Stradling Yocca Carlson & Rauth plans to add seven or more lawyers this year in a bid to bolster the Newport Beach law firm’s business doing corporate work and securities litigation.
Stradling now has 120 lawyers, most in Orange County. It’s the No. 3 law firm in the county, after Costa Mesa-based Rutan & Tucker LLP and Irvine’s Knobbe Martens Olson & Bear LLP.
The firm is looking to build on what it said drove its business in 2007,deals and defending companies against litigation.
“We’re going after more work like that,” said Mike Flynn, who heads Stradling’s executive committee.
Adding more lawyers should allow Stradling to take on work it otherwise would have to turn down, he said.
The firm is using headhunters to recruit mid-level to senior level associates from national law firms who have experience in corporate and securities law, Flynn said.
“We’re looking for experienced attorneys who’ve been well trained at national firms that can manage significant matters with little supervision,” he said.
Stradling largely competes with national firms, many with local offices.
In the past year, Stradling has defended companies against class-action lawsuits, worked on probes of misdated stock options and lawsuits related to acquisitions.
It worked on a couple of headline-grabbing deals in late 2007: Irvine-based Yard House Restaurants LLC’s sale of a 70% stake to San Francisco-based private equity firm TSG Consumer Partners, a deal estimated at about $200 million; and Irvine-based Specific Media Inc.’s $100 million in funding from Menlo Park’s Francisco Partners.
Stradling doesn’t plan to add lawyers in other parts of its practice, including real estate and estate planning.
Flynn said he doesn’t want to see any lawyers leave, though he said some could feel like they’re playing second fiddle.
The firm has “to adapt to the changes with our clients,” he said. “That’s our primary focus.”
Stradling’s lost a few lawyers in recent years.
In 2006, it saw seven lawyers leave to join the local office of Bingham McCutchen LLP. In November, Bingham nabbed a former partner at Stradling, Robert Funsten, to head up its new West Coast healthcare practice.
Straddling, which has offices in Sacramento, Santa Barbara, San Francisco and San Diego, has carved its niche in OC by serving small to midsize private and publicly traded companies in technology, healthcare, consumer products and restaurants.
The firm looks to help companies with everything from litigation, tax work and venture financing to initial public offerings and mergers and acquisitions.
Stradling worked on Irvine medical device maker IntraLase Corp.’s 2004 public offering and its 2007 sale to Santa Ana’s Advanced Medical Optics Inc. for $808 million.
In October, the firm helped North Carolina’s TranS1Inc., maker of a surgical device to treat back pain, stage an $82.5 million initial public offering.
Along with the Yard House and Specific Media work, deals like this have raised the bar for Stradling lawyers, Flynn said.
The firm doesn’t disclose revenue but saw it grow 20% last year, according to Flynn.
Growing Stradling’s corporate practice and securities work could meet revenue expectations, if not surpass them this year, he said.
With a slowing economy, 2008 could be a good year for acquisitions, according to Gary Douglas, founder of Mid Marketplace.com, a Newport Beach-based Web site for business owners and investors.
“Law firms will play a huge role in how those transactions play out,” Douglas said.
But public offerings could see a slowdown this year, he said. Litigation for public companies should hold strong, according to Douglas.
“Law firms that see these trends are staffing up now,” he said.
