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NAME: James T. Lloyd TITLE: Executive vice president and general counsel AGE: 60 ORGANIZATION: The National Railroad Passenger Corp., commonly known as Amtrak, was created by Congress 31 years ago to maintain a national passenger rail network. Partially subsidized by the federal government, Amtrak’s 25,000 employees service 500 stations on 22,000 miles of track spanning 45 states. In 2000, the carrier reported $2 billion in revenue and a ridership of 22.5 million, though it incurred a net loss of $768 million. ON THE BRINK: Lloyd underwent surgery for prostate cancer in 2000. Having “dodged a cancer bullet,” he said, he decided to cut short his tenure at Amtrak and retire Jan. 1, after serving only two years. He does so as Amtrak begins a year in which it faces the prospect of elimination. On Nov. 9, the Amtrak Reform Council, created by Congress in 1997, declared that the carrier would not be self-sufficient by its 2003 budget reauthorization. The finding triggered a requirement under federal law that the carrier draw up a plan for its own liquidation. Meanwhile, the reform council is required to offer Congress a parallel plan for restructuring Amtrak. Lloyd is guiding Amtrak’s efforts to respond to the council on two fronts: While assisting in the carrier’s efforts to draft a cogent restructuring plan as well as the mandated dissolution plan, he is also leading the search for a lawyer to replace him at the most crucial moment in the railroad’s history. His replacement will not have an easy year. The new general counsel will face a hostile Congress that, at best, will demand a significant reorganization of Amtrak, and, at worst, its elimination. Lloyd said that he is committed to Amtrak on a part-time basis until the transition is complete. THE DEPARTMENT: Amtrak’s legal department of 152 employees includes 26 lawyers. Alicia M. Serfaty, Lloyd’s chief deputy and one of several candidates being considered to replace him, oversees the litigation department, but it’s a “very informal reporting arrangement,” explained Lloyd. Beneath Serfaty, who served as interim general counsel before Lloyd arrived, may do so again come Jan. 1, Lloyd said. There are three deputy general counsel supervising three divisions: tort/Federal Employment Labor Act, labor and employment, and corporate affairs divisions. The Labor Act governs worker compensation claims against federal employers. With 5,000 claims pending at any time, four lawyers are dedicated to handling such claims for Amtrak. Three lawyers handle labor and employment matters, he said. About half of the departments’ lawyers belong to the corporate affairs division, said Lloyd, a catchall for most of the legal work handled by the legal department. Lloyd has considered his duties as Amtrak’s executive VP complementary to his job as general counsel. “The more deeply involved the general counsel is in the business of the corporation, the better equipped he or she is to provide effective counseling,” he said. INTENSE SCRUTINY: Because Amtrak was created by federal legislation, it must deal with a full panoply of federal red tape. “The U.S. Department of Transportation, General Accounting Office, four congressional committees and the Amtrak Reform Council all oversee this company — and we’re also subject to the Freedom of Information Act,” Lloyd said. A recent example of this scrutiny, said Lloyd, occurred last summer when the carrier completed a financing arrangement to borrow $300 million against its ownership of New York’s Penn Station. Criticism arose in New York and on Capitol Hill. “Looked at in its four corners, it was perfectly conventional — you monetize fixed assets. But because Amtrak is federally supported and it was Penn Station, the transaction acquired quite a lot of prominence,” he said. REFORM COUNCIL: Lloyd and members of his corporate affairs department are responsible for advising Amtrak officials and their lobbyists on legislative and regulatory issues. This duty has forced Lloyd to face constantly what he considers an impossible situation: to fulfill Amtrak’s role as a national carrier without incurring large deficits, while Congress simultaneously demands self-sufficiency, Lloyd said. “The company is schizophrenic in the sense it’s supposedly a public service but dressed as a private enterprise,” said Lloyd. Preparing for the fiscal 2003 reauthorization is one of the department’s biggest challenges because the carrier is also being asked by the Reform Council to plan its demise. “Personally I don’t think there is any risk that Amtrak is going to be liquidated,” Lloyd said. “But it will not emerge from reauthorization unchanged.” OUTSIDE COUNSEL: Lloyd said Amtrak doesn’t have any specific regular outside counsel beyond a few large firms, such as Latham & Watkins and Washington, D.C.’s Wilmer, Cutler & Pickering for corporate law and Philadelphia’s Morgan, Lewis & Bockius for class action and employment work. Additional tort work is regularly handled by New York’s Landman Corsi Ballaine & Ford. Amtrak’s far-flung operations and large amount of tort and FELA work force it to rely on small firms across the country. In addition, Lloyd chose commercial law specialists from New York’s Kalkines, Arky, Zall & Bernstein to handle negotiations with the U.S. Postal Service over the planned relocation of Penn Station to the Farley Post Office building across the street. The firm, with New York’s Paul, Weiss, Rifkind, Wharton & Garrison, is also handling a $200 million lawsuit filed Nov. 8 in federal court in Washington, D.C., against Amtrak by Montreal train manufacturer Bombardier Inc. The Canadian company alleges that faulty information on engineering specifications by Amtrak caused cost overruns related to the construction and delivery of Amtrak’s new Acela Express train sets. LITIGATION: Two other major pieces of litigation facing Amtrak are a class action discrimination lawsuit filed in 1999 by black employees. The suit, filed in U.S. District Court for the District of Columbia, alleges discriminatory practices in hiring, promotion and training by Amtrak and its unions. On Sept. 6, a judge denied Amtrak’s motion to dismiss. The other suit, filed in September in Washington, also was brought against Amtrak and its unions, this time by Massachusetts’ Bay State Transit Services. The plaintiff alleges that Amtrak conspired to deprive the company of a contract it had with the Massachusetts Bay Transportation Agency through tortious interference in its contract relations. Amtrak filed a motion to dismiss on Nov. 13. ROUTE TO THE TOP: Lloyd’s legal interests always involved travel, though before taking to the rails his practice was in the sky. With a B.A. from Kansas State University, Lloyd came to Washington, D.C., after graduating with an LL.B from Southern Methodist University School of Law in 1966 (“I never got the diploma changed to a J.D. because they wanted $25.”) to work for the Civil Aeronautics Board. He eventually moved over to private practice representing airlines for a small firm that later dissolved. From there, he moved on to the D.C. office of Seattle’s Preston Gates & Ellis, then to U.S. Airways as general counsel before joining Bryan Cave as of counsel. He joined Amtrak in 1999. Lloyd said that after Jan. 1 he hopes occasionally to serve as an arbitrator in commercial disputes when he’s not, among other things, “reading books I haven’t had an opportunity to read.” FAMILY: Lloyd lives in Washington, D.C., with his wife, Juliette, a banking consultant. He has two grown sons and a stepdaughter. LAST BOOK READ: “John Adams,” by David McCullough.

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