American Airlines passengers who fly tens of thousands of miles per year can earn elite status. Sixty nights annually at Hilton and Marriott hotels qualify for premium standing.
Corporate lawyers at 15 law firms operating in Texas reached elite financial status in 2022, according to the Texas Lawbook 50 data.
Only two are based in Texas. Four are headquartered in New York. Four were founded in Chicago and four others in California. One was birthed in Atlanta.
To make the Lawbook 50 elite, law firms must generate $1.3 million in revenues per lawyer and $3 million in profits per equity partner. We rank the firms based on RPL because PEP is a number that is easy to manipulate.
A handful of law firms, including Akin, O’Melveny & Myers and Fish & Richardson, achieved the $1.3 million in RPL, but each missed the profits barrier by a couple hundred thousand dollars.
Eight of the elite law firms in the Texas Lawbook 50 achieved revenue per lawyer of $1.5 million or more. Three topped $1.8 million. And one, for the first time in Texas history, broke the $2 million RPL barrier. The Texas lawyers at these 15 firms combined generated $3.18 billion in 2022.
On profits per equity partner, 10 of the law firms operating in Texas exceeded $4 million. Four of them exceeded $5 million PEP.
What sets these corporate firms apart from the rest?
They have elite practices and selective clients that allowed their partners to bill at hourly rates ranging from $1,400 to $1,870 in 2022. Associates at these firms billed rates that started at $750 an hour and hit $1,100 an hour for the senior, most experienced ones.
Kent Zimmermann, a law firm consultant at Zeughauser Group and author of Law Firm Mergers: Lessons from Successful Strategic Combinations, put it this way:
“The richest law firms can hire the best lawyers. The best lawyers have the best clients and charge the highest rates. The best clients and highest rates generate the most revenues for law firms, which leads to the highest profits. The highest profits allow those firms to go hire more of the best lawyers, and the cycle begins again.”
The best-paying clients in Texas are usually the largest corporations facing bet-the-company litigation or transformational transactions and wealthy private equity firms that view tens of millions of dollars in legal fees as a rounding error.
Here are the 15 elite corporate law firms operating in Texas in 2022:
No. 15 — Orrick: Founded in San Francisco, Orrick opened a Houston office in 2016 with 20 lawyers. In 2022, the firm experienced tremendous growth in Texas, going from 43 attorneys at the start of the year to 60 at the end. Orrick’s lawyers in Texas generated $79.4 million last year — a 34.7 percent increase over 2021, ranking it 37th on the 2022 Texas Lawbook 50. The firm’s revenue per lawyer in 2022 was $1.323 million, and profits per equity partner hit $3.113 million.
No. 14 — Willkie Farr: A New York-based corporate law firm, Willkie Farr lost several key partners in 2022 but has added lateral hires this year. The firm generated $47.7 million in its Texas operations last year, which was down from $68 million in 2021. Even so, the three-dozen attorneys in Willkie Farr’s Houston office worked on some premium transactions. Willkie’s RPL in 2022 was $1.326 million, and its PEP was $3.69 million.
No. 13 — Winston & Strawn: One of four Chicago-founded law firms to make the elite 15 firms in Texas, Winston opened a Houston office in 2011 and a Dallas office in 2017. Both have expanded significantly. The Texas Lawbook 50 shows Winston generated $212 million in revenue in 2022 — up from $34 million in 2016. The firm’s RPL in 2022 was $1.35 million and profits per equity partner hit $3.143 million.
No. 12 — Vinson & Elkins: V&E is the oldest and largest Texas legacy firm in the 2022 elite law firms listing. In 2022, the Houston-based firm generated $934.7 million firmwide – $619.3 million of it from their Texas lawyers. V&E’s RPL in 2022 was $1.395 million, and PEP was $3.52 million.
No. 11 — Weil Gotshal: Despite seeing its lawyer headcount in Texas drop by 11 in 2022, the New York-headquartered law firm still landed at No. 33 on The Texas Lawbook 50 with $84.6 million generated by Texas lawyers. That’s because Weil has elite corporate bankruptcy, transactional and litigation practices in Texas that helped the firm hit $1.41 million in RPL and $4.64 million in PEP.
No. 10 — McDermott: Led by corporate transactional lawyers such as Wilson Chu and Jack Langlois, McDermott grew its Texas lawyer headcount from 38 attorneys in 2021 to 56 last year. The Chicago-founded law firm reported revenues per lawyer at $1.42 million and profits per equity partner at $3.33 million. McDermott, which added an Austin office in 2022, ranked 36th in The Texas Lawbook 50 in 2022 with total Texas revenues of $79.6 million.
No. 9 — Sidley: Another Chicago-founded corporate law firm that achieved extraordinary growth in Texas during the past decade, Sidley had 211 attorneys in its Texas operations in 2022 generating $1.45 million each. The firm’s PEP last year was $4.17 million. Sidley’s revenue in Texas has gone from $100 million in 2015 to $306 million in 2022, which makes it ranked eighth in The Texas Lawbook 50.
No. 8 — King & Spalding: The Atlanta-founded corporate law firm King & Spalding entered the Texas market in 1995 — 15 years before it was fashionable to do so. The firm has grown steadily in Houston and had 127 attorneys in 2022. With revenue per lawyers at $1.538 million, King & Spalding generated $195.3 million in its Texas operations last year, ranking it 15th on The Texas Lawbook 50. The firm’s profits per equity partner was $4.727 million last year.
No. 7 — Paul Hastings: A 1,000-attorney corporate law firm founded in Los Angeles, Paul Hastings has only 25 lawyers in its Houston office, which the firm opened in 2012. The attorneys at Paul Hastings report RPL at $1.557 million and PEP at $4.89 million.
No. 6 — Latham & Watkins: Another corporate law firm founded in Los Angeles, Latham & Watkins entered the Houston market in 2010 and added an Austin office in 2021. It has grown from the original seven lawyers to 168 attorneys in Texas. Latham reported $105 million in Texas revenues in 2016, which jumped to $271 million last year. Latham’s revenue per lawyer in 2022 was $1.614 million and its PEP was $5.514 million.
No. 5 — Gibson, Dunn & Crutcher: One of the three fastest growing law firms in Texas in 2022 was Los Angeles-founded Gibson Dunn. The firm’s offices in Dallas and Houston added 42 attorneys in 2022 and saw its 159 Texas lawyers generate $257.7 million last year — up from $74 million in 2016. Gibson Dunn’s RPL was $1.621 million, and its PEP was $4.93 million in 2022.
No. 4 — Simpson Thacher: The New York-headquartered law firm has only 62 attorneys in its Houston office, but those attorneys are heavy hitters with revenue per lawyer at $1.682 million and profits per equity partner at $5.32 million. Simpson ranks 50th in lawyer headcount in Texas but is 25th in revenue generation at $102.4 million in 2022, according to The Texas Lawbook 50. That is up from $26 million in Texas revenues in 2015.
No. 3 — Skadden Arps: A Wall Street powerhouse, Skadden opened its Houston office in 1993. The firm has about 30 lawyers in Houston. The firm’s RPL was $1.82 million, and its PEP was $5.01 million in 2022.
No. 2 — Susman Godfrey: Only one of two Texas-based law firms to make the elite list, Susman Godfrey is a litigation giant that scored record-high revenues and profits in 2022. With revenue per lawyer at $1.875 million and profits per equity partner at $4 million, Susman jumped to 17th in the Texas Lawbook 50 in 2022 with Texas revenues at $190 million.
No. 1 — Kirkland & Ellis: Is there a revenue or profits ranking anywhere in the world that does not have Kirkland ranked first? The Chicago-founded corporate law firm opened in Houston in 2014. In 2015, The Texas Lawbook 50 ranked Kirkland 24th in revenue in Texas at $64 million. In 2022, Kirkland generated $780 million from its Texas operations. And the firm’s Texas lawyers became the first in Texas corporate law history to achieve $2 million RPL in a single year ($2.05 million, actually). Kirkland’s PEP in 2022 was an astonishing $7.516 million.
This is part seven in the Texas Lawbook 50 series of articles. Past articles include:
June 26: Texas legacy firms finding footing at home
June 12: Three firms, extraordinary growth — The LA connection
May 15: Another record for Texas revenues in 2022
April 19: Corporate firms in Texas continued to add lawyers in 2022 at a near record pace
April 6: Susman Godfrey looks to its 40 year history and has best financial year ever