Corporate Clients
Both Sides of the Balance Sheet
Enduring relationships became a hallmark of the Firm.
engraving reads: "lawyer counselor and friend." the cup was given to white by "a few of many friends in "the bankers trust company," Including, among the eight names engraved on one of the cup's three sides, seward prosser, then president of bankers trust.
The first decade of the 20th century was a good time to start a commercially focused law firm. Industry in the United States was taking off. Corporations, both large and small, were being formed. Growing government regulation of business and a general increase in the complexities of doing business were further factors that led to an expanding demand for corporate legal services. Most of White & Case’s first clients were financial institutions, but soon the Firm was also retained by leading corporations. These came both directly, as the new firm started to become known for the quality of its lawyers, and indirectly, from referrals by the Firm’s banking clients.
The first decade of the 20th century was a good time to start a commercially focused law firm. Industry in the United States was taking off. Corporations, both large and small, were being formed. Growing government regulation of business and a general increase in the complexities of doing business were further factors that led to an expanding demand for corporate legal services. Most of White & Case’s first clients were financial institutions, but soon the Firm was also retained by leading corporations. These came both directly, as the new firm started to become known for the quality of its lawyers, and indirectly, from referrals by the Firm’s banking clients.

u.s. steel corporation’s fairless works, morrisville, pennsylvania
U.S. Steel was one of a number of corporations that became clients of the Firm either directly or through referrals by the Firm’s banking clients.


Advertisements for Armour & Company and Swift & Company,
The Outlook
Magazine, 1916

Some of these early nonbanking clients included Armour & Company, Swift & Company and West Virginia Coal & Coke Corporation. By the late 1920s, the list also included U.S. Steel, McGraw-Hill and Combustion Engineering Corporation. The New York Shipbuilding Corporation and the Hog Island Shipyard were two other important early clients. Charlie Fay represented and advised both in connection with their efforts during World War I. New York Shipbuilding built battleships and destroyers for the U.S. Navy at its shipyard on the Delaware River in Camden, New Jersey. Hog Island Shipyard, then the largest shipyard in the world and the first designed for the mass construction of vessels, was located across the Delaware in Philadelphia and produced ships to carry war supplies and troops. Some of these ships, known as “Hog Islanders,” plied the oceans for many years after the war. Corporate clients referred to the Firm by its banking clients included the Pennsylvania coal companies controlled by the Kemmerer and Bowring families, referred to White & Case by First National Bank. Another key referral occurred in 1916 when New Jersey entrepreneur William Shortess asked a friend at Guaranty Trust Company which law firm he should use for a new company he was about to form, and was sent to White & Case. That was the start of a long relationship between the Firm and Shortess’s new company, Federal Paper Board, which, in time, became one of the nation’s leading manufacturers of the paperboard used for cereal boxes and other products. From its incorporation onward, White & Case provided just about every conceivable legal service to the company. It represented the company in acquisitions, litigation, its initial public offering in 1953, and other equity and debt financings. The Firm assisted the company in its defense against a hostile takeover attempt by Simkins Industries in 1967. White & Case became indispensable to the company as a trusted adviser. When Shortess died in 1942, a critical moment in the company’s history, Colonel Hartfield helped arrange the sale of the company to three of its senior executives. One of the buyers was John Kennedy, Sr., who became president and CEO, leading the company for the next 30 years. Kennedy continued to rely on the Firm, often discussing both business and legal matters with Hartfield and Glover Johnson. White & Case represented Federal Paper Board until it was acquired by International Paper Company in 1996.

hog island shipyard, Pennsylvania, 1918

While many of the Firm’s clients came through referrals, pure luck also occasionally played a part. In 1932, The Seagram Company Ltd. of Canada was charting plans to enter the U.S. spirits market, in anticipation of the repeal of Prohibition. According to White & Case legend, Seagram sent its Canadian counsel, Lazarus Phillips, to New York with instructions to interview White & Case and Root, Clark, Buckner & Ballantine and select one or the other to represent the company in its proposed purchase of a distillery in Lawrenceburg, Indiana. Arriving at Grand Central Station by overnight train, Phillips took the subway to Wall Street. Because White & Case happened to be located less than a block from the Wall Street subway station—Root, Clark was a block and a half away—he visited White & Case first. There he met Colonel Hartfield, who was so persuasive that Phillips appointed the Firm as Seagram’s counsel then and there. He never did get around to visiting Root, Clark—or at least that’s how the legend goes.
Seagram’s affairs were handled for the most part by another White & Case partner, Ezra Cornell, whose relationship with Seagram continued until Cornell’s retirement 44 years later. In addition to representing the company in its purchase of the Lawrenceburg distillery in 1933, Cornell advised Seagram on its listing on the NYSE in 1935—one of the first Canadian companies to be traded on the NYSE—and was involved in acquisitions, securities registrations, loan and credit agreements, and other matters for the company. Seagram’s U.S. tax matters were handled by Joe Willard and its litigation requirements by Tom Kiernan. Seagram’s CEO, Samuel Bronfman—a brilliant, imaginative and demanding client—often discussed business plans with Hartfield and Cornell, using them as a sounding board and relying on them for advice.
Despite the Great Depression—and to some extent because of it—the Firm continued to grow and prosper during the 1930s. Corporate reorganizations and bankruptcies became new, and major, sources of work, while a flurry of new federal statutes all served to bolster demand for legal services. Among the important new laws were the Banking Act of 1933; the Securities Act of 1933; the Securities Exchange Act of 1934; the National Labor Relations Act of 1935; the Public Utility Holding Company Act of 1935; the Social Security Act of 1935; and the Trust Indenture Act of 1939. The consequences for banks and corporations of some of this new legislation were far-reaching. The Banking Act, sections of which came to be known as the Glass-Steagall Act after the U.S. senators who proposed it, separated commercial from investment banking. The Securities Act required high levels of disclosure of financial information about companies that wanted to distribute their shares publicly.
Flurry of new legislation

the “Irving s. Olds,” Ore Boat, U.S. Steel Gary Works, 1944
Irving Olds was Chairman and CEO of U.S. Steel between 1940 and 1952 while continuing as a partner of the Firm.

An example of the Firm’s bankruptcy work during this period was its appointment as counsel to the preferred stockholders of Bush Terminal Buildings, which had developed an industrial park on the Brooklyn waterfront but went bankrupt in 1936. An example of the consequences of the Glass-Steagall Act was the closing by Bankers Trust of Bankers Company, its securities underwriting subsidiary. Years later, the Firm played a prominent part, as counsel to Bankers Trust, in arguing that Glass-Steagall did not prohibit Bankers Trust’s commercial paper marketing activity. To keep pace with the needs of its clients during the Great Depression, the Firm hired an average of about six new lawyers each year and took additional space in the Bankers Trust building, expanding to the 29th floor in 1936. With that addition, the Firm had six floors—at a total rent of $7,177.13 a month.
Ezra Cornell
Ezra Cornell was a great-grandson of Ezra Cornell, the founder of Cornell University. Born in New York in 1903, the younger Cornell grew up in Colorado, where his father was a newspaper editor, and attended Colorado College and then Cornell Law School, joining White & Case in 1927. Cornell was a corporate lawyer who was exceptionally good at developing and maintaining close, enduring client relationships. One of his clients, beginning in 1932 and continuing for 44 years until Cornell retired, was Seagram. Another of Cornell’s clients was Chicago Pneumatic Tool Company (now part of Sweden’s Atlas Copco), on whose board of directors Cornell served for many years. Cornell retired in 1976 and died in 1982 at age 79.
Tom Kiernan
Tom Kiernan graduated from Princeton in 1924, joining White & Case the following year as a clerk while attending Fordham Law School, from which he graduated in 1927. A highly capable litigator, Kiernan appeared on three occasions before the U.S. Supreme Court—twice on behalf of Seagram and once on behalf of Pan American-Grace Airways. “Tom was a real trial lawyer, who played everything straight,” according to Hal Fales. “He never exaggerated, never used a metaphor, and never said anything he could not prove by an eyewitness or an admissible document.” Robust and personable, Kiernan was called “Senator” by Orison Marden because, in Marden’s view, he looked like one. Kiernan returned the compliment by addressing Marden as “Professor.” Kiernan retired in 1981, completing a 56-year career with White & Case and becoming of counsel. In 1994, at age 91, he published a book,
White & Case: Some History, Reflections and Recollections After Sixty-Five Years
, which profiled many of the lawyers he had known in his years with the Firm. Kiernan died two years later in 1996. One of his grandchildren observed at his funeral, “White & Case was the only job Grandpa ever had. It was like his second family.”
Ezra Cornell was a great-grandson of Ezra Cornell, the founder of Cornell University. Born in New York in 1903, the younger Cornell grew up in Colorado, where his father was a newspaper editor, and attended Colorado College and then Cornell Law School, joining White & Case in 1927. Cornell was a corporate lawyer who was exceptionally good at
Tom Kiernan graduated from Princeton in 1924, joining White & Case the following year as a clerk while attending Fordham Law School, from which he graduated in 1927. A highly capable litigator, Kiernan appeared on three occasions before the U.S. Supreme Court—twice on behalf of Seagram and once on behalf of Pan
Gaining U.S. Steel
Of all the Firm’s corporate clients, in terms of sheer size, the biggest new corporate client of all was United States Steel Corporation, then the second-largest company in the world. U.S. Steel had been organized in 1901—coincidentally, the same year that White & Case was founded—by J.P. Morgan & Co. At its founding and for three decades thereafter, U.S. Steel was represented by Sullivan & Cromwell. Even though corporations in that day seldom changed their outside counsel, in the late 1920s U.S. Steel began using White & Case for legal work related to financings, subsequently retaining the Firm as its general external counsel in about 1936.
The relationship had its genesis in the personal friendship and mutual trust between DuPratt White and U.S. Steel’s chairman and CEO, Myron Taylor. White and Taylor were both Cornell graduates, served together for many years on the university’s board of trustees and were major contributors to its law school. Taylor had begun his career at the turn of the century as a lawyer in upstate New York specializing in cotton mill litigation before becoming an entrepreneur and the leading textile mill owner in New England. He chose White & Case to represent his textile ventures and financed the ventures through First National Bank of New York, which was closely allied with J.P. Morgan. Over time, he got to know Jack Morgan, and in 1927, after having sold his textile interests, Taylor was recruited by Morgan to join the U.S. Steel board of directors and chair its powerful finance committee. At the time, U.S. Steel’s earnings were slumping due to outmoded plants and a high level of debt. In a dramatic move, at Taylor’s initiative, the company issued a large amount of common and preferred stock in March 1929, just before the stock market crashed, and used the proceeds not only to modernize its plants but also to repay virtually all its debt.

U.S. Steel, Clairton Works, Blast Furnace Blowing Engine Building, Allegheny County, Pennsylvania

In 1938, White & Case was called upon for one of its most challenging assignments of the 1930s—representing U.S. Steel in the hearings of the Temporary National Economic Committee (TNEC), created by the Roosevelt Administration and the U.S. Congress to investigate alleged corporate monopolies. In establishing the committee, President Roosevelt declared, “Among us today a concentration of private power without equal in history is growing. This concentration is seriously impairing the economic effectiveness of private enterprise.” U.S. Steel appointed Olds as its special counsel for the hearings. Together with White & Case partner Adrian Foley and associates Blough and Hayne DeYampert, Olds worked virtually full-time for more than a year preparing for the company’s appearance. Primarily at Olds’s initiative, the company not only supplied the thousands of documents requested by the TNEC, but also went on the offensive by commissioning a team of eight economists and graduate students to prepare a three-volume study of U.S. Steel and the steel industry. “Olds’s services in this capacity were extremely valuable to U.S. Steel,” according to
American National Biography
. “[He] proved to be an affable, eloquent spokesman for the company, and the three-volume study he produced was praised as one of the most thorough and insightful ever made of U.S. Steel and the American steel industry.” The study broke new ground by including empirical estimates of the demand function for steel—“one of the first examples of the use of econometrics in a regulatory proceeding,” as Jonathan Baker, director of the U.S. Federal Trade Commission’s Bureau of Economics, pointed out half a century later. The TNEC was unswayed by U.S. Steel or any other company. Its final report, issued in 1941, slammed big business and alleged, “The principal instrument of the concentration of economic power and wealth has been the corporate charter with unlimited power.” As fate would have it, though, the report was overshadowed by a resurgent U.S. economy and the nation’s entry into World War II. The TNEC hearings faded away without much impact.
In 1940, U.S. Steel chairman and CEO Edward Stettinius Jr.—who had succeeded Myron Taylor two years earlier—resigned to enter government service, later becoming U.S. secretary of state. Olds, who was by now extremely close to the company, was invited by the U.S. Steel board of directors to succeed Stettinius as chairman and CEO. After consulting with his partners at White & Case, Olds accepted the offer, continuing as a partner of the Firm but withdrawing from active involvement. “They borrowed our Mr. Olds for a few months and kept him for years to be chairman of the board,” Colonel Hartfield once said with wry amusement. Olds was chairman and CEO of U.S. Steel for 12 years, after which he returned full-time to the Firm.

Myron Taylor
Myron Taylor, the chairman and CEO of U.S. Steel, was a fellow Cornell alumnus and personal friend of DuPratt White.

The wave of conglomerate mergers in the United States in the 1960s was characterized by a succession of mergers and acquisitions and, more significantly, the first great wave of hostile takeovers. White & Case played a key role in a number of celebrated cases, including helping its clients mount successful defenses against unwanted attacks, notably on behalf of Federal Paper Board in 1967 and the B.F. Goodrich Company in 1969.
The Firm’s biggest new corporate client, in terms of sheer size, was U.S. Steel, then the second-largest company in the world.
The restructuring of the company’s balance sheet on the eve of the Great Depression proved to be extremely advantageous. When the Great Depression struck, U.S. Steel continued to generate positive earnings because it had efficient plants and virtually no debt. In 1932, Taylor was elected chairman and CEO of U.S. Steel. As Taylor’s power at the company increased, so did the role of White & Case. Although DuPratt White’s friendship with Taylor had opened the door for White & Case at U.S. Steel, Irving Olds
(see profile)
was the lead partner on the account, and it was he who built the relationship. Moreover, just as Taylor began his career as a lawyer and ended up as chairman and CEO of U.S. Steel, so did Olds—and so, continuing the chain, did another White & Case lawyer, Roger Blough
(see profile)
. So close was the relationship between White & Case and U.S. Steel over a period of many years that yet another partner, Jack Tennant, was the company’s general counsel from 1953 to 1971, maintaining offices at both the Firm, of which he remained a partner, and the company.
Defending clients against hostile takeovers

Magazine article about the sale of the Empire State Building in 1951
The Firm represented the sellers, and the price of $51 million was the highest price paid at the time for a single structure.


The Wall Street Journal
headline on the purchase of a portion of the Empire State Building in 2016
The Firm represented QIA in its acquisition of a minority stake in the Empire State Building.

White & Case became known for its work on hostile takeovers during the 1960s, but it suffered somewhat from the perception that the Firm refused to represent hostile bidders. This perception may have arisen from the pronouncements and writings of Kelly, a partner specializing in merger and acquisition work, who argued that hostile deals were economically destructive. The perception was misguided. The Firm never had a policy of eschewing representation of unwelcome suitors. White & Case was, in fact, an early pioneer on the hostile side, having represented Alleghany Corporation in its 1954 proxy contest to win control of the New York Central Railroad. The takeover was notorious—one of the “most significant corporate mergers or break-ups in the past 100 years,” according to
The Wall Street Journal
—not least because of the image of Alleghany’s CEO, Robert Young, who projected himself as a friend of the small shareholder. It was a successful strategy: Young won the contest and became the New York Central Railroad’s chairman.
Taken at face value, the proposal seemed attractive. Heineman offered a package of Northwest debt and equity securities valued at about $77 per Goodrich share, a 35 percent premium over the market price. However, Ward Keener, Goodrich’s president and CEO, wanted no part of the offer. Goodrich was successful and financially solid, and Keener “was of the old school of executives, intensely suspicious of conglomerate promoters and their motives,” as Ohio State professors Mansel G. Blackford and K. Austin Kerr noted in
B.F. Goodrich: Tradition and Transformation, 1870-1995
. Keener issued a press release, drafted with the assistance of Ed Kelly of White & Case, blasting the plan. Keener and Heineman met two days later, with neither man giving ground.
Meanwhile, Keener turned to White & Case and Goldman Sachs, its investment banker, to mount a defense. Hostile takeovers were then in their infancy and strategies for attempting to thwart them were not yet well formed, so an innovative approach was required. The Goodrich no-holds-barred tactics included a negative advertising campaign ridiculing Northwest’s financial performance, tabling a proposal to double the company’s number of common shares and issuing a block of stock to Gulf Oil, which was viewed as a potential white knight. The shares were used to purchase Gulf’s interest in the companies’ joint venture, Goodrich-Gulf Chemicals, which had been jointly owned for 17 years. These measures were designed to complicate things for Northwest, but could not in themselves thwart the bid.

More aggressive actions were called for, and these were pursued in Washington, D.C. On the advice of White & Case, Goodrich contacted the Securities and Exchange Commission (SEC) to complain that Northwest had “gun jumped”—that is, it had allegedly pumped up the value of its securities in the offering through extensive publicity before its registration statement was effective. The SEC subsequently forced Northwest to put an admission of gun jumping in its prospectus. Goodrich also lobbied the state and federal governments to block the deal on antitrust grounds. The company received a sympathetic hearing in the antitrust division of the U.S. Department of Justice, which then brought a case against Northwest. Although a federal judge denied the government’s request for an injunction, he said the case would probably go all the way to the U.S. Supreme Court if the merger were completed. The most crushing blow of all, however, was delivered in the U.S. Congress. On the advice of White & Case, Jeter contacted Wilbur Mills, the Arkansas Democrat who chaired the House Ways and Means Committee. Within days, Mills introduced legislation to limit the tax deductibility of interest on debentures issued for stock in takeovers—debentures then commonly being used as currency to fund acquisitions. The effect of this was to cause the share price of many conglomerates, including Northwest’s, to plummet, thereby making its offer for Goodrich instantly less attractive. Northwest responded to the Mills tax proposal by reducing the amount of debentures to be issued in its bid and adding shares of preferred stock. However, the battle had effectively been lost, and by August, Northwest let its bid expire. Mills, for his part, pushed ahead with his proposed tax changes, which became law in the Tax Reform Act of 1969. The new law dampened the more exuberant phase of the conglomerate movement.
The Firm’s defense of Federal Paper Board against the 1967 hostile takeover attempt by Simkins Industries made legal history. It was the first time an all-cash tender offer had been defeated. White & Case, working closely with Federal Paper Board’s management and with investment bank Goldman Sachs, helped establish a multimillion-dollar buying pool—funded by the company’s customers and executives—to purchase the company’s shares on the New York Stock Exchange and raise the market price above the tender price. As a result, there was no incentive for owners of the stock to submit their shares for tender unless Simkins raised its price, which it did not. This novel approach was perfectly legal at the time but fell out of favor under subsequent changes in securities laws.
Equally spirited was the Firm’s representation of tire-maker Goodrich in 1969 to head off an attempted takeover by Northwest Industries, a conglomerate formed by lawyer and industrialist Ben Heineman. Even before Heineman launched his hostile bid, the Goodrich management, taking note of their company’s lagging stock price and a surge in trading activity, suspected that an unwelcome suitor was about to knock at the door. One of the White & Case lawyers who worked with Goodrich at that time was Jack McNally, who was equally on the ball. Recalling the events of 1969, he said, “One morning, I saw in the paper that some unknown buyer was accumulating Goodrich stock. I called Ray Jeter, the general counsel, and said, ‘You know, this is your first warning. You ought to get organized, even though you don’t know who it is.’ ” McNally and Jeter scheduled a meeting for a few days later, on January 20, 1969. Minutes before their meeting was to start, Heineman announced his bid. With an offer now on the table, McNally and Jeter were able to use their meeting to begin preparing a defense in case Goodrich’s management and board decided to oppose Northwest.
Jack McNally graduated from Holy Cross in 1950 and from Harvard Law School in 1953, before joining White & Case that same year. One of his primary areas of practice was M&A, specifically defense of hostile takeovers and joint ventures. His clients included B.F. Goodrich, Holly Sugar, Waterman Steamship, Chicago Pneumatic, Newmont Mining and many other financial services and industrial clients. Considered both an adviser and friend to clients, he also achieved great respect by offering straightforward, practical advice on even the most complicated of issues. At various times over his 40-year career at the Firm, he held a number of leadership positions, including multiple terms on the management committee. At the end of his career, and at the request of the Firm, he deferred his retirement and spent time guiding its offices and lawyers in Istanbul and Moscow. He was a longstanding member of the board of directors of Mohawk Fine Papers, Lavelle Fund for the Blind, Lawrence Hospital Center and All Hallows Foundation, the philanthropic arm of his former high school in the Bronx. He served in the U.S. Navy in World War II. McNally retired in 1994 and died in 2013 at age 86.
Jack McNally
Jack McNally graduated from Holy Cross in 1950 and from Harvard Law School in 1953, before joining White & Case that same year. One of his primary areas of practice was M&A, specifically defense of hostile takeovers and joint ventures. His clients included B.F. Goodrich, Holly Sugar, Waterman Steamship,
The National Student Marketing affair
Nearly all companies and law firms go through difficult periods. For White & Case, none was more challenging than the aftermath of its brief tenure as counsel to National Student Marketing (NSM), founded in 1965 by a young entrepreneur, Cortes Randell, to market products to college students. It appeared to be extremely successful, capturing the attention of investors. The company’s stock soared from an initial offering price of $6 per share in April 1968 to $140 in December 1969, and as it rose, NSM used the shares to acquire more than 25 companies. NSM was initially represented by Covington & Burling, a top Washington, D.C. law firm, and its auditors were Peat, Marwick, Mitchell & Co., which was equally prestigious. When Covington & Burling resigned in early 1969 for reasons that were never publicly disclosed, Randell approached White & Case partner Larry Morris to seek representation. “NSM was constantly acquiring companies, issuing stock and doing things that required lawyers,” Hal Fales later wrote in his book,
Trying Cases: A Life in the Law.
“Everything about them seemed first-rate, with the possible exception that Randell was a bit too much of a salesman when he made presentations to analysts, an appealing challenge to Larry Morris. He loved riding herd on clients of that kind, lecturing them like a Dutch uncle to keep them on the straight and narrow. To him, keeping clients out of trouble was the highest form of service, both to the client and to the public.” Based on assurances from Randell that he would heed Morris’s advice, White & Case accepted NSM as a client. Jay Epley, an associate who was in line to become a partner, was assigned to handle much of the day-to-day work. When Epley was elected to partnership in 1969, he was given overall responsibility for the relationship. At about that time, NSM began negotiating to acquire Interstate National, a Chicago-based insurance company. And that’s when the trouble began. On October 31, 1969, the day the acquisition was scheduled to close, questions suddenly arose as to NSM’s earnings. The underwriters involved in the deal were scheduled to receive a comfort letter from Peat Marwick stating that it knew of no significant adverse financial developments at the company up to five days prior to the closing. However, when the letter arrived it contained revised financial figures showing that NSM had broken even in the prior fiscal year, instead of earning a profit as previously stated. There was as yet no indication of fraud, just a downward revision of financial results. Peat Marwick suggested that the closing be postponed and its letter be circulated to all NSM and Interstate shareholders before the closing was held. Nonetheless, Interstate’s management decided to proceed as scheduled, concerned that the deal—which was considered favorable to Interstate shareholders—might collapse if it were delayed. The market price of NSM stock kept rising into early 1970, when NSM announced that it expected to report a first-quarter loss. The stock thereupon plunged, and Randell resigned, triggering an investigation that showed NSM’s earnings had been consistently overstated. These events culminated in 1972 in the filing of a complaint by the SEC charging that White & Case and the Chicago law firm Lord Bissell & Brook had “aided and abetted” a securities fraud based on their alleged failure to take proper action when they “permitted” their clients to complete a merger that had received shareholder approval based on a proxy statement containing materially misleading financial information. The complaint alleged that the lawyers had a duty to insist that their clients resolicit proxies based on corrected information and that, if the clients refused to follow this advice, the lawyers were required to resign and report the alleged securities violations to the SEC. This was a most serious charge. Corporate and lawyer interest in the complaint and the underlying issue of lawyer-client privilege was exceptionally high.
Business Week
wrote, “An SEC lawsuit has charged that corporate lawyers must police the financial dealings of their corporations for the public. If a firm will not reveal incriminating facts, then the lawyer must report them to the SEC. If the courts uphold such a practice, the whole lawyer-corporation relationship will be drastically altered.” Not unnaturally, the accusation caused great consternation within White & Case. Some partners believed the Firm had done nothing wrong and wanted to go to trial to clear the Firm’s name. Others believed White & Case was at least partly culpable and should reach a settlement with the SEC. Still others—while believing the Firm was innocent of the charges—wanted to settle to avoid a protracted public battle that might tarnish the Firm’s reputation. There was no consensus on the approach to take, and the matter dragged on for five years. Eventually, it was decided that the Firm should settle. The responsibility for the settlement fell to Ed Schmults, who had joined the Firm in 1958, became a partner in 1965, later left to serve in the Ford Administration and returned to the Firm in 1977. “When Ed came back,” Jim Hurlock, by then one of the Firm’s most influential partners, recalled, “I said, ‘The first thing you have to do is go to the SEC and see if you can negotiate a settlement to the National Student Marketing case.’ He had very good relations in Washington and I thought he could do that.” Indeed, Schmults, already a proponent of settling the case, negotiated a proposed settlement that was favorable to the Firm, which was then submitted to the partnership for approval. At a lengthy meeting in April of 1977 that went into the night, two-thirds of the partners voted to settle.
Irrespective of whether White & Case was, as alleged, culpable of aiding and abetting a securities fraud, the Firm suffered. How much is not certain. As Hurlock put it at the time, “I guess there is no way ever to measure how much damage you’ve done to yourself by being at war with the SEC for a number of years. How many prospective clients did not select White & Case because we were embroiled in this dispute?” Hurlock’s question was unanswerable, but fortunately the Firm continued to represent clients in many of their important matters both during and after the NSM saga.
White & Case helped to save New York from financial collapse in the mid-1970s.
New York City financial crisis

Gene Corey, a news building guard, reads the front page of the New York
Daily News
in the summer of 1975
President Gerald Ford said that he was prepared to veto any bill to bail out New York City.

During the summer of 1975, New York City was facing a severe financial crisis. At the height of the crisis, as the city was seeking federal assistance, the New York
Daily News
ran the now iconic front page headline: “Ford to City: Drop Dead.” Many believe that this headline cost Gerald Ford the 1976 presidential election to Jimmy Carter. (Ford lost New York; if he had won the state, he would have been re-elected president.)

During the early 1970s, the Firm had been representing the major U.S. clearinghouse banks in connection with their purchase of New York City bonds. Traditionally, very little due diligence was undertaken on lending transactions with governmental entities having taxing authority or other identifiable government-based income streams. But, as the city’s financial situation deteriorated, the White & Case lawyers representing the banks decided to poke around a little and did not like what they found. They alerted the banks that the accounting practices of New York City were novel, to say the least. Among other things, although still hard to believe, many of the account ledgers were in pencil, and erasures and changes could be seen throughout. This led to further investigation, with the end result being the creation of The Municipal Assistance Corporation for the City of New York (MAC), a fully independent and autonomous government entity created by the New York State legislature to oversee the financial affairs of New York City. In this role, MAC issued its own debt in exchange for nearly worthless New York City bonds. And as a result of its efforts in uncovering accounting irregularities in the city’s books and records, White & Case was named underwriters’ counsel for the “Big Mac” bonds, which led to the Firm representing the lead underwriters (at various times, Chase, Salomon Brothers and Goldman Sachs) in 94 separate bond offerings as a result of which debt securities of about $10 billion were issued. Thus, the Firm played a very important role in preventing the financial collapse of New York City, the ramifications of which would have had worldwide implications. Many White & Case lawyers contributed to this effort over the years, including David Blair, Jay Epley, Gene Goodwillie, Tony Kahn, Orison Marden, Willis McDonald and Don Wilkinson. The Firm also worked with the Financial Community Liaison Group—formed by representatives of several major banks, including Ellmore Patterson of J.P. Morgan and David Rockefeller of Chase Manhattan—to work with city, state and federal officials to help restore confidence in the city’s fiscal health. In this role, the Firm filed “friend of court” briefs in two lawsuits that unsuccessfully challenged the constitutionality of legislation adopted to address the city’s financial crisis.
Other work during the mid to late 1970s
Work for established and emerging clients also kept the Firm’s lawyers busy during this period. The attack by Bankers Trust and the Firm against the Glass-Steagall Act commenced about the time the NSM matter was being settled. The Firm’s banking practice kept on growing. The Firm continued working for a broad range of clients, including Arthur Young & Company, Prudential Insurance Company and U.S. Steel, and doing significant M&A work. And by the time the NSM case was settled in 1977, the Firm’s representation of Indonesia had been under way for about two years, and it was becoming clear that the Firm had a significant opportunity to build substantial sovereign practices in emerging markets.
Irving Olds
One of the remarkable things about White & Case was its ability, early on, to attract some of the brightest young law school graduates. Irving Olds was one of these recruits.

U.S. Steel executives
(left to right) Enders Voorhees, Chairman of the Finance Committee; Irving Olds, Chairman and CEO; and Benjamin Fairless, President, 1944

Olds then devoted a great deal of his time to raising funds for his two favorite educational institutions—Cooper Union for the Advancement of Science and Art, and Yale University—as well as for the New York Public Library, the Metropolitan Opera Association and the construction of New York’s Lincoln Center for the Performing Arts. He was a longtime trustee of the Metropolitan Museum of Art and served as trustee and president of the New York Historical Society.
Reflecting his love of both art and naval history, he assembled one of the great collections of naval prints and wrote two books,
The United States Navy, 1776-1815
, published in 1942, and
Bits and Pieces of American History
, published in 1951. He continued to practice law after returning from U.S. Steel and served as chairman of the Firm’s executive committee from 1954 until his death in 1963 at age 76.

Macdonough’s victory on lake champlain, 1814
Original hand-colored etching from the Irving S. Olds collection of naval prints given to the Firm by Olds.

Smart, tough and articulate, as well as someone of wide-ranging personal interests, Olds received a B.A. from Yale in 1907 and an LL.B. from Harvard Law School in 1910, and spent the next year as a law clerk for U.S. Supreme Court Justice Oliver Wendell Holmes before joining White & Case. Olds was made a partner in 1917 and worked with many of the Firm’s largest clients, including Bankers Trust. He also represented J.P. Morgan & Co. in connection with the purchase of armaments for the British and French during World War I, and the Foundation Company, which built skyscraper foundations. Beginning in the late 1920s, Olds developed the Firm’s important relationship with U.S. Steel, a relationship that was so close that, in 1940, Olds left the Firm to become U.S. Steel’s chairman and CEO. Olds headed U.S. Steel for 12 years until 1952, when he retired from that company (remaining on its board of directors) and returned to White & Case.
Roger Blough
Roger Blough was another White & Case lawyer who started from humble beginnings. He grew up in Riverside, Pennsylvania, where his father was a truck farmer and greenhouse operator and his mother a nurse.

Boris Chaliapin's illustration of Roger Blough appeared on the cover of
magazine, July 20, 1959

Blough (rhymes with “plow”) attended a one-room school and planned to stay only through the eighth grade, but his academic performance so impressed his teachers that they persuaded him to continue his education, which he did by working his way through Susquehanna Academy and Susquehanna University. Upon graduation from college in 1925, Blough coached basketball and taught science and math in the public schools of Hawley, Pennsylvania for three years. He then decided to become a lawyer and enrolled at Yale Law School, where he was an editor of the
Yale Law Journal
. Earning his law degree in 1931, he was hired by White & Case with the notation on his application by George Case: “First-class chap, good, clean-looking. I like him. We would probably make no mistake.”

Blough worked initially with such clients as Beech-Nut Packing Company and in the reorganization of Burns Brothers Coal Company, a coal and fuel oil distributor, and was subsequently part of the White & Case team that represented U.S. Steel in the TNEC hearings. In 1942, when U.S. Steel offered him the position of its general counsel, he was on the verge of being elected to partnership. Lowell Wadmond later recalled, “We knew we were about to make Roger a partner, but we couldn’t yet tell him. So when he asked whether he should take the job, all we said was, ‘You can’t make a mistake either way.’ ” Accepting the offer, Blough moved ahead rapidly at U.S. Steel and became its chairman and CEO in 1955, leading the company for the next 14 years and melding its scattered operations into a unified business.

Construction of the “Roger Blough” began in 1968 by the American Ship Building Company of Lorain, Ohio

Despite his accomplishments, he is primarily remembered for his run-in with President Kennedy in 1962 over the price of steel. When U.S. Steel raised its average price by $6 a ton, Kennedy reacted with fury, insisting the company should restrain its prices because the United Steelworkers union had previously accepted only a modest wage increase. Kennedy derided Blough publicly and threatened an antitrust investigation, price controls and other actions unless the company relented. Although Blough defended the price increases as necessary to finance plant modernizations, he eventually rescinded them under political pressure. When Blough retired from U.S. Steel in 1969, he returned to White & Case, this time with the partnership that had been his for the asking 27 years earlier. He practiced corporate law, was instrumental in the opening of the Firm’s Washington, D.C. office in 1974 and was a founder of the Business Roundtable, a public policy group composed of corporate CEOs. He retired in 1976 and died nine years later at age 81.