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Howrey Losing More Partners? Construction Lawyers Might Be Next to Leave

After all, there are fewer partners for Howrey to lose with each passing day, as the Howrey lawyer diaspora continues to grow. Let’s review the recent activity — and discuss some possible future defections.

On Friday we reported that IP litigator Mark Whitaker would be joining Baker Botts. That news has now been publicly announced.

Back on February 4, we mentioned that government contracts lawyer Barbara Werther was leaving Howrey, most likely for Ober|Kaler. She’s now on the Ober|Kaler website (although the firm apparently didn’t issue a press release touting her arrival, as it did for two first-year associates).

UPDATE: Just this morning, Ober|Kaler issued a press release on Werther and insurance coverage litigator Stephen Palley (who also joined from Howrey).

UPDATE (4/5/11): All in all, five Howrey construction lawyers joined Ober|Kaler.

Other outlets have noted additional partner departures. K.T. “Sunny” Cherian, described by The Recorder as a “top IP litigation rainmaker” with a book of business worth more than $10 million, joined the San Francisco office of Hogan Lovells this past weekend. Four other partners will join him in soaking up the Ho-Love: John Hamann, Sarah Jalali, Constance Ramos, and Scott Wales (who had been the hiring partner for Howrey’s S.F. office).

Also in S.F., Pillsbury Winthrop picked up IP partner Duane Mathiowetz. The news was reported by the Daily Journal (subscription), which noted that Mathiowetz, who worked as a mechanical engineer for a decade before going into law, has taken five patent cases to trial in the past five years (winning four).

Who might be the next to leave Howrey? Here’s some speculation….

A tipster tells us:

A number of key DC construction partners including Andy Ness met on Friday with Jones Day.

A number of the other construction partners (ex-Thelen partners) who know about this are concerned since Steve O’Neal is reportedly behind this meeting. There is a feeling that Steve wants to do like he did two years and move the entire practice (East and West Coast) to a firm (Jones Day) that really doesn’t have a construction practice.

Many on the East Coast are concerned that this could be “Deja Vu” based on what happened two years ago when Steve brokered the deal to move the entire Thelen construction group to Howrey. Many are also surprised that Andy Ness would be willing to put his trust in Steve again, even if he is a “friend.”

Word is that Steve went through a 1.5 year long dry spell when he joined Howrey — however, he recently landed the Las Vegas CityCenter deal, which is bringing in $500-900K a month. Steve is using this as the carrot to find a home for the group and probably another nice (Howrey-like) signing bonus for him.

The question is, will all the construction partners follow Steve again?

And is Jones Day looking past Steve’s CityCenter deal?

If Jones Day takes on the ex-Thelen construction lawyers and it turns out to be “deja vu,” that might not be good for JD. The hiring of the construction lawyers from Thelen is regarded by some observers as a mistake on Howrey’s part — or, more specifically, a mistake by firm chairman Robert Ruyak. In the words of Kim Eisler, over at Shark Tank Legal:

Partners say that the perhaps the most damaging Ruyak move was his decision to bring in 40 construction litigators (18 partners) from the San Francisco firm of Thelen in late 2008. The firm had been crippled by the recession and Ruyak “bought them on the cheap,” sources say, figuring the construction economy would rebound. It hasn’t and the Thelen acquisition proved to be a disaster. Most remarkable, however, was that the decision was made with almost no consultation of the partnership.

We reached to Howrey about these possible partner departures to Jones Day. Howrey declined to comment, through a spokesperson.

It’s interesting that so many partners are leaving or contemplating leaving Howrey, even though doing so probably means kissing their capital contributions good-bye (although query whether those might have gone down the drain anyway). Said a source:

[M]ultiple former partners that they don’t expect to get their capital back. Those who left last spring said they got about half of it back by fall (the firm has a six-month lag time on when they have to return it, from what I understand), but that the firm did some “reaccounting” to make sure they didn’t get the rest of it back.

Those leaving now express pretty minimal hope at getting it back. And what’s worse is that a year or two ago they created a program to give people incentives to put up additional capital with the promise of higher interest rates.

Leaving that money in a savings account earning 1 percent might have been smarter than lending it to Howrey. But hey, hindsight is 20/20.

If you have Howrey news to share, please email us, subject line “Howrey,” or text us (646-820-TIPS, or 646-820-8477). Thanks.

Howrey Rainmaker Cherian Going to Hogan [The Recorder via It’s Howrey Doody Time]
Pillsbury Scores IP Litigator From Howrey [Daily Journal (subscription)]
A Coup Too Late at Howrey [Shark Tank Legal]

Earlier: Prior ATL coverage of Howrey

ATL Law Firm Directory
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