Kelley Drye & Warren Llp Business Information, Profile, and History

Company Perspectives:

The time is now. The next century is approaching. New revolutions and industries are unfolding, from genetic engineering to virtual reality. The shape of the world is changing and Kelley Drye is bringing its industry knowledge and cross-disciplinary skills to bear for a diversified group of clients. We're not only helping the well-established corporations of today, but also advising the Chase Manhattans, Union Carbides, and GTEs of tomorrow, the potential success stories of the next 160 years.

History of Kelley Drye & Warren Llp

Kelley Drye & Warren LLP is one of the oldest and largest law firms in the United States. Started in 1836 as a two-man partnership in New York City, the firm has over 300 lawyers in New York; Washington, D.C.; Los Angeles; Chicago; Stamford, Connecticut; Parsippany, New Jersey; Brussels; and Hong Kong, as well as affiliated overseas offices in Tokyo, Bangkok, Jakarta, Manila, and Mumbai, India. Kelley Drye & Warren provides legal counsel in virtually all legal specialties, including traditional areas such as real estate and banking to newer fields such as environmental law and the Internet-based economy. For decades Kelley Drye & Warren has represented major corporations or their predecessors, including Union Carbide Corporation, Chrysler Corporation, and The Chase Manhattan Bank.

Origins and Practice in the 1800s

Hiram Barney began in 1836 a partnership that evolved into Kelley Drye & Warren LLP. He became the junior partner in the New York firm of Mulligan & Barney. In 1838 it became Waterman & Barney after Mulligan died and William Dwight Waterman teamed up with Barney. From 1841 to 1849 the partnership was called Barney & Mitchell with the addition of William Minott Mitchell.

Barney's first client was George Catlin, the famous painter of Indian and Western scenes. The lawyer also represented the estate of Francis Scott Key, author of "The Star Spangled Banner." Barney's notable legal career included trips to the Iowa Territory in 1840 and 1841 to help resolve land claims and title questions concerning the so-called Half Breed Tract located between the Mississippi and Des Moines rivers near Keokuk, Iowa. The Sac and Fox tribes had ceded the tract to the federal government in 1836 after their defeat in the Black Hawk War.

Originally an anti-slavery Democrat, Barney joined the new Republican Party and became a friend of Abraham Lincoln, who in 1861 appointed him the Collector of the Customs of the Port of New York. As the collector, Barney was responsible for overseeing 1,100 individuals, the largest federal agency at the time.

After the Civil War, widespread corruption led some in the legal profession to seek reforms. Thus the firm's early lawyers in 1870 helped organize The Association of the Bar of the City of New York that fought against Tammany Hall and its leader "Boss" Tweed.

In 1875 name partner William Allen Butler helped establish the Central Trust Company of New York, which became a long-term client. He also was a prominent litigator, especially in maritime law. According to the Kelley Drye firm history, Butler wrote that he had "the opportunity of aiding in establishing the jurisdiction of the Admiralty courts under the Constitution of the United States upon the basis of the ancient maritime law of continental Europe as distinguished from the circumscribed statutory law of England...."

The Firm from 1900 to 1945

In 1905 Butler, Notman, Joline & Mynderse split into two partnerships. Butler, Notman & Mynderse retained the predecessor firm's admiralty practice. The other new partnership of Joline, Larkin & Rathbone kept most of the previous firm's corporate practice, including Central Trust Company of New York. In 1907 the Joline firm helped the Metropolitan Street Railway and the New York City Railway successfully reorganize after they declared bankruptcy. Others reorganized by the Joline firm included Westinghouse Electric & Manufacturing Company in 1908, St. Louis & San Francisco Railroad in 1913, Maxwell Motor Company, Inc. in 1913 and 1921, American Writing Paper Company in 1926 and 1927, Detroit United Railway in 1928 and 1929, International Mercantile Marine Company in 1929, and the Oklahoma Natural Gas Corporation in 1933. The firm's attorneys in the early 20th century also represented Lanston Monotype Machine Company, Sloss-Sheffield Steel & Iron Company, Pressed Steel Car Company, The Virginian Railway, United States Industrial Alcohol Company, and Lever Brothers.

In 1917 the firm organized the Surdna Foundation for banker John E. Andrus. That foundation, which always kept a member of the Joline or successor firms on its board of directors, started with little money but by 1985 had $225 million in assets. The law firm also drew up the will of Augustus D. Juilliard and set up the Juilliard Musical Foundation and its Juilliard School of Music.

In 1921 the law firm hired Nicholas Kelley as a new partner. Kelley had graduated from Harvard University and then the Harvard Law School in 1909, worked for New York's Cravath law firm, and served as Wilson's and Harding's assistant secretary of the Treasury Department before he joined the firm.

In 1921 the firm represented The Guaranty Trust Company when it negotiated with the government of Peru for a $50 million loan, but that country was not financially sound enough to warrant such a large loan.

The firm also helped the Maxwell Motor Company gain a loan from Chase Securities Corporation so that it could build the first Chrysler automobile, and then it incorporated Chrysler Corporation under Delaware law in 1925. With the law firm's help, Chrysler Corporation in 1928 acquired Dodge Brothers and thus became the nation's third largest auto maker. Chrysler remained one of the firm's major long-term clients in the decades to come.

The Post-World II Practice

During World War II, Chrysler Corporation had converted its factories from auto production to making tanks, B-29 engines, guns, and other war-related items. The law firm played an important role helping return Chrysler to the peacetime production of civilian vehicles. In the 1950s the firm assisted Chrysler in its acquisitions of the Briggs Manufacturing Company and three foreign companies.

Other clients soon after the war included the Board of Governors of The Society of The New York Hospital, Lake Tankers Corporation, National Oil Transport Corporation, The Virginian Railway, and Norfolk & Western Railroad Company.

With the 1935 passage of the National Labor Relations Act, often called the Wagner Act, some law firms began labor practices since unions representing unskilled workers grew rapidly. The firm's lawyers after the war helped draft the 1947 Taft-Hartley Act, a major piece of union legislation. The law firm continued in the decades ahead to represent many companies involved in labor issues, a specialty that Robert M. Lunny said in his history was "unique for a large `Wall Street' or `Park Avenue' law firm."

The firm of Rathbone, Perry, Kelley & Drye in 1951 included 20 partners, 23 associates, and 64 staff and clerical workers. In 1965 the law firm began representing the New York Giants, which led to work for other NFL teams, the National Football League itself, and the NFL Management Council that represented the players in collective bargaining. In the 1960s the firm also represented The Holmes Protection Group in an antitrust case that went to the U.S. Supreme Court.

In the 1970s the firm's real estate practice expanded, so that by the mid-1980s it managed real-property investments for Connecticut General Life Insurance Company, Equitable Life Assurance Society of the United States, Metropolitan Life Insurance Company, Rouse Company, the Society of the New York Hospital, and the New York Province of the Society of Jesus (Jesuits).

In October 1974 the law firm included 84 lawyers, eight accountants, and 115 staff members. The passage of many new federal laws and regulations in the 1960s and 1970s stimulated the growth of the legal profession.

Two other events in the 1970s brought major changes to the nation's large law firms. First, advertising and public relations significantly increased after the U.S. Supreme Court ruled that professional associations' restrictions on advertising violated the First Amendment's guarantee of free speech. Second, the National Law Review and the American Lawyer were started to publish information on internal law firm management practices and their financial performance. Such legal journalism led to firms becoming more business-oriented as salaries skyrocketed in order to prevent lateral hiring by competing firms.

Like other elite corporate law firms, Kelley Drye & Warren grew rapidly in the 1980s. From 93 lawyers in New York in January 1979, the firm exploded in size to 210 lawyers in January 1984 in offices in New York; Miami; Los Angeles; San Francisco; Tokyo; Washington, D.C.; Morristown, New Jersey; and Stamford and Danbury, Connecticut.

Chrysler Corporation, one of Kelley Drye's historic clients, almost collapsed due to excessive debt and its poor performance compared to Japanese and German companies that made more fuel efficient cars during the 1970s energy crisis. To meet the strict requirements of a huge federal loan guarantee, Chrysler used Kelley Drye but mainly relied on New York's Debevoise, Plimpton, Lyons & Gates as its lead counsel in what Stewart called the "largest corporate rescue mission ever attempted."

Kelley Drye, since shortly after World War I ended, had been representing Union Carbide and Carbon Corporation, which became Union Carbide Corporation in 1957. The firm helped Union Carbide from 1957 to 1963 when the federal government charged it with antitrust violations. After using Kelley Drye for many purposes, Union Carbide again relied on its longtime outside counsel when it faced a major crisis that threatened its very existence. On December 3, 1984, a plant owned by a Union Carbide subsidiary in Bhopal, India, released toxic pollutants into the air that killed about 8,000 persons and injured about 300,000. Multiple lawsuits were filed that sought many billions of dollars in damages. Some thought Union Carbide would turn to a larger law firm, as Chrysler had done just a few years earlier. However, Kelley Drye had gained expertise in mass tort litigation when it helped Hercules Inc. successfully settle Agent Orange litigation filed by lawyers representing thousands of Vietnam War veterans. According to Kelley Drye's web site, "we had [Bhopal] suits on behalf of the more than 500,000 claimants consolidated and dismissed from U.S. courts, and were instrumental in designing a favorable settlement with the Indian government."

Developments in the 1990s and Beyond

Some of the firm's corporate clients in the 1990s included GTE, a leading telecommunications company; ADT Security Systems; venture capital company Sevin Rosen; Mission Energy Company; and Qwest Communications. By the beginning of the new millennium the firm's Project Finance and Infrastructure Group had provided legal advice to various sponsors, investment banks, and others involved in 100 projects in 40 nations.

To strengthen its Asian practice, Kelley Drye in 1997 affiliated with the law firm of Soebagjo, Roosdiono, Jatim & Djarot in Jakarta, Indonesia. Kelley Drye for 20 years had represented both Indonesian and non-Indonesian clients in transactions involving power, telecommunications, and other areas.

In the late 1990s Kelley Drye represented several foreign telephone companies that opposed proposed Federal Communications Commission changes. The FCC wanted U.S. long-distance companies to change their payment to international carriers for overseas calls. Fearing such changes would hurt their businesses and were indeed treaty violations, Hong Kong Telecom, Guyana Telephone & Telegraph, the Caribbean Association of National Communications Organizations, and several other entities engaged Kelley Drye to fight the FCC's changes.

To assist mainly its telecommunications and Internet-based clients, Kelley Drye in 2001 established an office in Tysons Corner, Virginia. The firm shared the 12th floor of the Tycon Tower with other companies, such as Nokia Venture Partners, LP, that together offered a wide range of legal, investment, financial consulting, public relations, and other business services. Without formal corporate mergers, this joint effort provided one-stop business assistance.

Responding to an increasingly globalized economy, Kelley Drye in the late 1990s made lateral hires to establish an International Trade and Investment Group and strengthen its Financial Institutions Group. The firm intended to bolster its Asian/Pacific practice in particular. Oracle Corporation in 2001 recognized Kelley Drye's expertise in that region when it chose the law firm to participate in its VentureNetwork web site that would give Asian companies more opportunities to learn about the New York law firm's services and how they could use online business methods.

Kelley Drye lawyer Robert L. Haig made a major contribution to his profession when he served as editor-in-chief of a 1998 six-volume work called Business and Commercial Litigation in Federal Courts. Michael A. Pope said this extensively documented book "rates a very special place in the library of today's litigator."

In 2000 Kelley Drye & Warren represented Amedeo Hotels Ltd. owned by Prince Jefri Bolkiah of oil-rich Brunei. The government sued the prince to recover billions that he allegedly embezzled. The law firm's international practice also included helping the American subsidiary of Germany's Daimler-Chrysler to set up its first American plant to build Mercedes-Benz automobiles. Similar globalization developments assisted by large law firms such as Kelley Drye occurred in many industries.

Although Kelley Drye & Warren did not rank among the world's 50 largest law firms, the American Lawyer included it in its annual listing of the 100 largest U.S. firms. Based on its 1997 gross revenue of $110.5 million, the firm ranked number 85. In 1998 it was number 89 with $120.5 million gross revenue, and in 1999 it declined to number 96 based on its gross revenue of $127.5 million. Its competitors in the new millennium included many larger American law firms and also foreign law firms such as London's Clifford Chance with its approximately 3,000 lawyers worldwide.

Principal Operating Units: Litigation; Corporate and Banking; Labor and Employment Law; Employee Benefits; Bankruptcy; Tax; Real Estate; Personal Services.

Principal Competitors: Baker & McKenzie; Jones, Day, Reavis & Pogue; and Skadden, Arps, Slate, Meagher & Flom.

Chronology

• Key Dates:

• 1836: Mulligan & Barney is founded.
• 1838: Partnership is renamed Waterman & Barney.
• 1841: Barney & Mitchell becomes the new name.
• 1849: Firm is renamed Barney & Butler.
• 1851: Barney, Humphrey & Butler becomes the new name.
• 1859: Partnership is renamed Barney, Butler & Parsons.
• 1874: Partnership adopts the new name of Butler, Stillman & Hubbard.
• 1896: Partnership's new name is Butler, Notman, Joline & Mynderse.
• 1905: New name of Joline, Larkin & Rathbone is chosen.
• 1918: Larkin & Perry is formed.
• 1920: Larkin, Rathbone & Perry becomes the firm's new name.
• 1943: Rathbone, Perry, Kelley & Drye is established.
• 1952: Kelley, Drye, Newhall & Maginnes is the partnership's new name.
• 1961: In its first merger, the firm acquires Barr, Robbins & Palmer.
• 1962: Kelley, Drye, Newhall, Maginnes & Warren is formed.
• 1965: Firm starts an affiliated office called Roberts & Hayden in Jersey City, New Jersey.
• 1969: Firm is renamed Kelley, Drye, Warren, Clark, Carr & Ellis after a merger.
• 1975: Kelley Drye & Warren LLP is chosen as the firm's permanent name.
• 1979: Merger with Cross, Brodrick & Chipman results in new offices in Stamford and Danbury, Connecticut.
• 1981: Firm starts a Washington, D.C. office.
• 1982: Miami office is opened; New York headquarters are moved to 101 Park Avenue.
• 1983: Firm merges with New York's Miller, Montgomery, Sogi & Brady, P.C.
• 1984: Firm opens offices in San Francisco, Los Angeles, and Morristown, New Jersey.
• 1997: Kelley Drye becomes affiliated with a law firm in Jakarta, Indonesia.
• 2001: Firm opens its new office in Tysons Corner, Virginia.