Wall Street takeover advisers Skadden, Arps, Slate, Meagher & Flom topped the American Lawyer's list of the 100 top-grossing law firms, with 1989 gross revenue of $517.5 million and net operating income of $235.5 million.
Although New York, Chicago and Cleveland firms topped the list, two big Los Angeles firms were among the top 10 in the survey, which relies primarily on information provided by the firms.
Gibson, Dunn & Crutcher ranked fifth with $280 million in gross revenue and $125 million in net operating income, according to the survey. Latham & Watkins, with $223.5 million in gross revenue and $114 million in net operating income, ranked eighth.
O'Melveny & Myers of Los Angeles ranked 14th, with $198 million in gross revenue and $89 million in net operating income.
The top three Los Angeles firms have traditionally represented large corporations, especially among the Los Angeles business establishment.
Morrison & Foerster of San Francisco ranked 22nd, with gross revenue of $168 million and net operating income of $58 million. Pillsbury, Madison & Sutro, also of San Francisco, ranked 27th, with gross revenue of $144 million and net operating income of $44.5 million.
Big-time law continues to be lucrative for partners of top firms. American Lawyer said some partners in top firms did as well as chief executives of the top 800 American corporations ranked by Forbes magazine. About 2,100 such partners matched the $890,000 in average salary and bonuses earned by corporate brass.
Although partners are getting richer, Steven Brill, editor-in-chief of American Lawyer, pointed out that growth in business at large law firms is slowing. Gross revenues of the "Am Law 100" grew 17%, from $10.6 billion to $12.4 billion, compared to increases of 20% and 23% in the two previous surveys.
Although the top 100 was led by Skadden, Arps, perhaps the best-known of the merger and acquisition specialists, the days of big-deal premiums are waning, according to Brill in a commentary accompanying the list. He advised lawyers to look for prudent contingency-fee cases.
Firms with a large market share will be able to obtain business in a down market, Brill said.
"The law business will demand wiser managers who know how to pick practice areas in which they will excel, know how to say no to growth for growth's sake and know how to be tough- minded about their people without being hysterical," he said.
BIG-MONEY LAW FIRMS
National rankings are based on gross revenue.
Net. Gross rev. opr. inc. Name City (millions) (millions) 1.Skadden, Arps, Slate, New York $517 $235 Meagher & Flom 2.Baker & McKenzie Chicago 341 135 3.Jones, Day, Reavis & Pogue Cleveland 320 130 4.Shearman & Sterling New York 281 98 5.Gibson, Dunn & Crutcher Los Angeles 280 125 6.Davis Polk & Wardwell New York 240 108 7.Sullivan & Cromwell New York 230 115 8.Latham & Watkins Los Angeles 223 114 9.Cravath, Swaine New York 213 113 & Moore (tie) 10.Fried, Frank, Harris, New York 213 85 Shriver & Jacobson (tie)
Lawyers/ Name Partners 1.Skadden, Arps, Slate, 948/147 Meagher & Flom 2.Baker & McKenzie 1,339/432 3.Jones, Day, Reavis & Pogue 1,052/369 4.Shearman & Sterling 487/123 5.Gibson, Dunn & Crutcher 611/194 6.Davis Polk & Wardwell 380/96 7.Sullivan & Cromwell 345/95 8.Latham & Watkins 475/170 9.Cravath, Swaine 288/64 & Moore (tie) 10.Fried, Frank, Harris, 368/104 Shriver & Jacobson (tie)
Net. Gross rev. opr. inc. Name (Nat'l rank) City (millions) (millions) 1.Gibson, Dunn & Crutcher (5) Los Angeles $280 $125 2.Latham & Watkins (8) Los Angeles 223 114 3.O'Melveny & Myers (14) Los Angeles 198 89 4.Morrison & Foerster (22) San Francisco 168 58 5.Pillsbury, Madison San Francisco 144 44 & Sutro (27) 6.Paul, Hastings, Janofsky Los Angeles 123 43 & Walker (32) 7.Brobeck, Phleger San Francisco 121 36 & Harrison (36) 8.Graham & James (61) San Francisco 85 30 9.Heller, Ehrman, White San Francisco 84 30 & McAuliffe (63) 10.Thelen, Marrin, Johnson San Francisco 82 27 & Bridges (64)
Lawyers/ Name (Nat'l rank) Partners 1.Gibson, Dunn & Crutcher (5) 611/194 2.Latham & Watkins (8) 475/170 3.O'Melveny & Myers (14) 449/145 4.Morrison & Foerster (22) 481/168 5.Pillsbury, Madison 450/165 & Sutro (27) 6.Paul, Hastings, Janofsky 356/112 & Walker (32) 7.Brobeck, Phleger 339/98 & Harrison (36) 8.Graham & James (61) 313/124 9.Heller, Ehrman, White 274/104 & McAuliffe (63) 10.Thelen, Marrin, Johnson 285/99 & Bridges (64)
Source: American Lawyer's Am Law 100 survey