US > Tax > Domestic tax: West Coast
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Domestic tax: West Coast
Leading lawyers
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- Hatef Behnia, Gibson, Dunn & Crutcher LLP ‘Never misses a detail or opportunity, and explains options clearly without wasting words’
- David Forst, Fenwick & West LLP ‘Energetic, knowledgeable and a joy to work with’
- James Fuller, Fenwick & West LLP ‘Immaculate - commercial from beginning to end’
The tax practices of the firms based on the West Coast have kept pace with the growth in the economy over the last quarter of a century but the larger firms now have a nationwide and international agenda which allows tax expertise to be drawn from out of the region.
This section covers those firms and lawyers having significant regional practices on the West Coast or particular expertise of wider application.
PRACTICE: Gibson, Dunn & Crutcher LLP’s tax practice has established a strong position in the Californian corporate market, although the expertise of the excellent team in federal and state taxation is available nationwide. The economic crisis has changed the rhythm of work with a significant drop in transactions and an increase in restructuring and bankruptcy assignments. Controversy matters are taken in by the practice but generally come from existing clients subjected to IRS audits. Clients comment on ‘a business minded approach’ and ‘well-managed work with available partners and correctly supervised associates’.
The practice has traditionally been very strong in private equity and met the expectations of the Californian entertainment, media, technology, and life sciences sectors, but for the most part does not specialize and is commended for depth of knowledge and breadth of experience.
Tax attorneys were brought into a team established by Gibson, Dunn & Crutcher LLP’s media and entertainment group to represent Vivendi in connection with the tax-free spin-off and subsequent merging of the Vivendi games division with Activision to create Activision Blizzard in a transaction valued at $18.9bn. The practice also advised in the complex structuring of a multi-million dollar gift to Chicago University.
CLIENTS: clients include BCBG Max Azria, Bionics Trust, Specialized Technology Resources, Wesco Aircraft, Pitney Bowes, Tyco Electronics, Nortel Networks, Cingular Wireless, Neopets, The Williams Companies, Covidien, Washington Mutual and Intel.
INDIVIDUALS: Los Angeles-based partner Hatef Behnia is a veteran of numerous complex high-value deals and ‘never misses a detail or opportunity, and explains options clearly without wasting words’. Also in Los Angeles, Stephen Tolles is regarded as ‘outstanding, a good ally in an appeal’ and also has wide experience in private equity taxation.
PRACTICE: Fenwick & West LLP is a leader in servicing the technology and life sciences sector and has developed a tax group to match. A consistent record of advising technology companies from start-ups to major multinationals has established an enviable reputation. The practice, which numbers some 20 attorneys, is based in the firm’s Silicon Valley office. Strength in international tax has been building, particularly in Asian markets. Clients comment on ‘a truly entrepreneurial approach-the tax expertise is applied to our business problem, we don’t get swamped with technicalities’.
In early 2008, the practice represented Carlyle Group as special tax counsel in the sale of its portfolio company Hispanic Teleservices to Paris Stock Exchange quoted Teleperformance, the first exit by the Carlyle Mexico buyout team. In February 2009, tax lawyers assisted Cisco Systems in an unsecured senior note issuance program totaling $4bn. In March 2009, practice attorneys were again required on the multidisciplinary group advising Cisco on its proposed acquisition of San Francisco-based Pure Digital Technologies, a $590m stock-based merger.
CLIENTS: Clients include Apple, CMI International, Daimler Chrysler, Limited Brands, Textron, IGN Entertainment, Electronic Arts, Cisco Systems, Symantec, Application Networks and Savi Technology.
INDIVIDUALS: All tax attorneys practice from Silicon Valley. Practice head David Forst is ‘energetic, knowledgeable and a joy to work with’ and is recommended for the most complex and high-value transactions and structuring. James Fuller who acted for Carlyle, is ‘immaculate - commercial from beginning to end’.
PRACTICE: Latham & Watkins LLP’s West Coast practice, substantially based in the firm’s headquarter city of Los Angeles, is available to the global network but also meets the demands of the Californian market. The practice, with 10 partners and some 15 associates is large enough to offer a comprehensive service, with specific regional expertise in the technology and pharma sectors. Instructions also flow from Asia, for both inward and outward investment, and the Los Angeles practice works closely with the Japanese and Chinese offices. The practice has been strengthened by the recruitment of Kurt Switzer as partner in Silicon Valley; he was previously with Ernst & Young.
Until the economic downturn, tax practice instructions were, to a large extent, transaction driven although now restructuring and bankruptcy issues have increased.
The practice recently advised AECOM Technology on several tax issues related to its acquisition of Earth Tech, a consulting business in the construction sector, for $510m. Further advice was required on the sale by AECOM of Earth Tech’s Mexican business to Japanese buyers. Los Angeles lawyers also advised Gracenote on the sale of the company to Sony for approximately $260m.
Intellectual property tax issues were involved when the Los Angeles practice represented QLT on the sale of the worldwide rights to Aczone, a prescription medicine for acne treatment.
CLIENTS: Clients Amgen, Oracle, R2 Technology, Icos, FileNet, Axonyx, Allergan, Sabre Holdings, Advanced Micro Devices, Ericsson, Comstar, Kilroy Realty, Kimco, Maguire Properties, National Golf Properties, Carlyle, Apollo Management, Goldman Sachs and Odyssey Partners.
INDIVIDUALS: In Los Angeles, Samuel Weiner is co-chair of the transactional tax practice and Laurence Stein is chair of the global tax practice - both are experienced lawyers who continued to handle complex instructions. Also in Los Angeles, Michael Brody, has a strong REITS practice within a wide expertise. John Clair, managing partner of the Los Angeles office, is vastly experienced in major transactions and financing.
PRACTICE: Morrison & Foerster’s four-partner West Coast tax practice’s strongest suit is in state and local tax advice. The firm’s strong corporate following generates numerous complex and challenging state tax disputes which are tackled with ‘a can-do attitude which seems to go from top to bottom’, according to clients. The practice acts for numerous multinational and major US domestic corporations not only in California but in virtually every US state. Attorneys from the practice have been involved in some of the major precedent cases including several which have reached the US Supreme Court.
The practice does not confine itself to controversial state tax issues. It contributes to planning and consultation exercises with clients to consider a range of taxes including sales taxes, local business taxes and capital stock taxes which may result in reorganizations for reasons of tax efficiency. Lawyers also conduct due diligence exercises on the state tax and local implications of M&A transactions.
Representations include assisting Hallmark in the corporate income tax controversy in New York State - the tribunal held that the state could not force the state-resident trading company to be combined with its out-of-state parent for New York State purposes. In Colorado, practice attorneys successfully represented Kroger when the Colorado District Court held that the corporation and certain affiliates could not be forcibly combined with other subsidiaries that had no nexus with Colorado.
The practice is not so visible in federal tax advice, although instructions are handled for the firm’s large following of private equity managers and other investors. Members of the team certainly have the ability and expertise to support complex transactional and restructuring instructions.
CLIENTS: Clients include Bristol Myers-Squibb, Citicorp, Control Data, General Motors, Hallmark, Sherwin-Williams, Sony, Sumitomo, Wells Fargo, and WR Grace & Co
INDIVIDUALS: In San Francisco and with a subsidiary office in Denver, Thomas Steele is a robust state tax specialist familiar in the courts and boasts an established a niche in the tax complexities of the telecoms market. Sacramento-based Eric Coffill, who heads the state tax practice, has long experience both as a lawyer with the California Franchise Tax Board and in private practice. For transactional tax advice Robert Cudd, who ‘knows business as well as the law’, is recommended for corporate structuring, REITS and other investment funds work as well as cross-border matters
PRACTICE: O’Melveny & Myers LLP’s domestic tax practice is centered in the firm’s five West Coast offices and is well-connected with the regional technology and bio-science sector as well as the film and television industries. Other members of the practice are based further east, and the Washington DC office in particular contributes to the more demanding instructions. It has a reputation for supporting entrepreneurial start-ups and growing with them, a good example being the recent representation of Napster and its directors in the approved sale to Best Buy Company for a $121m cash consideration.
In an instruction which highlights the nationwide penetration of the practice, Los Angeles partners provided the tax advice to Midway Investment & Development when the consortium won the $2.5bn bid for a 99 year concession to operate Chicago’s Midway Airport. The deal was settled in principle in September 2008 and approved by Chicago City Council in March 2009.
The practice has also recently advised in a major film financing agreement structured through a new partnership between a hedge fund, an individual and other production company-ongoing advice will be provided in connection with debt structuring and syndication.
CLIENTS: Clients include Clarity Partners, KKR, Lockheed Martin, Qwest, Trust Company of the West, McDonnell Douglas Real Estate Company, San Francisco Giants, International Game Technology and Western Digital Corporation.
INDIVIDUALS: Los Angeles-based Robert Fisher, recommended for transactions, led in the Midway Airport instruction. In Century City, Robert Blashek is a highly talented practitioner on both federal and Californian income tax matters who was handled numerous bankruptcy and work-out assignments. San Francisco-based Peter Ritter has an expertise in tax advice for structured finance transactions and REITs within his general tax practice.
Paul, Hastings, Janofsky & Walker LLP
PRACTICE: Paul, Hastings, Janofsky & Walker LLP’s tax practice offers ‘good response and client service’. It has a strong following among regional businesses, providing expert tax support in such industry sectors as real estate, hi-tech, pharma and electronics. A strong niche in the tax issues of the aviation industry is noteworthy. International instructions are increasing and the practice recruited two specialist partners during 2008; although based in Washington DC, their expertise is available to the wider practice, as are the skills of lawyers in the other Eastern offices. The practice attracts referrals from the Big 4 accountancy firms.
Lawyers recently represented a market leading US company to establish a joint venture with an overseas company in a similar business. The transaction involved the combination of business units in several states and involved tax sensitive issues such as the preservation of depreciation deductions. The practice serves as special tax counsel to Community Health Systems, an integrated healthcare delivery system in Georgia - a recent assignment required the complex reorganization of the organization from entirely non-profit to a non-profit holding entity with taxable subsidiaries.
CLIENTS: Practice clients include Platinum Equity, KRG Capital Partners and GI Partners, Amgen, AT&T, Hitachi Construction, PepsiCo, Semtech, Toshiba America Business Systems and US Epson.
INDIVIDUALS: Douglas Schaaf, the widely experienced chair of the tax department, is based in the Orange County office. Alexander Lee, who is vice-chairman of the Paul, Hastings, Janofsky & Walker LLP West Coast offices, divides his time between Los Angeles and San Diego - he ‘understands tax law and is very clear in his explanations - very constructive’. In Los Angeles, Nancy Iredale, a previous chair of the tax department, includes controversy in her practice and has a reputation for ‘persuasive negotiation’. In Palo Alto, Thomas Wisialowski specializes in investment fund taxation, and also has a REITs practice.
PRACTICE: Baker & McKenzie’s West Coast tax practice is substantially based in the Palo Alto. The complement of some 35 lawyers is supported by economists specializing in transfer pricing. The focus of the group is on business tax planning advice and support for transactional instructions. Supply chain reviews are undertaken for multinational companies. Several members of the practice take tax controversy instructions although most of these have wider practices.
The practice recently provided tax advice to Maxim Integrated Products on its acquisition of Vitesse Semiconductors’ storage products business for $63m plus a contingent performance uplift maxing at $12m.
CLIENTS: Clients include Alcon Laboratories, Whirpool and Louisiana Pacific Corporation.
INDIVIDUALS: Palo Alto-based John Peterson, also CPA qualified, is ‘very bright and extremely creative’, particularly in international tax. In the same office, Gary Sprague, is one of the region’s top international tax strategists.
PRACTICE: Irell & Manella LLP’s tax practice comprises 19 attorneys, of whom two are elder statesman ex-partners each titled partner emeritus. The larger part of the practice is based in the Los Angeles office with a smaller team in Newport Beach. Irell & Manella LLP is a well-established regional firm providing the high levels of competence which attract top-range regional business and referrals from similar firms nationally and internationally - the tax practice is an important element in the offering.
The practice has developed expertise in the alternative energy sector. Recent instructions include representation of SolarReserve, a builder of utility-scale solar power plants, in connection with its formation, initial capitalization and subsequent $140m preferred equity financing led by a division of Citigroup and Good Energies. In another instance, private equity funds formed jointly by GFI Energy Ventures and Oaktree Capital were assisted in the acquisition of both GoodCents, a developer of energy efficiency programs, and Turbine Generator Maintenance, an independent service provider to the turbine generator market.
In a media sector instruction, the practice represented Zoo Productions, a reality television production company, when it was sold to a UK-based conglomerate, All 3 Media. Tax attorneys also counseled the Herb Alpert Foundation in the structuring of a $30m gift to the University of California, Los Angeles (UCLA).
CLIENTS: Clients include US Biodiesel, Rustic Canyon Partners, GFI Energy Ventures, Angeleno Group, Crescent Entertainments, FDR Management, Wynn Las Vegas, Levine Leichtman Capital Partners, Pacific Life Insurance and Arrow Group.
INDIVIDUALS: Kevin McGeehan is an all round corporate tax expert of high standing. Rob Zeitinger specializes in aviation industry tax issues. Elliott Freier leads in many high-value transactions. Paul Frimmer is expert in personal and the state tax planning, particularly where art assets are involved. All lawyers mentioned practice from Los Angeles.
Orrick, Herrington & Sutcliffe LLP
PRACTICE: Orrick, Herrington & Sutcliffe LLP’s domestic tax practice, which offers ‘well-considered advice in a timely manner’, is centered in San Francisco, although expertise is also drawn from the West Coast offices in Los Angeles, Sacramento, Seattle and Portland. The New York office also forms part of the nationwide network. The practice lawyers offer a good mix of expertise, with several broad-based corporate tax experts and a small group specializing in the Orrick, Herrington & Sutcliffe LLP niche in public finance and utilities taxation. Noteworthy strengths include REIT taxation and planning for high-net-worth individuals and families.
In a major infrastructure assignment which closed during 2008, the practice represented Transurban in a public private partnership for the $1.6bn financing of a toll lane project for the capital Beltway in Northern Virginia -the financing included a unique tax-exempt bond utilizing new legislation. In an unusual assignment, the practice represented a Native American tribe in connection with a long running IRS audit alleging violations of tax law restrictions on $600m of tax-exempt bonds; the matter was resolved in favor of the tribe after three years.
CLIENTS: Clients include Bonneville Power, City of New Orleans, City of Vernon, Bay Area Toll Authority, Quaker Chemical, Tennessee Energy Acquisition Corporation and Highland Capital Management.
INDIVIDUALS: San Francisco-based George Wolf chairs the practice and is a leading member of the public finance tax group. In the same office Charles Cardall extends his municipal finance expertise into the tax-exempt sector. Also in San Francisco, Grady Bolding is recommended for his REIT advice within a wide practice.
PRACTICE: Cooley Godward Kronish LLP’s seven West Coast partners divide between the California and Colorado offices. In California, tax expertise has grown to service the demanding Silicon Valley corporates which continue to generate a substantial proportion of the firm’s fees. Loyal clients confirm Cooley Godward Kronish LLP’s quality and capacity as well as responsiveness and a ‘can do attitude which produces solutions’.
The Palo Alto partners represented Optasite in its $425m acquisition by SBA Communications in late 2008. The San Diego office advised on the formation and undertook ongoing representation for All Capital Partners-Global Investment Fund.
The tax lawyers in the Broomfield, Colorado office have solid experience of private equity fund formation and partnership issues as well as complex transactional matters. During 2008, Verenium was represented in a $90m bio-fuels partnering and investment transaction with BP. The same team represented Steelpoint Capital Partners in the buyout of the prAna clothing business from Liz Claiborne which required formation of an acquisition vehicle and advice on management equity rollover.
CLIENTS: Clients include Adobe Systems, Coltec Industries, ConocoPhillips, Dover, eBay, Entergy, Gilead Sciences, Goodrich, The Hartford Group, ITT Industries, MetLife, Starwood Hotels, Walter Industries and Verizon Communications.
INDIVIDUALS: Based in Palo Alto, Robert ‘Buff’ Miller is a popular and highly recommended transactions tax specialist. In San Francisco, Susan Cooper Philpot is an accomplished corporate tax practitioner. San Diego-based partner Bill Morrow is client commended for his ‘committed service and ready response’. Mark Windfeld-Hansen, who joined the Palo Alto office as a partner from Heller Ehrman in 2008, adds weight to the transactional tax practice.
PRACTICE: Loeb & Loeb LLP’s Los Angeles tax practice is directed very clearly at California-based businesses - the firm has recently established a practice group to specialize in serving new media and technology clients which adds to existing specializations in the entertainment industry, real estate and agriculture. The practice has an established reputation for advice to closely-held family businesses requiring competent tax support across the board accompanied by trust and estate planning for the next generation. The practice also advises in some large international transactions, business acquisitions and divestments, investments and controversy. Several multinational Fortune 100 companies utilize the practice for mid-market transactions. Members of the practice also specialize in executive compensation.
CLIENTS: Loeb & Loeb LLP have advised AIG Foundation, Bertelsmann, The Grateful Dead, Univision Music Group, Diana Ross, Vince Gill, Gaylord Entertainment, Sony BMG, Frontline Management, Providence Equity Partners, Hilton Foundation, Cousteau Society and the Arthritis Foundation.
INDIVIDUALS: In Los Angeles, Paul Sczudlo is expert in international tax planning for entertainers, musicians, record companies and the film industry. Stuart Tobisman, also in Los Angeles, is highly recommended for estate and individual tax planning.
PRACTICE: Mitchell, Silberberg & Knupp’s five-partner tax practice provides excellent support to the firm’s principal client following of privately-held companies, not-for-profit institutions and high-net-worth individuals and families. The firm’s strong employment law practice has stimulated a significant tax expertise in employment-related issues such as categorization. The practice strength in individual and estate tax planning is also very well developed. Members of the practice accept both state and federal tax instructions of all types.
Recent instructions include structuring tax-exempt bond financing for the purchase and development of a new college campus, and representation of several clients in disputes over the categorization of workers as employees or independent contractors.
CLIENTS: Clients include Amnesty International, California Community Foundation, California Institute of Technology, Greenpeace, Huntington Library, University of Southern California and World Vision.
INDIVIDUALS: Los Angeles-based David Newman, an expert in a state and individual tax planning, heads the practice. Also in Los Angeles Jeffrey Davine, who served as an attorney with the IRS, has handled a wide range of instructions including employee-related federal and state disputes.