Friday brought good news for associates at Sullivan & Cromwell. The firm announced generous springtime bonuses, which will double bonus compensation for some of the more junior classes. If you missed the news, which broke late on Friday, check it out over here.
So what kind of numbers are we talking about? PPP at QE is a seven-figure number, of course — but what’s the first digit?
It’s a “3,” just like last year — but “4″ is within striking distance. Here’s the breakdown, from Am Law Daily:
In 2009 only two firms in The Am Law 100 had profits per partner of more than $3 million, Quinn Emanuel Urquhart & Sullivan at $3.13 million and Wachtell, Lipton, Rosen & Katz at $4.3 million. After a very good year in 2010, Quinn Emanuel isn’t yet in Wachtell range, but it’s narrowing the gap. The firm is reporting average profits per partner in 2010 of $3.62 million, an increase of 16 percent from 2009.
Wow. CHECK YOU Malibu and Hamptons real estate listings.
Revenue per lawyer in 2010 was $1.125 million, up 6.6 percent from $1.055 million in 2009. The firm also grew in head count last year, as name partner William Urquhart predicted last year it would. The number of lawyers increased from 398 to 489, a rise of more than 20 percent. The equity partner ranks grew, too, from 77 equity partners in 2009 to 94 in 2010; nonequity partners decreased from 44 to 37.
That’s impressive too. It’s not hard to boost PPP numbers by shrinking the equity partnership (and many firms take that approach). Growing your PPP and the ranks of your equity partners at the same time — now that’s a real accomplishment.
Of course, there are some structural factors at Quinn that contribute to the robust profits. First, the firm has high leverage (more than five to one, according to Am Law Daily). Second, the firm’s litigation focus helps — not just in terms of gigantic contingency fees, but also on the expenses side. As explained by name partner William Urquhart — yes, Bill Urquhart, of CHECK YOU EMAIL fame — because Quinn isn’t a full-service firm, “We don’t need an ERISA partner, or books on international tax law, or an in-house catering service because we don’t do deal closings. If you walk into any of our offices, they’re much more spartan.”
Which practice areas at Quinn drove profitability last year? Check out the complete Am Law post for more.
Congratulations, Quinn Emanuel partners, on your awesome 2010. Lawyers at rival firms sometimes snipe at QE, but it’s sounding more and more like player hating.
P.S. Of course, and this is a point that’s sometimes lost in our bonus coverage, remember that the partners are the owners of the business. They take on greater risk than mere employees, and in this day and age, they generally work just as hard, if not harder, than their employees (the days of partners leaving at 5 p.m. while associates go on toiling are ancient history). So partners, as business owners, have the power to take for themselves the lion’s share of revenue increases — and it’s entirely understandable if they exercise it.