For Nelson Mullins Riley & Scarborough, last year was one for the record books.
South Carolinabased Nelson Mullins hit all-time highs in three key categories in 2012, according to The American Lawyer's reporting: The firm's gross revenues rose 14.3 pecent to $271 million; its revenue per lawyer jumped 9.6 percent to $625,000 this year; and its profits per equity partner climbed 13.3 percent to $680,000. Average compensation for all partners, meanwhile, increased 7.6 percent to $495,000.
Nelson Mullins managing partner James Lehman tells The Am Law Daily that the firm's litigation and corporate practices both contributed to the firm's strong financial results. On the litigation front, Lehman cited several high-profile trial victories, including a June jury verdict in Arizona state court for client C.R. Bard Inc. in a bellwether case concerning blood vessel filters, and a trio of defense wins for Pfizer in ongoing litigation related to the pharmaceutical giant's hormone replacement therapy drugs Pempro and Premarin. The firm's intellectual property, government relations, and health care groups also turned in robust performances last year, Lehman says.
Lehman says a long-term commitment to controlling expensesan effort that took on fresh urgency amid the recessionalso contributed to the firm's record-breaking 2012.
"Being careful on costs allows us to offer a value proposition to our clients, whether through an alternative fee arrangement or a rate structure that's more attractive in this environment," he says. "That creates a lot of demand for our professionals." According to Lehman, Nelson Mullins began moving to lower overhead more than a decade ago by relocating back office staffers scattered across various offices to the firm's home state and other less expensive locales. "Part of our master plan from the beginning was to put administrative support in lower-cost areas like South Carolina and keep overhead centralized to the extent possible. We've seen the benefits of a low overhead model as a result."
At the same time, Nelson Mullins has been launching new offices and adding groups of laterals. Last year alone, the firm entered the Nashville market in April, acquired a group of 16 litigators (including eight partners) from Boston firm Cetrulo & Capone to open an office in that city in November, and hired lawyers in Atlanta and Raleigh. The net effect was an a modest uptick in head count, with the firm's total number attorneys increasing from 414 to 433, and its partnership ranks expanding from 257 to 275. Much of that growth was fueled by a 14.4 percent jump in the number of nonequity partners from 104 to 119. "I believe the equity partner numbers were more a timing issue," says Lehman. "They were not the result of a decision to shrink the equity partnership."
On the heels of such a strong 2012, Lehman is cautiously optimistic about the firm's prospects for the year ahead. "Our litigation continues to be very strong and we have a series of trials that are scheduled in 2013 already," he says. "The first quarter of corporate appears to be pretty strong as well."
This report is part of The Am Law Daily's early coverage of 2012 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 2013 issue and on AmericanLawyer.com. The Am Law Second Hundred will be published in the June issue.