Who are the most successful plaintiffs firms in the land? For the first time The American Lawyer has answered that question, identifying the 16 highest-grossing plaintiffs firms in the United States. They are a group diverse in geography–they dot the map from New York to California, Chicago to Florida–and in size.
Reaud, Morgan & Quinn of Beaumont, Texas, has all of 13 lawyers. Milberg Weiss Bershad Hynes & Lerach, before it split, had more than 200. These firms also run the practice area gamut. They include a boutique aviation shop, two paradigmatic personal injury practices, and the country’s most efficient securities and mass tort operations. If there’s anything that links the 16 disparate firms, it’s a sensibility: Reaching the pinnacle of success as a plaintiffs firm requires as much business savvy as legal ability–and as much of both as generating revenue on the defense side.
A lot of the people on this list actually didn’t want to be here. It’s not that they didn’t want to be acknowledged as the most successful of their breed–they did–but they feared that any linkage of their firms’ names with dollar figures would make them even more convenient political targets than they already are. “They’re going to take your list and match it with political contributions and wave it around,” one lawyer said.
Perhaps, but we think this list of the top-grossing plaintiffs firms in 2003 (the most recent complete fiscal year) is apt to be rather disappointing to tort reform types. The big surprise to us as we compiled it was how few plaintiffs firms took in gross fees of over $50 million, a number that wouldn’t put them within spitting distance of The Am Law 200. The highest-grossing plaintiffs firms generate revenue of less than $150 million in a typical year, and that’s counting the $20Ð30 million a year that seven of these firms receive from the tobacco litigation.
There are exceptions, of course–Lloyd Constantine of Constantine & Partners isn’t on this list, which looks at gross revenue for 2003, but will take in over $200 million next year, when his court-approved fees in the Visa USA Inc. and Mastercard International Inc. antitrust suits are paid. But for the most part even the biggest and most successful plaintiffs firms aren’t grossing anything like the biggest and most successful defense firms in The Am Law 200.
Revenue per lawyer is another story. In some cases RPL is a number that makes the folks at Wachtell, Lipton, Rosen & Katz look like a bunch of slackers. At 13-lawyer Reaud, Morgan & Quinn lawyers generate an average of almost $8 million in revenue. But as so many of these plaintiffs lawyers are quick to point out, even revenue per lawyer doesn’t translate directly to profitability.
Their overhead costs can be staggering. Perry Weitz of Weitz & Luxenberg, whose firm is profiled beginning on page 14, says that with research, mock juries, advertising, experts, and paralegal support, it can cost his firm as much as $25 million to gear up for a mass tort, with payoffs sometimes not coming for years, and sometimes not at all. Law school students take note: Whatever you’ve heard about frivolous lawsuits, quick settlements, and private Gulfstream jets, it’s actually not easy to make a killing as a plaintiffs lawyer.
This list is not an accounting of the richest plaintiffs lawyers in America, though certainly many of them practice at firms represented here. Because of the idiosyncratic compensation structure of plaintiffs firms–and the extremely limited number of lawyers within each firm with access to financials–we did not attempt to calculate profits per partner. It is a certainty, however, that partners at several of these firms regularly bring home more than the $2.9 million at Kasowitz, Benson, Torres & Friedman that topped The Am Law 200 this year. Kasowitz has 44 partners.
Reaud, Morgan has two. Weitz & Luxenberg has three. Both firms are tightly managed, so no matter how much it costs to engineer mass torts, those partners are doing very, very well, thank you. This list is also not intended to acknowledge spectacular results by sole practitioners or plaintiffs lawyers practicing at firms too small to generate $50 million in revenue. Nor does it include firms that specialize in corporate plaintiffs work, such as Houston’s enormously successful Susman Godfrey, which had revenue in 2003 of over $100 million.