Crowell & Moring Turns 40 and Eyes Growth Far Beyond Washington

Crowell & Moring quickly established itself as a Washington-centered government contracts and regulatory law powerhouse after breaking away from Jones, Day, Reavis & Pogue in dramatic fashion in 1979.

Four decades later, Crowell is at a crossroads. While its mainstay, government-facing practice groups, remain strong, the firm has been busy writing its next chapter by bulking up its offices in California, New York, and London as it adds to capabilities in health care, international trade, and white collar crime.

As Crowell celebrates its 40th anniversary, the firm has faced its share of challenges, including recent revenue and partner-profit slides. Yet Crowell is increasingly signaling an eagerness to deepen its bench and broaden its focus, including geographically.

“There’s been fantastic growth outside of D.C.—and that’s a direction I see us continuing,” said Chahira Solh, head of Crowell’s 27-lawyer Orange County, Calif. office.

Growth Plans

After leaders at Jones, Day, Reavis & Pogue (now known as Jones Day) decided to fire the firm’s government contracts team in Washington—because its success, one partner wrote at the time, had “created obstacles to the growth of our national practice"—the heart of that team struck out on their own. The founding of the new firm on June 1, 1979, threw many in Washington’s relatively staid legal community.

Since starting on its own with 53 lawyers, Crowell has grown 10 times as large. As of April 30, the firm included 543 attorneys, including 207 partners and 47 senior counsel, according to a spokeswoman.

The firm has announced several significant hires over the last year. In October it revealed it had scooped up a nine-lawyer health care team from Cadwalader, Wickersham & Taft. Several months later, in early 2019, Crowell picked up a set of laterals in London and announced that the firm’s international consulting arm was opening a new Shanghai office.

California and New York are likely to play a central role in the firm’s growth in the next three to five years, according to Phil Inglima, chair of the firm and a white collar litigator. He told Bloomberg Law that those offices will likely be growing at a faster clip than in the firm’s home base in Washington.

Crowell will be doing this by adding “depth and capacity” to the 20 or so legal disciplines in which the firm already feels well-established, Inglima said.

“We believe we need to continue to be strengthening and deepening, and we expect that to be substantial” over the next three to five years in each of the firm’s existing offices in Los Angeles, Orange County, Calif., and New York. Growth is also expected in the firm’s London and Brussels offices, he said, which are “in recruitment mode right now.”

In Crowell’s San Francisco office alone, he said to watch for announcement of another eight to 10 lawyers by the end of this year.

In addition to growing practice groups, like health care and white collar, that augment the firm’s original Washington-centric strengths, the managing partner of Crowell’s New York office, Glen McGorty, said the firm is also eyeing additional laterals that could add to its overall breadth in areas like corporate law and mergers and acquisitions, as well as tax and real estate.

“I’d love to reach a critical mass of 100 lawyers in New York,” from the roughly 65 currently there, said McGorty, a former federal prosecutor.

Despite growth in other areas, Crowell hasn’t forgotten its roots in government contracts.

On the contrary, that group’s 60 practitioners make up the largest such group the firm has ever known, said government contracts practice group co-chair Peter Eyre.

Eyre said expansion around the country only aids the firm’s government contracts client base. “At the core, in our DNA, is adding value for our clients,” he said—and having the right mix of lawyers in the right mix of locations only helps clients receive holistic solutions when needed.

“Crowell has always been very strategic in the way they’ve been growing,” said Mary K. Young, a Washington-area based partner with the law firm consultancy Zeughauser Group, who did strategic planning for the firm in 2011. “They’ve wanted to build on their strengths.”

Contingency Matters

Consolidating strengths has had its challenges for Crowell & Moring in recent years. The firm has in the past had merger discussions with smaller New York firms Satterlee Stephens, and Herrick Feinstein, which according to reports at the time, broke off in 2016 and 2017 respectively.

Those interviewed for this story were reluctant to talk about these discussions—though McGorty said “in every instance, we made the decision that it wasn’t the right fit for us.”

And despite its overall headcount growth, Crowell has suffered reversals in terms of gross revenues, which in 2018 dropped 4.2 percent from the previous year to $401 million, and in profits per equity partner, down to about $1 million from $1.1 million, according to the most recent AmLaw rankings.

Inglima attributed the decreases as temporary setbacks resulting from Crowell’s reliance on contingency work, about 10 to 12 percent of the firm’s revenues, he estimated. That’s a bigger part of the revenue mix than is the case at other AmLaw 100 firms, he said.

Contingency case revenues spiked in 2016 and 2017, said Inglima, in part through the $680 million judgment against the Sudanese government the firm won on behalf families of Americans killed in the 1998 bombings at American embassies in Kenya and Tanzania.

At its core, he said, the firm’s “base business” of hours billed and fixed-fee, non-contingency work boasted a record year in 2018.

Sponsorship and Diversity

Crowell & Moring lawyers say the firm promotes values not usually associated with Big Law, like collaboration, credit-sharing, and democratized decision-making.

A big part of the democratic nature of the firm is reflected by its efforts to ensure diversity, as well as its commitment to pro bono work, partners said. Crowell will be celebrating this week in large part through community service efforts at each of its seven offices.

The firm touts that in 2018, it elected a majority-women class of new partners, five of eight, for the first time, and that more than 50 percent of the partners in the firm’s L.A. office are now female or can otherwise be classified as diverse.

One reason for this is Crowell’s rooted sponsorship initiative, launched in 2012, which groups more senior attorney sponsors with less veteran protégés, to aid the protégés’ careers by helping them “move through this organization,” said Ellen Dwyer, chair of Crowell’s executive committee.

“We needed to be more deliberate in ensuring that our women and diverse lawyers, and of course other majority lawyers as well, had access to sponsorship,” said Dwyer. “We want to embed sponsorship as a cultural value of the firm.”

More than 100 Crowell attorneys have taken part in the program as sponsors or protégés, she said.