When the founders of King & Wood — now the largest law firm in the People’s Republic of China — chose that name 11 years ago, it wasn’t about ego.
“Actually, we do not have a Mr. King and a Mr. Wood,” says Wei Zhang, a Palo Alto, Calif.-based partner in the firm. Instead, the firm, hoping to appeal to Western clients, named itself with two Chinese characters that, when pronounced, sound like King and Wood. “I think maybe there is a famous Western lawyer named Mr. Wood,” adds Zhang.
King & Wood is one of a handful of foreign law firms that have been setting up shop in San Francisco or Silicon Valley as globalizing U.S.-based firms invade their native lands. Though some are more ambitious, most are content to put just a few lawyers on the ground, with the goal of finding and keeping clients and sending some work home.
“It’s a model that many American firms have followed overseas,” says legal consultant Peter Zeughauser. “They’re offices opened to develop relationships with other law firms and search for work.”
As American firms learned when venturing overseas, it isn’t easy to gain traction and get noticed in a crowded market.
King & Wood sought to open a beachhead in the Bay Area three years ago by merging with a tiny Fremont firm.
But the PRC firm found its new American partners more interested in joining the wave of Chinese-American returnees — dubbed “sea turtles” in China — eager to get in on China’s explosive growth.
In March, Zhang showed up with the vision of using the office to market his firm to U.S.-based companies involved in international transactions.
“We have to try,” he says. “In China we are very famous — We are [the] top PRC law firm for four consecutive years.”
Even Australia’s Minter Ellison, the largest firm in the East, took time to become known in the Bay Area.
The 1,400-lawyer firm, which opened first in New York five years ago before settling upon a San Francisco office, also has offices in Bangkok, Hong Kong, Jakarta, Shanghai, Australia, New Zealand and London.
It now has seven lawyers in the Bay Area.
“It’s very, very different going from a market where we are a major brand and a significant player to one where the majority of the market isn’t very familiar with us,” says Darren Gardner, who heads the firm’s San Francisco office.
But it’s making inroads in the tech sector, handling labor and employment issues for Cisco Systems Inc. and others, including some Silicon Valley law firms.
“We and Minter Ellison refer work to each other,” says Fenwick & West partner Ralph Pais. “What better way to have somebody remember you? It is like sending them flowers.”
The Indian firm Nishith Desai Associates staffs its Silicon Valley office with associates who come from Bombay and Bangalore for three- to four-month stints.
The advantage is the lawyers maintain an “India” perspective, says associate Kartik Ganapathy.
Most of the newcomers are from the Pacific Rim. “We’re too far for the European firms,” says Fenwick’s Pais. And few of the newcomers have the size or reach of the top U.S. firms, much less that of the U.K.’s huge Magic Circle firms.
“Most of the Asian firms are not that big and tend to be country-specific,” said Pais.
That’s why relationships with American firms can make all the difference.
King & Wood is now leasing space in Wilson Sonsini Goodrich & Rosati’s Palo Alto office. In exchange, Wilson plans on making its home inside King & Wood’s Beijing space when it goes to China.
“We have lots of mutual friends,” says Wilson partner Lucas Chang. Though they have no formal relationship, Chang says, the firms refer work to each other.
“Most U.S. companies and venture funds prefer to use a U.S. law firm and have them work with a PRC law firm,” says Carmen Chang, a partner in Shearman & Sterling’s Menlo Park, Calif., office. Still, she says, “Most of the PRC law firms can stand on their own two feet.”
An example is Jun He Law Offices, whose client list includes Fortune 500 companies Motorola, ExxonMobil, General Motors and WalMart. The firm, with a 10-year-old office in New York, handles some matters on its own, others alongside American lawyers.
Many law firms in China, says Jun He partner Xiaolin Zhou, “look like an association of lawyers getting together to practice and share the cost. But we are more like a real structured partnership.”
Jun He has stationed one of its lawyers at Fenwick & West, and the firm also lent a lawyer to Wilson Sonsini, back when Carmen Chang worked there.
“So far, Jun He doesn’t have a presence in Silicon Valley,” says Jie Chen, the Jun He partner at Fenwick. “I hope the people with the companies and the bankers here will know more about Jun He.”
Jun He also boasts that more than 30 of its 200 lawyers are U.S.-licensed.
Zhou says other firms may head to the United States from China. But he doesn’t expect too much competition. “Law firms are very busy domestically in China. And also to open an office here, it requires a tremendous amount of talent, time and money.”
McCann Fitzgerald, an Irish firm, has its own unique strategy: Skip the lawyers.
The firm’s sole agent is a business development professional, Larry Mone. His job is to find tech companies that might want to move operations to Ireland. The McCann firm specializes in helping companies set up shop.
“From customer service to back-office stuff, [American companies] look to Ireland,” says Mone. He markets Ireland’s English-speaking workforce, business-friendly environment and low corporate tax rate.
While the U.K.’s Clifford Chance made a big splash in California, many English firms are content to dispatch lawyers for visits to the Valley in the hopes of developing referral relationships.
“They mostly show up when the weather in Europe is particularly bad,” says Fenwick’s Pais.
Others believe you can’t beat being on the ground. Osborne Clarke opened a Silicon Valley office five years ago — just in time for the downturn. Still, the small office of this U.K.-based firm regularly works deals with Valley firms.
For example, the firm has teamed up with Wilson to provide U.K. legal advice to Informatica Corp. in its $62 million merger with Striva Corp.
And Osborne has worked alongside Heller Ehrman, assisting client ActivCard Corp. in its acquisition of Aspace Solutions Ltd., and helping with a spin-off of a British pub chain.
Brett Dick, who directs Heller’s international practice, found Osborne lawyers invaluable. “They helped translate the English documents into English,” he says.