UPDATE: McDonough, Holland and Allen to Close; City Attorney Said To Be Unaffected

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steinerWe have been hearing for weeks about turmoil at the law firm of McDonough, Holland and Allen, where City Attorney Harriet Steiner is employed.  As we have discussed in the past, the city has a contract City Attorney with an agreement with the law firm to retain the services of Harriet Steiner along with various support staff.

We have now learned that McDonough, Holland and Allen will close by September.  The Sacramento Bee reported on Saturday, “The sagging economy apparently contributed to the imminent demise of a legal powerhouse in Northern California.”
It continued, “McDonough Holland & Allen PC, Sacramento’s second-largest law firm and a fixture in the local legal community for more than 55 years, said Friday that it intends to “wind down its operations sometime this fall.”

Harriet Steiner told the Vanguard on Friday that she does not anticipate that the changes to impact the services to the city.  She wrote in an email, “I cannot comment at this time except to say that my work for the city should not be affected. In addition the other lawyers in my firm are also committed to assuring that any changes at My firm do not impact the services to the City.”
Questions remain as to whether she will form her own firm with some of the staff as carryover, or whether the city might consider bringing her in house.  Though we suspect something along the lines of the latter.
Neither Mayor Pro Tem Saylor nor City Manager Bill Emlen responded on Friday to Vanguard’s attempts to get a comment.

Friday’s Story

The lead story in the June 18 Sacramento Business Journal is “McDonough struggles to keep lawyers.”  According to the article, 20 lawyers have left in recent months from what had been a 99 lawyer firm, the second-largest in the region.
The Journal reports:

“At least five lawyers have made commitments to other firms in moves that have not been announced and 19 layers – including some of the firm’s top billers and rainmakers – are in serious talks about leaving.

A frenzy of discussions continued mid-week in board rooms, back rooms, restaurants and bars, but most sources clammed up in deference to senior partners trying to save the firm while others attempt to lure McDonough’s top talent.”

Also of note is the report that “a possible merger with Stoel Rives LLP failed, sources say, though Stoel appears to be wooing specific lawyers.”

The report goes on to say, “Stoel Rives is still talking to lawyers at McDonough, sources say, but managing partner Tim Taylor declined comment with an email that said the firm is exploring opportunities to ‘strengthen our presence and capabilities in California’ and ‘Sacramento will continue to be the focal point of our operations.'”

We note this, only because that is the same Tim Taylor who is President of the Davis Joint Unified School Board.

The bigger picture and story is what would happen to the city’s long time City Attorney Harriet Steiner.  Steiner has been City Attorney of Davis since 1986 and she is a shareholder and member of the law firm.

According to her bio at the law firm, “Serving as City Attorney of Davis since 1986, Harriet assisted in the development of the City’s agricultural mitigation ordinance for farmland and habitat preservation and in the development of the City’s Affordable Housing Ordinance and its new Middle Income/Work Force Housing Inclusionary Housing Ordinance.”

Furthermore, she also “serves as general counsel to the Sacramento Metropolitan Cable Commission, which holds the cable television franchise for the county and the cities within the County of Sacramento. She also represents the City of Modesto on cable and telecommunications matters, as well as other local franchising entities. She has negotiated cable franchise renewals and transfers, franchises with cable overbuilders, and represented franchising entities in cable and wireless cellular tower litigation.”

The Vanguard will continue to monitor this developing story and attempt to get comments from the City Council, City Manager, and possibly the City Attorney.

—David M. Greenwald reporting

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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17 thoughts on “UPDATE: McDonough, Holland and Allen to Close; City Attorney Said To Be Unaffected”

  1. David M. Greenwald

    Just wanted to highlight that I exchanged emails with Harriet Steiner, she said, “I cannot comment at this time except to say that my work for the city should not be affected. In addition the other lawyers in my firm are also committed to assuring that any changes at My firm do not impact the services to the City”

  2. Rich Rifkin

    David, what is causing this exodus from Harriet’s firm?

    I would imagine it has something to do with the state government’s finances. Law firms of that ilk make a lot (all?) of their money off of government work; and there must be much less money going around to them, now.

    Or did a senior attorney with McDonough, Holland and Allen quit and take with him all of those other lawyers? That sort of thing happens now and then at law firms.

    As Harriet says, “(her) work for the city should not be affected.” However, this might be a good time (especially with a new city council coming in) to take a second look at what you reported on some time ago–the notion of having in-house legal services (which might be having the city hire Ms. Steiner or someone else full-time).

  3. David M. Greenwald

    Yeah, I think it’s always look exploring. I did not see a clear-cut savings for the city given the city would have to probably have an assistant and a deputy city attorney at minimum. I think that ends up costing more than what we are paying now and we would lose the benefit of the large number of attorneys hired by McDonough. Again I still think it’s at least worth exploring.

  4. JustSaying

    Ms. Steiner certainly has a heavy workload. How much has Davis paid for her services for, say, the last five years? Are her charges ALL we pay for legal services, or just a portion of our costs?

    Her many years of experience probably benefit the City. Does that balance out any premium we might be paying for part-time help–as opposed to hiring a full-time city attorney with less experience to lead our legal operation?

  5. David Thompson

    Going in house should be looked at but it is not the only option. Many smaller California cities have a diverse set of arrangements for obtaining legal counsel from outside law firms. If the city has an opportunity to bid the contract there are a number of firms that would step forward, and in this climate, I would suspect we would obtain savings. The city could then look at the potential for savings versus the level of service and make an appropriate judgment. However, there are many qualified firms providing legal services to cities.

  6. Rich Rifkin

    [i]”However, there are many qualified firms providing legal services to cities.”[/i]

    Winters just got a fantastic new deal from a Dixon based firm, Dewey, Cheatham and Howe. We should look into that.

  7. Rich Rifkin

    [i]With no apologies to Click and Clack, Rich?”[/i]

    No. Tom & Ray got that from the Three Stooges. Some years later, the Marx Brothers borrowed the idea from the Stooges and appeared as Dewey, Burnham & Howe.

    [img]http://www.collider.com/uploads/imageGallery/Three_Stooges/the_three_stooges.jpg[/img]

  8. David Thompson

    June 18, 2010
    Sacramento’s McDonough Firm to Close Its Doors
    [Cheryl Miller: Legal Pad]

    McDonough, Holland & Allen, one of Sacramento’s largest law firms, will wind down operations this summer, according to a statement issued Friday by the firm’s chief executive officer.

    Edward Quinn Jr. said the 80-lawyer firm, with offices in downtown Sacramento and Oakland, would try to merge with another firm or perhaps spin off practice groups. But the firm as an entity will no longer exist, Quinn said.

  9. So fed up

    Well if Harriet Steiner leaves the City who is going to handle the NewPath cell tower lawsuit caused by the incompetence of former Director of Community Development Katherine Hess? We Davis residents get to foot that bill which may well go up now.

    Why hasn’t Katherine Hess been fired for this and her many other screw-ups? After four years of abysmal performance as Director why does Hess simply get to be demoted and keep a six figure salary when other City employees who do their jobs well get laid off?

    All eyes need to be on City Manager Bill Emlen to see how he handles this situation with Steiner. If he can’t do his job then he and Hess need to be fired.

  10. Sue Greenwald

    [quote]All eyes need to be on City Manager Bill Emlen to see how he handles this situation with Steiner. If he can’t do his job then he and Hess need to be fired. [/quote]The city council is directly responsible for hiring legal council; the city manager is not responsible.

  11. E Roberts Musser

    SG: “The city council is directly responsible for hiring legal council; the city manager is not responsible.”

    My concern is if the city decides to retain the services of Harriet Steiner, they will end up paying more for the privilege than we already pay.

  12. David Thompson

    After Losing 20 Lawyers Since March, Venerable Calif. Firm Plans to Close. Posted Jun 18, 2010 7:02 PM CDT
    By Martha Neil ABA Journal
    Email Print Reprints After losing more than 20 lawyers since March, the second-largest law firm in California’s state capital plans to close its doors, perhaps as early as Labor Day.

    Although there are presently about 80 lawyers still on the McDonough Holland & Allen attorney roster, the prospect of more departures has forced the Sacramento-based firm to close, officials said today. Among those whose departure is imminent is former managing partner Jeffry Jones, who is expected to announce a move next week, reports the Sacramento Business Journal.

    “During the last few months, it has become clear that, for a variety of reasons, some attorneys and attorney groups are interested in moving in different directions and the firm, as currently organized, will no longer be viable for the long-term,” CEO Ed Quinn said in a news release.

    However, the firm’s attorneys will continue to practice as usual in the meantime and clients will not be adversely affected, he said.

    In business for more than 56 years, the McDonough firm had been suffering from declining revenue. It laid off 16 percent of its support staff in 2006 and four associates and 13 staff in May 2009, as detailed in earlier ABAJournal.com and Sacramento Business Journal articles.

  13. Superfluous Man

    What makes you think she would forgo an opportunity to continue working in the private sector to go in-house? I don’t know if this firm paid market salary, but the firms that do pay their first year associates upwards of 160K(more so the case before the economy tanked) in addition to what are very handsome annual bonuses (more than most household incomes in the US, in some cases).

    Would she be willing to take a large pay cut just to work in-house for the Davis City Council? Could the city offer her a competitive salary or even close to what she could (did) make at a large private firm?

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