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In late November, Joan Guggenheimer and Stephanie B. Mudick made corporate history when they were named co-general counsel of Citigroup. In an interview with the New York Law Journal, the two women talked about the challenges they faced in heading the largest in-house legal department at the largest financial services company in the United States. Names and Titles: Joan Guggenheimer and Stephanie B. Mudick, co-general counsel Ages: Guggenheimer is 49; Mudick, 45. The Business: “We’re huge,” Mudick said. She is not exaggerating: as of the end of the third quarter of this year, New York-based Citigroup posted revenues of about $61 billion and assets topping $1 trillion. Citigroup was formed three years ago when Citibank and insurer Travelers Group stunned competitors with the biggest financial services merger in history. The company, which has some 230,000 employees, offers credit card, banking, insurance and investment services through more than 2,600 locations in some 100 countries. “We are creating the model financial institution of the future,” Sanford I. Weill, the chairman of Travelers Group, said at the time of the merger. “In a world that’s changing very rapidly, we will be able to withstand the storms.” Last month, in a departure from its bigger-is-better strategy, the company announced it would split off the property casualty unit of its insurance business, which contributes about 10 percent of Citigroup’s income. Responsibilities: “We basically decided to split the job up and each take primary responsibility for 50 percent,” Mudick said. Guggenheimer kept her role as general counsel of the company’s corporate and investment bank. She also oversees legal and compliance functions for emerging markets, and is co-head of Citigroup’s anti-money-laundering effort. Mudick kept her title of general counsel for the company’s consumer group, and oversees legal and compliance for insurance and global investment management and private banking group functions. They report to Charles Prince, the former general counsel, who continues in his role as Citigroup’s Chief Operating Officer. In-House Legal Department: Citigroup’s legal department, with more than 2,000 lawyers, is the largest of any U.S. company, more than double the size of the next largest legal department, that of General Electric Co., which numbers a mere 840 lawyers. The ranks, Mudick said, are swollen in part by the “600 or 700″ lawyers who handle Travelers’ insurance claims. The legal department is structured along functional lines, servicing Citigroup’s five major subsidiary businesses: corporate and investment bank; emerging markets; consumer group; insurance; and asset management, global investment management and private banking. Each group has a chief executive officer, chief financial officer and general counsel. On top of that, at the corporate level, are the co-general counsel and a cadre of companywide lawyers. Citigroup relies heavily on its in-house people, who are expected to handle the bulk of the legal work, with the exception of major litigations and transactions. Outside Counsel: According to Mudick, Citigroup has more than 200 law firms on its outside counsel roster nationwide. They declined to name Citigroup’s primary law firms: “we’d undoubtedly leave someone out and then they’d be upset with us,” Guggenheimer said. According to a National Law Journal survey, the law firms that Citigroup most often turns to for outside legal assistance are Skadden, Arps, Slate, Meagher & Flom; Shearman & Sterling; Cravath, Swaine & Moore; Simpson Thacher & Bartlett; and Milbank, Tweed, Hadley & McCloy. They had some words of advice for outside counsel: First, “we expect [outside counsel] to regard Citigroup as their client and not a particular business transactor. It’s extremely important that they understand that they owe a duty to the company overall,” Guggenheimer said. Second, “we look for a sense of real ownership and accountability,” Mudick said. “We don’t give something to a law firm and then wait for them to come back with the answer. There’s a critical dialogue that needs to go on all the time.” Third, “we look for first-rate service, but also some consciousness that it’s a business and it should be done in a cost-effective way,” Guggenheimer said. “Some [outside counsel] are good at it and some of them honestly aren’t that great at it.” RECENT EVENTS Sept. 11: The challenges arising from the terrorist attack run the gamut from employee issues to how best to support Citigroup customers affected by the tragedy. Citigroup lost six employees in the Sept. 11 attack, and 2,500 more who worked in 7 World Trade Center were displaced when the building collapsed. The company offered employee assistance programs and counseling to anyone who needed it. It also created a $15 million scholarship fund for children of victims and an emergency lending program for downtown businesses and individuals trying to get back on their feet. Recession: Citigroup has announced layoffs, or planned layoffs, of 12,500 employees, or about 5 percent of its staff worldwide. Mudick said she suspected that Citigroup has had fewer layoffs percentagewise than its competitors because the company’s diversification helps it weather economic storms in any particular sector. Biggest Challenges: For Guggenheimer, defending the infamous “Boom Boom Room” case, a 1996 sexual harassment class action lawsuit against Smith Barney involving about 26 women, has been her most formidable challenge to date. “I don’t even want to repeat what [the New York Post headlines] read,” she said. Guggenheimer explained that, instead, looking at the case strictly as an isolated litigation, they asked themselves, “what’s the whole problem here?” and sat down to think about how they were going to vault themselves to the next level. “As a result, we were able to settle the case in a way that had substantial benefits both to the class members and present and future employees,” said Guggenheimer, who serves on Citigroup’s diversity committee, one of the outgrowths of the lawsuit. “It’s the thing I feel the most proud of.” The Travelers-Citibank merger proved Mudick’s most challenging task to date. “It was an extremely dramatic and far-reaching transaction,” she said, “and, of course, we had to do it on a timetable that was simply somebody’s fantasy.” Going Forward: Citigroup’s enormous size and complexity creates a special set of challenges for general counsel. “The level of complexity of what we sell and how we sell it gets more and more complicated all the time,” Mudick said. The company’s status as an industry leader also puts them in the hot seat. “We’re a big pink moose in the forest,” she said. “If we change something in the business, that is likely to have a spillover effect.” Advice to Other Women: When asked what advice she would give women lawyers in the financial services industry, Mudick half-jokingly said, “Work here!” Mudick estimated that the percentage of women lawyers at Citigroup “is at least roughly equal,” with a number in prominent positions (including, of course, them). The legal and compliance group has had part-timers for years, and the company provides emergency childcare at its corporate offices in its downtown and midtown locations. Mudick, who has 2-year-old twins, telecommutes one day a week. Guggenheimer advises all women in the financial services industry, not just lawyers, to “find your own style. Then figure out how to use it in the best way possible.” How They Got Here: Guggenheimer earned her bachelor’s degree at State University of New York-Binghamton and her law degree at Columbia Law School. After law school, she clerked in the 2nd U.S. Circuit Court of Appeals. She then joined Davis Polk & Wardwell as a litigation associate. She joined Smith Barney’s legal department in 1985, was promoted to deputy general counsel in 1993, when Smith Barney was acquired by Travelers, and then to general counsel of institutional businesses two years later in 1995. She was promoted again to senior deputy general counsel in 1997, when Travelers merged Smith Barney with Salomon Brothers, and then to general counsel of Salomon Smith Barney in 1999. Mudick got her bachelor’s degree at Smith College and her law degree at Benjamin N. Cardozo School of Law. After law school, she joined Skadden, Arps, Slate, Meagher & Flom as a corporate lawyer. In 1993 she joined Smith Barney, where she was general counsel of the investment banking division. She became deputy general counsel of Travelers in 1997, deputy general counsel of Citigroup in 1998 when Travelers and Citibank merged, and then general counsel of the consumer group a year later. Both women were born and raised in New York City.

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