Typically when a law firm opens an office in a new geography, it recruits a handful of lawyers from the outside, usually from the same firm.
Tossing that playbook to the side and forming a new one, Winston & Strawn LLP announced on Monday the hiring of 23 partners from eight different law firms in Texas, the bulk of whom will join in Dallas, where the firm is opening an office.
The office will be led by Thomas Melsheimer, a trial lawyer from Fish & Richardson who represented Mark Cuban in his 2013 insider trading fraud lawsuit filed by the U.S. Securities and Exchange Commission, and Bryan Goolsby, executive chairman of Locke Lord who chaired its real estate investment trust practice group and finance committee.
All told, Winston’s Dallas office will kick off with seven partners from Locke Lord; six from Fish & Richardson; three from Jones Day, and one partner from each of the following firms: Norton Rose Fulbright, Squire Patton Boggs, K&L Gates and Miller, Egan Molter & Nelson.
Meanwhile, two real estate partners from Locke Lord will join Winston’s Houston office.
Goolsby, the co-managing partner of the Dallas office, said that the firm expects to staff between 55 and 60, estimated figures that includes associates and partners from additional competitor firms who have not yet been announced.
“It will require us to re-configure the space to accommodate everyone,” said Goolsby, of the firm’s new Dallas digs at 2501 N. Harwood St., although he didn’t elaborate how.
The addition is a major acquisition for Winston, which now has 17 offices throughout North America, Asia and Europe, and was perceived in the legal market as a nod to Texas’s business friendly regulatory environment (it doesn’t have a state income tax, for instance), and a foreshadowing of future expansion of large law firms in Dallas.
“I think what you’re seeing is the first move into Dallas like what you saw at the height of the energy boom, with outside firms opening in Houston,” said Tim Powers, managing partner of Texas-based Haynes and Boone.
Over the past decade, major law firms such as Kirkland & Ellis, Latham & Watkins and Sidley Austin have planted outposts in Houston to tap into a stream of transactional and litigation work for corporate clients in the city’s robust energy industry, which houses Phillips 66, Baker Hughes, Sysco, and others. Now, lawyers expect the same to happen in Dallas, the fourth most populous city in the United States which maintains the headquarters of American Airlines, AT&T, Exxon Mobile and J.C. Penney. Already, other international law firms including Jones Day and Baker McKenzie have opened offices in Dallas, but none in recent memory have opened with so many partners and from top practices.
Outside of Melsheimer and Goolsby, co-managing partners of the new Dallas office, the group includes Matthew Orwig, the former U.S. Attorney for the Eastern District of Texas between 2001 and 2007.
Orwig was managing partner of the Dallas office of SNR Denton before it merged to become Dentons, between 2009 and 2011, and has been with Jones Day since 2012.
It’s rare for a large law firm to recruit so many partners from such a variety of different law firms and announce them all at once. In January 2016, Orrick Herrington & Sutcliffe made a similar announcement, outlining plans to open an office in Houston with 20 unnamed partners from a half-dozen law firms big and small.
Tom Fitzgerald, managing partner of Winston, said that the addition was driven by a combination of existing client demand and opportunities to hire from outside. He said that the firm conducted an analysis, based on current clients and clients the firm hoped to land, about practices in the market that would best suit Winston. The team ended up being a group with a practice focus ranging from commercial and intellectual property litigation, transactional, finance, tax and real estate.
“We had several clients in the area that we thought we could better serve by having a local office — major corporations, financial institutions, and other types of privately owned companies,” said Fitzgerald, declining to identify clients. “We also thought our platform could attract the highest level talent in Dallas. That has been proven correct by the people joining us as partners.”
According to a search of Bloomberg Law, Winston has represented the following companies in Houston federal courts over the past year: Bank of America NA, AOL, Inc., Comcast Corporation, Motorola Mobility LLC, and Dell, Inc.
Fitzgerald said recruiting the entire group took six to eight months.
“The planning process took maybe three to four months. Then the interviews themselves took three to four months,” he said. " You don’t put this stuff together over a month.”
Fitzgerald said that the firm engaged a single headhunter, Clint Johnson with Johnson Downey, to conduct a search of the Dallas legal market.
“We talked about the opportunities for the individuals who were potentially out there, and we made selective interviews and explained to people what we were doing,” he said. “We had a vision and it was one focused on the ability to bring existing clients through the door and cross-sell. And that is what led to the formation of the office.”
Melsheimer said that Winston contacted him in the fall, and the courting process entailed meeting with Winston’s chair Dan Webb, the former U.S. Attorney for the Northern District of Illinois.
“My interest in them was initially not reciprocal,” he said. “I had been very happy with Fish for nearly 20 years and was not looking to move when they first approached me. But the more I met with them, the more I saw their commitment to Dallas, and I realized that their litigation brand matched very well with mine and it would allow me and my team to have a broader practice and a broader platform.”
Melsheimer said that meeting with Webb was a turning point in his decision to join Winston. “He is someone I looked up to as a young lawyer from afar,” he said. “Spending some time with him and hearing how he saw my role at the firm and how he saw us growing the practice... was compelling for me.”
Asked about compensation, Melsheimer declined to comment, other than to say: “I did not leave Fish because of dissatisfaction with money; I think it’s fair to say the commitment [Winston] had to Dallas was reflected in the financial packages they presented to many of the key partners. I don’t want to comment one way or the other, but I certainly wouldn’t have done this after nearly 20 years if the financial terms of it weren’t solid.”
In one twist in the recruiting process, Melsheimer said that he alerted Fish & Richardson of his discussions with Winston while he was wrestling with the decision.
“Most headhunters tell you that you should announce it at once, and don’t give anybody any warning,” said Melsheimer. “That wasn’t my relationship with the firm and I was certain itwould be better for everyone if I told them that I was thinking about it. That made it harder in January in terms of going back and forth, but it made it easier once I did make my decision. When I made it at the end of the month, it wasn’t a shock.”
Kent Zimmermann, a consultant to law firms, said that firms are increasingly prioritizing Dallas, and Texas, more broadly. He said one reason for it is the perception of law firm leaders who expect energy practices to reap the benefits of a friendly regulatory environment under the new Trump administration, pointing to President Donald Trump’s pick of Rex Tillerson, the former chief executive of ExxonMobil, as secretary of state.
“A lot of industries are putting a lot of money there,” he said.
In recent years, Toyota Corporation, State Farm and Kubota Tractor Corp. have all announced that they are moving their headquarters to Dallas (or areas bordering it), citing lower taxes, lower cost of living and a Central Time Zone that’s easy to access both coasts.
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