An Irvine-based law firm with a quirky name is making a case for growth outside Orange County.
Payne & Fears LLP is getting its third office outside OC in as many years after agreeing to combine with San Francisco-based The Louderback Law Firm, which has 11 lawyers.
The deal is set to close this week.
The firm, which focuses on employment law and general business litigation, will have about 50 lawyers, including roughly 30 in Irvine, following the Louderback deal.
Payne & Fears opened its first office outside OC in 2003 in Los Angeles. It opened a second in Las Vegas in 2004.
James Payne, managing partner, said the firm is looking at possibly expanding to Dallas and Phoenix.
Payne & Fears is the ninth-largest OC-based law firm, based on the Business Journal’s annual list, which ranks firms by attorneys. Daniel Fears and Payne opened the firm in 1992.
“Both of us have a real entrepreneurial approach,” Payne said.
Defending Employers
Payne & Fears specializes in defending employers, counting clients such as 7-Eleven Inc., Boeing Co. and Bank of America Corp.
About half of Payne & Fears’ business is labor and employment law,areas that have seen a lot of growth.
Congress has passed laws that have increased the complexities of labor law in the past several years, Payne said.
At the same time, lawmakers in California and other states have passed their own labor laws, creating a patchwork legal system that makes legal advice more crucial for companies with widespread operations.
One example: the Americans with Disabilities Act, a federal law that’s been on the books for several years.
California has tweaked the rules, in many cases making them more onerous for companies.
“We try to help minimize the risk of litigation,” he said.
Overtime Suits
A newer area of concern: lawsuits that arise from employees who believe they should have been paid hourly wages,and overtime pay,instead of being treated as salaried workers.
In California, employers have to pay overtime to non-managing workers who work more than eight hours a day.
“This is a huge area in the employment and labor field,” he said. “These tend to be fairly large cases, and they require a lot of manpower from law firms.”
In April, software engineers at Redwood City-based video game maker Electronic Arts Inc. settled a $15 million suit for unpaid overtime. Payne & Fears wasn’t involved in the case.
Clients of Payne & Fears are asking the firm to deal with employment and labor issues in other cities.
Miami-based homebuilder Lennar Corp., which bases its regional operations in Aliso Viejo, tapped Payne & Fears to deal with issues that come with its huge housing developments.
The firm is representing Lennar in a lawsuit brought by its general liability insurance company. The insurance company is asking for $8 million from Lennar. That would cover what the insurer paid to settle a 4,000-home class-action action lawsuit involving construction defects. Lennar is asking for several million dollars in unpaid claims and bad-faith damages.
As part of the deal, Chuck Louderback, who ran the San Francisco law firm, was named a partner at Payne & Fears.
Louderback said he had been approached by much larger firms with as many as 500 lawyers. But he liked Payne & Fears partly because of its smaller size.
With fewer lawyers, Louderback can get to know his colleagues in different offices.
“It’s important for me to really know the attorney, to know who you’re working with,” he said. “I like to know them on a person-to-person level. If you’re at a national law firm with 500 lawyers, all you’re doing is just recommending someone you might not know at all.”
Louderback said he can help Payne & Fears navigate the courts and the challenges of defending employers in an area not known for being friendly to businesses.
“I know the Bay area,” he said.
Payne said he’ll enjoy transferring some of his work to the San Francisco office.
“It just makes sense to have an office up there,” he said. “I’m up there once a week.”
Leno Joke
The firm’s unusual name hasn’t hurt its growth. Instead, it’s landed some free marketing from the late-night talk show circuit.
Jay Leno featured the firm on “The Tonight Show” late last year.
Leno said, “Here’s a frightening law firm,these are not people you want to meet in court,the law firm of Payne & Fears.”
A clip of Leno’s joke, which drew big laughs from the audience, is featured on Payne & Fears’ Web site.
Other OC firms recently growing beyond the county line include Newport Beach-based Stradling, Yocca, Carlson & Rauth, the county’s third-largest firm.
Stradling opened an office in Santa Monica, joining others in San Francisco and Santa Barbara. The firm, which has about 100 lawyers, is looking to open an office in San Diego.
