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Norton Rose CEO Peter Martyr has brushed off claims that next year’s merger with Fulbright & Jaworski will jeopardise the firm’s referral relationships with other US outfits, as concerns emerge among parts of the UK-headquartered firm that the tie-up could have a negative effect on some partners’ practices.
A number of Norton Rose partners in London and Canada are understood to be nervous about the impact of the deal on their ability to win referred work from US firms other than Fulbright, with the Canadian business particularly reliant on work passed on by firms in the States.
In addition, some City partners have practices almost entirely dependent on referrals from the US or from American firms in London such as Chicago-based Sidley Austin and New York’s Cravath Swaine & Moore, Simpson Thacher & Bartlett and Weil Gotshal & Manges, as well as a number of local or specialist firms, although of these, Weil is understood to be open to referring work to Norton Rose despite the deal. Sources have also indicated there are likely to be key departures in the wake of the merger being completed.
Areas such as corporate and regulatory are said to be particularly referral-heavy.
But Martyr, who will be CEO of Norton Rose Fulbright, told The Lawyer: “There will be a change in relationships. We have to accept that in the States there’s less anxiety about retaining a strategic relationship with what might be seen as strategic rivals. In this country [the UK], if you get instructed on something and another firm gets another bit of it, there’s incredible tension. Our relationships are with specialists – I don’t think they’ll change.”
He later added in a statement: “Of course the question of referrals was discussed with everybody, and corporate obviously were heavily involved. No partners [across the firm] voted against.”
A number of figures close to the firms have highlighted the ranks of Norton Rose partners in London and Canada expressing concerns about the impact of the merger, with one in the US commenting: “The culture in America is that you can [work together with rivals], but the bottom line is it’s definitely going to affect people on both sides. You always do the cost-benefit analysis and say these are where we get our referrals from. It’s a done deal in actuality but there are a lot of partners who are unhappy – there are groups that may leave.”
Another source said: “There are some partners who historically have had informal relationships with a whole bundle of other US firms in the States. Are we going to get as much or more work [they will say]? I’ve spoken with partners who fall both sides of these lines.”
Norton Rose’s merger with Houston-based Fulbright is set to go live on 1 June next year, creating the third-largest firm in the world by lawyer headcount (14 November 2012).