Firm targeting US and Europe for growth as it looks to make up ground on rivals. By Matt Byrne
Shearman & Sterling is aiming to increase its global litigation revenues significantly over the next few years in what amounts to an admission that its dispute resolution capabilities are currently underweight.
Shearman has one of the world’s highest-profile litigation and arbitration practices, and is particularly well known for current hot areas such as Foreign Corrupt Practices Act (FCPA) advice. Yet the total litigation revenue as a proportion of the firm’s overall fee income lags behind that of many of its competitors.
New York-based securities litigation partner Herb Washer says this is an area Shearman is now looking to address.
“Our goal is to grow litigation significantly over the next five years until it is at least a third of total revenue,” says Washer.
In a radical overhaul of Shearman’s strategy, the firm’s current level of litigation revenue, approximately just over 20 per cent of the fee income, is expected to mushroom.
“We plan to do this cautiously rather than aggressively,” adds Washer. “We won’t be going out there buying books of business. But recently we brought in two antitrust litigation partners [Edward Schwartz and James Donato] and two IP litigation partners [Scott Doyle and Michael Bednarek], plus we made up three partners [Richard Kelly in London, Daniel Laguardia in New York and Mark McNeill] in the last round. That’s a good start.”
Washer says he expects most of Shearman’s litigation growth to come in the US, with key areas it plans to enhance including securities litigation, regulatory enforcement and IP.
“We already have a very strong international arbitration practice headquartered out of Paris,” Washer adds, referring to the group headed by Emanuel Gaillard.
The firm is also seeing particular growth in its securities litigation practice and civil litigation relating to subprime-related CDOs.
Washer adds that the continuing growth in importance of white- collar fraud and FCPA-related matters is acting as a catalyst for Shearman’s litigation push.
“FCPA enforcement has become an explicit priority of the Department of Justice,” says Washer. “There’s not only a greater number of cases but the fines are trending upwards. There’s very big money at risk and companies are spending big money to defend themselves against allegations. There’s no doubt this is a significant driver for the growth of our practice and many of our competitors.”
Shearman partner Dan Newcomb is regarded by many as one of the trailblazers in relation to FCPA work. As Washer puts it, he’s “the father of FCPA”.
Shearman also has plenty of former government prosecutors on board, notably partner Philip Urofsky, to lend credibility to its criminal fraud practice.
“Another area of anticipated growth for us is UK litigation,” adds Usher.
Shearman’s City group is headed by former Freshfields Bruckhaus Deringer partner Jo Rickard, a department that is now expected to expand along with Paris, Germany and New York.”