Locke Lord's MP Clements Weighs in on Patton Boggs Talks
While he acknowledged that the Chevron dispute had resulted in the loss of some client matters, Newberry touted the firm’s work for sovereign wealth funds in the Middle East, which he says could create some fruitful syngergies with Locke Lord’s Texas-based energy clients. (Newberry added that 40 percent of Patton Boggs' annual income is from litigation, 35 percent from corporate transactions and 25 percent from public policy work.)
And though the firm has hit a rough patch of late, none of the layoffs at Patton Boggs have affected its public policy practice. Several former Patton Boggs say that the D.C.-based group will be the driving force in any potential merger, and that the desires of Boggs—who has stepped back from the firm in recent years—and other leading partners will play a major role in whether or not it decides to merge.
A PATH FORWARD?
Locke Lord’s Clements says her firm is following the Chevron matter—she cites its potential liabilities and “reputational aspects”—as part of the due diligence related to a possible Patton Boggs merger. “We’re certainly watching it closely," she adds. (Patton Boggs is awaiting a federal judge’s ruling on whether Chevron’s counterclaim against the firm can proceed.)
Clements says growth in the Middle East—Patton Boggs has offices in Abu Dhabi, Doha, Dubai and Riyadh—has indeed been on Locke Lord’s agenda, but that the firm has resisted opening an office in the region because of a feeling it was late to the market. Instead, Clements says “acquiring an existing, established practice” is probably the best path for Locke Lord to take.
Patton Boggs handles work for the nascent governments of Iraq and Libya, as well as the Syrian opposition. Such clients could offset Locke Lord’s recent loss of its $1 million-a-year lobbying contract for the Pakistani government following the departure of Benazir Bhutto’s widower, Asif Ali Zardari, as president upon the completion of his five-year term in September. (Last year Mark Siegel, a partner with lobbying arm Locke Lord Strategies, won an Emmy Award for his work producing a documentary on Bhutto, who was assassinated in December 2007.)
Clements describes the loss of the Pakistan work as part of the cyclical nature of lobbying. “When government’s change, they change their lawyers,” Clements says. “We have good lawyers at Locke Lord Strategies who I’m confident can replace that business.”
As for whether that business is replaced in the context of a merger with Patton Boggs, two leaders of rival Am Law 100 firms speaking on the condition of anonymity tell The Am Law Daily they see such a deal as likely.
Given that both firms are comparably sized, they are likely to find it challenging to overcome disparities in gross revenue, profits per partner and revenue per lawyer. Stuart TenHoor, a D.C.-based legal recruiter and consultant, says the best way to bridge such gaps in a merger is through deequitizing partners. It is unclear whether these negotiations have gotten far enough for that option to come up.
Clements declines to comment on such matters, but says the primary criteria she considers when evaluating a potential merger is if it benefits her firm's clients and whether a common culture and philosophy can be adopted after a combination.
The Swiss verein, the mechanism of choice for many large international firm mergers these days, is not something that Clements supports. “I think it’s counterintuitive to integration and crafting a common culture,” she says. “At Locke Lord we have a level playing field that’s a true partnership, and that’s what we would want [in any merger].”