During this turbulent year, Los Angeles County’s 100 largest law firms have faced financial challenges, regulatory issues, and industry consolidation, while demonstrating resilience through adoption new technologies.

In particular, real estate law has been a challenging sector due to rising interest rates impacting valuations as well as new developments. However, interest rates are expected to fall over the next 12 months and activity to increase, particularly for distressed properties that may become available following a foreclosure or off-market transaction with the current owner.

“Deal flow has improved now that there is some visibility on interest rates. However, there is still a lot of uncertainty around the commercial real estate market, so the recovery has been uneven and bumpy,” said Mathew Wyman, partner and president of Cox, Castle & Nicholson.

This sentiment may extend to other transactional work for firms specializing in mergers and acquisitions, restructuring, capital raising due diligence, tax and securities litigation. As companies prepare to expand their operations, they have increased legal hiring and some companies have merged in an effort to provide stronger service offerings with larger, more geographically diverse staffs.

A year of growth
Several new companies have entered the Los Angeles market over the past year through mergers. Several East Coast companies have sought West Coast offices to interact with media, entertainment, technology, private equity and family offices located in that region. Philadelphia-based Saul Ewing LLP entered the Southern California market through a merger with local firm Freeman Freeman & Smiley in August 2023. At the time, the merger added 50 attorneys in offices across Los Angeles and Orange County. This also brought the firm’s total number of offices to 18 nationwide, with more than 400 attorneys.

Saul Ewing already had several clients based or with significant operations in California. In the three years before the merger, the firm handled more than 500 client cases in the state, despite not having a local office. Some of the important industries include higher education, cannabis, insurance, sports and entertainment, and food and agribusiness. She also has a nationally recognized real estate practice.

“The collaborative culture, hard work, industry focus and full range of legal services are what attracted us to Saul Ewing,” said Steven Ziven, former managing partner of Freeman, who is now managing partner of the office of Los Angeles, in a press release. . More recently, the office expanded with the addition of Stephen Ma, an experienced litigator, who has represented public and private companies and their officers, directors, members and investors.

He has experience defending music publishers in licensing and copyright disputes and representing real estate developers and lenders in breach of contract disputes and claims of fraudulent transfer. Another national firm that entered the Los Angeles market in the past year was Thomson Hine LLP, which opened an office on July 1, 2024, with 11 attorneys and a total of 25 employees. Trial attorneys from Conkle, Kremer & Engel joined the firm and established its first West Coast office. The group has experience representing clients in industries such as beauty and personal care products, fashion, technology, real estate and manufacturing.

Other mergers have been announced and are expected to be finalized in the coming months. These include Lewis Roca and Womble Bond Dickinson, which announced plans to merge effective January 1, 2025. Both companies operate in Los Angeles, and Womble Bond Dickinson operates an office in Irvine. The merger will create a firm with more than 1,300 lawyers in 37 offices across the United States and the United Kingdom. In September, Locke Lord and Troutman Pepper agreed to merge, effective January 1, 2025. The new firm will be called Troutman Pepper Locke and will have more than 1,600 attorneys in 33 offices in the United States and two in Europe.

Both companies operate offices in Los Angeles.

Among the smaller companies, Pittsburgh-based Leech Tishman has partnered with Los Angeles-based Nelson Hardiman, effective October 1. Nelson Hardiman attorneys specialize in the healthcare industry and work with hospitals, health systems, other healthcare facilities, physician organizations, telehealth providers and laboratories. on licensing, operational and reimbursement issues.

Alston & Bird recently opened a new office in Century City and relocated its downtown Los Angeles office to a space that includes an outdoor terrace. The company has also taken measures in terms of recruitment. Partners Edward Poplawski and Olivia Kim have joined the firm’s Los Angeles office. The duo have worked together for over 20 years and have extensive experience in intellectual property and complex patent litigation. They strengthened the intellectual property practice that added partners Erik Carlson and Theresa Conduah in Southern California earlier this year.

Continued implementation of technology
Artificial intelligence (AI) technology is something that all businesses are looking to integrate into their processes and workflows, including law firms. Some companies took a more cautious approach and were slow to add the technology. “We are evaluating them carefully and will implement them where it makes sense, but only after we are satisfied that they will meet the needs of our customers and that critical concerns such as information security will be addressed to our satisfaction ” said Dwayne McKenzie, managing partner at Cox, Chateau and Nicholson.

Other companies have looked for ways to implement AI across the board. In some cases, it’s employees who are the biggest supporters of new technology, creating ways to get involved with it. At Seyfarth Shaw LLP, the firm implemented a suite of unique, secure, AI-powered generative tools that were rolled out to 2,000 attorneys and staff across the firm. The tool recorded 2,500 employee interactions in its first three months. At an employee fair where ideas were presented to increase collaboration and innovation, the company said all seven finalists used AI in their proposals. Two of the collaborators on the winning entry were Los Angeles partners Michael Afar and Andrew Paley.

“We have designed a long-term strategy to integrate generative AI into the fabric of Seyfarth, deploying multiple efforts that align technology with processes and people,” said Jonathan Brophy, managing partner of the Century City office. at Seyfarth Shaw.

However, not all sectors are equally active in using AI technology. According to the recent Allen Matkins/UCLA Anderson Forecast California Commercial Real Estate survey released this summer, although the use of AI technology is on the rise in the commercial real estate industry, survey respondents had limited use cases where it has been used. . This includes anticipating what the supply chain will look like and reducing the carbon footprint with robotics that help select parts.

Yet, like many lawyers, caution and risk assessment are key, with businesses taking a wait-and-see approach to AI implementation. “Despite growing demand in data centers, particularly for AI infrastructure, few of our respondents are actually using AI to inform and develop their strategies going forward,” said Alykhan Shivji, partner at the firm of real estate lawyers Allen Matkins, in a press release.

-David Nusbaum