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Baer: Notebaert’s pick The search for a new GC at Qwest Communications International Inc. ended on an unexpected note last November. Rather than tap a battle-tested outsider to guide the telecom through its mounting problems, CEO Richard Notebaert gave the top legal job to Richard Baer, a relatively green in-house attorney. On paper, the choice seemed puzzling because of Baer’s apparent disadvantages. Not only did he have limited experience in management, he also lacked a strong background in telecommunications law. Before joining Denver-based Qwest in 2001, Baer worked for nine years at Sherman & Howard, also located in the Colorado capital. At the firm he spent most of his time on general commercial litigation for clients that included Qwest. Notebaert — who initially considered several other GC candidates with more experience — isn’t talking about why he chose the 45-year-old Baer. But sources close to Qwest say that the CEO was won over by Baer’s stellar performance since joining the company. Baer started as a deputy to then — general counsel Drake Tempest, working primarily on the company’s rising tide of litigation. Shortly after taking over as Qwest’s new chief executive last summer, Notebaert got wind of Baer’s indefatigable work habits and exacting attention to detail. Last August, Notebaert installed Baer in a new “special counsel” position reporting directly to the CEO, and gave Baer full responsibility for responding to federal investigations of Qwest’s accounting practices. According to sources close to the company, Baer’s elevation to GC reflected Notebaert’s growing confidence in the way the lawyer was handling the Securities and Exchange Commission and U.S. Department of Justice probes. “[Notebaert] hired Rich because he was able to watch Rich work — and he liked what he saw,” says one of Qwest’s outside attorneys. “If Rich had applied a year earlier, he wouldn’t have gotten the job. He just didn’t have the resume.” Implementing A Regime Change The shake-up in Qwest’s law department is just one of many since Notebaert took over as CEO from Joseph Nacchio, who was fired by the company’s board last June. Chief financial officer Robin Szeliga, president and chief operating officer Afshin Mohebbi, and a slew of executive vice presidents subsequently joined the exodus from Qwest, as did GC Tempest, one of Nacchio’s more notable hires. (Tempest returned to his previous job as a partner in the New York office of Los Angeles — based O’Melveny & Myers.) “When Tempest left, a lot of us figured his deputies would go with him,” says Patrick Comack. A telecom analyst at the Miami-based investment banking firm of Guzman & Co., Comack has long followed Qwest and the other Baby Bells. “When companies clean house at the top, shareholders usually want to see a brand-new face at the general counsel position.” And indeed, that almost happened. Sources close to Qwest say that Notebaert’s first choice was actually Susan Lichtenstein. The two had worked together as CEO and GC before, first at Ameritech Corporation, and then at Tellabs, Inc., a Naperville, Illinois — based telecom equipment manufacturer. After Lichtenstein declined his offer, Notebaert interviewed several other candidates with years of high-ranking in-house service, including Frank Eichler, the former GC at MediaOne, Inc., and Robert Connelly, former deputy GC at U S West, Inc. (Neither Lichtenstein nor Eichler could be reached for comment, but Connelly confirmed that he had been interviewed for the Qwest job.) Though those candidates all sported heftier resumes than Baer, Qwest observers say that Notebaert made the right choice. “Rich is the most tireless, most intense lawyer I’ve ever been around,” says Lawrence Theis, a partner in the Denver office of Seattle’s Perkins Coie, one of Qwest’s chief outside firms. “He’s got this uncanny knack for plugging dikes in crisis situations. That’s exactly the type of person Qwest needs right now.” Since stepping into his new post, Baer says that he’s had to stop handling individual cases and work mostly in an administrative role. In addition to the SEC and Justice Department investigations, the company and its executives face accusations of fraud in several potentially huge shareholder suits. Meanwhile, the FCC still hasn’t approved any of the company’s applications to offer long-distance service to its customers. And Qwest continues to battle smaller competitors who claim the company isn’t complying with the Telecommunications Act of 1996. In other words, the company’s new GC has inherited a full plate. “Rich Baer is going to earn his money — no question about that,” says investment analyst Comack. “He’s going to be busy for a very, very long time.”

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