DEC 2006/JAN 2007 ISSUE 170

Pittsburgh steal How $16bn Mellon Corp drove Reed Smith to get Parker and Richards Butler Reed Smith Richards Butler

Touchdown When $16bn key client Mellon Corp got active in London, Reed Smith realised it needed to move fast. Richards Butler is the latest part of a high-risk global expansion project TOM FREEMAN

IN OCTOBER LAST YEAR, REED SMITH Jordan already had experi- managing partner Greg Jordan was sent a ence of a UK law firm takeover, Legal Business feature article. The piece albeit on a much smaller scale. concerned Richards Butler managing partner On the day he took over the Roger Parker’s desire for his firm to achieve a reins at Reed Smith, 1 January US merger. The title was ‘Get Parker’. 2001, his firm acquired a small In the feature, Parker rationalised, as LB London and Coventry outfit has long argued, that in future an elite group with a respected corporate and of global law firms of the Clifford Chance AIM practice, called Warner and Skadden Arps genus, would exist, as Cranston. That began the era of would up to 20 other large international an international Reed Smith. outfits. He realised that for his firm to The move – a relatively modest survive and not fade into mid-level obscurity acquisition of fewer than 100 and mediocrity, it would have to be part of UK lawyers – was precipitated by this latter group. Jordan liked the article, and the actions of a key client that what his Richards Butler counterpart had to had been talismanic for his firm say. He decided to try and get Parker. for over a century: the $16bn market cap Mellon Financial Corporation, a world leader in asset management, with nearly Roger Parker will become part of a transatlantic giant when his firm $5 trillion under its control. merges on 1 January to create Rarely have the fortunes of one Reed Smith Richards Butler

2 Legal Business December 2006/January 2007 Photography PHOTOSHOT, ADRIAN HOBBS Image manipulation COOK DESIGN Reed Smith Richards Butler

client and one law firm been so MELLON AND REED SMITH – IN THE BEGINNING… closely intertwined and for so long, in this case since each other’s near-simultaneous foun- Judge Thomas Mellon was an Ulster Scot whose parents – farmers – set off for the USA in 1818. He dations in : Mellon in was five years old. By 1869, he was a wealthy man, having used law as a stepping-stone into great 1869, Reed Smith in 1877. entrepreneurial endeavours, as Pittsburgh’s golden age (or rather, iron and steel age) was in its By 2001, of course, a glob- ascendence. That year he founded T Mellon & Sons – a bank that sons Andrew and Richard would alised economy had taken hold. come to transform into a US powerhouse. Mellon was acquiring a UK In 1877, James Hay Reed and Philander Chase Knox launched a law firm in Pittsburgh: Knox & finance house, Newton Invest- Reed. They had previously worked for Reed’s uncle, David Reed, who died in that year. Knox was a ment Management, and would boyhood friend of , the coke-making billionaire; Reed went to university with Andrew need substantive English law Mellon. Such connections were peerless, as Pittsburgh powered America’s industrial revolution. From advice. The risk of Reed Smith a standing start, fees rocketed to $110,000 in 1889. The two partners split the profits down the missing out on the action of middle. The average wage at the time was $500 a year. such a key growth client – it ‘ was in many ways the original venture capitalist,’ remarks Mellon Corp general bills Mellon in excess of $10m counsel, Carl Krasik. Reed Smith was Mellon’s key legal adviser then, and remains so 130 years on. each year – was a potential Today, the wealth has been spread: 256 equity partners will expect a profit share averaging almost disaster in the making. $900,000 each. Fast-forward four years, and to Warner Cranston’s legacy senior partner, Ian Fagelson. He chatted with Jordan about a potential Richards Butler deal. Jordan, an atypically impulsive and energetic young leader, flew straight into London after the LB article had been digested. It was Fagelson who put in the initial call to Parker, in mid- October 2005. ‘Greg Jordan’s in town,’ he said. ‘Would you like Andrew Mellon Richard Mellon James Hay Reed to meet up?’

Size matters was promoted to the On 1 January 2007, the Reed general counsel Smith Richards Butler merger ‘Mellon has directly influenced position in June goes live. Several banking clients 2006. When at Reed have emerged out of Mellon con- our strategy.’ Greg Jordan, Reed Smith Smith, he’d made a nections and there is more work point of getting to to be exploited, particularly know every single one of the 350 across Europe and Asia. But a sin- lawyers at the firm. ‘That would gularly successful, tight-knit Reed be impossible now,’ he notes. Smith culture will be severely put Reed Smith will comprise 1,300 to the test. Mellon’s new general lawyers as of January, and over counsel, Carl Krasik, in an 1,500 lawyers after a planned exclusive interview with Legal Chicago tie-up next March. Business, is under no illusions. Jordan is clearly now con- ‘Greg deserves an enormous pat fronted by the biggest challenge on the back,’ he says. ‘But a managing partner of an inter- looking from the outside, the national law firm can face: more places and time zones living up to a globalised you’re in, the greater the pressure ambition. He’s got Parker. But on management to create a firm.’ there is plenty more still to do. Krasik was an executive-level This piece examines partner at Reed Smith before the clients that drove the Fagelson: put the initial call in to Parker moving to Mellon in 1995. He expansion, the financial risks >

December 2006/January 2007 Legal Business 3 Reed Smith Richards Butler

> involved, and the one of Jordan’s closest allies, Reed Smith’s expansion strategy. Key chances of success corporate partner and director partners were dispatched to California in in a market littered of strategic planning Michael 2003 after the firm acquired a venerable but with US-UK flirta- Pollack, was dispatched with a financially patchy 250-lawyer litigation tions and shotgun one-way ticket to the UK. Parker firm, Crosby, Heafey, Roach & May, and marriages. Today, says: ‘When Mike arrived, it this will happen again when Reed Smith Coudert Brothers is quickly became a case of “Can and 140-lawyer Chicago firm Sachnoff & in the bankruptcy we do a deal?”’ Weaver become one in March 2007. In that courts, and Clifford Parker assessed the potential instance, the head of litigation, Tom Chance is a dirty for a Reed Smith tie-up, not McGough (son of Walter McGough, the pair of words in a least on account of its most former head of litigation at Reed Smith and post-Brobeck Cali- famous client. ‘Reed Smith had a mentor of Greg Jordan), will move to fornia. Meanwhile, had some successes in making Chicago. The seniority of the dispatched the likes of Latham sure it was an important partner lends credence to the gravity of the & Watkins, DLA provider to Mellon in Europe, commitment. This isn’t lip service; it’s Piper and a Cohen: Sullivan supremo also close to Mellon but it undoubtedly needs senior partners making genuine sacrifices in potential Dewey more,’ Parker notes. ‘There’s order to try and create an ongoing culture Orrick threaten to leave less glob- something about US law firms: as a new, much larger firm emerges. But the alised multi-site firms looking if you don’t track your clients rapidity of growth has caused Jordan to sparse. As the competition intensi- as they expand internationally, pause on a planned launch in Texas. ‘We’ll fies, so clients pare down their you’re going to be pretty vul- wait till the dust settles,’ he confirms. favoured adviser lists, and value nerable in your own back Expect a move towards the end of next billing starts to mean what it says. yard. There’s a threat to the year, sources say. The fatal mistake is to forget about business there.’ your core values and core clients. On the day that Reed Smith Ties that bind On that count, certainly, Reed took over Warner Cranston, it As it enters a tumultuous year involving the Smith has its corporate survival sent its primary Mellon client bedding down of two major mergers, Reed head tightly screwed on. In reality, relationship partner, Tom Todd, Smith is set to embark on raising the quality it had no choice. to London, to make the right of the core client base and the standard of introductions and develop the complex, ongoing, multi-office work that Follow your client client relationships. He’s still can be executed. Again, Mellon has been Parker is in charge of a 300-lawyer there, nearly six years on. influential in all this – a tree-trunk of operation with offices in France, This is an illuminating continuity from which new branches are Greece, Dubai and other centres – example of a notable element of springing. ‘Mellon has directly influenced plus a semi-detached Hong Kong group that shares the name, if not REED SMITH RICHARDS BUTLER – MAKING IT WORK all the management agreements, with London. The fate of Parker’s all-too-autonomous Hong Kong It’s all very well to talk up the global synergies – but execution is all, as any law firm leader will admit. For partners was still undecided at the past six months, Reed Smith and Richards Butler have prepared for their 1 January 2007 merger. press time – causing a little embar- ‘The underlying rationale for the merger was the desire to create enhanced client servicing capabilities,’ rassment among the leaderships of says Richards Butler’s Meirion Jones, who will head the combined firm’s global client relationship man- Reed Smith and the London HQ of agement activities. ‘Much of the pre-merger due diligence was concerned with analysing where the Richards Butler. Jordan could only demand lay, and much of the cross-selling now taking place is about putting this analysis into action.’ confirm that ‘we are in discussions’ Here are some examples: with them, and that ‘our long-term goal is to have a strong practice in ■ The Richards Butler Piraeus office has already acted on a major matter for one of Reed Smith’s that part of the world and we largest US clients. intend to do that one way or the ■ The addition of Richards Butler’s strength in depth in Europe was instrumental in Reed other’. It is a strong contrast to Smith’s appointment to the ANZ Bank panel. London, where the chemistry was ■ Joint teams from each side of the Atlantic are cultivating cross-referral activities with Indian instant and the rationales for clients and firms. union well understood early on. ■ Richards Butler shipping partners are in New York working with Reed Smith’s corporate After the initial meeting that partners there. Fagelson had engineered went ■ Partners from Richards Butler’s financial services litigation team have met with Mellon, along encouragingly, things really picked with several of Reed Smith’s other largest US clients. up again in February 2006, when

4 Legal Business December 2006/January 2007 Reed Smith Richards Butler

REED SMITH – A FIRM ON THE MOVE Cohen concurs: ‘It is a complementary relationship: there are things we couldn’t do, that Reed Smith, the firm on the Equity partners Non-equity partners Total number of attorneys ground, absolutely can.’ His relationship 31 December 2000 with Mellon has been nurtured for years, Reed Smith before the not least with former Mellon chairman Warner Cranston acquisition 196 80 594 Martin McGuinn on the seminal 1987 31 December 2001 ‘good bank/bad bank’ deal: a highly innova- One year on, as a tive transaction that rescued the bank from transatlantic firm 203 112 689 a threatening oblivion of bad loans. With 31 October 2006 the help of Drexel Burnham Lambert’s junk Reed Smith before the bonds and Warburg Pincus’s equity raising, Richards Butler merger 214 276 1,041 it’s no exaggeration to say that it set Mellon 1 January 2007 on its path towards its position today as a The firm fully merged as global financial powerhouse. Cohen recalls Reed Smith Richards Butler 256 311 1,277 McGuinn telling him that he’d ‘pulled off a 1 March 2007 great coup’ in hiring Krasik from Reed Reed Smith Richards Butler when it Smith. ‘He has good judgement,’ Cohen merges with Sachnoff & Weaver 290 353 1,417 says of Krasik. ‘And, unlike most lawyers, he Source: Legal Business knows when to talk, and when not to. I’m a terrific fan of his.’ Krasik, genteel and self-effacing, our strategy,’ Jordan notes. ‘It has led to bank. Krasik explains: ‘We’re describes the greatest compliment ever work from Bank of America, PNC, particularly close to Sullivan. paid to him as a lawyer, which occurred Wachovia, Federated Investors and Rodge Cohen is an extraordi- during the $16bn sale to Citizens Bank of JPMorgan Chase.’ nary lawyer who combines Mellon’s retail banking division in 2001. The ties that bind Mellon and Reed unbelievable skills with a very ‘One of the Citizens Bank lawyers said to Smith are tightly drawn. Krasik, Mellon’s decent humanity and humility, me: “I can’t tell where the Mellon legal GC, virtually grew up at Reed Smith. and is a pleasure to work with.’ department ends and their outside lawyers Shortly after his summer promotion to the Indeed, when Nogay was a Reed step in.”’ general counsel position, he hired from Smith partner, he’d do joint Reed Smith one of its most senior corporate presentations with Sullivan on Past glories partners – and his very own protégé – Arlie particular matters for Mellon. Attaining such proximity is something all Nogay. Nogay, now assistant general ‘Both firms really want the best corporate lawyers strive for with their counsel at Mellon, had spent 19 years at for the corporation,’ Nogay clients. As Krasik acknowledges: ‘When I Reed Smith. ‘I wouldn’t have moved for any enthuses. ‘They’re both adding joined Reed Smith, you didn’t need to other reason,’ he says. ‘This is a once-in-a- value.’ In describing the extent develop new clients; now the competition is lifetime opportunity.’ of Reed Smith’s work for the intense.’ Back in its first halcyon days, Reed Mellon’s relationship with Reed Smith is bank, he adds: ‘The firm Smith represented an incredible Pittsburgh- by no means exclusive. Elite New York firm functions in a little bit of an in- based elite that numbered such giants of Sullivan & Cromwell – where chairman house role. They know what the US industrial revolution as Andrew Rodgin Cohen is Krasik’s long-time adviser Mellon people are thinking. Carnegie (steel), Henry Clay Frick (coke to – features heavily on the larger deals; Davis They know what Mellon wants make the steel), George Westinghouse Polk & Wardwell also does work for the to see.’ (airbrakes for the steel-made railways) and Henry Heinz (processed food for the workers), not to mention the eponymous Andrew Mellon (their banker ‘If a US firm doesn’t track its clients and fellow investor). Reed Smith was both as they expand internationally, it’s raised on such glories and, in a way, saddled with the going to be pretty vulnerable in its legacy of Pittsburgh’s subse- quent demise, as the heavy own back yard.’ Roger Parker, Reed Smith Richards Butler industry base was depleted throughout the last century. The one constant, though, >

December 2006/January 2007 Legal Business 5 Reed Smith Richards Butler

THE CLIENT’S PERSPECTIVE Carl Krasik, general counsel, Mellon Financial Corporation

This summer, Carl Krasik, 62, was promoted to general counsel at $16bn market cap Mellon Financial Corporation. Krasik had spent 25 years as a partner with Reed Smith before joining the bank in 1995. He had been one of Reed Smith’s most senior partners, responsible for, among other things, adjudicating partner compensation. Legal Business met him in his wood-panelled offices high up Mellon Tower, in the heart of Pittsburgh. With top-level experience of both private practice and in-house, he is well placed to assess the current nature of client-law firm relationships.

Price is not irrelevant. But we’re not looking for the lowest bidder. I’m not going to unduly obsess about rates being $50 an hour less – I would ask myself how much more time would be used educating new lawyers. I want people who I’m familiar with. I want loyalty to be shown. If Reed Smith screws something up… Once is okay. If they screw it up again, that’s a problem. When a mistake happens, and we have to fix it, the best thing is that there’s no finger pointing, and the firm is able to say ‘we blew it’. This is a key advantage of deep rela- tionships. I also have to ask myself, ‘Did I sit on something for too long?’ And I’m not going to impose false deadlines. I’m not going on a power trip. These are two-way streets. The critical quality is for the outside law firm to buy into the ‘ownership’ of the issue. If they’re going to emotionally buy in to the issue, to care as much as you do – then you really have a partner. Money is not enough of a glue. Clearly, the accepted wisdom for satisfaction comes in many shapes and sizes. It’s also a lifestyle private practice law firms is that you’ve got to be global. Certainly, issue. Here, there’s a 99% chance that at 4.50pm on a Friday, you if a firm is based in Pittsburgh, you’ve got to expand out of it. But can make a problem someone else’s for the weekend. you must maintain the firm’s culture. You need to have been in We don’t hire rookies. We have 70 lawyers in-house – ten of them the trenches, at 3am in the morning, with your partners. And in London. Europe is a major growth area. We want Mellon to be you’ve got to work out at a management level how to break down perceived as a destination for people looking for an in-house the old loyalties of the legacy firm you’re acquiring. career. Do English lawyers want more access to the US group, or Greg Jordan deserves an enormous pat on the back. But looking from more independence from them? From talking to other banks, I’ve the outside, the more places and time zones you’re in, the greater got a sense that lawyers in Europe needed to clear questions with the pressure on management to create a firm. the US first. The way I see it, business would never get done if You can’t buy job satisfaction. As an in-house lawyer, you don’t that was the case. I’m going to London shortly to listen, and to send a bill, and you never worry about where your next project find out how to make the job more attractive from a London comes from. For some, it’s like dying and going to heaven! But job lawyer’s perspective.

> was Mellon (although note that Heinz is still Pittsburgh managing partner, who came back from the Second World War a major and active client). It is entirely con- Carolyn Duronio). and weren’t offered partnerships. Today, ceivable that, without Mellon, Reed Smith Kirkpatrick & Lockhart Nicholson Graham would have remained a respectable and mid- The rivals is the main locally based rival of the firm. If sized regional player – perhaps with the During the firm’s slower years, a soon-to-be-completed merger comes off singular eminence of representing the competition also arose. Kirk- with Preston Gates & Ellis (a firm whose estates and endowments of an unusually patrick & Lockhart was formed central moniker came from William Gates, high concentration of local billionaires (this 60 years ago by a group of dis- father of Microsoft’s Bill), a 1,400-lawyer it does anyway, and with great pride, led by satisfied Reed Smith associates behemoth across 21 countries will emerge.

6 Legal Business December 2006/January 2007 Reed Smith Richards Butler

Kirkpatrick secured a London merger with Nicholson Graham & Jones at the start of 2005. Peter Kalis, the widely admired ‘Today is the era of explosive law firm leader of the firm, observes: ‘The cama- raderie of our founders kept us going. By growth. We do most of our business at recruiting great talent, we moved up the food chain – we didn’t inherit Reed Smith’s 40,000 feet.’ Peter Kalis, Kirkpatrick & Lockhart Nicholson Graham great clients.’ For many years, they quietly co-existed as the go-to Pittsburgh firms. ‘Today, though,’ Kalis adds, ‘is the era of explosive law firm growth. I’m sure Greg London in the late 1990s, but to the east of Pittsburgh (the latter had Jordan feels as I do: we do most of our retracted. Stiffer competition is foundries, the former the founding fathers). business at 40,000 feet.’ coming from both east and west. There, Dechert is thriving – its London Buchanan Ingersoll & Rooney is another Take – the rival and offices are, not insignificantly, housed in the Pittsburgh firm that tried to expand into more lordly Pennsylvanian city gleaming new Mellon Financial Centre in >

GLOBAL LAW FIRM LEADERSHIP AND WEST VIRGINIA CONNECTIONS

Oh, the West Virginia hills! I must bid you now adieu. have emerged from Pittsburgh – Wheeling’s nearest large city. Kalis, In my home beyond the mountains I shall ever dream of you… who is a few years older than Jordan, recalls that his first experience of him was when he and his wife needed a cat-sitter, and Jordan was then So goes the song of West Virginia, one of America’s quieter states. Consid- in law school, looking for some extra pocket money. ‘That was his finest ered the southern-most northern state, and the northern-most southern hour!’ Kalis suggests as only a friend could, before adding: ‘I admire state, it’s basically in the middle of nowhere. Rodgin Cohen, revered him enormously. He has been an extraordinary leader of the firm, and chairman of New York’s mighty Sullivan & Cromwell grew up in its state an example of an asset to the community.’ Kalis believes that his two capital, Charleston – the largest town in West Virginia (but with a popula- firms have ‘friendly competition. Each firm makes the other better’. On tion of only 50,000). Perhaps the state’s most famous legal luminary is the Pittsburgh itself, Kalis states: ‘Its decline was over-dramatised, and its late John Davis, born in the little town of Clarksburg. Most notably, Davis revival is as well. Every community will undergo periods of stress – was the Democratic Party nominee for President of the in public and private sector leaders have to adapt and embrace change. 1924 (losing to Calvin Coolidge) and co-founder of Davis Polk & Wardwell Today, it’s one of the great places in the US for young people to start – a similarly revered New York law firm. ‘None of us quite compares to their careers.’ him!’ Cohen acknowledges. Ralph Baxter left Wheeling as a child when his family moved to Califor- And so to a little town called Wheeling, the birthplace of three very nia. But under his stewardship, Orrick invested $13m in the town, using it active global law firm leaders: Greg Jordan of Reed Smith, Peter Kalis of as a base for its global operations centre, and over 150 employees are Kirkpatrick & Lockhart Nicholson Graham, and Ralph Baxter of Orrick, based there, a figure that is expected to rise to 250 over the next couple of Herrington & Sutcliffe. They all know each other, and share a sense of years. ‘It’s all in the water,’ Baxter confirms. He has nothing but praise for understandable civic pride, having risen from such modest origins. All his Pittsburgh-based legal rivals. ‘Reed Smith stands out as a singular three were engaged in major law firm mergers as this piece was going to example of how to chart one’s own course. It is clearly focused on its press. ‘I wouldn’t have stepped out of the merger talks [with Preston segments of the market. Greg Jordan is very smart. He presents to others Gates] for anyone else,’ Kalis says, referring to an e-mail request for his in a low-key way. He respects whomever he is talking to. He’s instantly views on Greg Jordan that would have flashed up on his BlackBerry. likeable, and inspires his colleagues.’ Baxter concludes: ‘It proves that if Both Jordan and Kalis have their roots in Greece, from where their you have a great strategy and good execution, you don’t need to be from parents arrived. Respectively, they run the two largest law firms to New York or London. Most regional firms don’t pull that off.’

Peter Kalis, Greg Jordan, Reed Smith Kirkpatrick & Lockhart Nicholson Graham Ralph Baxter, Orrick, Herrington & Sutcliffe

December 2006/January 2007 Legal Business 7 Reed Smith Richards Butler

> Blackfriars – and has bags of international Butler and Chicago integrations. news to the press asset management practice expertise. Finally, For the past six months, Reed and their staffs, Morgan Lewis, another Philadelphia-based Smith and Richards Butler simultaneously. global giant, made a big splash recently lawyers have been working out It is a similarly when it opened what has become a booming new ways of doing business. open approach office in Pittsburgh. Where once Richards Butler ran when it comes to As with Wall Street, America’s major departments on a geographical the division of commercial centres are scenes of equally basis, now it is global practice profits. Financial hard-fought competition. (New York, in streams. They’ve been making awards and fact, is a relative weak spot for Reed Smith. joint trips to meet with estab- promotion are The firm has around 100 lawyers there at lished clients on either side, and directly linked to the moment, and it will be the centre of are already winning work. performance within investment growth over the coming year.) Getting on the ANZ Bank panel each practice stream. is one recent example, based on And every equity Profit hikes Mellon-formed experience at partner knows Growth for growth’s sake can be fatal for a Reed Smith and Richards Butler’s Nogay: Mellon move was ‘once-in-a-lifetime opportunity’ exactly what every law firm. One of the most notable achieve- wider European capabilities. other equity partner ments during Reed Smith’s rapid and acqui- Similarly, Chicago’s Sachnoff & is taking home. (This is the sition-led growth is its constant increase Weaver does much local US diametric opposite of many law in revenue per lawyer. Since 2001, the work for Sara Lee and McDon- firms; for example Cleveland- figure has risen by around 10% each year, ald’s – these companies are based global giant Jones Day, currently standing at $609,000 per fee- already Reed Smith clients where such knowledge is kept earner. Similarly, average equity partner in Europe. within the grasp of a single, profits have risen accordingly, and are omnipotent chief.) There’s a 7% expected to rise from $800,000 to $875,000 Open house bonus allocation for outstanding for the calendar year just ending. This is Richards Butler had spent much performance, and profits are despite major integrations – something of of 2004/05 talking to New York- shared from one global pool. which Jordan is particularly proud (when based national US firm Proskauer With Reed Smith’s proximity he took over, PEP was at $400,000). ‘Neither Rose, but talks were aborted to Mellon, and the subsequent London nor Chicago will take a nick out of soon after the story was leaked targeting of investment banking our profitability,’ he says. ‘What’s more, no to the press. ‘We took stock, and relations, Richards Butler’s senior equity partner has left the firm over drew breath. We were concerned former drive to advertise itself as the last five years.’ with appearing on the front a firm that would sue invest- Having become transatlantic on his first pages, and looked at our ment banks is likely to become day as managing partner, and successfully processes and protocol,’ Parker more muted. ‘We’ll have to be absorbed a 250-lawyer California firm (whose says. As such, as soon as Richards very careful,’ Parker says. ‘Litiga- star litigator, Colleen Davis, is about to Butler and Reed Smith realised tion is 50% of this firm, as it is at become global head of litigation), Jordan has they had a chance of making Reed Smith. And although we’re a measure of confidence about the Richards a merger work, they released the most often used as an inter-bank firm – bank A sues bank B – REED SMITH – SUSTAINED GROWTH IN PROFITS AND REVENUES certainly,’ he concludes, ‘I doubt you’ll find us suing Mellon!’ You can say that again. Frank Average profits Average revenue Firmwide Guadagnino, Reed Smith’s Pitts- per equity partner per lawyer revenues burgh-based global head of financial services, observes: 2001 $400,000 $423,000 $268m ‘Companies are reducing the number of law firms they use. 2003 $558,000 $498,000 $441m It’s much easier for them to deal with fewer firms. So, the more 2005 $800,000 $609,000 $563m services you provide, and the wider the geographical reach, 2006 $875,000* $628,000* $620m* the better.’ No prizes for guessing which bank he spends Projected merged firm revenues for 2007 $850m* 75% of his fee-earning time *Projected estimates by Reed Smith, and subject to amendment Source: Legal Business dealing with. LB [email protected]

8 Legal Business December 2006/January 2007