Clifford Chance Plots US Growth Amid ‘Kirklandization’ of Market

Clifford Chance is positioning itself as “opposite” to behemoth US law firms as it looks to grow stateside and fend off increasing competition on its home soil.

“We are adapting and we will adapt to that market,” firm global managing partner Charles Adams said of the US. “But also, everywhere, offensively and defensively, where the likes of Kirkland and Latham want to compete.”

The London-founded firm wants to double its revenue in the US. It’s turning to the lateral hiring market, looking to add 12-19 partners annually in the next three years. That would build on an impressive 2023 fiscal year that saw Clifford Chance recruit 19 US partners and grow its American revenue by 28%.

The firm doesn’t publicly break out its US-specific revenue. Its global revenue reached nearly $3 billion in its most recent fiscal year, a record, up roughly 9% from the prior year.

For Adams, the key to the firm’s strategy is that Clifford Chance offers multinational clients local, specialized knowledge in markets across the globe. That differs from US firms who’ve built international offices to follow clients’ needs in specific product areas, he said.

Adams is not “naïve around the Kirklandization” of law firms, he said, a nod to the world’s highest grossing law firm, Kirkland & Ellis, and the broader skyrocketing pay for top lawyers. The US market’s competitiveness will cause the firm to “modernize and adapt,” including on compensation, he said.

“It’s a big thing for Clifford Chance to be turning to the market. We’re turning everywhere to the market,” Adams said in a wide-ranging interview, joined by Americas regional managing partner Sharis Pozen. “What we won’t do ever again, I think, is shut ourselves out to the outside world, which is where we’ve been for the last decade.”

Charles Adams

Photo: Clifford Chance

Elite UK firms such as Clifford Chance, Freshfields and A& O Shearman have been waging a two-front battle with highly profitable US firms such as Kirkland, Latham & Watkins and, most recently, Paul Weiss.

Those US firms have unsettled the London market by raising pay for new associates and rainmaker partners alike.

Still, Clifford Chance’s Pozen said the firm doesn’t see itself as “fighting back” against those firms in the US. Pozen is a former Clifford Chance client: she was global head of antitrust at GE. She said international clients see the value of the firm’s longstanding global reach.

A client recently told Pozen Clifford Chance was, in its international scope, “opposite” the offerings of large US firms, she said.

“The US-headquartered firms don’t have the bulk, heft, knowledge and local presence to the degree we do around the world,” Pozen said.

Still, the firm is looking to bulk up its stateside presence.

Clifford Chance last year launched a Houston office, its third in the US, with 10 partners from rival firms, including Latham & Watkins. The strategy was to plug American lawyers into a global energy and infrastructure practice already established in places like London and the Middle East, Pozen said.

The firm’s Houston, Washington, New York and Paris offices in May advised French multinational energy company TotalEnergies on entering a joint venture agreement with Massachusetts-based Vanguard Renewables, according to Clifford Chance. The deal will develop food biowaste into renewable natural gas in the US.

The firm’s “fairly small” geographic footprint in the US has Pozen considering opening an office in California, she said. The market supports the firm’s strategic practices of healthcare, life sciences, technology, and energy and infrastructure.

Sharis Pozen

Photo: Clifford Chance

“We have this global tech powerhouse practice and represent a lot of California and West Coast companies,” she said. “Should we move there defensively to Northern California, or is it a more opportunistic move in Southern California? Those are some of the challenges that I see.”

Partner Christopher Morvillo helped win an acquittal of fraud charges brought against former Autonomy Inc. chief executive Mike Lynch in a San Francisco federal trial in June, ending a 12-year saga that was viewed as one of Silicon Valley’s largest fraud cases.

Clifford Chance also advised on the launch of one of the first spot bitcoin exchange-traded funds in the US earlier this year.

Adams said the firm will watch how the tie-up between Allen & Overy and Shearman & Sterling plays out over the next few years. A successful merger could make other US firms more interested in a deal, he said.

“We want to see success because as a global organization, that does create a level of disruption that we’re interested in seeing succeed,” Adams said. “But we know how hard it is, so we’ll wait and see.”

Clifford Chance has already recruited a number of partners who left A&O Shearman. The additions include Kris Ferranti, a New York-based leader in Shearman & Sterling’s real estate practice, and Daniel Shurman, a London-based derivatives and structured products partner.

The US growth effort comes as pay for top lawyers in the country has soared well above $20 million annually. Adams said the growth in compensation over the past decade is “unprecedented” and represents a “shock to the system.”

Much of that growth has come at firms focusing on private equity clients. Clifford Chance intends to continue offering a balanced set of services to a wide range of clients, Adams said.

“What we’re confident in is there is a sustainable, really exciting version of us that will see us through this,” Adams said. “It won’t be without some pain and internal adjustments, and some losses, and great gains. But that’s the market. We believe in it and we’re a part of it.”