Several law firms with OC presences are growing their area operations noticeably—by different metrics and in varied ways.
• Orrick added an M&A practice and partner to its OC office.
• McCune Wright Arevalo entered OC from its Inland Empire base.
• Troutman Sanders’ bump is coming on the national acquisition of Pepper Hamilton.
• Crowell & Moring tapped a trend in regulatory legal eagling.
• K&L Gates doubled lawyer count incrementally through 2019.
K&L added five attorneys in its corporate practice, three in litigation, and 14 overall.
Whether buying, hiring or expanding, law firms saw—and see—opportunity for growth in OC.
Irvine Calling
All six firms are in Irvine—with four in the same office tower complex: Jamboree Center, at the San Diego (405) Freeway and Jamboree Road.
Atlanta-based Troutman, locally at 5 Park Plaza, is buying Philadelphia-based Pepper Hamilton, in 4 Park Plaza; K&L Gates, based in Pittsburgh, is at 1 Park Plaza; Washington, D.C.-based Crowell & Moring is in tower No. 3.
Orrick is a few blocks away on Main Street at the Irvine Concourse.
McCune took space at 18565 Jamboree Road—one of the buildings at The Boardwalk, a new office project from Trammell Crow, and is about to get a new neighbor: Rutan & Tucker, planning to complete its own move-in there by June (see related story, page 1).
New, Old
New Boardwalk offices aside, the two firms couldn’t be more different.
Rutan is OC-based and charts its history here to 1906; Theodore Roosevelt was president. Now with 143 attorneys, it’s the second-largest firm here and the largest full-service one. McCune is a baker’s dozen years old, an OC newcomer and has four local lawyers—too small to qualify for the Business Journal list (see page 35).
It has big plans, though.
McCune largely litigates for the little guy, opposing banks and carmakers in class actions, for instance, molded more like longtime area trial lawyers Robinson Calcagnie or Callahan & Blaine.
The Ontario-based firm began in consumer fraud and moved into product liability and catastrophic personal injury, among other areas.
Cases have involved shareholder disputes, and a new hire at a startup who later developed a similar product and sold the company and concept for $10 million.
It’s added offices in Illinois and New Jersey, in addition to SoCal, coming to Irvine mid-2019.
Clients want “a firm in [their] area. That’s why we are here,” said co-founder and Managing Partner Richard McCune. “We want to be part of the community we serve.”
He expects firmwide revenue to grow 25% to 50% this year, with OC a primary driver of that.
Addition, Subtraction
A second duo of neighboring law firms is nearly nearer to each with the merger of Troutman Sanders and Pepper Hamilton set to close April 1.
The fully integrated new firm—Troutman Pepper Hamilton Sanders—has about 60 attorneys and partners here and would be a top 10 OC firm by that count.
Nationally, it will have 1,100 attorneys at 23 offices in eight of the 10 most active legal markets in the U.S.
Irvine was one of only three U.S. cities where both firms had a presence.
A linkup “lets us offer clients more resources and bench strength,” Troutman Managing Partner Larry Cerutti told the Business Journal.
Similar cultures —“client care and collaboration”—and complementary practice areas made it a good mix, he said.
“Pepper Hamilton has robust life sciences, healthcare, and private equity,” while Troutman chops are strong in “energy, banking and finance, and insurance.”
The former had strengthened health sciences work here with a new focus for those firms on data privacy (see related item page 22). About 15% of Troutman attorneys firmwide handle its energy work.
The new firm will have $855 million in revenue and could crack the Am Law 50 list of top-grossing U.S. law firms.
Pepper Hamilton is locally led by Managing Partner David Allen; the firms declined comment on leadership moves coming after April.
Mergers, Acquisitions
M&A touched Orrick—formally Orrick, Herrington & Sutcliffe—as well.
It added corporate transactional work in the area said Co-Managing Partner Don Field.
The San Francisco-based firm has corporate transaction groups “in many of our 27 offices, but it’s something we didn’t have here.”
To start it, the firm drew partner Bryan Gadol from Morgan, Lewis & Bockius in August. Gadol brought an associate and a paralegal over from Costa Mesa.
Gadol has since advised on deals with local connections including payment processor BlueSnap’s buy of Armatic Technologies Inc. in Irvine, which brought a return for several local investors, and the acquisition of Irvine-based Benchmark Cosmetic Laboratories by developer and manufacturer Knowlton Development Corp. in November.
Benchmark clients include cosmetics firm Drunk Elephant, founded here and sold to Shiseido Co. for $845 million in October.
Attorneys, Generally
Crowell & Moring in January launched a new local practice geared to compliance with state laws and their attorneys general actions.
The new work fits into the firm’s efforts in media, privacy and regulatory areas and is led by an ex-Missouri assistant attorney general Clayton Friedman and Michael Yaghi. Both came over from Sidley Austin in Costa Mesa.
“We were [a] missing piece in their OC office,” Friedman said.
Friedman and Yaghi have worked on cases with Crowell & Moring attorneys including advertising and media co-chair Chris Cole.
Another piece: Natalie Ludaway, former chief deputy attorney general for the District of Columbia, who joined the firmwide attorney general work in March and is based out of the firm’s Washington, D.C. headquarters.
Friedman said attorney general work is relatively new but not unheard of. Demand ebbs and flows depending on the specific states and which parties happen to be in power; California has a rep for regulation, including its new online privacy act affecting consumer data and companies that hit in January as Crowell formed the new practice here.
“We anticipate more California AG enforcement after July 1,” Yaghi said.
Office Space
Law firms remain a prized tenant for landlords owning high-end space in the area, although industry trends over the past decade have seen most firms opt to do more with less, in terms of their total square footage.
Thank the move toward digitization for part of the consolidation, along with trends toward less formal offices and more open space.
The average floorspace per law firm partner stands at 1,825 square feet, reflecting a reduction of 6.3% from year-ago levels, according to recent national data from commercial brokerage Colliers. At the same time, the average rent paid by those firms is up nearly 6% year-over-year.
Here’s a look at some notable office movers and shakers among the area’s legal firms:
• Troutman Sanders has about 40,000 square feet at Jamboree Center and a shade under 50 attorneys and support staff; it’ll add about a dozen lawyers in absorbing Pepper Hamilton, which is vacating its offices in a nearby tower.
• McCune Wright Arevalo moved into 3,200 square feet at The Boardwalk, a few floors below Rutan & Tucker, which expects to occupy 72,000 square feet there. The latter has two and a half floors; McCune has Suite 550.
• Orrick officials said they are looking to take more space when its lease at Irvine Concourse ends next year. It has 24,000 square feet and plans to negotiate for more at its existing complex, or look for new space near John Wayne Airport or Newport Center.
K&L Gates planned for growth with its 40,000 square feet at Jamboree Center. Managing Partner Michael Hedge said the firm added 14 attorneys and partners last year for a total of 27 and isn’t done yet.
“We’ve been in this space about six years and have enough room to go to more than 50 [attorneys].”