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It’s not unheard of for a major corporation to put a former practicing lawyer in its chief executive’s chair. Southwest Airlines Co. has just done it for a second time. But what makes it surprising is that Southwest’s culture is so … well, unlawyerly. With a unique business model that has inspired many imitators, Southwest is admired for incongruous traits: a whip-crackingly precise management that keeps the planes on schedule, revenue climbing, and earnings above par; and a work-hard-and-play-harder leader, Herb Kelleher, who inspired rabid loyalty from employees. From a startup regional carrier three decades ago to a major national player today, Southwest has seemed the kind of place that tried not to disturb a sleeping general counsel, lest he veto the wild parties and dampen the entrepreneurial zeal. It was only fitting, though, when the company’s longtime general counsel, Jim Parker, was named in June to replace Kelleher. Parker doesn’t mimic the style of the iconoclastic Kelleher, the Wild Turkey-swilling front man who appeared in ads sporting the company logo tattooed on his arm, and who once offered passengers who were embarrassed to fly a discount airline a paper bag to wear over their heads. But Parker’s corporate DNA is a match. Before joining Southwest 15 years ago, he practiced law with Kelleher at San Antonio’s Oppenheimer, Rosenberg, Kelleher & Wheatley, where Kelleher was Southwest’s chief outside counsel. Since then Parker has been a key strategist and Kelleher intimate. Behind the company’s freewheeling image is the story of an airline conceived in litigation and nurtured in regulatory maneuvering. The kind of place, in other words, where a lawyer belongs on top. Soon after taking the controls at Southwest, Parker talked with American Lawyer senior reporter Douglas McCollam. Q: Do you think your legal background helps you function as a CEO? Or is it a hindrance? A: I think it’s a benefit. I really have a respect and appreciation for the conflict of ideas that occurs in the legal practice. That enables me to encourage people to speak up and express different points of view. I recently read an article that [said that] when someone comes into your office and tells you they are 99 percent sure something is going to work, that’s when you need to stop and make backup plans. They probably haven’t thought about all the things that can go wrong. Q: That’s certainly a very lawyerlike view of things. Looking at Southwest’s history, it was a company born out of litigation. It spent years in court battling to get routes and slots. Do you think that that litigious background influenced the company’s culture? A: Oh, absolutely. Our company would not exist were it not for the superb lawyering of Herb Kelleher in fighting the battles that kept us alive. It was even to the point that he continued to represent the company and deferred his fees when the company had $356 in the bank. We were always under siege and really developed a warrior mentality. It still permeates our culture. Q: It’s the nature of things that, if you are a successful warrior, you go from being the underdog to the overlord, which presents new problems. What sort of legal challenges do you see for the company? A: I think the biggest legal challenges now are in the legislative and regulatory arenas. The greatest threat to the airline industry is reregulation — though it might take different names, like a passenger’s “bill of rights.” Our philosophy is that anything like that will dampen competition and injure the consumer. Q: But Southwest was born in the age of regulated airlines. A: Not really. We were formed as an intrastate airline within Texas. As such, we were not subject to the regulatory structure of the civil aeronautics board. We probably never would have become an interstate carrier if Congress had not deregulated the airlines. Q: So you see yourself as a product of deregulation. A: Absolutely. Q: Other than reregulation, what are the legal challenges as you take the helm? A: Well, we are involved in a lawsuit right now [against] a consortium of our competitors who have put together Orbitz, a Web site with the goal of becoming the dominant method for the sale of airline travel. We decided not to participate because we never want to become dependent on a system owned by our competitors for the distribution of our inventory. Q: You are running a risk by doing that, though. A lot of people already use online reservation systems like Expedia or Travelocity, which don’t, I think, list Southwest’s flights. A: They don’t. There is a risk, but we have a very successful Web site of our own through which we sell about 30 percent of our seats right now. We sold about $1.7 billion through that last year — by far the No. 1 airline Web site in the world. Q: Southwest folks act a little wacky on the flights, telling jokes, singing songs. Do you ever worry that some of that could be used by a savvy plaintiffs’ lawyer if you ever had an accident? A: Actually, it’s a great question. The answer is no. Because the loose, casual, friendly exterior you see really overlays a very disciplined, regimented safety structure. We have the best safety record of any airplane in the world. We’ve never had a fatal accident. Q: You’ve had some runway mishaps. A: We’ve had some runway overruns but never a major or fatal accident. Q: Final question. Your predecessor is said to hold the Southwest record for in-flight consumption of free cocktails — seven in a one-hour flight. Any chance you’re going to break that record? A: Herb was such a legend with smoking and drinking. It’s more than any one person can do. I’ve had to split it up with Colleen Barrett, our new president and chief operating officer: Colleen is going to handle the smoking; I’ll handle the drinking.

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