Top Gun Pilot Produces Winning Law Firm
A former “top gun” fighter pilot who flew figher jet missions in southeas Asia in the early 1970’s for the Air Force, Robert (Bob) Lowe, Jr., is no fighting for the RTC in litigation, professional liability and transactional matters.
Lowe is found of Lowe & Associates, P.C., and Olde Town Alexandria, Virginia, minority-owned law firm that RTC officials consider to be a prime example of the successful ventures that have participated in the Joint Referrals and Representations Program offered by the RTC’s Division of Legal Services in conduction with the Department of Legal Programs (DLP) of the Division of Minority and Women’s Programs (DMWP).
Lowe and his firm first began representing the RTC in 1990, having been introduced to the RTC through a joint-counsel arrangement with the Washington, D.C., offices of Morrison & Hecker, a non-minority firm with offices in Kansas City and Washington, D.C.
“Our initial assignments involved multi-million dollar adversary proceedings in bankruptcy court and complex litigation involving local area RTC conservatorship assets,” Lowe said. “But, our work was just beginning.”
Lowe recounts that while his firm was relatively small when it first began to work with the RTC, the firm had already represented a number of Fortune 500 clients. Today, Lowe & Associates has nearly doubled and will soon expand its existing waterfront offices and add two more attorneys.
“Lowe & Associates is a successful, growing firm because they provide excellent service and counsel to their clients. It’s that simple,” said Mary A. Terrell, RTC Senior Counsel/Director, DLP. “They started out with the outstanding reputation of Bob Lowe with his top-gun fighter approach to winning lawsuits and his experience as a trial lawyer with two of Virginia’s oldest law firms.”
Moreover, both Terrell and Lowe agree that the success Lowe & Associates has had in its work with the RTC has been a catalyst for opening other doors to this talented law firm.
“The RTC’s Joint Referrals Program is the most effective such program I have ever seen, whether we’re talking national or local, governmental or non-governmental,” Lowe said. “A lot of the credit belongs to the RTC staff and Mary Terrell for their aggressive commitment to making this program work.”
In January of 1992, Lowe & Associates and Morrison & Hecker became the first joint-counsel firms to be assigned to the closing and litigation review of an RTC receiver-controlled thrift. The mass of the work involved required them to maintain a staggered, on-site presence at the thrift for three months.
Terrell said that after that assignment, many senior RTC attorneys who worked with Lowe & Associates noted that this firm required little or no assistance from non-minority firms in handling the complex litigation and due diligence matters that were a major part of RTC work. “When we put this program int oplace, we knew the minority- and women-owned firms could handle this work, but because this kind of work had always fallen to non-minority firms in the past, we needed a program that allowed minority- and women-owned firms to showcase their expertise and talent,” Terrell said. “Lowe & Associates is a textbook example of what we knew was out there.”
Since then, Lowe & Associates has performed work for the RTC independent of, and in partnership with, non-minority firms. Their reputation has continued to build, as well.
“Our work with Lowe & Associates on professional liability matters has been a pleasure; they have top notch attorneys and are incredibly well-organized and responsive,” said Robert (Rob) Steinberg, managing partner of the Washington office of Porter, Wright, Morris & Arthur, one of the RTC’s busiest outside majority firms. “I have truly enjoyed working with the Lowe firm on RTC matters, and look forward to working with Bob Lowe and his attorneys on our joint-venture matters for private sector clients.”
In recalling the initial contact with RTC, Lowe points out that he has always remembered hearing Mary Terrell say that her only job was getting substantive financial institutions work immediately to minority- and women-owned law firms.
“I know that the sophistication of the financial institution work that we have handled for the RTC was undoubtedly the catalyst to Lowe & Associates’ rapidly developing international practice,” Lowe said.
In October 1994, the Lowe firm was competitively selected by Booz, Allen & Hamilton as its subcontractor and the Porter, Wright firm as subcontractor to Lowe, for the provision of capital markets, financial, regulatory and privatization legal services to the newly independent states of the former Soviet Union. The Lowe and Porter Wright firms began preliminary work in this U.S. AID program in November, 1994. The Morrison firm may also provide support functions in this work.
Late last year, RTC’s Atlanta office again selected the Lowe and Porter Wright firms to perform a professional liability investigation. Based on preliminary estimates, the firms’ split of substantive legal work will be fifty-fifty.
Today, the Lowe firm continues to handle both governmental and private sector clients, including the FDIC, U.S. AID, Rubbermaid Commercial Products, Inc., Mooring Financial Services and the Welshire Credit Corporation. Lowe & Associates also represents other corporate clients that in the past relied almost exclusively upon the “large” law firms for complex legal service requirements.
Programs Fail to Send Majority of Work to Firms Owned by Minorities
Big companies, elite law firms and government agencies all announced programs in recent years to steer more work to minority law firms. The result so far: some progress, but less than many people had hoped.
Robert Lowe is one lawyer who has come out ahead – but not before having to dispel some stereotypes. Mr. Lowe, an Asian-American, remembers an interview he had with an employee of the Resolution Trust Corp. in 1990 about working on failed-thrift cases for the federal agency. “You guys have secretaries and word processors, don’t you?” he recalls the agency representative asking.
As a graduate of the respected University of Texas law school who was already counseling the likes of Nordstrom In. and Porsche Cars North America Inc., Mr. Lowe, 43 years old, found the query a little amusing. “People think you can hardly walk” if you are a minority-owned firm, he says.
The RTC soon learned that Lowe & Associates had both secretaries and computers, and the agency is now a satisfied customer. half of the annual income of the six-lawyer firm, based in Alexandria, VA, comes from a score of thrift cases it handles for the agency. “I am glad I had the opportunity to put my foot in the door,” he says.
But while Lowe & Associates is a major beneficiary of the recent push to increase the profile of minority law firms, some other minority shops are facing a tough time. One problem is that corporate legal departments and even the RTC, seeing to cut costs, have reduced their reliance on outside counsel. In addition, not every group that says it wants to steer work to minority firms ends up doing so.
Where the initiatives have worked, they have served the clients’ needs while sparking the formation and growth of minority firms. Though most minority-owned firms are still quite small, with about 40 lawyers at most, the elevated demand for their work has led to the creation of some significant strategic alliances with bigger, more established firms.
Last fall, for example Jones, Day Reavis & Pogue, one of the U.S.’s largest law firms, formed an alliance with six-lawyer White Hill Sims & Wiggins, a black-owned firm in Dallas. Terms call for Jones Day to get a piece of the work that White Hill may pull in a s a result of government or corporate efforts to use minority law firms. White Hill, in turn, gets access to Jones Day’s research and support facilities, and a fancy new address via a cut-rate lease on excess space Jones Day had in its office in downtown Dallas.
So far, everyone is optimistic about the arrangement, which Richard Kneipper, a partner with Jones Day in Dallas, views pragmatically. “I am not interested in doing good, but rather making money for both firms, and if I can do some good in the process, that would be great,” he says. “I hope they turn out to be just an awesomely successful firm.”
In some other instances, though, such partnerships have proven to be fraught with pitfalls. Disputes can arise over apportioning billings between the firms and over who bears legal liability in case of alleged malpractice. Minority firms, being smaller, can also be less stable than their partners. Graham & James called off a major joint venture with a minority firm three years ago after Graham’s would-be partner ran into financial troubles. And some people express concern that the arrangements sometimes turn into mechanisms for big firms to attract business targeted for minorities without giving a fair share of work to the minority joint venture partner.
The ventures that focus on getting work form the RTC seem to have been among the most lucrative so far. Mr. Lowe’s success grew from a joint venture with Morrison & Hecker, of Kansas City, which found its big RTC practice threatened a few years ago when the agency decided to cut off firms unless they had ties to minorities. Other big firms entering such alliances include the likes of Hughes, Hubbard & Reed, based in New York; Atlanta’s Powell, Goldstein, Frazer & Murphy and Brobeck Phleger & Harrson, San Francisco.
But even this sort of venture doesn’t always work. Donald Hill, a partner in White Hill, is on his second joint venture with a big firm. The first, a highly touted, two-year alliance with the Dallas office of Arter & Hadden, a big Cleveland-based firm, didn’t bring much new work his way, he says. An Arter & Hadden partner, Forrest Smith, disputes the idea that the venture was a flop, and says the firm is still keen on the idea of joint ventures. “If you want to crack the corporate community, the average minority law firm is not going to be able to get through that door. That firm is going to need some way to get in there,” he says.
Corporations have been warming to minority firms, although the bottom line has been uneven. Much of the corporate interest has been channeled through the ABA Minority Counsel Demonstration Program, which set out in 1988 to hook up minority lawyers with corporate legal lawyers from a list of minority lawyers that the ABA maintains, although lately the growth in signatories has slowed. And fees generated by the program – on the order of $40 million to $50 million a year – have been about flat in the past two years.
May firms say the program was invaluable in the beginning but question whether economics are prompting some companies to retreat. Says Renaye Cuyler, of Gorayeb & Cuyler, a minority-owned New York firm and a participant in the ABA program: “The old-boy network is still alive and well.”