Newly Elected CEO Guides Cozen O’Connor Toward Practice Diversity and Market Expansion Of Counsel Steve Taylor February 2013

Immediately after Hurricane Sandy hit the East Coast last year, Michael Heller knew exactly what to do. As president and executive partner of Philadelphia’s, 575-attorney Cozen O’Connor, he sent an email to the members of the firm’s management team asking them to find a way for their foundation, which is funded by the partners, to help the victims of the super storm.

And the firm did help, significantly and without any fanfare. “ Michael didn’t do it by going through some well-known organization to try to get some good press, which some laws firms did,” says managing partner Vincent McGuinness. “He reached out to the governors of the states that were hit and asked how we can best, quietly, help the victims of Sandy. The governors were very appreciative.” A couple of months later in late December, Heller and his colleagues heard about a terrible accident in Washington State in which a tree fell on a car killing a mother and father and injuring three of their children. Some of the Cozen attorneys had worked with the man, who was an insurance adjuster, but Heller had never met him. Still he reached out. “Michael,” recalls McGuinness, who also has a reputation for helping those in need, “was the first to come out and say, ‘Guys, let’s get together and figure out how we’re going to help this family, the surviving three children; we have to help these people.’” The firm has established and is funding a foundation that will help with the care and welfare of the couple’s children. One year, recently, the partners earned a very significant contingency fee. “The first thing Michael said was, ‘We need to make sure that every single person in the firm, not just the partners, receives some of this fee,’” McGuinness says. “Time and time again I see Michael wanting to help those who need help the most. It’s great to know that there’s a leader who reinforces the charitable culture of our organization.” Cozen also has a leader who knows how to help his firm. Heller came to the partnership nearly 20 years ago, helped establish and build its business and transactional practices—when he arrived Cozen was primarily an insurance-litigation firm—and has been instrumental in its growth and expansion and its financial success both before and during the recession. In 2011, Heller became Cozen’s president and executive partner and last September his partners elected him, after a long succession process, chief executive officer, a position he assumed at the start of this year. He also serves on the firm’s board of

directors, management committee, and heads the emerging business and venture capital practice. Simply put, he’s been a busy guy and now, as CEO, he’s gotten even busier. One thing seems certain: Heller has the respect of his colleagues. “Michael has genuine leadership skills and style that make people here very comfortable,” McGuinness says. “He’s as good a leader as anyone I’ve met.” Recently, Of Counsel talked to Heller about his career, the challenges he faces and the opportunities he sees as firm leader, the changes in the legal profession, Cozen O’Connor’s future, and other topics. Here, then, is that excerpted interview. Of Counsel: Michael, why did you decide to become a lawyer? Michael Heller: I had a lot of legal role models in my life so becoming a lawyer seemed to be a natural career path. And, I wanted to find a way to mix a business degree, a financial degree, and a law degree into a career. At one point, I thought I wanted to go into business and have a career with lots of diversity so I thought having a legal degree would do that. OC: You earned your law degree from Villanova University School of Law. Did you go right to the Wolf Block firm (a longtime Philadelphia partnership that dissolved in 2009)? MH: Yes, I did in 1989, and I’m very happy I chose a legal career rather than a business or an accounting career, both of which I considered. OC: In September of 1994 you left Wolf Block to come to Cozen O’Connor and over the years many of your colleagues at Wolf Block followed you over to Cozen. MH: Yes, there were two groups of lawyers. The first group, of about 13 attorneys, I helped recruit about four months after I left to form the business department at what then was purely a litigation firm. Then in 2009, 68 more of my former colleagues joined us when Wolf Block closed its doors. Growing and Expanding OC: You’ve been quite responsible for much of Cozen’s growth and practice expansion over the last 15 to 20 years. MH: I would say more like over the last 10 years. One of the roles I’ve played at the firm has been evaluating and pursuing, with the firm’s management, our lateral acquisitions. And over the years we’ve diversified our practice while continuing to maintain the core national and international reputation we’ve had in the insurance litigation space. We wanted to become a diversified full service firm and we have by acquiring lateral transactional lawyers as well as commercial litigators, including groups of laterals.

OC: The firm has grown from about 170 attorneys when you joined it to 575 now, with much of that growth coming in the last several years. What’s been the strategic thinking behind this significant growth? MH: The ultimate vision is that this really creates a very unique set of practices that mix well and allows us to utilize the national brand and reputation we had in the insurance and commercial litigation space. And on the insurance side, the practice is recession resistant, which has enabled us to capitalize on the transactional and commercial litigation practices that, depending on the economy, do well or very well. We feel we’ve created a firm like none other in the country that does very, very well in the good times and does very well when the economy is not doing well. OC: It sounds like, because of the recession-proof nature of the firm, you’ve been able to seize opportunities when the recession hit, in terms of expansion and growth, as other firms were flailing. Michael, just to switch gears here a little—you became the firm’s president and executive partner in 2011 and, in addition, you were also elected to serve as CEO in September, taking office at the start of this year. You were involved in an extensive succession plan with management and former CEO Tad Decker. What advice would you give a partnership that’s about to move from one leader to the next? What succession tips do you have? MH: I would recommend that the attorneys try to get those individuals—if you’ve targeted one, two, or three potential leaders—actively involved in the management of the firm so that you can evaluate them for a several-year period while at the same time educating them on the management process, how the firm operates. Get people involved in the early going so that whoever is elected can transition much more smoothly, and frankly, this gives the rest of the firm the opportunity to see them in a management role. A Balancing Act OC: What’s the biggest challenge you faced as the leader of the firm? MH: The biggest challenge I’m currently facing is the allocation of time between management and practicing law. I still have a very active practice, and balancing that practice with the management responsibilities is a work-in-process and is not an easy issue. There are some that would say, and I’m starting to believe it, that managing a firm that’s as large as ours is a full-time job and should be a full-time job. But at the same time, I like practicing law. I think to be a good manager of lawyers you need to fully understand what it takes to be a practicing attorney. So I’m continuing to practice because, one, I like it, two, my clients expect it of me and, three, because I think it will make me a better manager. I expect finding this balance will be an ongoing challenge for me. OC: What other challenges have you had to, or expect to, navigate through?

MH: I suppose another is defining my role. We have a very strong managing partner as well—Vince McGuinness. He’s actively involved in managing the day-to-day operations of the firm. That will help me with my practice-management balance. With that, it gives me the flexibility to help to define the role in a way that I think is in the best interests of the firm. So a challenge has been trying to figure how to define my role, which may be a little different than my predecessors defined their responsibilities. I’m getting very involved in the strategic planning of the firm. I’m traveling around the country to talk to our partners and associates and staff—I think that’s very important. And in the next year or two, I plan to go around the country to meet our clients. OC: You just got back from London. Were you visiting the branch office there? MH: Yes I was, and I was also meeting with a consultant because we’re looking to expand globally. OC: What other global markets are you looking at? MH: I think we’re going to be opportunistic. We’ve got offices in London and Canada, and we want to be very careful about how we expand around the globe. Obviously, in the United States, expansion is still extremely important to us. Now that we’ve built the firm we have, diversifying the practices and our geography in the United States, we want to explore overseas. So we’ll be looking at Asia, Australia, South America, and Mexico. We want to see where our clients need our services. OC: What’s been the most rewarding part of your job as firm leader? MH: I really appreciate the support that I’ve gotten, and not just from Tad [Decker], the former CEO, who was very helpful, but also all of my partners around the country and the globe. There’s a lot of energy out there about our five-year strategic plan that we’ll be rolling out. Because we’ve had some very strong years recently, people are quite optimistic about the future. OC: You mentioned that you’re continuing to practice. What’s particularly satisfying about your practice? MH: Well, being on the deal side. I really like being involved with and playing an active role in helping entrepreneurs build a company. I’ve always liked being in the entrepreneurial and emerging-business space. That’s why I’m reluctant to let my practice go because I like watching companies grow and being an active partner in it. Feeling Responsible for 1,200 People OC: What keeps you up at night? What do you worry about?

MH: [Chuckles and pauses] Well, we have 1,200 employees. So I need to make sure that we are continuing to grow and build the firm while maintaining our fiscally conservative nature and making sure that every one of our employees has an opportunity to continue to build a career at our firm for the next 25, 30 years, and beyond. You look at all of the firms that have imploded in the last five to 10 years. Any manager that comes into this role would be crazy not to spend a lot of time looking at what went wrong with those firms and try to use that as a basis for making sure that you’re making smart decisions. So that’s one thing that keeps me up at night. Another is the fact that the practice of law is changing. Over the next 10 years we’ll see a very substantial change in the way lawyers service their clients and the expectations that clients have. OC: Of course, many of us have read, written, and talked about the transformations in the profession that have already taken place and those that will emerge in the future. Michael, what do you think will be some of changes that we’ll see? MH: I think more and more big corporations are going to consolidate the number of law firms that represent and advise them. I think there will continue to be significant rate sensitivity, and therefore, you’re going to need to develop more creative ways to provide services and bill for those services. You’re going to need to make sure that you can provide a diverse set of services to your clients because otherwise I think you’ll draw the short straw when they’re looking to consolidate. So, it’s very important to have as many lawyers at your firm as possible connecting with the client. OC: That squares with some recent studies by consultants that I’ve seen. MH: I also think that technology is going to play an extremely active role in the practice over the next 10 years and it’s going to be incumbent upon law firms to be more on the cutting edge of technological change as opposed to being reactive. Law firms, as most of us know, have often been reactive to technological change. The really good, prosperous law firms of the future will be the ones that more fully embrace innovative technology. OC: Speaking of the future, let’s look at the near future for Cozen O’Connor. In addition to exploring various global markets for possible expansion, in what other directions do you see your firm going? MH: We’re going to continue to use the platform that we have around the country to build the full-service nature of the firm west. Right now, we have what I would call an international litigation practice [with offices in many markets], and a regional transactional practice with offices in New York, New Jersey, Washington, Delaware, and Philadelphia. That’s on the transactional side. We just acquired a number of good lawyers from [Philadelphia-based] Duane Morris on the IP side, which put them in Chicago, Atlanta, and Washington. So I think we’ll continue to expand our business practices west: Chicago, Houston, Dallas, and Los Angeles. And because of the changes that have come and I think are going to continue to come to the profession, we’ll also explore lower-cost ways to provide service to our clients.