1. NOVEMBER 29 2012
FT
US INNOVATIVE
LAWYERS
2012
www.ft.com/innovative-lawyers-us
RESEARCH PARTNER SUPPORTED BY

2. 2 FINANCIAL TIMES THURSDAY NOVEMBER 29 2012 FINANCIAL TIMES THURSDAY NOVEMBER 29 2012 3
US INNOVATIVE LAWYERS 2012
LEADING AND LAGGING
This is the third year that the Finan- the report show that some four years moving into the 21st century in how
cial Times has produced the US Inno- after the start of the financial crisis, it communicates with clients, the
vative Lawyers special report. The lawyers are helping to bring resolu- report suggests that, in terms of proc-
report includes our unique rankings tion to some of the bitter disputes ess innovation, US firms lag behind
of law firms that are bringing fresh arising from the credit crunch and the those in the UK. While there are the
thinking and practices to solving busi- finalising of significant restructurings beginnings of change, relatively few
ness problems in America. – though a few battles are still being top firms have tackled seriously their
This year we have had a particularly fought. hourly fee models, despite the increas-
strong set of submissions to the rank- The increased burden of regulation ingly vociferous demands of clients.
ings, from more than 60 law firms and on US business, notably in the anti- But as the in-house corporate counsel
nearly half that number of in-house trust area and the Dodd-Frank Wall section of the report reveals, lawyers
legal teams across the US. The sub- Street reform act, has kept lawyers at top US companies are changing the
missions give an insight into some of busy trying to lighten the load for cli- rules of engagement.
the main business, regulatory and eco- ents in an innovative manner. I would like to pay particular thanks
nomic issues preoccupying America. And while Asian and South Ameri- to Reena SenGupta, the inspiration
Some of the most dynamic areas of can economies present great opportu- for the rankings, whose RSG Consult-
the economy are showing themselves nities for US businesses, they can also ing does the research; and to FT col-
by the way they are pushing and pose threats – from copycat manufac- leagues who have helped make the
changing the law to keep up with their turers and from alleged theft of intel- report such an annual landmark.
innovations. These sectors include lectual property. Lawyers have been
technology, social media, telecommuni- heavily involved in these controver- Martin Dickson
cations, pharmaceuticals and energy. sies, such as in the smartphone wars. US Managing Editor
The litigation and finance sections of But, while the US legal profession is Financial Times
THIS YEAR... Contributors
TRACY ALLOWAY
is the FT’s US Financial Correspondent
SPECIAL REPORTS EDITOR
Michael Skapinker
CAROLINE BINHAM EDITOR
is the FT’s Legal Correspondent Hugo Greenhalgh
INTRODUCTION INDIVIDUALS ED CROOKS LEAD EDITOR
4 The top legal businesses have plotted 14 The top 10 agents for change is the FT’s US Industry and Energy Rohit Jaggi
moves that recognise the increased Editor PRODUCTION EDITOR
power – and demands – of clients BUSINESS OF LAW DAVID GELLES George Kyriakos
16 Training and secondment are is the FT’s US M&A Correspondent SUB EDITOR
CORPORATE helping to keep lawyers off the SARAH MURRAY Diana Hargreaves
6 Law firms have skilfully identified rocks of uncertainty is a freelance journalist ART DIRECTOR
ways to make sure that corporate REENA SENGUPTA Derek Westwood
mergers get the regulatory green light IN-HOUSE is chief executive of RSG Consulting PICTURE EDITOR
despite opposition 18 Cross-functional groups and cost PAUL SOLMAN Michael Crabtree
efficiencies are transforming legal teams is a freelance journalist ILLUSTRATOR
INTELLECTUAL PROPERTY RICHARD WATERS Martin O’Neill
8 Pharmaceutical groups are foremost LITIGATION is the FT’s US West Coast Editor RESEARCH
among those that have needed help from 20 Creative work is reversing a sharp Lulu Rumsey
law firms rise in the scope of joint cases PUBLISHER, EMEA
Dominic Good
LAWYERS TO THE INNOVATORS ENERGY HEAD OF STRATEGIC SALES
9 Law firms are increasingly helping
clients to shape their businesses in areas
22 Novice global powers and the shale
revolution are changing the energy
Research methodology Patrick Collins
HEAD OF PROJECT DELIVERY
such as digital strategy and networking landscape Rachel Harris
The FT and its research partner RSG HEAD OF B2B & WORLD REPORTS
FINANCE Consulting use a bespoke methodology Robert Grange
10 From embattled firms to ailing to rank lawyers on innovation. ADVERTISING PRODUCTION
economies, lawyers have played a critical For the FT US Innovative Lawyers 2012 Daniel Lesar
role in restructuring report, 320 submissions were received
and more than 400 telephone inter- RSG RESEARCH TEAM
views with senior lawyers and C-suite Reena SenGupta, Yasmin Lambert,
executives conducted to arrive at the Caroline Davies, Dominic Williams,
final rankings. The entries were scored Alex Mole, Maria Kyriacou
out of 10 points on originality, ration-
ale and impact, and benchmarked
against each other to arrive at the
final rankings. The research was con-
ducted by a team of six RSG research-
ers between September and November
2012.
A more comprehensive version
of the tables can be found at
www.ft.com/innovative-lawyers-us

3. 4 FINANCIAL TIMES THURSDAY NOVEMBER 29 2012 FINANCIAL TIMES THURSDAY NOVEMBER 29 2012 5
US INNOVATIVE LAWYERS 2012 US INNOVATIVE LAWYERS 2012
INTRODUCTION
FIRMS GROW ● FT LAW 25
SMARTER ON Rank
2012
1
Rank
2011
5
Firm
Latham & Watkins
Legal
expertise1
133
Business
of law2
41
Total3
174
STRATEGY 2
3
2
7
Skadden, Arps, Slate, Meagher & Flom
Paul Hastings
162
104
0
42
162
146
4 1 Davis Polk & Wardwell 98 38 136
The top legal businesses have plotted moves 5 3 Cleary Gottlieb Steen & Hamilton 106 19 125
that recognise the increased power – and
6 22 84 0 84
demands – of clients, says Reena SenGupta
Weil, Gotshal & Manges
7 9 Seyfarth Shaw 60 22 82
7 14 White & Case 62 20 82
9 11 Kirkland & Ellis 81 0 81
9 10 Paul, Weiss, Rifkind, Wharton & Garrison 81 0 81
11 22 Jones Day 75 0 75
12 12 Mayer Brown 64 0 64
12 4 Orrick, Herrington & Sutcliffe 40 24 64
14 - Cooley 61 0 61
N
14 8 Sullivan & Cromwell 61 0 61
16 - Crowell & Moring 40 20 60
16 - Ropes & Gray 60 0 60
18 - DLA Piper 36 23 59
early all the leaders of changing their behaviours and assuming tres. In terms of changing the value propo- Paul Hastings has put behaviour change of legal work for the lawyers. Work com- changing market conditions and a com-
the firms in the 2012 FT Law 25 had the different roles. sition of lawyers, the trends have been at the centre of its Superior Performance ing from the collapse of Lehman Brothers, mitment to innovation that marks them
same observation this year: the market is The submission from Morrison Foerster, subtle but more interesting. and Coaching programme, designed to the US investment bank, from the big out to their clients. 19 6 Cravath, Swaine & Moore 58 0 58
flat so the only way to grow is to win a firm that started on the west coast, Brad Malt, chairman of Ropes & Gray, place the competencies most valued by financial institutions and from litigation Another firm that has done significantly
business from competitors or to create exemplifies these trends. Its commitment says: “Buggy whip manufacturers went clients at the core of its associate career relating to residential mortgage-backed better in the rankings is Weil, Gotshal & 20 - Debevoise & Plimpton 43 0 43
new markets. to the US covered bond market in the out of business as they did not adapt to development. securities still creates situations where Manges – up 16 places – which has
Most of the top US law firms have simi- mid-2000s broke new ground to allow insti- the car. We are faced with a buggy whip The firm analysed the behaviours of role lawyers can craft the innovative solutions appointed younger partners to head the
lar strategies – to focus on retaining pre- tutions access to additional capital. And moment. Firms can pretend that old mar- model lawyers in the firm before building that dominate the FT rankings. litigation and corporate departments. Exec- 20 18 Dechert 24 19 43
mium work and to avoid commoditisation. its ability to marry its technology exper- ket dynamics exist – but they don’t.” For a proprietary framework around them. The nature of the financial crisis has utive partner Barry Wolf says: “Our law-
To achieve this, they need continually to tise with its capital markets practice the firms who agree with this, changing Although this is not new in the corporate also driven unexpected opportunity. While yers are adapting to the moving cheese.
20 21 Simpson Thacher & Bartlett 23 20 43
prove that they are ideal for handling recently gave birth to FrankNDodd, named the behaviours of their lawyers to align world, the systematic and comprehensive the image of the bankers is tarnished, the We preach the wow factor – the idea that
complex, high-value matters. This is not after the Dodd-Frank Wall Street Reform more with clients’ demands is imperative. way that the firm has sought to replicate legal profession retains its reputation for you have to continually impress clients.”
easy in the $240bn US legal market, which and Consumer Protection Act. This tool desired lawyer behaviour is unusual for integrity and independence. Several law Most of the top US law firms are well- 23 - Holland & Knight 19 23 42
is both broad and deep. In 2010, the vast allows institutions to navigate the regula- the legal profession. firm leaders felt that clients were increas- managed businesses. But management
majority (78) of the top 100 most-profitable tory tangle of new legislation. Both inno- Crowell & Moring realised that to get ingly looking to their lawyers instead of writer Clayton Christensen, author of The
law firms globally were American. vations are ranked in the 2012 FT report. the whole firm to use professional project the bankers for more all-encompassing Innovator’s Dilemma: When New Technolo- 24 19 Morrison & Foerster 22 19 41
The only way these firms can maintain Four years into the downturn with no management techniques required behav- business advice. gies Cause Great Firms to Fail, points out
their position on the value curve is to sign of a boom means clients have the iour change. “We started with the notion Chris White, chairman of Cadwalader, that even the best-managed businesses 25 16 Cadwalader, Wickersham & Taft 40 0 40
prove to clients that they are unique. This upper hand. Nearly all the 200 clients that we, not an outside consultant, had to Wickersham & Taft, says: “There is a void can fall from industry leadership.
onus on differentiation may be one reason interviewed to compile the report wanted change behaviour before an online tool as to who the CEO can turn to. They are The question for the US legal profession
why they have been keener than ever to better fee arrangements and efficiencies would be effective,” says the firm. After relying more on the lawyers and not so is whether the financial crisis is a turning 1) Legal expertise score is the total score for all ranked entries in the Corporate, Finance, Litigation, IP, Energy and Lawyers to the
show the Financial Times their innova- from their law firms. While a few firms ‘We preach the wow putting more than 400 lawyers through much on the bankers. This gives the pro- point similar to that facing Sears, the innovators categories. The maximum possible score is 360.
tions. A flat, paralysed market has taken still feel they can sidestep client demands, the training, the firm’s project manage- fession an opportunity to innovate.” department store, in the 1980s when it 2) Business of law score is the total score for all ranked entries in the Business of law category. The maximum possible score is 90.
innovation from something that is nice to most have sought to improve their process factor – the idea that ment approach is now becoming a differ- This year’s FT Law 25 shows west coast failed to read the implications of discount 3) Total is the score for all ranked entries in all categories of the report. The maximum possible total is 450.
have, to being a “must-have”. innovations and, in particular, the value entiator for it in winning pitches. firms Latham & Watkins and Paul Hast- retailing for its core business.
The competition in the FT report proposition of their younger lawyers. you have to However, the pace at which the US ings rising through the tables to challenge All the chairmen of the top firms talk
US INNOVATIVE LAWYERS 2012 SUPPORTED BY
reflects the struggle for market differenti- On the process innovation side, the sig- firms are adopting process innovations is previous incumbents Davis Polk & Ward- about change and the need to “not fight
ation. The rankings reveal lawyers nificant trends have been a more wide- continually impress much slower than in the UK. Part of the well and Skadden, Arps, Slate, Meagher & the last war”. And yet at the same time
working at the intersection of different spread adoption of fixed and predictable reason for this is because the financial Flom. With strong submissions across the they cannot, they say, see their firms
practice areas and technologies, actively fees, project managers and low-cost cen- clients’ crisis has continued to deliver a rich seam board, these firms display resilience to being all that different in five years’ time.

4. 6 FINANCIAL TIMES THURSDAY NOVEMBER 29 2012 FINANCIAL TIMES THURSDAY NOVEMBER 29 2012 7
US INNOVATIVE LAWYERS 2012 US INNOVATIVE LAWYERS 2012
CORPORATE
● CORPORATE
Score
Dechert 24 Developed a clever agreement and “air cover” strategy to pull off
client Medco’s $29bn merger with Express Scripts.
Mayer Brown 24 Used an innovative method of valuing contract terms to enable
Standout
Cemex to identify IBM as the most suitable strategic partner.
Skadden, Arps, 23 Acting for Express Scripts, used a new approach to merger
Slate, Meagher guidelines and a “double dummy” structure to complete its $29bn
& Flom deal with Medco.
Davis Polk 22 Advised Dalian Wanda in its $2.6bn purchase of AMC, the largest
& Wardwell ever takeover of a US company by a Chinese group.
Cleary Gottlieb 21 Used a “poison pill” and an unusual board agreement to defend
Steen & retailer Family Dollar against a hostile takeover bid from Trian.
Hamilton
Kirkland & Ellis 21 Developed a complex merger and financing arrangement to enable
three buyers to acquire shoe company Collective Brands, then split
the business between them.
Kirkland & Ellis 21
Highly commended
Crafted a novel indemnification structure to ensure American
brewer Molson Coors’ €2.65bn ($3.37bn) acquisition of StarBev
was acceptable on both sides of the Atlantic.
Paul Hastings 21 Secured EU competition approval for $1.375bn sale of Samsung
hard disk drive business to Seagate Technologies, paving the way
for clearance in other key jurisdictions.
Davis Polk 20 Employed mergers and acquisitions principles to create a flexible
& Wardwell mechanism and bring about Delphi Automotive’s initial public
offering.
Skadden, Arps, 20 Devised a novel agreement to separate Amilyn from Eli Lilly,
Slate, Meagher preserving Amilyn’s value before acquisition by Bristol-Myers Sqibb
& Flom and AstraZeneca.
White & Case 20 Overcame significant hurdles to enable Industrial and Commercial
Bank of China to acquire controlling stake in Bank of East Asia of
the US.
Cravath, Swaine 19 Developed a highly complex transaction to allow Pentair to merge
& Moore into Tyco Flow and redomesticate the new business to Switzerland.
Latham & 19 Created a way to assure National Football League players’ incomes
Watkins during a dispute with owners, helping to prevent cancellation of the
even though it filed with the commission a Express Scripts and Medco could were not 2011 season.
SWEETENING
day later, its deal was reviewed after the actually close competitors. The FTC
Samsung one. subsequently found at least 10 significant Mayer Brown 19 Balanced the interests of airlines, government agencies and lenders
“That 24-hour difference in the filing others. to secure the privatisation of Luis Munoz Marin Airport in Puerto
Rico.
turned out to be decisive,” says Mr Hata- “There has been a revolution in anti-
way. “The other group was viewed to be the trust in the last 10 years. Historically mar- Skadden, Arps, 19 Took an unusual approach to Delaware law to successfully
‘three to two’ instead of the ‘four to three.’” ket shares ruled. Now more weight is
THE PILL
Slate, Meagher defend Cephalon against a hostile takeover bid from Valeant
As a result, the Samsung/Seagate deal placed on competitive effects analysis,” & Flom Pharmaceuticals.
was cleared without conditions, while says Dechert partner Mike Cowie. Sullivan & 19 Provided multi-faceted advice on Frank McCourt’s divorce, the
Commended
Western Digital and Hitachi had to agree After an eight-month review, the work Cromwell bankruptcy and sale of the LA Dodgers and a settlement with Major
to substantial divestitures. of Dechert and Express Scripts counsel League Baseball.
“Samsung latched on to this in a way Skadden, Arps, Slate, Meagher & Flom
that most clients would not,” says Mr Hat- was successful and the merger was Akin Gump 18 Devised a legal structure combining non-profit services and
away. “Doing all this work before the deal approved. Strauss Hauer for-profit management approaches to provide affordable healthcare
Law firms have skilfully identified ways to make
& Feld in Texas.
is negotiated was a bit unusual.” In other deals, finding the right solution
An even more dramatic bout of consoli- was not so much about overcoming oppo- Kirkland & Ellis 18 Created an unusual agreement between Bristol-Myers Squibb and
sure that corporate mergers get the regulatory dation was also going on in the US phar-
macy benefits-managers (PBM) market at
sition as about hedging risk. When an
auction for Amylin Pharmaceuticals, a
AstraZeneca, providing a template for collaboration in the
pharmaceuticals sector.
green light despite opposition, finds David Gelles about the same time. In July 2011, Express
Scripts, the third-largest player in the
biotechnology company specialising in
diabetes drugs, began this year, most of
Sullivan &
Cromwell
18 Developed a complex holding company structure to enable Chile’s
LAN Airlines to merge with Brazil’s TAM, creating the leading Latin
industry, said it would buy Medco Health the big pharmaceutical companies took American carrier
Solutions, the second-largest, for $29.1bn. note.
The industry already had only three big Kirkland & Ellis client Bristol-Myers Jones Day 17 Used an exchange offer to help tempt S1 shareholders away from an
A
existing offer and accept a bid from ACI Worldwide.
rivals, and this deal would reduce that Squibb, the pharmaceutical group, was
number to two. As is the case with most among those interested. But the Amylin McDermott Will 17 Provided critical advice on Chinese law to enable the Fila/Mirae-led
“three to two” mergers, opposition came price tag, of around $7bn, was rather too & Emery consortium to win South Korea’s largest ever outbound consumer
from all sides. The pharmaceuticals indus- much for Bristol to tackle alone. So Kirk- products deal.
try lobbied hard, and the Federal land helped Bristol to partner with Astra-
Trade Commission, 32 state attorneys-gen- Zeneca, another drug company with which
eral and both houses of Congress held it already collaborated on diabetes drugs.
hearings. Though so-called “club deals” are com-
To win over regulators, attorneys from monplace among private equity firms, it
ny significant transac- two. The law firm Paul Hastings knew Dechert realised they would have to make was unprecedented for two public compa- a structure under which Bristol assumed partner, who represented Wanda. These
tion has challenges – which may be that its client Samsung would face an the case that market share was no proxy nies to team up to buy another public full ownership of Amylin. But through a sensitivities led Mr Mills to exercise unu-
related to regulation, competition or price. uphill battle if it were viewed as the fol- for market power. With a new interpreta- company with the intention of jointly new contract, AstraZeneca assumed 50 per sual caution while working with AMC’s
And while it is up to bankers to orches- lower. So New York partners, including tion of the recently revised merger guide- owning and operating it. cent ownership of the company. The unique private equity owners. In a move
trate the deal and the companies to reap Scott Hataway, looked for ways to regain lines in the US, Dechert demonstrated that But because Amylin was being sold in structure protected the companies from to ease the sellers’ nerves, Wanda depos-
the rewards, it is often the corporate law- first-mover advantage. The team identified a fast-moving auction, Kirkland had to substantial tax liabilities. ited a large sum of money in a Hong Kong
yers who are left to do the dirty work of a precedent in European law that would work with Bristol and AstraZeneca to Another risky deal earlier this year came account that AMC would be entitled to
figuring out just how, exactly, to get a allow the Samsung deal to be reviewed by establish rules for the bidding, and a max- in the form of the biggest-ever acquisition collect even if the deal were to fall apart.
deal done. the European Commission before the imum price the companies were willing to of a US corporation by a Chinese company, Such reverse termination fees are not
When Samsung Electronics began the Western Digital deal, even though Sam- pay. A stipulation was included that if Dalian Wanda Group. The conglomerate uncommon in deals in which private
process of selling its hard disk drive oper- sung’s was announced later. If either company either company wanted to continue bid- said in May this year that it would buy the equity firms are the buyers.
ations to Seagate Technology, the compu- Standard practice is to announce the ding without the other, it could do so only cinema chain AMC Entertainment Holdings “It was a sign that we had meaningful
ter storage manufacturer, for $1.375bn, it deal, then file for review with the wanted to continue on its own and not with a new partner, for $2.6bn. skin in the game and did not want to walk
knew obstacles lay ahead, with the market commission. Simply putting together the and that the company that did not con- Chinese acquisitions of North American away,” says Mr Mills.
already consolidating. Then, as it was pre- filing can take months, and by the time bidding without the tinue would not then be able to re-emerge companies are viewed warily these days, Ultimately the fee was not needed.
paring the deal, rivals Western Digital and Samsung was set to announce its deal, as a buyer. “This was particularly chal- and almost all such deals come under scru- Davis Polk was able to get the deal
Hitachi said they wanted to Western Digital still had not filed. other, it could do so lenging given that we were in a competi- tiny from the Committee on Foreign Invest- cleared by the regulators. Nonetheless the
cut a deal on their hard disk drive busi- So Samsung worked with the commis- tive auction process,” says Kirkland part- ment. “From a purely rational point of view reverse termination fee was an innovative
nesses as well. Taken together, the two sion beforehand, then filed for review only on its own, not ner Daniel Wolf. it seemed benign, but the fact that it was a solution to an unusual problem – some-
transactions would reduce the number of within an hour of announcing the deal. Once Bristol and AstraZeneca won the Chinese buyer made the sellers nervous,” thing that is so often needed to push com-
big players in the market from four to Western Digital was caught off guard. And with a new partner bid, Kirkland helped the companies devise says Philip Mills, a Davis Polk & Wardwell plex deals through.