Solo and Small Firms
Jun. 18, 2002
New Breed of Law Firm
Steve Wasserman's pitch to McDonald's executives worked. On June 12, Wasserman and several representatives accompanied him to Cambodia to pursue opening the first McDonald's in the country.
It was during a recent dinner in Cambodia that the country's secretary of state asked San Fernando Valley attorney Steve Wasserman for some entrepreneurial assistance.
Kong Vibol of Cambodia's Ministry of Economy & Finance had tried for sometime to lure McDonald's Corp. to his Southeast Asian nation of 12 million people. But the fast-food franchise resisted the offer, says Wasserman, a name partner at Tarzana's Wasserman Comden Casselman & Pearson.
So, while dining on French cuisine at a five-star hotel, Vibol suggested that Wasserman intercede on his behalf. Wasserman, a business lawyer in Cambodia on an unrelated business venture, agreed to place a few phone calls to the Chicago-based McDonald's once he returned to the states.
Back at his office, in a three-story brick building owned by the law partnership, Wasserman repeats the pitch he gave to the fast-food folks: The Orient is a hotbed of business activity right now, and of the world's top 10 busiest McDonald's, seven are in Hong Kong.
His pitch worked. On June 12, several McDonald's executives accompanied him back to Cambodia to pursue opening the first McDonald's in the country.
It shouldn't be long before Cambodians are consuming quarter-pounders with cheese and adding to the billions served.
"We view ourselves as the entrepreneurs of the Valley,' says Wasserman Comden partner Clifford Pearson, referring to Los Angeles' San Fernando Valley.
While nearly 80 percent of the cases the firm handles are litigation matters -in 2001 Wasserman Comden won two of California's 10 largest verdicts at $94.5 million and $30 million - another lucrative endeavor that pads partner profits are business ventures.
Wasserman, 55, declined to release the 40-attorney firm's per-partner profits but says going into business with national and international companies make his firm all the more unusual. Wasserman Comden has 14 partners and 26 associates divided among four offices. The other offices are in Brentwood, Alhambra and Los Angeles.
Wasserman and Vibol first met in Los Angeles when a business client of Wasserman's, who was doing business with Vibol, brought the Cambodian dignitary to Wasserman's home.
The firm, which uses money from the name partners' personal accounts to finance business partnerships, is particularly interested in Asian ventures, Wasserman says. The Far Eastern market is ripe for business and proving profitable, he adds.
Wasserman notes that the firm's recent investment in a Cambodian papaya venture will generate upward of $3 million annual revenues.
The Wasserman partners won't reveal the percentage interest they hold in the venture, where the firm partnered with a Cambodian papaya grower to buy 120,000 trees and sell the fruit to Europe, Hong Kong and in the Middle East.
What they will reveal, however, is that the partners sunk no firm dollars into the deal. Instead, they offered sweat equity - their time, business contacts, expertise and guidance - says partner Len Comden, 57.
Comden notes that he hopes to get a seven-figure return on the investment.
One international business venture that the partners tout as unprecedented is a deal between the firm and Tongji Hospital in China.
The joint venture between the Chinese government, which owns 30 percent while American investors, including Wasserman Comden, own the remaining 70 percent, will set up a hospital and medical clinic for Westerners working in Shanghai. The deal brings Western medicine and Western doctors to the Far East, Wasserman says.
"Nothing like this has been done before. This is the first time the Chinese government is allowing licensed American doctors to practice medicine in China,' he says.
Wasserman notes that the deal specifies that the doctors can only practice in Shanghai.
Americans working for American companies in China can enroll in this medical group, and they will receive American-style health care. The 30 doctors involved are of Chinese-American descent and are semiretired professionals. The business venture provides them with an apartment, a chauffeur and a housekeeper, and they live in China for three months at a time, Wasserman says. And with 300,000 Westerners living in Shanghai, the venture's prospects look good.
It's little surprise that the firm's business ventures have been successful. From the beginning, the name partners have clicked, socially and professionally.
Wasserman and Comden met in 1964 while Alpha Epsilon Pi fraternity brothers at UCLA. After graduating law school at Southwestern University, Comden worked three years at the Los Angeles County public defender's office. Wasserman, after earning a law degree at San Fernando Valley College of Law, managed his folks' garment business, Grand Prix Corp., in Los Angeles and Kansas City, Mo.
In 1976, the friends decided to form a firm because each had grown restless in his respective job.
Wasserman and Comden moved into a small building overlooking the U.S. Highway 101 in Los Angeles' San Fernando Valley, where the two men lived.
In the early days of the firm, Comden says, they took any client who walked through the door.
"We dragged some of them in,' Comden jests.
Partner David Casselman, 49, joined in 1982. Casselman started his legal career at Los Angeles' now-defunct Brill Hunt DeBuys & Burby, then moved to Kern & Wooley before joining Wasserman Comden.
Pearson, 47, worked as a financial analyst for the Royal Bank of Canada before he joined the firm in 1984. An acquaintance of the firm referred him, he says.
He notes that it was an exciting opportunity to join a young group of attorneys in the Valley.
From the beginning, the lawyers at Wasserman Comden handled a variety of cases. Eventually, the firm grew into an insurance defense firm of 40 attorneys. But in the mid-1990s, when insurance companies began setting up in-house counsel, eradicating the need to hire outside firms, insurance defense grew unprofitable and undesirable. Thus, the firm branched out into other areas: business, family law, intellectual property.
Just around that time, the lawyers stepped up their pursuit of investing in business ventures. Wasserman says with the name partners' business backgrounds and knowledge, it seemed a profitable idea to pursue various partnerships. There is no conflict of interest with a firm participating in a business deal, he says, as long as the lawyers do not represent any of the parties in any legal matters.
Pearson has a master's degree in business administration from the University of Miami, in addition to his law degree from Whittier College, and Wasserman had hands-on experience at running a business. So it made sense for the firm to go after business ventures with the kind of tenacity it used in court trials and transactional matters, Wasserman says.
Buying into the Tarzana office building and financing the construction of a 6,000-square-foot shopping center in Van Nuys were the firm's first two business ventures, Comden says. Since then, the members participate in roughly six business ventures a year, some in the $100 million range. They typically realize a six- to seven-figure return on each venture. The partners will not disclose how they split the money among themselves.
With the papaya deal in the pipeline, Wasserman continues to work on the deal with Tongji Hospital and continues talks with McDonald's representatives.
McDonald's has restaurants in 121 countries. Cambodia wants to be 122. The country is looking to grab a share of that American culture, Wasserman says.
He adds that the Cambodians embody a young dynamic culture.
For former legal client and current business partner Sandy Lang, there is no other group of lawyers he trusts more.
In 1997, Casselman represented Lang in a lawsuit against a business partner, who allegedly misappropriated funds from their business, the Secret Inc. The trial court awarded Lang $22 million after the business partner failed to comply with three discovery orders. The 4th District Court of Appeal affirmed the judgment in 2000.
"These guys are smart, hardworking - you can reach them 24/7 - and honest, and they really care about their clients. They won't bullshit you. That's why I trust them with my money and my business,' Lang says.
He notes that he made the firm partner in a motion picture company that he is starting. He declines to name the company, however.
Casselman points out his small-sized Valley firm garners verdicts and settlements just as plump as the skyscraper firms in downtown Los Angeles and Century City. But he's tired of reading that angle in the press.
"We represent a new breed of law firm. We're diversified in a number of practice areas, and we are split between plaintiffs cases and defense cases,' he says,
Casselman notes that lawyers at Wasserman Comden handle family, criminal, real estate, corporate, trust and estates, tax and bankruptcy law matters.
Plus, by knowing how to play both sides, the Wasserman Comden lawyers have insight into what opposing counsel might be thinking and what the risks and benefits are, he says.
"We are also fairly well-recognized as being the firm that is capable of going to the wall,' Casselman says of taking a case all the way to trial.
"But it's my own personal philosophy that trial is the last resort. Some firms believe getting to trial is the goal. Our belief is that it is in the client's best interest - less stress, less emotionally draining and probably at less cost to them - to get a settlement,' he says.
However, as far as civil matters are concerned, Casselman won't touch a plaintiff's case unless it could net a verdict or settlement of at least $2 million.
In October 2001, Casselman won a $94.5 million jury verdict against the city of San Diego in a breach of contract case. He represented a developer at odds with the city over taxes, contracts and even traffic.
That same year, Casselman won a $29.6 million verdict for the Los Angeles County Metropolitan Transportation Authority against Tutor-Saliba-Perini, J.V., the Metro Rail Red Line's general contractor. Casselman proved that the company never planned to work at night, yet the contractor submitted claims to the MTA for millions of dollars in compensation saying noise limitations on nighttime construction jacked up projected costs.
Meticulous by nature, Casselman reads and rereads every document, finds loopholes, plugs them, if possible, and ensures that every "t' is crossed and "i' dotted.
It's that kind of trial readiness that intimidates even veteran litigators.
"I have opposed David, and I hope never to do it again,' says plaintiffs' lawyer Bruce Broillet of Santa Monica's Greene Broillet Taylor Wheeler & Panish. Broillet faced Casselman in a products liability case with multiple defendants. Casselman's client, a defendant in the case, settled.
"I have rarely seen an opponent who gets as prepared,' Broillet adds.
As the partners at Wasserman Comden prepare for the future, they will continue arguing cases they believe will net seven-figure verdicts and settlements. And on the corporate side of things, they'll keep mining for potential partnerships.
"We're always looking for new business opportunities,' Wasserman says.
Donna Huffaker
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