How Are U.S. Firms Faring in London?
Many partners at the elite New York firms are dismissive of the U.S. capabilities of their U.K peers. But have the U.S-based firms done any better in crossing the Atlantic? In terms of overall impact, it's fair to say that U.S. law firms are a far more significant part of the U.K. market than the English firms are in America. While only a handful of U.K. firms have ventured stateside, the 350 largest U.S. law firms by head count collectively employ more than 6,000 attorneys in 92 U.K. offices, according to The National Law Journal's 2013 NLJ 350 survey.
The U.S. firms have also earned bragging rights when it comes to lateral hires. The higher relative profits per equity partner of many U.S. firms, which has been exacerbated by the strengthening of the dollar against the pound over the past five years, means they've had more success in attracting and retaining top talent.
Take Simpson Thacher & Bartlett, for example. In 2009, Simpson stunned the market by capturing one of London's top corporate partners—private equity specialist Adam Signy from Clifford Chance. The following year, it returned to Clifford Chance for one of its leading funds partners, Jason Glover.
With a few notable exceptions—such as derivatives star Daniel Cunningham, who joined Allen & Overy in New York from Cravath, Swaine & Moore in 2001—the U.K. firms have simply been unable to land such high-profile laterals in the U.S. (Cunningham left A&O in 2009 to join Quinn Emanuel Urquhart & Sullivan.)
But while lateral hiring at U.S. firms in London surely helped many headhunters survive the recession, most U.S. firms have made only limited inroads in taking work or clients from the top U.K. practices, and remain small and often peripheral players when it comes to the biggest-ticket transactions and domestic law.
Firms like Kirkland & Ellis; Weil, Gotshal & Manges; and Skadden, Arps, Slate, Meagher & Flom do compete regularly with the Magic Circle in certain areas, such as restructuring and private equity. But each has less than 140 lawyers in the U.K., making them smaller than any of the Magic Circle firms in the U.S.
"U.S. firms have clearly had an impact on the London market, not only in terms of winning work but also producing partner mobility," says former Clifford Chance global managing partner Tony Williams, now a law firm consultant. "However, if they are honest, relatively few will be happy with their performance in London, given the limited market share they've been able to develop."