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James Shaughnessy wasn’t worried about job security when he took on the general counsel post at PeopleSoft nearly a year ago. Although the company was in the midst of fending off Oracle Corp.’s hostile takeover, Shaughnessy felt optimistic that the U.S. Department of Justice would block the acquisition. Even if that failed, he said, the chance to participate in the battle was irresistible. “It’s ironic, because the risks made it attractive,” Shaughnessy says. In December — six months after Shaughnessy left his post as deputy general counsel at Hewlett-Packard to join PeopleSoft — the company succumbed to Oracle’s final $10.1 billion offer. The merger of technology companies frequently means their legal departments are consolidated and many lawyers are left out on the street. With Oracle’s acquisition of PeopleSoft, almost all of PeopleSoft’s 50-lawyer legal department was laid off. But the strength of the department’s lawyers — at least in part because of their handling of the merger — has meant that most have already landed on their feet. Some have found jobs at other companies, two have opened their own firms and others, including Shaughnessy, are taking time off before looking for a new position. But others may find the in-house market tough to crack. “It’s insanely competitive,” said consultant Gary Davis. “A lot of people with glow-in-the-dark resumes” are trying to get jobs. Davis, of Patterson & Davis Consulting, said PeopleSoft lawyers may have an edge in the market. “They saw a lot while they were there, particularly at the end,” he said. “I would imagine they would be sought after.” Shaughnessy, 50, said he hasn’t started looking for a new gig, but is interested in either a traditional general counsel position with a company of PeopleSoft’s size or larger or a more entrepreneurial job where he could be involved in business strategy as well as legal affairs. “[PeopleSoft] was one of the most transformational career experiences, the likes of which come by every five to seven years,” said Shaughnessy, who is now living in Houston. Others in PeopleSoft’s legal department also said they gained valuable experience in the takeover. As an SEC and governance lawyer, Carol Vanairsdale said she was exposed to disclosure and other issues in one year “that at other times would have taken a lifetime to get.” David Chavez, PeopleSoft’s assistant general counsel, said he was consumed with helping to coordinate the swarm of activity: providing information to the Department of Justice, which was in trial to block Oracle’s takeover; rapidly learning Delaware corporate law to defend against Oracle’s suit and various shareholder suits; and making sure customers continued to buy PeopleSoft’s products. “It always felt like we were under siege from all sides,” he said. After being laid off, PeopleSoft employees received at least four months’ severance pay. And PeopleSoft founder David Duffield, who returned to the company as CEO during the takeover battle, set up a fund for laid-off employees who are having trouble finding new jobs. They can apply for cash grants of up to $10,000. As a senior vice president, Shaughnessy is receiving 18 months of base salary plus bonus pay and health-care benefits. He also made more than $2 million exercising his stock options. At the time he joined the company, he owned 25,000 PeopleSoft shares and had the option to purchase 250,000 additional shares at a price of $17.57. The stock price was $26.50 at the time of the takeover. David Chavez, PeopleSoft’s assistant general counsel, oversaw the transition of the legal department through mid-February. He said Oracle offered jobs to five to 10 PeopleSoft lawyers, but only a few accepted. Oracle has a different way of doing business, Chavez said, and “coupled with the fact they were the bad guys for so long,” most PeopleSoft attorneys were not interested in staying on. Oracle declined to comment on PeopleSoft’s legal department. Rachel Wasserman, a transactional licensing attorney in PeopleSoft’s Chicago office, was one of the few who accepted an offer from Oracle. She said a licensing lawyer in the Denver office and another in New Jersey also stayed on. “It took some mental readjustment,” Wasserman said. But, she added, everyone at Oracle has been supportive. Several other PeopleSoft attorneys have found new jobs: � Delia Guevara, who was in charge of PeopleSoft’s litigation, is taking the same post at Fireman’s Fund. � Securities lawyer Carol Vanairsdale is working part time at a company in Walnut Creek. � Amy Lee, who was PeopleSoft’s immigration lawyer, has opened a solo immigration practice in Oakland. � Terence Church, who left PeopleSoft a couple of months before the takeover, has also launched his own business, providing general counsel services to companies without full-time in-house lawyers. Church, who was assistant GC in charge of the transaction and licensing group at PeopleSoft, said the takeover made him wary of working in house. “I felt a little bit nervous about what can happen with a company suddenly,” said Church, who previously worked at Cisco Systems and LSI Logic. “My thought was I needed to do something to diversify my income flow and give myself a little security.” Recruiter Martha Africa, of Major, Hagen & Africa, said lawyers experienced with Sarbanes-Oxley, corporate securities, intellectual property and licensing are most in demand. “It always takes a while [to find another job] unless you’re absolutely lucky, unless you fall into the exact skill set” a company is looking for, Africa said. Not all tech acquisitions are devastating to the target company’s legal department. Davis pointed to Symantec Corp.’s $13.5 billion acquisition of Veritas Software Corp. as a situation in which lawyers at both companies will keep their jobs. While Oracle and PeopleSoft were in the same business, Davis said Symantec and Veritas, whose merger hasn’t been finalized yet, are in separate markets. “Symantec needs Veritas’ legal department to be as strong as it has been,” he said. Symantec and Veritas representatives declined to comment. But last month Art Courville and John Brigden, general counsel of Symantec and Veritas, respectively, sent out a “Dear Colleagues” letter describing the legal department of the combined company. They jointly signed the letter, “office of general counsel,” suggesting that they are working as a team. More than half of Compaq’s legal team joined Hewlett-Packard following their merger in 2002. Shaughnessy, who was deputy GC of Compaq at the time, said about 45 of Compaq’s 70 lawyers joined HP and about 20 have remained with the company. Shaughnessy had gone through a similar merger four years earlier when Compaq acquired Digital Equipment Corp. For Shaughnessy, one of the most striking aspects of the PeopleSoft job was working with board members as they struggled to decide what was the best course of action for shareholders. A difficult task came his way in September when the board decided to remove Craig Conway as CEO. Shaughnessy was called on to carry out the task and conducted Conway’s exit interview, arranging for Conway to clear out his office and return his company badges. Shaughnessy said it was a difficult assignment because he had been hired by Conway and was close to him. “We actually had a laugh,” Shaughnessy said. “I told him I had considered many scenarios when joining PeopleSoft and this wasn’t one I had considered.” Shaughnessy said all of the in-house lawyers were tested throughout the takeover period, and that will make them highly valued in the marketplace. But he expects their transitions to be difficult, given the collegial atmosphere of PeopleSoft. “David Duffield created a special environment,” he said. “People may have a hard time duplicating that. It’s unfortunate, but it’s business.” For more on PeopleSoft’s merger battle with Oracle, see “Extreme Takeover” in the May issue of The American Lawyer at www.americanlawyer.com.

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