When Gregory Jordan was a baby in Wheeling, W.Va., his parents used to get him to go to sleep by taking him out in the car and driving him over the cobblestone streets.
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| Annie O'Neill, Post-Gazette Click photo for larger image.
Gregory Jordan
The Series
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It's not an item that shows up on Jordan's resume, but it's not an insignificant talent for the managing partner of the biggest law firm in Pittsburgh and one of the 25 largest in the world.
In the 41/2 years Jordan has been the top partner at Reed Smith, the firm has grown from about 600 attorneys to nearly 1,000, and its U.S. ranking by the National Law Journal has climbed from 38th to 17th.
Jordan, 45, is one of the youngest managing partners of a top-25 law firm, and in 2003, American Lawyer magazine named him one of the top 45 lawyers in America under the age of 45.
In a recent interview, he described how the firm's aggressive approach to mergers has made it one of the fastest growing law firms in the world, and why he thinks the trend is just in its infancy.
Although some legal observers think the law firm merger mania is about to cool off because many of the most attractive medium-sized firms have been snatched up, Jordan doesn't agree.
He believes law firms are "fairly early in the trend of consolidation," Jordan said, "and while we won't end up like the accounting world with just three or four major firms, I do think over the next several years there will be 30 or 40 or 50 major law firms who are in the position to get most of the major international projects and have significant operations in key markets throughout the U.S. and Europe and Asia."
Reed Smith aims to be in that group, Jordan said, and it's only now, after 128 years of existence, that the venerable Pittsburgh icon is beginning to realize that it doesn't just provide counsel to big businesses, but is legitimately becoming a big business itself.
The firm was formed in 1877 by Joseph Hay Reed, who developed a close and lucrative relationship with Andrew Carnegie.
Today, Jordan said, the firm has topped $500 million in revenue, making it the fifth or sixth largest private company in Pittsburgh.
Reed Smith, of course, is not the only large, growing law firm in Pittsburgh. Kirkpatrick & Lockhart Nicholson Graham was ranked 36th largest U.S. law firm at the end of last year and has grown significantly since then by acquiring a major London firm, so that today it has only about 50 fewer lawyers than Reed Smith. Buchanan Ingersoll was ranked 113th at the end of last year, and it too has expanded since then.
In the past five years, Reed Smith has picked up eight firms or practice groups in California, New York, Washington D.C., London and Munich.
The law firm scored the biggest U.S. merger of 2003 when it acquired the 200-lawyer California practice of Crosby Heafy. The Oakland firm was known for its strength in litigation; Reed Smith was stronger in handling financial services and regulatory law.
The synergy was obvious from the start, Jordan said. Not only was the combined firm able to pick up more work from each firm's traditional clients, but it was able to compete for more important assignments.
In one case, Jordan said, the merged operation was able to land a major job from a big pharmaceutical firm that had previously used Reed Smith and Crosby Heafy only for regional litigation on either side of the continent.
The pharmaceutical firm, which Jordan declined to identify, hired Reed Smith to be lead counsel on a major case after the law firm "took some of the stars from the key practices to visit the company" and convinced it that it had a deep enough talent pool to take on the bigger challenge.
In all, the Reed Smith and Crosby Heafy merger generated more than $50 million in new business that neither firm would have been able to get on its own, he said.
When Reed Smith acquired the London firm of Warner Cranston four years ago, it wasn't just trying to gain a European foothold, but was working to serve the interests of one of its oldest clients.
Mellon Financial Corp., which Jordan says now has a London building with a couple thousand employees, was expanding in the United Kingdom at the time, and Reed Smith needed to find a way to serve Mellon's interests there.
Unlike mergers involving retail or manufacturing corporations, Jordan said, law firm combinations aren't designed to save a lot of money by cutting staff or eliminating duplication.
Instead, they're designed to bump up revenue growth and get major legal jobs that the separate firms wouldn't have been able to compete for.
Still, Reed Smith maintains an advantage over some of its bigger competitors in New York, Los Angeles and London because it is based in a less expensive city and can offer better rates than those megafirms without hurting its bottom line.
That could mean that several quickly expanding law firms based in medium-sized cities like Pittsburgh will have an advantage in the law firm merger derby and be able to help their sometimes struggling cities become more prominent in the process.
A crucial factor in that trend are the Internet and other communication technologies that stitch together global firms.
The power of almost instant e-mail, document transfer and "virtual meetings" among key lawyers in different cities means that major clients "will become increasingly comfortable with working with [law firms] that aren't down the street from them."
The technology can also pose the risk of burnout, as executives in many companies have learned.
Jordan said that when he gets up in the morning, his portable Blackberry digital assistant already is filled up with e-mails from Reed Smith's Munich operation, and when he goes to bed, he's still getting e-mails from the West Coast firms.
"There's a reason why these devices have been nicknamed crackberries," he said of his palm-sized Blackberry. "It's easy to become addicted to continuing to reach for it when you're on vacation or on the weekend and you're trying to decompress."
After growing up in Wheeling -- his father was a railroad conductor and his mother was a recovery room nurse -- Jordan attended Bethany College and then the University of Pittsburgh Law School.
He had always thought he'd head back to Wheeling and hang up a shingle, but after interning with Reed Smith as a student, he joined the big firm right out of law school in 1984.
He specialized in financial services and intellectual property law, but when he was chosen to become managing partner starting in 2001, Jordan knew his litigation duties would take a back seat because "running the firm had to be job No. 1 because it had become such a big business."
And despite the electronic umbilical cords of e-mail and video conferences, Jordan believes that no managing partner can run a major firm from the home office.
"Part of running a big firm is being out there with your clients and out there with your partners." That puts him on the road about half the year, with overnight stays about 125 days a year, and that's where his ability to sleep on long flights is a gift.
In the future, Reed Smith will look at expanding into Paris, since its London operation has an entire French-speaking practice that represents French companies, as well as into the emerging global powerhouses of India and China, he said.
The most important areas of the law for Reed Smith? Jordan cited three:
* Defending the firm's major clients, particularly pharmaceutical companies like Wyeth, Merck and Eli Lilly, against a growing number of class-action product liability lawsuits, which are being mounted by plaintiffs' lawyers who are almost as well-funded today as defense firms like Reed Smith.
* Financial services work, "partly because mainstay clients like Mellon and PNC and Federated Investors are in the middle of that, but also because that's where the money is."
* Intellectual property -- copyrights, trade secrets and related matters, because "continuing advancements in technology create opportunities for fortunes to be won or lost more quickly than ever before. We have about 100 lawyers working full time on intellectual property, and that's probably not nearly enough."
The last area is one that Jordan particularly enjoyed as a litigator, and which gave him one of his best-known legal triumphs.
In 2000, Jordan won a landmark victory in one of the first cases to test copyright law and the Internet. The case involved a Canadian company called iCraveTV, which was run by William Craig, who earlier had worked for Fox Sports Net in Pittsburgh and then for the Pittsburgh Penguins.
iCraveTV picked up broadcast signals from American networks and then retransmitted them over the Internet with banner ads from sponsors. It claimed Canadian law made that legal and said its Web site warned Internet users that they had to stipulate they were Canadian residents.
Jordan had once represented Fox Sports in actions against Craig, and said Reed Smith was able to outbid several West Coast law firms for the case by convincing the major TV and movie studios that even if the Pittsburgh firm didn't have as much entertainment industry expertise as other firms, no firm knew Craig and his business habits better than Reed Smith.
That won Reed Smith the lead counsel job, and in early 2000, Jordan brokered an agreement in U.S. District Court here in which iCrave agreed to shut down its Internet Webcasts.
"Bill Craig told me after that," Jordan laughed, "that if I ever got elected to the lawyers' hall of fame or some equivalent, he wanted to be invited to the ceremony because no one would have had more to do with my success than he did."