The Score

February 24, 2012 4:08 PM

The Am Law 100, the Early Numbers: Fewer Partners Means Higher Profits at Goodwin

Posted by Ross Todd

Goodwin Procter saw its gross revenues grow 2.5 percent to $695.5 million and its revenue per lawyer rise just over 1 percent to $925,000 last year, according to The American Lawyer's reporting. At the same time, a net loss of 13 equity partners helped push profits per partner up 3.4 percent to $1.5 million.

While noting Goodwin's gains, chair Regina Pisa acknowledges that the firm did not perform as well as some other Am Law 100 firms.

"I think Goodwin had a good year but some of these firms had great years," says Pisa, who has presided over a 13-year expansion effort during which the firm has tripled in size. 

The smaller equity partnership is not due to a strategic restructuring, according to Pisa. Instead, she says, it is the product of two factors: retirements and a decision by the firm to proceed more conservatively in promoting partners.

Nonetheless, Goodwin, which has been active in making lateral hires as part of its growth strategy, suffered some notable departures in 2011. As previously reported by The Am Law Daily, Jenner & Block snapped up Goodwin partner Wesley Fredericks in January 2011 to lead its New York corporate practice. And as reported by sibling publication The Asian Lawyer, U.K firm Herbert Smith hired Goodwin partner Kyle Wombolt in May to launch a U.S. regulatory law practice in Hong Kong with a focus on investigations and compliance.  

Lateral moves aside, Pisa says Goodwin's transactional practice in Asia gained steam last year as clients sought to make investments in China-based Web properties. In April, for instance, the firm represented Moscow-based investment firm Digital Sky Technologies in its $500 million investment in Chinese E-commerce company, with Hong Kong office chair Yash Rana leading the Goodwin team on the deal.

"Our Hong Kong office has finally gotten some traction and that's one of the two focuses on our growth this year—London and Asia," Pisa says. 

Overall, Pisa says, 2011 was a strong year for Goodwin's business practice, which "really took it on the chin during the recession," but saw demand rise 5 percent last year. The firm's technology, private equity, and corporate transactional practices were particularly strong, with demand up 11, 6, and 10.5 percent, respectively. Goodwin's business lawyers averaged about 1,800 hours billed this year, while the firm's litigators averaged about 1,900, according to the firm. 

As previously reported by sibling publication The Am Law Litigation Daily, Goodwin litigators have enjoyed a steady stream of work for client Countrywide Financial Corporation in suits related the financial crisis. 

In October and December Goodwin litigators won favorable rulings for Countrywide that denied class certification in multidistrict litigation pending before a San Diego federal district court judge. The residential mortgage giant had been accused in the suits of engaging in misleading sales and marketing practices in the run-up to the housing meltdown.

"At various times we've predicted that the pipeline [for those cases] is 18 months to two years out," Pisa said. "I think those cases have at least have two to three year's life left in them."

As the firm moves into 2012, Pisa's own role has been redefined. Earlier this month, she handed the title of managing partner off to New York real estate capital markets partner Robert Insolia. While relinquishing oversight of Goodwin's day-to-day operations, Pisa will continue to spearhead firm strategy in her role as chair. As she sees it, one of her key duties now is to be a "revenue catalyst" for the partnership.

"I think that for us it's not about expenses, it's not about managing the head count," she says. "For us it's all about focusing on topline revenue growth."

This report is part of The Am Law Daily's early coverage of 2011 financial results of The Am Law 100/200. Final rankings and full results for The Am Law 100 will be published in The American Lawyer's May 2012 issue and on The Am Law Second Hundred will be published in the June issue. An interactive chart of the financial results reported so far is available here. The chart will be updated as additional data is reported.

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