August 10, 2015

LAW360

By Erin Coe

SAN DIEGO — Pulling in a rainmaker is often more than a way for a law firm to boost its bottom line. The addition of superstar talent also can help a firm advance practices that are part of long-term goals and strengthen its brand.

The main advantage of luring rainmakers is the big books of business they bring with them, but these lateral hires also can open avenues for the firm to draw new work and raise its stature in the legal community, according to legal experts.

“What the rainmaker is really bringing on board is additional clients that can be potentially serviced across the board, not just in the area where the lateral practices,” said Jack Zaremski, founder and president of Hanover Legal Personnel Services Inc. “The opportunities for the firm are potentially enormous, and they go well beyond the lateral’ portable book of business.”

In addition to increasing the firm’s revenue and client base, a rainmaker can bring an enhanced level of prominence and attention to the firm, according to Larry Watanabe, founder of legal recruitment firm Watanabe Nason LLC.

“This can enable a firm to create momentum for potential future lateral ‘star’ hires,” he said. “Properly handled and publicized, this can enrich a firm’s profile when others are considering a lateral move.”

At the same time, rainmaker hires are not for the faint of heart. These lateral moves tend to be a significant endeavor for firms because it’s not just a matter of getting a partner a new office and moving over a few clients, Zaremski said.

“These are complicated moves,” he said. “You’re talking about partners with a stable of clients and presumably other attorneys and professionals who they are bringing along in order to facilitate the transition. … Firms need to make sure the rainmaker is going to be a good fit culturally, because without that component, oftentimes these lateral moves could be a recipe for failure.”

The hiring of rainmakers also can be quite costly, according to Watanabe.

“More often than not, the laterals are guaranteed compensation packages for at least a two-year period, and compensation is of course predicated upon one’s ability to generate and deliver revenue,” he said.

Here, Law360 highlights five firms that have scored high-profile rainmakers in the U.S. this year and why each recruit is such a coup.

Latham & Watkins LLP

Latham has lured several prominent attorneys to its partnership in an effort to bolster its entertainment and intellectual property litigation practices.

The firm in June picked up Marvin Putnam, a star entertainment and IP litigator who helped AEG Live LLC successfully defend a $1.9 billion wrongful death trial brought by Michael Jackson’s family, from O’Melveny & Myers LLP for its Century City, California, office.

It also scored Michael Morin and David Frazier, veteran patent attorneys in pharmaceuticals and biotechnology who count Abbott Laboratories and AbbVie Inc. as clients, in February from Finnegan Henderson Farabow Garrett & Dunner LLP. A month later, Casey Dwyer, also of Finnegan, joined the pair in Latham’s Washington, D.C., office, bringing expertise in representing pharmaceutical companies in patent cases over top-selling drugs.

“These are all prominent, first-chair trial lawyers with a proven track record in success in high-profile matters for significant clients,” said Sean Berkowitz, global chair of Latham’s litigation department.

Putnam’s addition is expected to advance the firm’s strategy of growing a pre-eminent sports, entertainment and media practice in the Century City office, which was launched in November by Joseph Calabrese and four other former O’Melveny transactional and finance attorneys, according to Berkowitz.

And the three patent litigators are important for the firm’s plan to expand its IP department, particularly in pharmaceutical and biologics matters, according to Berkowitz.

“This is an area with a changing landscape in the drug world, and one we see as a strategic area of growth,” he said.

With the highest revenue of any law firm last year, Latham differs from its competitors in how it approaches star laterals, Berkowitz said. An addition must not just make strategic sense for the firm; the lawyer must mesh with the firm’s strong culture of collaboration and must have proven skills.

“We’re not looking to incrementally add to our bottom line,” he said.”It’s difficult for any one person to have a meaningful impact on the bottom line for a firm that has $2.6 billion in revenue. The focus is really on strategic fit, the attorneys’ reputations and cultural fit.”

King & Spalding LLP

In March, King & Spalding lured longtime trial lawyer Bobby Burchfield “ who was co-head of McDermott Will & Emery LLP’s D.C. office, a member of the firm’s management committee and its former head of complex litigation “ to the firm’s own complex litigation practice in the district.

Burchfield, who has more than 30 years of experience handling antitrust, securities and other complex corporate cases, has represented the Republican National Committee and U.S. Senate Majority Leader Mitch McConnell, R-Ky. He’s also known for his representation of President George W. Bush as general counsel during his re-election campaign.

“One of the strengths of our firm is our litigation and trial practice in the U.S. and globally,” said Sarah Borders, King & Spalding’s partner in charge of lateral hiring. “The addition of Bobby Burchfield to our bench is an important part of advancing our litigation strategy.”

The firm also reinforced its IP practice in its Houston office in February with the addition of John Barr Jr., who had been co-head of the IP litigation practice at Bracewell & Giuliani.

In July, Alexander Calfo, a product liability litigation heavyweight, joined the firm’s San Francisco office from Barnes & Thornburg LLP. Calfo, along with other attorneys, scored a win for Johnson & Johnson’s DePuy Orthopedics Inc. in October when a Texas federal jury unanimously cleared the company of accusations it manufactured a dangerous and defective metal-on-metal hip implant in a bellwether trial in multidistrict litigation over the company’s Pinnacle device.

And in January, the firm’s D.C. office netted Granta Nakayama, a top-flight environmental litigator from Kirkland & Ellis LLP with experience at the U.S. Environmental Protection Agency and at the U.S. Navy’s nuclear service as an engineer.

King & Spalding is not just focused on adding to its bottom line; it is interested in investing in its business, Borders said.

“We’re always trying to develop our brand and make sure we’re the franchise of choice for clients,” she said. “Part of why we are successful in attracting lawyers to the firm is that we are able to clearly articulate what the opportunity is at King & Spalding and what the strategy of the firm is. Some people are up for the challenge, and others are not. … Then we invest in those partners who have the practices that are consistent with our strategy. Our approach to lateral hiring is very integrated with our firm’s strategy.”

Paul Hastings LLP

Hiring 16 partners in the U.S. alone, the firm has brought in more partners so far this year than it added in all of 2014. Among the new lawyers are four key rainmakers who are expected to take the firm’s mergers and acquisitions, patent and white collar practices to new heights.

The firm in March picked up David Shine, previously the co-head of Fried Frank Harris Shriver & Jacobson LLP’s M&A practice, to lead its M&A group in New York. Shine works on private equity investments and health care megamergers, such as advising Merck & Co. on its $14.2 billion spinoff of its consumer products line to Bayer AG last year. He also has represented Northrop Grumman Corp., GE Capital Corp., Medco Health Solutions Inc. and Vodafone Group PLC.

Also that month, Paul Hastings bolstered its patent litigation team with former McDermott high-stakes technology aces Yar Chaikovsky and Blair Jacobs, bringing with them a half dozen other former McDermott IP partners to its Palo Alto and D.C. offices. Chaikovsky joined the firm as its new global IP practice vice chair.

Since joining the firm, Chaikovsky notched a victory for security software company Trend Micro Inc. in a high-stakes case against Intellectual Ventures LLC in April when a Delaware federal judge held that two of Intellectual Ventures’ anti-virus patents were invalid for claiming abstract ideas.

In addition, Jacobs and Chaikovsky scored big for chipmaker Fairchild Semiconductor Corp. in June when a Delaware federal jury found that rival Power Integrations Inc. induced infringement of Fairchild’s patent used in power converters, awarding nearly $2.4 million to Fairchild. The jury also awarded Power Integrations $100,000 upon finding that Fairchild infringed one of its patents at issue.

The three additions follow the firm’s high-profile hiring in February of ex-Squire Patton Boggs LLP litigator Robert Luskin, a big name in the world of white collar and Foreign Corrupt Practices Act investigations. He has represented New Jersey Gov. Chris Christie, disgraced cyclist Lance Armstrong and classified ad site Backpage.com.

Paul Weiss Rifkind Wharton & Garrison LLP

In January, the firm hired Taurie Zeitzer, a prominent private equity rainmaker from Kirkland, to join its corporate transactions team in New York.

Zeitzer, who is known for bringing in multibillion-dollar deals, has a long-standing relationship with PE giant Apollo Global Management and has handled many of its deals as well as those of its portfolio companies, including Verso Paper Corp. and alkylamines producer Taminco Global Chemical Corp. She also has worked with Searchlight Capital Partners.

The firm’s best lateral hires have become fully integrated members of the firm, working seamlessly with its partners and clients and generating new work from new and existing clients, according to Brad Karp, chair of Paul Weiss.

“Taurie has followed this path in her first several months at the firm,” he said. “Taurie is a world-class private equity lawyer, and has fit perfectly into our strong and growing corporate practice. Her clients, some of the world’s largest and most prominent PE firms, benefit from the strength of that practice, just as the firm reaps considerable benefits from Taurie’s insight, experience and wise counsel.”

Ambitious lawyers at the top of their game want to be part of the firm’s success, according to Karp.

“Our firm has never been stronger or more successful “ in terms of our client roster, the profile of our matters, the depth of our talent, our profitability, our pro bono practice, our culture,” he said. “We have a long tradition of handling the most important matters for the world’s most important clients and doing so in a collaborative and old-fashioned culture. These attributes make our firm highly attractive to star laterals and differentiate us from our peers.”

Liner LLP

Finally, Liner, a small firm based in Los Angeles, in July snapped up 10 Dickstein Shapiro LLP attorneys, including insurance group head Kirk Pasich. The additions give the firm a wealth of experience in high-stakes, multimillion-dollar recovery litigation and access to marquee clients such as Sempra Energy and Huntington Ingalls Industries.

Pasich noted that the nature of his practice “ suing insurance companies and brokers “ limited him somewhat in the firms he could join, but because he has long carried a book of business valued at more than $10 million, several preliminary offers were dangled in front of him, including one that promised to double his current compensation.

He said Liner won him over, in part, because it is an entrepreneurial firm that takes a different approach to business and the practice of law.

“It doesn’t have a budgeted number of hours for associates, and it actually allows each practice group within the firm to decide the appropriate compensation for people,” he said.”There is zero red tape, no meetings and no committees. It’s run very collegially and focuses on what’s right for the practice. It’s not a cookie-cutter set of rules for everybody.”

And with a lower overhead at Liner than his former firm, Pasich was able to drop rates for clients.

Liner also appealed to him because he could see it as being a long-term home not just for him but also for the most junior attorneys and the most senior partners of his group. In addition to the lawyers, Pasich also was able to bring over three secretaries, two paralegals and an office administrator.

“In looking at the national marketplace for lateral market moves, what struck me was that firms acquiring lateral partners tend to prefer the fewest supporting lawyers possible, but I believe that my success has as much to do with the people I practice with as with what I do on my own,” he said. “With Liner, there was never a discussion about cutting back people. [Managing partner Stuart] Liner liked our group and what we offered, and he asked me, ‘Who do you want to bring?’ In my experience, that is a rare thing.”

Pasich said loyalty is important to him, and he wouldn’t have moved over to Liner if his team wasn’t able to come with him.

“My team has been loyal to me, and I believe it’s a two-way street,” he said.