National law firms flock to Houston

by Ford Gunter
Houston Business Journal

Continuing a recent trend of national law firms establishing a presence in Houston, two more have recently set up shop.

Tampa-based insurance specialists the Merlin Law Group announced the opening of a Houston office just after Hurricane Ike. And Fish & Richardson PC, a Boston-based intellectual properties firm, this month opened its 12th office, taking several lawyers from the local office of New York firm Weil, Gotshal & Manges LLP to form the Houston operation.

This isn’t Fish & Richardson’s first pass at Houston.

The firm, which has offices in Austin and Dallas, tried to crack the Houston market in the early 1990s. Fish & Richardson shareholder David Healey says that effort didn’t work out because of “problems unique to the office.”

But Fish & Richardson was hardly the first national firm to blow into Houston in the late-1980s and early-1990s and fail to gain traction. Almost every national firm that opened up shop in Houston during that tumultuous time found similar hardships, although many are coming back now for a second try. This time, they are riding the wave of a more diversified Houston that has seen a technology boom — which includes biomedicine and aeronautics — accompany today’s strong oil prices.

“The firm’s growth pattern has been to grow by seeking out talented groups of IP lawyers in different cities,” Healey says. “You really have to go there than to build in one place; you have to follow the talent.”

Now, both Fish & Richardson and Merlin see the opportunity for profit in Houston, and plan to grow accordingly.

“We’re expecting to be 15 lawyers within 12 months,” says Healey, who started the Houston office along with fellow former Weil partners Garland Stephens and Anita Kadala.

Another Weil lawyer, Of Counsel Norma Bennett, was also in place when the Fish & Richardson office opened in 1 Houston Center on Oct. 1. Two weeks later, on Oct. 14, another former Weil associate came on board, bringing the total to five lawyers, three paralegals and three staff members.

“We’re starting to look for new space,” Healey says.

While Fish & Richardson is one of the larger firms in the nation, Merlin only has 16 lawyers, including 10 in Tampa and two in its 3 Riverway office in Houston, but that will change.

“Eventually we plan on having a similar-sized office (to Tampa) focused on nothing other than Houston insurance cases,” says Merlin President Chip Merlin. “The intent is to grow that Houston office as a central point for all of Texas.”
HOOKED ON HOUSTON

The Fish & Richardson opening comes at a time of increasing IP litigation in the U.S. District Court for the Eastern District of Texas, one of the most popular locations to file a patent infringement lawsuit. For Healey and the other litigators that joined Fish & Richardson from Weil, the opportunity to focus on just that was too good to pass up.

“The purpose of this move, really, is that Fish & Richardson is a firm that is focused on IP,” Healey says. “There are 425 lawyers that are IP-centric. Because of that, it’s able to provide a much better breadth and depth and allow me to focus on parts of the case and free me up.”
BLOWING IN

For Merlin, the move to Houston for an insurance law firm seems well-timed after a busy hurricane season, but the firm has actually had a presence in Houston since June, and moved its first attorney over in August. A second attorney was brought into the Galleria-area office last month. While the firm has two other satellite offices in Coral Gables, Fla., and Gulfport, Miss., Houston is clearly destined to be second in size only to the home base of Tampa.

It wasn’t until a report came out listing Houston as one of the three biggest markets for storm insurance claims — alongside Miami/Dade County and Tampa — that serious talks began about opening an office in a city where Merlin lawyers, by nature of their work, had already been active.

“We were settling a lot (of past hurricane-related cases), and cases were staring to dwindle a little bit,” Merlin says. “One attorney wanted to go to a larger area, and I suggested Houston. It was time to make an actual presence there rather than travel back and forth.”

The firm has handled prior claims unrelated to Hurricane Ike, but is now poised to capitalize on the latest hurricane to hit Houston.

“I anticipate what’s going to happen is going to be a very large demand for services,” Merlin says. “For three to six months and up to two years after a major catastrophe we continue to get calls about insurance disputes. That will be a peak demand.”

Even after the hurricane issues subside, Merlin anticipates demand for the firm’s services to stay high based on the fact that Houston is one of the largest cities in the country.

“Insurance litigation has increased significantly in the last decade,” he says. “Insurance companies are taking on more governmental entities. Insurance carriers, instead of having long-term relationships with clients, they seem to be taking a much harder line. The insurance companies on the claims side will be under even more pressure.”

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