Principal Ivan Adler spoke to The Hill about the major defections, mergers, and restructuring occuring on K Street.
By Megan R. Wilson | July 24, 2014
The lines of power in Washington’s lobbying industry are being redrawn.
While upheaval is nothing new for K Street, change has come at a dizzying pace in recent months, with each day bringing announcements of firms snatching up offices, combining forces or stealing away entire groups of employees.
Each mass defection on K Street “makes the earth shake a little bit every time,” said Darrell Conner, the co-practice group coordinator for the public policy and law group at K&L Gates, who has been at the firm for 21 years.
“It’s like LeBron James going to [the] Cleveland [Cavaliers]. When you see players going to different teams, there’s a whole different competitive playing field,” he adds. “You have to ask yourself: How do we compete with those teams on the court?”
The seismic changes extend all the way to the top of the industry, where the firm formerly known as Patton Boggs has seen undergone a massive restructuring as part of a merger with the law firm Squire Sanders.
The merger deal led to an exodus of staff, with at least three competitors — Holland & Knight, Akin Gump Strauss Hauer & Feld and Jones Day — welcoming some former Patton employees into the fold.
But there have been several other shakeups in the past year that show just how volatile the lobbying business has become.
Earlier this month, the law firm Dickstein Shapiro saw more than a dozen of its lobbyists walk out the door and join Greenberg Traurig. Earlier in the summer, a handful of Williams & Jensen advocates broke away to start their own venture.
“Once you have that blood in the water, the sharks start to circle, and you see firms try to pick off the best people,” said Mike House, the chairman of the legislative practice at Hogan Lovells.
“I think it’s been coming for some time, and it’ll come in waves,” House said of the K Street churn.
Veteran lobbyists agreed that the business is going through a time of change but said the recent convulsions have been unusual in their frequency.
“Leaving a firm and taking a big chunk of people with you, or a whole practice area, doesn’t really happen twice in the same year, let alone twice in the same month,” said Tony Podesta, the founder and chairman of the Podesta Group.
Between the 1990s and early 2000s, several lobbyists noted, K Street underwent a major transformation as public affairs shops began acquiring lobby firms.
“That was en vogue for awhile,” said Joel Jankowsky, who founded Akin Gump’s public law and policy practice. “They were trying to create these ‘one-stop-shopping’ deals.”
“You don’t see that anymore,” said House, of the same trend.
Jankowsky told The Hill that, while there does appear to be a new pattern developing on K Street, it largely “mirrors the corporate world.”
“It’s not unique to law firms or lobby firms. There’s a lot of consolidation in the corporate world, particularly in the high-tech sector,” said Jankowsky, who represents some of the tech industry’s biggest names. “I don’t know if it’s a cycle, but there does seem to be a pattern.”
Akin Gump brought in $33.8 million last year, and stands to make millions more this year with the addition of new lobbyists, including an 11-person healthcare practice.
Times are also changing at Greenberg Traurig, the former stomping grounds of the infamous lobbyist Jack Abramoff.
The firm has added 40 new lawyers and lobbyists to its Washington outfit alone. In the most recent move, Andrew Zausner joined the firm — and brought 12 lobbyists along with him. He also brought a $2.8 million client, the tobacco company Lorillard.
The additions “put them back on the map as far as having a government relations presence,” said headhunter Ivan Adler, a principal at The McCormick Group.
Adler says the volatility of the industry has kept his phone ringing.
“Star lobbyists are no different than star athletes who are looking for the right team where they can excel,” he said.
Industry leaders said some lobbyists leave firms to carve out a niche for themselves, while others seek stability. Sometimes, lobbyists simply want more freedom to run their business as they see fit […]
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