Chadbourne & Parke
Chadbourne & Parke
Sales: $187 million (1999 est.)
NAIC: 54111 Offices of Lawyers
Chadbourne & Parke is a major international law firm. Based in New York City, it operates branch offices in Hong Kong, Moscow, London, Tokyo, Los Angeles, and Washington, D.C. The firm represents numerous corporations, foundations, financial institutions, and individuals in most areas of modern law, from mergers and acquisitions and financing options to antitrust, environmental, and intellectual property. Numbering among its long-term clients are Brown and Williamson Tobacco Corporation and The American Forest and Paper Association, formerly known as The American Paper Institute.
Origins, Career of the Founder
Thomas L. Chadbourne, Jr., founded Chadbourne & Parke in 1902, but he had gained considerable experience before starting that firm in New York City. In Chicago he began as a clerk for Judge Russell M. Wing. After studying the law on his own, he was admitted to the bar in Milwaukee, where he worked with a few partners.
In his autobiography Chadbourne described his decision to focus on corporate law. “The panic of 1893 … worked a tremendous change in the legal profession. Up to that time, criminal and civil trial practice had received the emphasis…. It was a change that I saw plainly, and one which suited me admirably. Criminal and trial practice, so loved by Wing, had failed to arouse my deeper enthusiasms, but the very first contact with business made me feel that I had struck my medium.”
On January 1, 1896 the Chicago law firm of Wing, Chadbourne & Leach opened for business. Clients included the natural gas firm Crane Company, the financial and railroad businesses of Arthur B. Stilwell, and the Pullman Company, which made railroad cars. In spite of Chadbourne’s successful early career, in 1902 he decided to leave Chicago for New York City, the nation’s center for finance and the legal profession.
In 1909 Chadbourne was joined by Arthur Shores. After Shores left the partnership in 1918, the firm became known as Chadbourne, Babbitt, & Wallace with the addition of New York lawyer Kurnal Babbit and William Wallace, Jr., a formerly prominent Montana lawyer. In 1924 the Chadbourne firm took over the practice of John Stanchfield and Louis Levy and was renamed Chadbourne, Stanchfield & Levy. William M. Parke, later a name partner, came into the firm as part of the 1924 acquisition.
In New York, many of Chadbourne’s main early clients were railroad companies. Thomas Chadbourne in his autobiography wrote about aiding George Jay Gould’s many companies, including the Pacific Express Company, the Missouri Pacific Railway, the Texas and Pacific Railway, the International and Great Northern Railway, and the Wabash Railroad. George Gould (1864–1923), the son of financier Jay Gould, took over his father’s corporate empire after he died in 1892, but by 1918 the last of the Gould railroads had declared bankruptcy, in part from increased ship transportation after the Panama Canal opened in 1914.
When Thomas Chadbourne wrote his autobiography in 1928, he claimed his law firm of 38 lawyers brought in more than $2 million in annual receipts. He said that when he began practicing law, “all was personal. Yet today I see only one or two clients of the hundreds that come into the office, and I do not even know some of my assistants by name or sight.”
In 1928 the Chadbourne partnership represented over 150 major corporations, and Thomas Chadbourne was one of New York City’s top corporate lawyers and businessmen. He served as chairman or director of the Wright Aeronautical Corporation, Mack Truck Incorporated, International Mining Corporation, New York Rapid Transit Corporation, Brooklyn-Manhattan Transit Corporation, Adams Express Company, Otis Elevator Company, Vertientes Sugar Company, Manufacturers Trust Company, and the Marlin Rockwell Corporation.
In the last phase of his distinguished career, Thomas Chadbourne represented some of the nation’s largest sugar producers in negotiations with several other nations that stabilized the international sugar market. Chadbourne’s plan was adopted in Brussels in 1931. Fortune called Chadbourne’s work “one of the greatest ventures ever undertaken in business diplomacy.”
The Chadbourne law firm in its early decades represented some prominent individuals, such as Eddie Rickenbacker, World War I flying ace and later president of Eastern Airlines; actress Maxine Elliot; novelist Fannie Hurst; and writer James Joyce in sensational litigation concerning his famous book Ulysses.
Cherovsky said that during the depression years of the 1930s, the Chadbourne law firm had a “high-powered aviation law practice,” with Eastern Airlines, TWA, and North American Aviation (later renamed Rockwell International after a merger) as clients. In 1942 the firm was involved in much publicized litigation concerning a Nevada plane crash that killed 22 passengers, including Carole Lombard, Clark Gable’s wife.
Unfortunately, the firm lost a name partner in 1936 with the departure of Louis S. Levy. At that time Levy was being investigated for earlier helping Judge Martin T. Manton’s business partner gain a $250,000 loan that never was repaid at the same time Judge Manton presided over a case in which he ruled in favor of a firm client. In 1939 Levy was disbarred and Judge Manton was convicted of judicial corruption.
Post-World War II Developments
In its February 1958 issue, Fortune wrote about how the big Wall Street law firms operated. The article ranked the firm of Chadbourne, Parke, Whiteside & Wolff as Wall Street’s tenth largest law firm, with 21 partners and 49 associates as of December 1957. The article estimated that the 20 largest Wall Street firms employed about 1,700 lawyers. Although the article estimated the revenues and earnings of an average Wall Street law firm, much information about the internal workings of the nation’s large firms remained unavailable until the late 1970s when legal journalism was revolutionized by the start of the National Law Review and the American Lawyer.
In the late 1960s and 1970s Chadbourne, Parke, Whiteside & Wolff represented the Piper family in extended litigation. Chris-Craft Industries, Inc. tried to take over the family’s Piper Aircraft Company, but the Piper family and First Boston Corporation opposed that deal. After the Pipers sold their business to Bangor-Punta Corporation, Chris-Craft sued Bangor-Punta, First Boston, and the Piper family for committing fraud. Although Chris-Craft won a $36 million damage award in the lower courts, in 1977 the U.S. Supreme Court reversed that decision. Chadbourne Parke and other law firms on both sides of the case earned a total of almost $5 million in what Justice John Paul Stevens called “monumental litigation.”
According to author Erwin Cherovsky, Chadbourne & Parke “was in disarray by the mid-1980s.” Based on its 1986 gross revenues of $39 million, the firm was ranked as number 96 in the nation’s top 100 law firms by the American Lawyer. However, the firm’s finances improved with gross revenues increasing to $75 million in 1989, making it the nation’s 57th largest law firm. Its 1989 gross revenues were $95 million. Cherovsky listed American Brands, TWA, American Hoechst, Belgian Airlines, Renault, American Paper Institute, and Unysis as some of Chadbourne & Parke’s representative clients.
Like other law firms, Chadbourne & Parke in the 1980s increased its initial salaries for new associates just out of law school. From $65,000 in 1986 and 1987, its starting associates were offered $83,000 in 1990. The big law firms increased those salaries in the 1990s to beyond $150,000 as they competed for the best graduates from elite law schools.
By the 1980s Chadbourne & Parke had added a significant number of women attorneys but few minorities. From four women partners and 27 associates in 1986, the firm in 1990 included seven women partners and 64 associates. In 1990, a total of 60 partners and 143 associates worked at Chadbourne & Parke, but that included only 13 minority associates and no minority partners.
A significant part of Chadbourne & Parke’s growth came from lateral hires from the Manhattan law firm Barrett Smith Schapiro Simon & Armstrong. After merger talks failed in November 1987, some of Barrett Smith’s top tax attorneys decided to move as a group to Chadbourne & Parke. By early 1998 Chadbourne had hired seven partners and one senior associate from the smaller firm that had about 85 lawyers before these defections. Several other Barrett Smith lawyers later joined Chadbourne.
Although we have grown substantially in recent years, we have continued to maintain an informal, friendly working environment while delivering legal services at the highest level of the profession. The standard we set for our firm is to maintain professional excellence in an environment that is hospitable and welcoming to all people, regardless of gender, race or other classifications. We respect and value each other’s differences. The people who work at Chadbourne & Parke—lawyers and non-lawyers alike—are our greatest assets.
Practice in the 1990s and Beyond
Chadbourne & Parke in the late 20th century continued its longtime representation of tobacco industry clients. For example, in 1981 the Tobacco Institute’s Committee of Counsel met in Chadbourne’s New York office. The committee’s 13 lawyers, including two from Chadbourne, represented the industry’s major companies (Brown & Williamson Tobacco, Philip Morris, and R.J. Reynolds, Lorillard Tobacco, and Liggett Group). Although those corporations competed for market share, in 1958 they had formed the Tobacco Institute to coordinate efforts to defend themselves against early legal attacks.
Critics accused the Committee of Counsel of playing a key role in keeping secret any information indicating tobacco-caused health problems and also preventing scientists from developing safer cigarettes because that might lead to lawsuits against the tobacco companies. The Wall Street Journal on April 23, 1998 said the allegation was that the tobacco “firms participated in a conspiracy to deceive the public.” Industry lawyers replied that they were just doing their job in defending their clients.
In the late 1980s Chadbourne & Parke’s client American Tobacco Company had been sued by the family survivors of Nathan Horton, a longtime smoker who died in 1987. The TV show 60 Minutes covered Horton v. American Tobacco on the eve of the trial in Lexington, Mississippi. After the jury dead-locked 7-5 against Horton, the judge declared a mistrial. Author John A. Jenkins wrote in his 1989 book that this “was the first case in which the verdict wasn’t simply, ‘not guilty.’”
In 1996 a Florida jury issued a guilty verdict against Brown & Williamson, defended by Chadbourne & Parke. The plaintiff originally had sued American Tobacco Company, which was acquired by Brown & Williamson in 1995. In 1998 the First District Court of Appeal in Tallahassee overturned the guilty verdict, a big victory for the tobacco industry and Chadbourne & Parke.
However, in 1998 the tobacco industry reached an agreement with several state attorneys general who had sued the big tobacco firms, including Brown & Williamson, for extensive damages. The tobacco companies were required to make periodic payments totaling $206 billion through 2025, to be divided among the various states. The tobacco settlement ended or changed many of the industry’s common practices. No more advertising to minors. No more outdoor advertising of any kind. No more “Joe Camel” cartoon characters to promote cigarettes. Many other restrictions applied, including no more secret documents kept from the public by the tobacco companies and their lawyers. Although some critics claimed the tobacco companies got off easy, many saw it as a victory. The National Association of Attorneys General detailed this historic 1998 agreement on its web site at www.naag.com.
Chadbourne & Parke attorneys represented some major clients in patent disputes and other areas of intellectual property law. For example, the firm represented Symbol Technologies, Inc. in patent cases involving bar code technology. Other IP clients included United States Surgical Corporation, Walt Disney Corporation, Acushnet, Rockwell International Corporation, SAP AG, Siemens Corporation, and Digital Equipment Corporation.
In the late 1990s several Asian nations suffered an economic downturn that hurt some American law firms with Asian offices. For example, by May 1998 Chadbourne & Parke’s Singapore office declined to just one partner and two associates and later in the year was closed, leaving just the Hong Kong office as its sole Asian location.
Chadbourne & Parke in 1998 was one of three major U.S. law firms that were involved in the financing of $567 million to construct the new Meizhouwan power plant in the People’s Republic of China’s Fujian province. Corporate Finance in December 1998 rated this as one of the largest project finance deals of the year and also pointed out that it “was exceptional for its entirely foreign ownership—the second time ever in China—and the lack of implied central government support.”
The firm’s project finance work had begun in the early 1980s when it started to represent various clients in the U.S. private power sector. That practice grew to include many overseas project finance deals in the Middle East, Africa, and Asia. The firm represented the African Plantations Corporation in Malawi, Tanzania, Zambia, and Zimbabwe; the Carthage Power Company in Tunisia; and Colgate-Palmolive in Nigeria.
In Israel Chadbourne & Parke represented Newcourt Capital Inc., Energy Investors Funds, and the government of Israel in various energy and road financing projects. Other clients involved in Middle Eastern deals included EQUATE Petrochemical Company, the International Finance Corporation, and Panda Energy International.
After the collapse of the Soviet Union in 1991, several large law firms, including Chadbourne & Parke, established Moscow offices to help companies invest in Russia and the other former Soviet countries. Chadbourne also created relationships with affiliated local law firms to expand its international practice.
The point was that Chadbourne & Parke, like other large law firms, played an important role in the globalized economy in which money and corporate influence flowed in what some called the borderless economy. Chadbourne hired its own attorneys with foreign language skills, worked with affiliated law firms, and used modern telecommunications and computer technology to link its overseas lawyers with its main offices in the United States.
- Thomas L. Chadbourne, Jr., starts his solo practice in New York City.
- The partnership of Chadbourne & Shores is organized.
- Chadbourne, Babbitt & Wallace is started.
- The firm takes over the law practice of Stanchfield & Levy.
- Firm opens its Washington, D.C. office.
- Firm is renamed Chadbourne, Wallace, Parke & Whiteside.
- Offices are started in the United Arab Emirates of Dubai, Abu Dhabi, and Sharjah.
- Partnership is renamed Chadbourne & Parke; Los Angeles branch office is established.
- Firm opens its Hong Kong office.
In its July 5, 2000 issue, the American Lawyer ranked Chadbourne & Parke as the nation’s 67th largest law firm, based on its 1999 gross revenues of $187 million. That marked a decline from its 1998 ranking as the nation’s 50th largest firm.
At the dawn of the new millennium, Chadbourne & Parke faced some tough challenges, not only from competing law firms and the big accounting firms that hired thousands of attorneys but also from the rapid pace of technological, socio-economic, and political change. New multinational agreements, such as the North American Free Trade Agreement (NAFTA), expanded international trade. Many people all over the world demanded stricter environmental standards, thus creating new legal issues for attorneys. New nations emerged, such as the Slovak and Czech republics. Moreover, the so-called New Economy based on Internet transactions posed multiple challenges to attorneys and their clients. Built on the legacy left by Thomas Chadbourne and other early partners who served American clients, the much larger firm of Chadbourne & Parke in 2000 served not only American but global clients, often in legal specialties that did not even exist years ago.
Chadbourne & Parke Gaikokuho Jimu Bengoshi Jimusho (Chadbourne & Parke Japan LLC).
King & Spalding; Kirkland & Ellis; Milbank, Tweed, Hadley & McCloy.
Barrett, Paul M., “As Economies Dip, a Global Law Firm Parties On,” Wall Street Journal, October 28, 1998, p. B1.
Chadbourne, Thomas L., The Autobiography of Thomas L. Chadbourne, ed. Charles C. Goetsch and Margaret L. Shivers, New York: Oceana Publications, Inc., 1985.
“Chadbourne & Parke Project Team in Crisis,” International Financial Law Review, May 1998, p. 5.
Cherovsky, Erwin, “Chadbourne & Parke,” The Guide to New York Law Firms, New York: St. Martin’s Press, 1991, pp. 49–52.
France, Mike, “Inside Big Tobacco’s Secret War Room,” Business Week, June 15, 1998, p. 134.
Geyelin, Milo and Ann Davis, “Tobacco: A Vast Trove of Tobacco Documents Opens Up—Tobacco’s Foes Target Role of Lawyers,” Wall Street Journal, April 23, 1998, p. B1.
______, “Verdict Against Tobacco Firm Is Reversed—Florida Appellate Ruling in Smoker’s Case Favors Brown & Williamson,” Wall Street Journal, June 23, 1998, p. A3.
Goulden, Joseph C., The Million Dollar Lawyers, New York: G.P. Putnam’s Sons, 1977, p. 324.
Hoffman, Paul, Lions of the Eighties: The Inside Story of the Power-house Law Firms, Garden City, N.Y.: Doubleday & Company, 1982, pp. 123–124, 132, 202.
Jenkins, John A., The Litigators: Inside the Powerful World of America’s High-Stakes Trial Lawyers, New York: Doubleday, 1989, pp. 184–192.
Klaw, Spencer, “The Wall Street Lawyers,” Fortune, February 1958, pp. 140–44.
Lundberg, Ferdinand, “The Law Factories: Brains of the Status Quo,” Harper’s Magazine, July 1939, pp. 180–92.
Sebastian, Pamela, “Chadbourne Parke Hires Attorneys from Barrett Smith,” Wall Street Journal, February 1, 1988, p. 1.
Wright, Chris, “Fired Up: Tri Energy Closes Thai Deal,” Corporate Finance, December 1998, pp. 64–66.
—David M. Walden