Law firms merge to fill service gaps

Kansas City-based Blackwell Sanders and St. Louis-based Husch & Eppenberger on Sept. 17 announced the beginning of merger talks. If the two firms – two of Springfield’s five largest by number of attorneys, according to Springfield Business Journal’s May list of the area’s largest law firms – do merge, the combined firm would comprise 630 attorneys, 16 offices and anticipated revenues of $255 million, according to a joint news release.

Virginia Fry, managing partner of Blackwell’s Springfield office, and Gary Powell, in charge of Husch’s Springfield office, referred questions to the managing partners in their respective headquarters.

Husch Management Committee Chairman Joseph P. Conran said he couldn’t comment on the status of negotiations other than to say that they are ongoing. The news release said the two firms could have a decision by year’s end.

“Although both firms are relatively diverse and large, each has had its strategic strengths – Husch its litigation practice, and Blackwell its corporate,” Conran said in the release. “A combined firm would offer clients the best of all possible worlds.”

Blackwell Sanders Chairman David A. Fenley could not be reached for comment.

The two firms have a combined 41 attorneys in their Springfield offices. Husch lists John Q. Hammons, Bass Pro Shops Inc. and Herschend Family Entertainment as clients; Blackwell’s client list includes Hammons, CoxHealth, College of the Ozarks and SRC Holdings Corp.

Blackwell Sanders has 330 attorneys spread among nine offices in four states, plus Washington, D.C., and London. Husch employs 300 attorneys in seven offices in Missouri, Illinois and Tennessee.

Gary Cunningham, partner with the Springfield office of Lathrop & Gage LC, said that while he’s not privy to the specifics of the impending Blackwell-Husch merger, he sees potential conflicts among the firms’ client lists.

“With two firms of that size joining, there is going to be some conflict of interest, and they’ll either have to get rid of some clients or they’ll have to have some people leave in order to service clients,” Cunningham said. “Any law firm has to, first and foremost, ensure they are free from any kind of conflict among their clientele.”

Same names, new places

Cunningham himself has been through the merger process; his firm – Cunningham, Harpool & Cordonnier – joined Lathrop in 2002.

Cunningham’s not alone. At least four Springfield law firms have merged with St. Louis- or Kansas City-based firms as part of a decade-long influx of firms from those two cities into Springfield, according to Frank Evans III, managing partner of Lathrop & Gage’s Springfield office.

Evans held the same role with Springfield firm Miller & Sanford PC when that firm and its 13 lawyers merged with Kansas City-based Lathrop in 2000. Lathrop & Gage has 10 offices in Missouri, Colorado, Kansas and New York. The firm employs about 300 attorneys.

Miller & Sanford partners kept the title in Lathrop’s Springfield office, which is now the second-largest Springfield firm, according to SBJ’s May list.

“Typically, the partners in each firm will continue to be partners in the merged firm,” Evans said. “That’s usually what happens.”

The wave of legal merger activity began in 1997, when Husch joined Springfield firm Farrington & Curtis PC, signaling Husch’s entry into southwest Missouri.

Most mergers have been between Springfield firms and larger out-of-town groups. While firm names may change to represent new ownership, the people often remain in place, lending stability to the market.

“I don’t know that it changes the Springfield law market dramatically one way or the other when these mergers occur,” Evans said. “I think primarily the effect is internal in the firms themselves, and in what advantages they’re able to accomplish.”

Cunningham said client needs are addressed when Springfield firms join forces with those from larger out-of-town markets.

“We like to think of a Springfield market, but there is no such thing,” he said. “Springfield people and businesses need some type of expertise not only in Kansas City and St. Louis, but in Jefferson City as well. My experience has been that I have been much better able to service the client by having available to me expertise in those cities.”

Reasons for merging

Cunningham pointed to a desire to reduce his firm’s overhead as the driving force behind his merger with Lathrop.

“We were interested in the merger because of the support that a firm the size of Lathrop could provide us, in network, document retention, Internet access and firm administration,” Cunningham said.

“We were allowed to become lawyers again and devote our full attention to the practice of law and the service of clients,” he added.

Evans noted that when it comes to mergers, and the reasons behind them, the law field is much like any other industry.

“Like a lot of businesses in the overall economy, there is a tendency toward consolidation, and this (recent activity) is a natural evolution of that,” Evans said. “The ability to communicate between offices and the ability to share information in spite of geographic distance makes it easier to have law firm consolidation, just like it’s easier to have consolidation in any number of other industries.”