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Last July, when Michael Capellas realized he needed legal help in a hurry, the MCI Inc. CEO called The Calypso, a boat floating off the coast of Alaska. That’s where Anastasia “Stasia” Kelly, MCI’s newly hired general counsel, was vacationing with her family. Kelly wasn’t due to report for a couple of weeks. But a crisis over allegations that MCI routed calls illegally through Canada — a practice called “least cost routing” — looked serious. So the day after Capellas’ call, the Kelly family flew east on the MCI jet. The plane touched down in Kelly’s hometown of Chicago just long enough to drop off her family and pick up Carol Ann Petren, Kelly’s former deputy at Sears, Roebuck & Co., and now at MCI. By the first week in August, Kelly and Petren were embroiled in what Kelly calls a “perfect storm” of legal work. They had to defuse the least-cost routing crisis, which they did, later in the fall. The company had to help the U.S. Department of Justice with its criminal investigations of ex-CEO Bernard Ebbers and other former MCI brass. It had to get back its government contractor status. And MCI’s lawyers had to strike deals with creditors to emerge from bankruptcy quickly. Meanwhile, MCI’s legal department was in shambles. Paul Eskildsen, acting GC prior to Kelly’s arrival, took over regulatory and public policy work. Kelly hired Gibson, Dunn & Crutcher’s Joseph Warin and Douglas Cox, with whom she’d worked at Sears, to handle the routing litigations. Later, Kelly lured U.S. Airways’ corporate secretary, Jennifer McGarey, to that position at MCI, and hired Davis Polk & Wardwell associate Nicole Jones for securities work. The law department now employs around 200 lawyers. When it came to implementing Richard Breeden’s corporate governance prescription, “Restoring Trust,” Kelly played traffic cop. Last fall she tapped lawyers from Weil, Gotshal & Manges, including Marcia Goldstein, the company’s lead bankruptcy lawyer, to write Breeden’s simpler provisions into MCI’s bylaws and corporate charter. But she needed more attorneys to tackle the tougher provisions. A few months later, with more lawyers in-house, Kelly parceled work out to her own specialists. McGarey and Jones are handling the provisions that deal with Securities and Exchange Commission filings. And Nancy Higgins, the chief ethics officer, is setting up procedures for reporting ethical lapses. But at the top of the pyramid is Kelly. Says Breeden: “She has the most demanding general counsel job in the country.” Kelly had better savor that abbreviated vacation. She might not be taking another one anytime soon.

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