A Major Investment

Corporate Counsel

01-01-2013

J.P. Morgan is banking on STACEY FRIEDMAN, a former Sullivan & Cromwell litigation and regulatory partner, to head up its legal team as general counsel of the bank's recently formed corporate and investment bank division. J.P. Morgan, a division of JP Morgan Chase & Co., merged its investment bank and treasury and securities services divisions in July as part of an overall bank restructuring.

While at Sullivan, Friedman spent a year working full-time at then-client J.P. Morgan as one of the principal architects of the bank's mortgage-backed securities litigation defense. "My family calls it 'try before you buy,' but I think it could be seen as the world's longest job interview," Friedman jokes. She took on her GC role at the bank in August.

The Duke University Law School graduate has represented clients in proceedings involving the Securities and Exchange Commission, the U.S. Department of Justice, the Federal Trade Commission, the New York Stock Exchange, the U.S. Senate Permanent Subcommittee on Investigations, and the European Commission.

J.P. Morgan was sued by state and federal watchdogs, including New York State, in early October. In November the company agreed to pay $296.9 million to resolve claims made by the SEC. Friedman was a key member of the team that reached the settlement with the SEC.

Friedman's legal experience is hardly limited to banking and securities. At Sullivan she led a successful challenge to the constitutionality of an Arkansas statute prohibiting unmarried cohabiting couples from serving as adoptive or foster parents. The law was perceived as aimed primarily at gay couples, who are prohibited from marrying in Arkansas. "That was one of the most important cases I've ever been involved with," she says. In her new role, Friedman hopes to make it possible for her team to do meaningful pro bono work outside the bank.

J.P. Morgan's global legal team has undergone a major reshuffling as part of the bank's reorganization. KAREN LINNEY, who was previously general counsel of the EMEA (Europe, Middle East and Africa) investment bank division, has taken on an expanded role as GC for those regions in the corporate and investment bank division. Linney joined J.P. Morgan—then Chase Manhattan—in 1993 from Clifford Chance.

DIANE GENOVA, who has been with J.P. Morgan for 31 years and is based in New York, has been named global GC for markets and investor services and general counsel for the bank's chief investment office. Genova says she has worked on just about every crisis in the wholesale financial markets. In March she provided testimony to the House Financial Services Committee about the collapse of MF Global Holdings Ltd.

MIKE DUNN, who has been with J.P. Morgan for five years, was made global GC for banking and relocated to New York from Hong Kong, where he was general counsel for the Asia-Pacific region. Dunn worked for Cravath, Swaine & Moore and for Citigroup Inc. before joining J.P. Morgan. JOHN MURPHY, who was general counsel for the investment bank in the Asia-Pacific region, has taken on the GC role for the expanded corporate and investment bank division in Asia. And FACUNDO GÓMEZ MINUJIN, who has been with J.P. Morgan for 17 years, is the bank's new general counsel for Latin America. He continues to serve as senior compliance officer for Argentina, Bolivia, and Uruguay.

—LISA SHUCHMAN

* * * * * *

Gilding the Lilly

MICHAEL HARRINGTON has some big shoes to fill. The 49-year-old attorney stepped into the role of senior vice president and general counsel at Eli Lilly and Company on January 1, replacing ROBERT ARMITAGE, who was set to retire at the end of 2012.

"I feel like I'm following a legend," Harrington says, referring to Armitage, who played a large role in recent patent law reform in the United States. This isn't the first time Harrington has followed in Armitage's footsteps: By pure coincidence, both men attended Albion College, a small liberal arts school in Michigan.

Harrington worked closely with Armitage as his deputy GC, and he says he's learned a great deal from his predecessor—especially when it comes to influencing public policy.

Armitage's tireless efforts to reform the U.S. patent system resulted in the passage last year of the America Invents Act. Harrington also hopes to effect change on a national scale, but his focus is—and will continue to be—on civil justice reform. Harrington serves on the executive committee of Lawyers for Civil Justice, a national organization of corporate counsel and defense lawyers seeking changes in the judicial selection process, judicial pay, discovery rules, and litigation costs.

Harrington, who grew up in Evanston, Illinois, and attended Columbia University School of Law, joined Eli Lilly in 1991. He has held a variety of legal and business positions at the company, including general counsel for Asia-Pacific operations and managing director of Eli Lilly New Zealand. He says his international experience has helped him focus on the global needs of the company. Many of the more than 100 lawyers on his staff work overseas. "The business has gotten more complicated, and we need to be more collaborative and speak with one voice," he says.

Pepper Hamilton partner Nina Gussack describes Harrington as unflappable. When Eli Lilly was mired in litigation related to improper marketing of its antipsychotic drug Zyprexa, the company had to negotiate settlements with attorneys general around the country. "Mike was at the table speaking directly with the attorneys general, and he always managed to find common ground," she says.

Lilly spent $1.2 billion to settle thousands of individual product liability lawsuits filed by patients who took Zyprexa, paid the federal government $1.4 billion in fines in 2009, and pled guilty to charges related to the off-label marketing of the drug. The drug's patent protections expired last year.

Harrington, who ran Lilly's litigation group from 2004 to 2009, was deeply involved in those cases. "We've learned a lot in the last 10 years," he says. "There will always be litigation in our business, but I don't anticipate anything like in the past."

—L.S.

* * * * * *

Oil's Well That Ends Well

In one of the most important steps it has taken to improve its reputation with its shareholders, Chesapeake Energy Corporation announced the appointment of JAMES WEBB as general counsel in late September.

Webb had served as chief legal counsel for Chesapeake on a contract basis for the previous four months. He fills a vacancy in the legal department left by HENRY HOOD, who served as GC from April 2006 until this past June. Hood will stay with the company to manage the land and regulatory departments for the United States's second-largest natural gas producer.

In April, Reuters reported that Chesapeake cofounder Aubrey McClendon may have taken out as much as $1 billion in personal loans, putting up his stake in company wells as collateral. McClendon, who at the time was CEO and chairman of the board, did not disclose the loan amount to shareholders.

Hood initially defended the transaction, denying the existence of a conflict of interest and stating that the board was "fully aware" of the CEO's transactions. The board refuted that contention a short time later, indicating it had not reviewed or approved the transactions.

The company subsequently announced plans to separate the CEO and chairman functions. Independent chairman Archie Dunham was appointed in June.

Webb took the reins of the legal department full-time as Chesapeake reportedly faces an antitrust investigation by the U.S. Department of Justice over Michigan land deals, as well as lawsuits filed by shareholders who claim the loan disclosure caused shares to drop in value.

Before joining Chesapeake's legal team, Webb spent 17 years at McAfee & Taft, Oklahoma's largest law firm. He also worked at Gorsuch Kirgis in Denver. Webb earned his law degree from Washington University in St. Louis.

—SHANNON GREEN

* * * * * *

File Under: Advice

The world's largest office products company has tagged a new number one for its law department. Staples Inc. named MICHAEL WILLIAMS its general counsel, vice president, and secretary, effective November 7.

Williams replaces CYNTHIA PEVEHOUSE, who held the GC position for less than a year. According to a Staples spokesperson, Pevehouse left the company to "pursue other interests."

Williams comes to Staples from Sony Electronics Inc., where as general counsel he was responsible for the division's legal operations in the United States and Central and South America. In 2008 the Minority Corporate Counsel Association gave Williams and Sony an Employer of Choice award for workforce diversity.

Before going in-house, Williams was a partner in the Los Angeles office of Heller Ehrman, where Sony was among his Fortune 500 clients. He was a partner at Andrews Kurth in Los Angeles from 1991 to 1998 and an associate at Gibson, Dunn & Crutcher from 1982 to 1991, also in Los Angeles.

Between earning a bachelor's degree in political science from Ithaca College in 1975 and embarking on his legal education, Williams spent four years serving as a Marine infantry officer. He graduated cum laude from the University of San Diego School of Law in 1982.

Williams joins the office supply giant at a time when it's facing retail challenges in a weak U.S. economy. Total sales for the second quarter of 2012 dipped 6 percent compared to the previous year. Staples scaled back its 2012 sales and earnings outlook as a result. Staples has a worldwide staff of 88,000 and generates more than $25 billion in annual revenues.—S.G.

Avon Products Inc. has selected a fresh face to head its legal department. And the hire came not a moment too soon: The appointment of JEFF BENJAMIN as the company's new top lawyer was announced amid talks with federal investigators over a bribery probe, and shortly after the July departure of former GC KIM RUCKER to Kraft Foods North America.

Benjamin came out of retirement September 12 to join the cosmetics company as general counsel and senior vice president. He had stepped down from Novartis Corporation, a health care portfolio company, after a 40-year career, most of which he spent working his way up the Novartis legal department ladder.

Avon reports about $11 billion in annual revenue, and the company has struggled with both a competitive retail environment and ongoing legal problems. The Wall Street Journal reported in August that Avon had entered talks with the U.S. Department of Justice and the Securities and Exchange Commission in order to settle possible violations of the U.S. Foreign Corrupt Practices Act. Avon allegedly engaged in bribing Chinese and other foreign officials. A number of top executives have left the company or have been fired since 2008, when Avon began its own internal investigation.

Luckily, Benjamin may have just the right legal makeup that Avon needs to polish its image. From 1986 to 2011, he worked in the legal department of Ciba-Geigy, then with Novartis Corporation when it was created by Ciba-Geigy's 1996 merger with Sandoz. Benjamin had his first general counsel role with the pharmaceutical giant, helping to develop its first formal compliance program. In his time at Novartis, he gained experience in both litigation and government investigations. According to a statement by Avon, Benjamin was known for recruiting high-caliber talent to the company's legal department.

During his career, Benjamin also served as Novartis's chief ethics and compliance officer and chair of the ethics and compliance committee from 1997 until his retirement. He has served on the advisory board of the Brennan Center for Justice since 2002.

Benjamin began practicing law as a litigation associate with Kronish, Lieb, Shainswit, Weiner & Hellman, after earning his law degree from New York University Law School in 1971, and holds a bachelor's degree in government from Cornell University.

—JULIE McMAHON