London chief made first global committee chair
The most significant development is that, for the first time, the elite New York firm has appointed a London-based partner, Tom Reid, as chair of its international committee.
Davis Polk managing partner John Ettinger believes that fact alone points to the growing will among his partners for increased internationalisation.
“Ten years ago, if you’d said the partner leading the committee which helps analyse our international strategy would be one not based in New York it would have been almost unthinkable,” said Ettinger. “Now, no-one was surprised.”
Reid is charged with coordinating the firm’s revved-up thinking about its overseas presence. However, the London-based partner was keen to play down his new role’s significance.
But Reid issued a note of caution, stressing that growth can be volatile depending on the position in the economic cycle and that there are plenty of markets that could be busy today but are not sustainable in the long term.
“Each market’s different,” Reid adds. “We don’t think that one model fits all, but there are some things, such as the quality of lawyers and a client-driven strategy, that you can make uniform.”
Two of the busiest overseas markets for Davis Polk right now are India and Latin America. Reid says the firm is involved in two high-yield deals, two equity offerings and a brace of major M&A deals on the subcontinent alone.
“But we would have no plans to open an office there and we may look to expand our relationships with quality Indian lawyers,” says Reid.
In India Davis Polk works with several of the leading local firms, including Amarchand & Mangaldas & Suresh A Shroff & Co, Luthra & Luthra and AZB & Partners.
In other jurisdictions, such as Germany, where it has close ties with Hengeler Mueller, or the UK, where it is best friends with Slaughter and May, it prefers to work on a more exclusive basis.
In France Davis Polk has broken this mould with the hire of local lawyers, including JeantetAssociés managing partner Georges Terrier and corporate partner Christophe Perchet.
Firms that deal with fraudsters given reprieve
The case, Stoneridge Investment Partners v Scientific-Atlanta, centred on whether primary liability under Section 10 (b) of the Securities Exchange Act extended to third parties.
If the court had found for the plaintiffs it would have allowed shareholders to sue third-party companies that do business with another that is found to have committed fraud. The consequences for law firms could have been devastating.
As reported by The Lawyer last year (15 October 2007), the Supreme Court appeal of this securities class action appeared to have garnered input in the form of amicus briefs from every high-profile lawyer in town.
Now the case, which has also generated interest in political circles, may lead to new legislation aimed at protecting the rights of investors and the US capital markets themselves.
The Supreme Court judge who authored the ruling, Justice Anthony Kennedy, said Stoneridge had the power to deter overseas companies from doing business in the country because of the risk of being sued.
“That, in turn, may raise the cost of being a publicly traded company under our law and shift securities offerings away from domestic capital markets,” Kennedy added.
Allen & Overy litigation partner Michael Feldberg says he would “not be shocked” to see activity in Congress as a result of this decision.
“It’s an election year and I wouldn’t be surprised if there was now political pressure to pass new legislation that’s perceived to be investor-friendly,” Feldberg says.
He says Stoneridge is obviously a very important decision for advisers to securities issuers.
“It throws up a challenging hurdle for plaintiffs to overcome,” Feldberg adds. “It’s the latest in a line of Supreme Court decisions, which arguably stretches back as far as Central Bank in 1994, that will make it more difficult for plaintiffs to bring claims under Section 10 (b).”
New chiefs claim London is at the heart of strategy
Former managing partner of the New York office and the new global management committee chairman Dennis Fleischmann, plus the new head of New York Vincent Alfieri, were appointed to their roles last December. Don Lent remains chairman of Bryan Cave.
Fleischmann says that, although Bryan Cave is focused on growing its global footprint generally, London remains at the heart of its strategy.
“London’s importance continues to grow,” says Fleischmann. “We’re now one of the top 50 largest firms in New York and we’re always interested in more growth here, but London is also right at the top of the list of places we’d like to grow.”
Neither would say whether there were current talks in the City, but the past year has already seen significant growth in Bryan Cave’s London office. In September the City office hired two partners, including the head of Pinsent Masons‘ City corporate tax group Mark Cawthron.
Last month Bryan Cave sealed an alliance with Chinese firm Alpha & Leader, making it Alpha’s preferred counsel for US matters for its offices in Beijing, Hong Kong and Shanghai. Elsewhere it also opened its first offices in Germany, Hamburg and Milan.
Alfieri, who continues as the leader of Bryan Cave’s employment practice, took the opportunity of the firm’s rapid international growth to deflect the market perception that his firm remains a St Louis-based outfit.
“We’re a national and international firm commited to working across all our offices,” Alfieri insists.
St Louis remains Bryan Cave’s largest office.
Gibson dunn hire hikes fund formation nous
Gibson Dunn & Crutcher has made a little progress in its quest to strengthen one of its strategically pivotal areas in New York with the hire of Dewey & LeBoeuf partner Ed Nelson.
Co-chair of Gibson Dunn’s private equity group Edward Sopher reveals that the firm has been looking to expand its private fund formation capabilities for some time.
“Ed fits the bill perfectly,” says Sopher. “His addition will enable us to continue our strong momentum in the fund formation market and his experience with real estate funds will be particularly complementary.”
Nelson advised on fund formation deals for both sponsors and institutional investors while at Dewey. His bias is towards private equity funds, particularly those related to real estate.
At Dewey he worked on a number of major transactions for clients such as Olympus Partners, Graham Partners, GE Pension Trust, Swiss Re and General Motors.
Nelson says he was attracted by the opportunity at Gibson and, in particular, “the very established transactional private equity practice”.
In a statement, Dewey says: “We wish Edward all the best in his new venture and thank him for his contributions to the firm.”
Earlier Byrne in the USA blogs…
Cad’s no fad
Cadwalader’s redundancies continue to feature highly in the minds of most lawyers in New York this week.
It was a shock when it came, no doubt about it, but maybe not that much of a shock in hindsight.
In fact, when quizzed, most people I spoke to used the same word to describe the sackings: “Inevitable”.
One top New York partner put it so well I thought it only fair to share it: “Cads rode the high wave. They were cranking things out 24-7 at the height of the market. And you just can’t reposition that many lawyers quickly.”
The guessing game on who’s next is already in full swing.
January always looked like it was going to be the month the credit crunch fallout would start to show for real. This could be just the start.
-Posted: 16 January
Big plans for Big Apple
Guess which firm is the latest to break cover and start making sabre-rattling noises about its New York growth plans?
If you said “Arnold & Porter” you deserve an extra-special prize.
The DC-based firm isn’t particularly known for its all-out bombast, but check out Mike Gerrard, the firm’s New York head, on what’s in store this year: “The firm has adopted a much more aggressive lateral hiring programme than before.
“One of the firm’s top priorities is the growth of the New York office via laterals.”
Okay, that might not be a declaration of war exactly, but coming from A&P it’s tantamount to a battle cry.
Last year A&P’s New York office hired three laterals, a significant investment in what is a relatively small, all-equity partnership.
Now, according to Gerrard, the firm is in “very active talks” with several more.
The first-quarter shake-out is already well underway. Who would have thought A&P would be up there leading the charge?
– Posted: 18 January
To read more Byrne in the USA blogs, click here.