Father of five, two-time Hawaiian Iron Man competitor, climber, trial lawyer extraordinaire and co-founder of what can legitimately claim to be the leading global litigation-only firm. John Quinn has earned the right to put his feet up. Not a chance he says.
On a hiking trip to Wyoming a few years ago, a group of Quinn Emanuel Urquhart & Sullivan litigators, headed up by founder John Quinn, arrived at a freezing 9,000 ft lake. Quinn joked that the first summer associate to swim the lake would get a job offer at his firm. Turning his back on the group for a moment, he heard a splash as one of the keen students dived headlong into the water. True to his word, an offer was made.
Every year Quinn takes a team of lawyers on a hike. Not a weekend for the faint hearted, this year saw 90 lawyers head to Utah and the stunning red rock scenery of the Escalante Wilderness. Another year saw three associates glissade down the wrong side of Mount St Helens, Washington. They were eventually found by search and rescue at 3am the following morning.
In its 15th year, the hike has become emblematic of the sort of firm that Quinn and his partners have created: a firm which challenges its lawyers to come out from behind their desks and suffer a bit. But underpinning it all is a genuine sense of bonhomie.
As Quinn talks to LB from his Pasadena home, his nonchalant conversational style is juxtaposed with his steely desire to win, at all costs, at whatever he does. One of eight children from Utah, four of his siblings are either lawyers or married to lawyers. Of his own five children, one is already a lawyer and another is in law school.
The profession courses through his veins and, at the age of 60, he comes alive when talking about the challenges of the business and practice of law. It’s easy to imagine what he was like as a younger lawyer, knocking on doors and cold calling in a bid to build Quinn Emanuel from its 1986 launch.
Early years
Quinn graduated with an honours degree in history from California’s Claremont University, and from there he went on to Harvard Law School where he edited the Law Review between 1974 and 1976. He then found himself at Cravath, Swaine & Moore in New York practising corporate law and after two and half years he ‘saw the light’, as he puts it, to pursue a career in litigation.
His time at the Wall Street firm laid much of the groundwork for his future philosophy of law. ‘Cravath did the very best, top quality work. It was good for me to learn that nothing should leave the office unless it’s the very best it can be,’ he says. ‘A commitment to client service, trying to be creative and add value. Cravath was very good at inculcating those values in young lawyers.’
Following his brief flirtation with Wall Street’s elite he felt the call of the West Coast and he de-camped with his wife and first child in the early 1980s. He says that his love for the outdoors with easy access to the mountains prompted the move.
As well as being general counsel to the Academy of Motion Picture Arts and Sciences, he has completed two Hawaiian Iron Man triathlons, an astonishing feat of endurance that asks competitors to complete a two-mile swim, a 110-mile bike ride and a marathon. He enters the ballot every year to compete and dismisses his completion time of between 14 to 15 hours as being pretty slow.
‘The marathon can get pretty painful,’ he says without a trace of irony. ‘But I’m not beneath walking. Basically your legs are trashed after six hours of biking and it is very difficult, but when you finish it’s amazing.’
On arrival in California he admits that he bounced around for a while. After two months at a firm that later merged into Morrison & Foerster, he left to start a firm with former Cravath colleague Bob Baker.
‘Up until we hit about 25 lawyers, John literally read every single submission made by every lawyer in the firm.’ – Bill Urquhart, Quinn Emanuel
That venture was doomed to failure due to a lack of work and Quinn was, at just three years qualified, too green. He then launched a Los Angeles office for Reboul, MacMurray, Hewitt, Maynard & Kristol, a Midtown New York firm in 1981. It began as a one-man show and grew to five lawyers before Quinn spun out with three of his fellow lawyers, Eric Emanuel, David Quinto and Phyllis Kupferstein, to start a new firm, Quinn Emanuel.
Those early years were tough. From the outset the team knew they wanted to be a litigation-only outfit and hit the streets doing what they could to get work through the door.
One strategy was to get new case filings from the Los Angeles court docket and approach the companies that had been sued. He says that often the first time the company knew it was being sued was when it heard from the firm. Quinn claims his firm was the first to do this, although it is a common practice now.
‘We begged and borrowed to get work initially,’ Quinn remembers. ‘Knocking on doors, grovelling any way to get hired, to get people to give us a chance. We worked very hard to get our first assignment and our thought was always that if we got that first assignment, we would get a really good result and impress the client with our commitment. If we got one assignment, then we would get the next one and the next one.’
Bill Urquhart, who joined the firm in 1988, says Quinn’s pursuit of perfection has been the most critical factor in the firm’s success because he was involved in everything, no matter how small. He led and others followed.
‘Up until we hit about 25 lawyers, John literally read every single submission to court made by every lawyer in the firm,’ Urquhart recollects. ‘I remember distinctly walking into John’s office about 15 years ago and he had just finished giving his closing argument in a major jury trial. I asked him what he was doing and he told me he was revising a draft of answers to interrogatories. Several thoughts ran through my head: first, didn’t he need at least an afternoon off after a stressful trial? Second, why didn’t John have an associate do this?’
Quinn credits Urquhart, his old Cravath colleague, as having the biggest influence on his career: ‘He taught me never to be intimidated by anyone. No goal is too high. Everyone puts on his pants the same way in the morning. All people are the same on the most basic level.’
A turning point in the firm’s history is when the firm represented General Motors (GM) against Volkswagen in a trade secrets dispute involving a senior director Jose Lopez. The firm secured a $1.1bn settlement in 1996 for GM, garnering a huge amount of national and international press, which gave the firm a mandate to start shouting about what they could do.
Quinn remarks: ‘We are not bashful about talking about the things we have done. We have achieved a lot in a relatively short period of time and when we get some good results we talk about it.
‘We remain impatient and hungry. We don’t have time to wait for news of our achievements to trickle out. We’re going to accelerate the process because we’re in a hurry to be the premier litigation firm in the world (if we aren’t already),’ he continues.
The two most important trials of his career are very different. In 2003 he represented two German nationals who moved to Santa Barbara and sued media giant Bertelsmann and its former chief executive. The claimants said they were due a share of the proceeds from the sale of Bertelsmann’s half of AOL Europe. The firm won a $295m verdict; the seventh largest jury verdict in the US that year.
Secondly he points to his representation of Barbie doll manufacturer Mattel in the ongoing theft of trade secrets case against MGA, the maker of the Bratz dolls. The case is currently in the Court of Appeal. After an initial win for Quinn and his team, the decision was overturned in April 2011 by a federal jury in Santa Ana, California. You haven’t heard the last of Quinn on this one.
Quinn-tissential
In 2010, Quinn Emanuel became the second most profitable firm in the world. Sitting slightly behind Wall Street stalwart Wachtell, Lipton, Rosen & Katz, Quinn Emanuel recorded profits per equity partner (PEP) of $3.7m, marking a 20% increase from 2009 when it was a shade over $3m. Wachtell’s PEP for the 2010 year was up to $4.34m after an 8% increase on the previous year.
Impressively, Quinn Emanuel’s profits per lawyer of $648,000 and profit margin of 62% in 2010 are also comfortably among the highest in the LB Global 100.
The last financial year saw turnover rise 31% to $550.5m from $419.1m in 2009 placing the firm 58th in the Global 100. However, the firm is still, by global standards, relatively small. Last year it averaged 526 lawyers, including 130 partners, 92 of whom are in the equity. Every single one is a litigator.
The growth has been impressive. In 2002 Quinn Emanuel was a $106m business, meaning its average annual growth rate over nine years sits at a staggering 20.9%. Quinn, along with his founding partner Eric Emanuel and now a core group of partners, have been at the very centre of the firm’s success.
Numbers aside, Quinn says the secret to success is ultimately simple. ‘Winning cases is something that is a deep part of our culture. We don’t win every single trial but we are not comfortable if we don’t come out on top. People breathe, eat, sleep and live the cases we are working on.’
In 2010 the firm won 17 out of 17 cases with one mixed verdict. This year alone it has gone to trial 16 times, losing one and receiving a mixed verdict on another.
‘We don’t want to do everything, we don’t profess to be the best at everything – we just want your toughest problems.’ – John Quinn, Quinn Emanuel
Quinn goes into overdrive explaining that having the capability to act on intellectual property and patent litigation cases in multiple jurisdictions on parallel cases will be a crucial part of the firm’s future success. There are currently roughly 22 separate disputes around the world between Apple and Samsung alone. Since Howrey went bust, there is a clear niche to be filled by firms to provide integrated representation across borders and under one roof. You’d wager Quinn Emanuel could fill that gap. The firm is currently acting for Motorola, Samsung and HTC in several global disputes over the smart phone.
That strategy, Quinn says, could drive further office openings for the firm. Already plans are in place to open another office in Germany in the next couple of months. In 2003 the firm took the decision to stop representing large banks and accountancy firms because there was just too much competition.
The team then started gearing itself towards acting for clients that sued the largest financial institutions. The move has seen the firm take significant positions against the banking establishment for all classes of investors. Earlier this year the firm filed over a dozen of the 17 lawsuits that The Federal Housing Finance Agency brought against US and international banks, claiming that they sold nearly $200bn in fraudulent mortgage investments to the defunct housing behemoths Fannie Mae and Freddie Mac. Mortgage-related claims have gone through the roof since the US housing market crashed in 2008, leading to claims against the likes of UBS, Goldman Sachs and Bank of America. Clients include bond insurer MBIA and MassMutual.
The firm’s successes have already led to it building formidable and focused overseas outposts. Its Tokyo and Mannheim offices focus on intellectual property and patent litigation. In London, the firm’s anti-bank and restructuring stance is headed up by partners Richard East and Sue Prevezer QC (see box ‘Looking East’ p38). And in October, the firm hired two of the most respected litigators in Russia: Ivan Marisin and Vasily Kuznetsov from Dechert, ahead of the firm’s Moscow launch.
Quinn mentions the possibility of further continental European offices that will likely be focused around contentious IP work.
London has started to broaden out its platform to commercial disputes and hired Olswang’s former head of litigation Martin Davies at the end of 2010. Plans to hire an arbitrator to build a City practice, as well as acquiring a broader team of litigators are in the works.
Quinn does not buy into the idea that a global litigation firm is harder to manage the larger it gets and he doesn’t seem worried about maintaining and improving profitability. Simplicity and quality are at the heart of the Quinn Emanuel business model.
‘We don’t have the challenge of trying to explain that we are the best at everything, all the time, everywhere,’ he says. ‘That’s the problem that a large firm has. Our message to the business and legal community is simple: we don’t want to do everything, we don’t profess to be the best at everything – we just want your toughest dispute problems. We would be crazy to tinker with that.’
Quinn goes so far as to say that it is easier to manage a firm filled with just litigators. Although one managing partner of a UK firm claims that the prospect would terrify him. ‘It is a real force for cohesiveness for the firm that everyone is a litigator and everyone understands what everyone else does. The power of that can’t be exaggerated,’ claims Quinn.
This firm wants the cases others don’t and it’s not afraid to shout about it. This swagger bordering on arrogance has driven the firm from its humble West Coast origins to the global scene.
Somewhat reassuringly there is not a five-year plan. Quinn has a distaste for bureaucracy – the firm famously doesn’t have the modern trappings of law firm management, the executive or strategy committee. ‘I don’t know what management committees do,’ he quips.
The mantra of simplicity and quality comes up more than once when talking about running the business. If the firm makes the right choices about the people they bring in then the rest will follow. Or so he says.
‘The single most important thing that drives a successful law firm is so important that it dwarfs anything else, and it is kind of self evident,’ Quinn says. ‘The quality of the lawyers that you practice with is crucial. If you make those decisions right most things take care of themselves.’
It’s refreshing to hear such a simple and transparent view of how to run a law firm.
Quinn Emanuel hasn’t reached this point by being warm and cuddly but talking to Quinn and his colleagues, the will to win quality work and people, coupled with a laid-back approach to management means the firm has all the ingredients needed for a successful law firm.
Hard work should be in the mix. Quinn says that he will bill in excess of 2,500 hours this year and has already spent more time in court during 2011 than at any other point in his career. When a name partner is setting an example like that, how can the rest not follow suit?
‘Viewed as a business, law practice is very simple, especially compared to what most of our clients do,’ he asserts. ‘We are bringing people with legal knowledge and talent together with people who have legal problems and most of the time you’re charging them by the hour. In a sense it is a dumb business.’
The man
It is difficult to talk to a colleague, client or adversary about John Quinn without the superlatives flowing. In fact it’s pretty hard to find anyone who will say a contrary word about him.
East, who co-heads the firm’s London office, echoes many others when he says: ‘John is by some margin the best person I have ever worked for and I regularly marvel at his ability to manage 140 litigation partners. He exercises sufficient control but allows people to be who they are. He enfranchises people to do things they are good at.’
There are of course those wishing to do his and his firm’s achievements down. It is difficult to see these as anything more than cheap shots. ‘He is convinced that he is always right. He puts his stamp on the firm and he is a tough character but I’m not sure he’s always as right as he thinks he is,’ pipes up one rival from a litigation firm.
Colleagues say that his intellect – he loves history, particularly the Ottoman Empire, and he can reel off Shakespearean soliloquies at the drop of a hat – combined with his perfectionism and his competitiveness make him a formidable trial lawyer.
Fellow name partner Bill Urquhart adds: ‘Nobody goes into a trial better prepared than John. Once you put him in a courtroom he becomes charismatic. He works very hard to establish credibility and exercises great judgement about how far to push things.’
Quinn’s passion for his job and his firm is limitless. In an e-mail exchange following the interview he signs off with an apology, explaining that he loves talking about ‘our firm’.
One chink in his armour, however, could be that he cares too much. Urquhart suggests that as the firm began to grow, Quinn had to learn to rely on others. In fact, he says, that his own greatest contribution to Quinn’s career was convincing him to do this so ‘that way he could run multiple litigations’.
What has emerged now is a firm filled with senior litigators and up and coming stars who are at the core of its success. Quinn is very generous with his praise for his fellow lawyers.
In the interview he name checks dozens of his partners across the platform that contribute to the firm’s success: Peter Calamari and Michael Carlinsky are among a long list reeled off at speed. He enthuses about the quality that has come into the firm.
The arrival of Dan Cunningham in New York from Allen & Overy in 2009 was a significant moment for the firm but Quinn says there are countless ‘Cunninghams’.
He mentions the arrivals of Andy Schapiro from Mayer Brown in Chicago, Martin Davies in London and Stephen Neuwirth who joined from Boies, Schiller & Flexner in New York.
November’s addition of outgoing Novartis general counsel Thomas Werlen to Quinn Emanuel’s European practice is recognition of how far the firm’s stock has risen outside of the US since 2008. There are many more.
‘Nobody goes into trial better prepared than John. Once you put him in a courtroom he becomes charismatic.’ Bill Urquhart Quinn Emanuel
The overriding sense from Quinn is one of pride in his firm and in the quality of his lawyers while recognising that their approach to the law may not be everyone’s cup of tea.
‘We have a “no assholes rule”,’ he explains. ‘No matter how smart they are and how much business they can bring in, if we can’t live with them, we can’t bring them in.
‘What we do is not for everybody and in a way it is kind of a self-selection process. People who are comfortable and whose idea of marketing is answering the phone won’t be attracted to us.’
Pride, perfectionism, enthusiasm, simplicity, intellectual rigour. To get one of these from a modern day law firm manager is a bonus, to get them all is just plain lucky.
Quinn doesn’t believe in heavy-handed management. There is only one committee, which oversees the contingency fee process at the firm. ‘Good lawyers in my experience do not
need managing,’ he says. ‘You need to get out of the way and give them the support they need to help them be successful. But they don’t need to be given quotas or pep talks. We just don’t do it like that.’
Surely after 25 years at the top of the letterhead, Quinn is ripe for a bit of peace and quiet. But he’s having none of it. Future challenges hold as much excitement as past successes.
‘I really love this, I love the practice of law and the business of law,’ he bubbles. ‘I love the people I work with, I don’t like the beach and I don’t know what I would do if I were not doing this. I fear the day that I am not doing this. This is fun. I love all aspects of it.’
The end game?
In his mind, Quinn’s aim is simple: To become the leading litigation firm in the world. And for the most part this has been achieved, so what’s next?
With scale will come inevitable problems as big names will leave, profitability will be more difficult to manage and an increasingly diverse practice, albeit all litigation, will become something of a juggling act.
What Quinn Emanuel has going for it, is a zeal shared by all of its lawyers to become the best at what they do. Quinn has done well to avoid any accusation of being dictatorial,
no mean feat given his incredibly high profile. He has done well to have around him not just some of the best trial lawyers but also people who share his vision of the future.
This side of the pond, Quinn Emanuel may have only been on the scene for a few years but the firm has assimilated itself into the global law landscape remarkably well.
The art of bringing a law firm to the top of the global game is by no means simple but the partners at Quinn Emanuel make it seem that way.
The final word should go to Urquhart: ‘John used to say his ultimate goal was to reach the point where the firm’s name would be mentioned in any discussion of the top-five business litigation firms in the US. I think John’s goal has been achieved.’
Looking East
Following a two-year search for the right partner to launch a London office, Quinn Emanuel Urquhart & Sullivan found its man in restructuring litigator Richard East. The Californian firm hired East from Kirkland & Ellis in 2008 and in typical Quinn Emanuel fashion it came in for him just as he had signed on the line with Weil, Gotshal & Manges. It prompted a change of heart that East says he has no regrets in making.
Sue Prevezer QC followed from Bingham McCutchen shortly after and the pair now co-manage the London office. While the firm was by no means the only one in the City to have an anti-bank litigation stance, its pushy US approach to marketing and winning made it feel like an entirely different proposition.
‘Unfortunately we are saddled by a history of US firms coming over and saying they are going to do this and that and then not doing it and not investing, folding and then they are gone,’ says founding partner John Quinn. ‘There is a certain amount of scepticism from recruits. Will your life be run out of the US and will the firm be around in the next five years?’
The London office has grown to six partners and 20 lawyers since East joined. These include Martin Davies, who joined from Olswang at the beginning of 2011 and finance litigator Robert Hickmott from CMS Cameron McKenna. Observers point to Davies’ arrival as he is the firm’s first genuine heavyweight commercial litigator as pivotal.
On the case front, the team has had some impressive wins. Prevezer secured a unanimous decision in the Court of Appeal favouring HSH Nordbank in its high profile $275m claim against UBS. She also had a big win for a group of investment funds in the Supreme Court following the collapse of Sigma Financial, a structured investment vehicle.
The firm has also acted for bondholders on the Cattles, Wind Hellas and European Directories restructurings. While not all successful, they show where the firm is setting out its stall. Regular clients include York Capital, MBIA and Oaktree.
Up to 60% of the firm’s City work comes from referral relationships with the likes of Ashurst, Weil Gotshal, Ropes & Gray, SJ Berwin, Kirkland and Stephenson Harwood.
East says they have worked hard at making these relationships two-way while admitting that their style isn’t always for everyone. There is some indication that some of the larger UK litigation practices have started to see Quinn Emanuel as a rival to their own disputes businesses because the US piece is so large.
The balance sheet looks good. In 2009, the office made a tidy profit of £5.7m with the highest paid fee-earner taking home £1.5m. In 2010, the office had a gross turnover of £12.4m, making a profit of £8.4m. It is understood that the team is expecting to significantly improve on 2010’s numbers with one partner suggesting they could top the £20m mark.
‘We are pretty much where we wanted to be after three years,’ suggests East. ‘Now the challenge is very different – it is to make a more permanent practice in the market. We are not just doing anti-bank work now.’
Noises from the US are very encouraging with partners palpably excited about what has been achieved in a relatively short space of time. The recent move into Moscow through the lives of Ivan Marisin and Vasily Kuznetsov is understood to have been suggested by London.
Despite what has already been achieved, the ambition is to do more and quickly. Although there is no wish for the team to be 100 lawyers, there is a will to build the platform beyond anti-bank work.
The firm is defending Russian metals tycoon Oleg Deripaska against Michael Cherney, who is suing him for allegedly defrauding him out of a large part of his metal business. The case, due to be heard in the High Court next April, has swelled the office’s paralegal ranks to around 30.
‘It is an environment that if you work hard you are rewarded and there are few hierarchies. I like the direct approach,’ enthuses East.
Rivals suggest the firm’s uncompromising style has led to a number of firms taking their businesses elsewhere. However, everyone at Quinn Emanuel recognises that they are not everyone’s cup of tea. It is clear though that the hedge funds love how they operate and were the reason behind the move into the City in the first place.
One City litigator tells LB: ‘Ultimately who am I scared of most when we go to pitch? It is Quinn Emanuel because of what they have done and what they can do.’ It hasn’t all been plain sailing – in a move that clearly saw Bank of America rattled, it filed a motion to disqualify Quinn Emanuel from representing AIG in a $10bn securities litigation case in October. In what appears to be an act of brinkmanship the bank is claiming that the firm is conflicted because London-based partner Marc Becker had acted for Merrill Lynch at his previous firm, Munger, Tolles & Olson. In typically bullish fashion Quinn Emanuel will fight the filing, however it is understood that Becker has stepped down from the partnership while the case is ongoing, although he is expected to return to the firm at some stage.