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by Vault Law Editors | September 30, 2009


And now we see how they play out. This week, The American Lawyer released its 2009 Global 100 ranking of the world's highest-grossing law firms. The biggest upset (which isn’t news to those who have been following the firm's financial travails) is Clifford Chance’s dethroning by Linklaters. Freshfields Bruckhaus Deringer has also vaulted over its larger Magic Circle rival to take the No. 2 spot, leaving CC in third place.  

The presence of so many UK firms at the top prompts AmLaw’s Richard Lloyd to examine whether “The English Advantage”—British firms hedging their bets against a downturn by spreading the risk across global networks (“the sort of hedge that American firms have with their litigation and bankruptcy practices”)—has proved successful this year. Lloyd’s conclusion: “Some firms’ hedges, it turns out, were more robust than others.”

Insights on the strategy:

  • “The success of an international hedge is not only about geographic diversity. ‘It's about business mix rather than just scale,’ says Freshfields chief executive Ted Burke.”
  • “An international hedge is about timing—it reflects the way the downturn spread internationally,” says Lovells managing partner David Harris.  For some firms, like Shearman & Sterling, “the impact of the downturn was blunted by the slow progression of the crisis from the United States to Europe and finally to Asia.”

What next?

  • “The same slow rollout is expected to mark the end of the downturn. A growing number of forecasts suggest that Asia will emerge first, led by China.”

And, according to Linklaters managing partner Simon Davies:

  • “Government-related work is going to become more important, there will be more regulation.”
  • “With banks having less leverage, the volume of financial product work will be at a lower level.”
  • “With continued volatility in the markets, law firms will have to increase the flexibility of their lawyers, partly by broadening training.”

- posted by vera


Filed Under: Law

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