624.4) 7.0 595 (328) 0.0 3,053
3 Jones Day 1,035.0 (569.9) 20.9 635 (350) 10.4 1,970
4 Latham & Watkins 1,033.0 (568.8) 14.0 1,275 (702) 11.8 1,513
5 Sidley Austin Brown & Wood 926.0 (509.9) 11.4 895 (493) 9.8 1,421
6 Mayer Brown Rowe & Maw 813.0 (447.7) 15.3 820 (452) 12.3 1,249
7 White & Case 811.0 (446.6) 20.1 1,010 (556) 8.0 1,552
8 Weil Gotshal & Manges 801.0 (441.1) 16.4 1,505 (829) 15.8 1,015
9 Shearman & Sterling 730.5 (402.3) 4.4 1,215 (669) -4.7 988
10 Kirkland & Ellis 725.0 (399.2) 18.7 1,900 (1,046) 5.6 854
11 Sullivan & Cromwell 687.0 (378.3) 10.1 1,900 (1,046) 10.5 647
12 McDermott Will & Emery 668.0 (367.8) 6.4 1,115 (614) 4.2 901
13 O’Melveny & Myers 658.0 (362.3) 16.5 1,280 (705) 13.3 909
14 Gibson Dunn & Crutcher 645.5 (355.5) 13.4 1,375 (757) 16.0 747
15 Morgan Lewis & Bockius 631.0 (347.5) 13.2 825 (454) 14.6 1,063
16 Davis Polk & Wardwell 587.0 (323.2) 3.0 1,925 (1,060) 8.5 581
17 Akin Gump Strauss Hauer & Feld 585.0 (322.1) 1.7 865 (476) 16.9 832
18 Cleary Gottlieb Steen & Hamilton 580.0 (319.4) 9.2 1,445 (796) 0.0 758
19 Simpson Thacher & Bartlett 576.5 (317.5) 6.1 1,940 (1,068) 5.1 637
20 Greenberg Traurig 572.5 (315.3) 23.1 875 (482) 12.2 952
 
Source: AmLaw 100

Top 10 US firms by profits per partner
Firm 2003 PPP* $K (£K) % change in PPP
1 Wachtell 2,585 (1,423) -11.5
2 Cahill Gordon 2,405 (1,324) 30.4
3 Cravath 2,080 (1,145) 6.1
4 Simpson Thacher 1,940 (1,068) 5.1
5 Dickstein Shapiro 1,935 (1,066) 58.6
6 Davis Polk 1,925 (1,060) 8.5
=7 Kirkland & Ellis 1,900 (1,046) 5.6
=7 Sullivan & Cromwell 1,900 (1,046) 10.5
9 Paul Weiss 1,840 (1,013) 5.7
10 Milbank Tweed 1,820 (1,002) 2.0
 
*profits per partner
Source: AmLaw 100

Most profitable non-New York firms
Firm $K (£K)
1 Dickstein Shapiro 1,935 (1,066)
2 Kirkland & Ellis 1,900 (1,046)
3 Gibson Dunn & Crutcher 1,375 (757)
4 O’Melveny & Myers 1,280 (705)
5 Latham & Watkins 1,275 (702)
6 McDermott Will & Emery 1,115 (614)
7 Howrey Simon 1,090 (600)
8 Paul Hastings 1,060 (584)
9 Bingham McCutchen 1,055 (581)
10 Goodwin Procter 1,025 (564)
 
Source: AmLaw 100