Henry Bunsow’s departure from Howrey cost the firm one of its top intellectual property rainmakers and one of the firm’s most recognizable names. According to former partners with knowledge of the firm’s financials, it also cost the firm a book of business worth around $20 million.
News broke Tuesday that Bunsow was leaving the firm after nine years as the regional managing partner for Howrey’s Northern California offices and joining Dewey & LeBoeuf’s San Francisco office. Bunsow, who also served as Howrey's vice chairman, took with him Howrey IP partners Denise De Mory and Brian Smith. Bunsow, De Mory and Smith all join Dewey as partners.
To those watching the firm amid its recent spate of defections, Bunsow’s departure was the latest crack to form in the Howrey edifice and one that might be hard to recover from. Bunsow was among the highest billing and highest earning partners at the firm. As one former Howrey partner put it, “He’s not a guy you want to see leave the firm.
Reached today, Bunsow said that Howrey’s woes factored into his decision to join Dewey. He said he talked to “about a dozen” firms before deciding to join Dewey.
“Howrey is doing all of the right things, but they should have done them earlier,” Bunsow said. “I lived through the down times, but I wanted some insurance that rather than waiting to see if the good times were around the corner, I wanted to take advantage of them now. I didn’t want to invest more years in the process.”
He said that he and the firm discussed some “accommodations” that might be made if he decided to stay, but that he “didn’t feel that would be fair to other partners.”
Bunsow’s departure comes shortly after Gary Bendinger, who served as co-chairman of Howrey’s global litigation practice, left the firm in December for Sidley Austin. Two former partners said Bendinger was also among the highest paid partners at the firm.
With both Bunsow and Bendinger leaving, rumors about the future of Howrey began cropping up again, including that the firm was looking for a partner to merge with.
Firm leaders have done their best to quash those rumors, while keeping all of their options on the table.
Sean Boland, co-chairman of the firm’s antitrust practice and vice chairman of the firm, said he told the firm’s partners on Friday that “there are no active merger discussions at this time.” That said, Boland added, “Like all firms, we get approached by other firms, and if it seems like a good idea, we’d run it down. But we like the identity Howrey’s developed. That doesn’t mean, however, that our model isn’t always being tweaked.”
Howrey has been under the microscope during the past year due to a swath of partners who have left the firm. In all, The Am Law Daily reports that the firm has lost more than 60 partners during the past year.
It’s not that the defections are surprising. Losing some partners after reporting a 35% decline in profits per partner in 2010—thanks to fewer contingent fee payments coming in than in the prior year— is to be expected. But the sheer volume has raised some eyebrows.
The firm contends that the reductions to its partner ranks were made strategically.
Last year, Robert Ruyak, the firm’s managing partner and chief executive officer, said that the cuts were made to trim practices that weren’t in keeping with the firm’s three core practices: IP, antitrust and global litigation. Ruyak said, “This was not like we forced people out the door. We did a careful strategic analysis to determine whether they fit with our core as a firm. If they didn’t, we discussed how this was an opportunity for them to move to a firm where they could be more successful with their practice,” Ruyak said. Ruyak couldn’t be reached for additional comment.
Peter Zeughauser, a law firm consultant who has represented the firm for more than 10 years, echoed that sentiment, saying that the firm was “getting back to its strengths.”
But doesn’t the loss of Bunsow hurt the firm? Zeughauser said, “Look, in today’s world you’re going to lose people you don’t want to lose. But Howrey is very focused on continuing to strengthen its practice and that’s what they’re doing. What’s happening at Howrey is largely by design.”
And as The National Law Journal reported Tuesday, Boland said the firm is in a “much better position for 2011” after the restructuring.
“The amount of costs taken out of the firm at all levels—which include leases, partners, associates and the like leaving the firm—have made the firm much more efficient,” Boland said. “It’s done wonders for our cost structure such that we’re going to see some major advantages in 2011. We’re very encouraged by the cost cutting that we’ve done.”