This week The Lawyer publishes the first-ever investigation into the relative sizes of litigation practices on both sides of the Atlantic. By extension, it’s a crucial indicator as to which firms may be the busiest in the coming year (see story).
Inevitably our table is skewed towards the Americans because of the sheer depth of their domestic litigation market. And of course, their fused profession helps. The top 30 sets in the UK, according to The Lawyer UK 200 Annual Report 2008, turn over nearly £700m between them, which would have bumped up the UK firms’ figures a little.
But let’s dig a little deeper. Litigation is not the safety belt many firms would like, as the omission of Heller Ehrman underlines. As it is now defunct, we didn’t include it in our table, but it is an instructive tale. One of the reasons Heller began to unravel was that its culture wasn’t sufficiently robust to withstand the trigger of a couple of unexpected settlements in major cases on which the firm was relying.
Similarly, Clifford Chance’s US litigation practice, which laid off 20 lawyers earlier this year, did not see any significant upturn in work, despite previous assumptions to the contrary. Various settlements, again, played their part here.
US firms’ dependence on their home market cannot continue for ever. The larger firms are undergoing a change of thinking in this regard. Even classy US litigation dynamo Paul Weiss knows that its reliance on domestic work will have to change. We have an exclusive interview with Paul Weiss’s chairman-elect Brad Karp (see page 18). He is taking over the firm at a fascinating point in its development, when it is starting to shed its traditional aloofness from the global market.
Last year the only UK firms outside the magic circle to gross more than £100m in disputes work were Clyde & Co, Eversheds, Herbert Smith and Lovells. All happen to be targeting the Middle East at present. Similarly, Freshfields’ litigation practice now derives half of its revenue from outside the UK. UK firms have always farmed outside their home market – they’ve had to. But they’ll be facing a little more competition from the Americans from now on.