Unlucky Roll of the Dice
With Abramoff, Greenberg Traurig Had a Hot Hand. Now It’s Feeling the Effects of His Departure.
In the three years that star lobbyist Jack Abramoff spent with Greenberg Traurig, the Republican rainmaker helped transform the firm’s lobbying practice from a sleepy division with less than $4 million in revenue into one of the kings of K Street, with annual billings topping $25 million a year.
Now, Greenberg Traurig is learning the price of losing Abramoff.
New documents show that Greenberg Traurig has shed about $7 million in revenues — half of the firm’s total — since it fired Abramoff when his lucrative lobbying efforts on behalf of American Indian clients came under investigation by Congress and a federal grand jury.
In the past six months, Greenberg Traurig also has lost more than a dozen lucrative Indian and corporate contracts, a handful of experienced lobbyists and its prized position among the largest firms in Washington.
The firm now clings to No. 8 in the lobbying rankings, after climbing as high as No. 3 just last year, according to lobbying rankings compiled by Roll Call.
The firm still raked in $7 million in lobbying revenues from Jan. 1 to June 30 of this year and expects to retain a base of about $5 million in revenue in the second half of this year — enough to keep it among the top 20 lobbying firms in Washington.
“In a time of change at our firm, we are proud of our strong governmental affairs team, and look forward to continued growth,” said Jill Perry, a spokeswoman for the Miami-based law firm.
She added that the firm’s partners are “confident that Greenberg Traurig is and will remain among the top echelon of Washington’s governmental affairs practices.”
But the new figures from lobbying disclosure forms and interviews with current and former Greenberg Traurig lobbyists show for the first time just how much revenue the firm has lost due to Abramoff’s departure.
During the last six months of Abramoff’s tenure at Greenberg Traurig — from July 1 to Dec. 31, 2003 — Abramoff took in $6.5 million in lobbying revenues from the dozen clients he represented, according to lobbying disclosure forms.
After Abramoff left Greenberg Traurig, those same 12 firms paid just $2.6 million from Jan. 1 to June 30, according to the newly released forms.
For example, one Abramoff client, the Agua Caliente Band of Cahuilla Indians, paid Greenberg Traurig $500,000 for lobbying during the first half of this year after spending $980,000 on lobbying in the last six months of 2003.
Another Abramoff client, Tyco International, reduced its payments to Greenberg Traurig from $1 million in the second half of last year to $480,000 this year.
The reduction in lobbying fees from Abramoff’s clients this year — a total decline of $3.9 million — represents more money than all but two dozen of Washington’s largest lobbying firms earned in the first half of the year.
But the worst may be yet to come.
Much of the $2.6 million that Greenberg Traurig received from Abramoff’s clients so far this year was billed before Abramoff was fired on March 2.
Since then, about half of Abramoff’s clients have cut their ties to Greenberg Traurig, including the Agua Caliente, Chitimacha Tribe of Louisiana, Coushatta Tribe of Louisiana, Primedia Inc. and Voor Huisen Project Management.
In the meantime, several of the Abramoff clients who remain at Greenberg Traurig have drastically reduced their monthly contracts.
Tyco International once paid Greenberg Traurig a $150,000-a-month retainer. Today, they pay a fraction of that.
Unysis slashed its $25,000-a-month contract by more than half, according to Greenberg Traurig sources.
As a result, lobbying revenues for Greenberg Traurig are expected to fall by another few million this fall.
Some of Greenberg Traurig’s lost business was sucked up by Cassidy & Associates, a competing lobbying firm that hired Abramoff and a few of his aides this spring.
Lobbying forms for Cassidy & Associates show that the firm picked up about $480,000 in revenue in the first six months of the year from clients once retained by Greenberg Traurig.
U.S. Tobacco, Wal-Mart, United Rentals and the Chitimacha Tribe of Louisiana were among the nine Greenberg Traurig clients who transferred their lobbying accounts to Cassidy & Associates, according to lobbying documents and Greenberg Traurig lobbyists.
Though Abramoff has since left Cassidy, the accounts are handled by Jim Hirni and Todd Boulanger, two former Greenberg Traurig lobbyists.
Other factors beyond Abramoff’s departure have affected the firm’s bottom line. Several other Greenberg Traurig lobbyists have left the firm recently, including Ron Platt and Gary Shiffman.
While at Greenberg Traurig, they pulled in more than $5 million in revenue during the past three years by helping victims of terrorism collect judgments from countries charged with sponsoring terrorism, including Iraq, Iran and Libya.
In the past few months, Shiffman left the firm to take a job with the Homeland Security Department. Today is Platt’s first day at the firm Buchanan Ingersoll.
Then, last week, another Greenberg Traurig lobbyist, Duane Gibson, announced that he was leaving the firm to join the Livingston Group.