An earlier version of this story misidentified the chair of the firm's insurance and reinsurance practice. He is Elliott M. Kroll not Elliott M. Knoll.
Law firms expand despite downturn
Monday, July 5, 2010
Washington-based Arent Fox, which like many law firms has been exploring how it can reshuffle practice areas and restructure in light of the economic downturn, is launching an insurance and reinsurance unit in New York.
Last month, the firm hired five lawyers for the unit that will litigate cases for and against insurance companies, represent the industry in regulatory matters before Congress and advise insurers on their own insurance and investments. The firm said it expects the unit to grow substantially in the future.
"The reality is insurance is countercyclical or at least noncorrelated to the economy," said Elliott M. Kroll, who chairs the firm's insurance and reinsurance practice. "Everyone needs insurance and disputes arise ... There are always regulatory issues to be addressed that have nothing to do with whether the stock market is up or down."
Over the past two years, law firms have been scrambling to find new work to make up for lost revenue they experienced when their corporate clients, particularly in commercial real estate and finance, significantly reduced their legal work to save money. They have taken a range of action -- closing practice areas, laying off lawyers, using contract lawyers, offshoring legal work, merging and even shutting down.
"It's always prudent business to move your pieces around in response to fluctuating demand and to focus on growing practices with the most immediate potential," said Eric Seeger of Altman Weil, a consultancy based in suburban Philadelphia that advises law firms.
Womble Carlyle Sandridge & Rice last month established a practice to help companies under scrutiny by a state or federal government investigation.
Howrey is another D.C. law firm that has expanded into new areas.
Earlier this year, Howrey launched an energy technology unit, with about 25 lawyers focusing on matters related to the construction of nuclear power plants. In 2008, it acquired about 45 lawyers in the construction litigation practice at Thelen when that firm went out of business.
"As entities in the construction industry have run out of money and financing disappears -- this is fertile ground for litigation," said Mark A. Klapow, a Howrey partner.