Already a Bloomberg.com user?
Sign in with the same account.
Top of the News
HARRY PEARCE FOR THE DEFENSE
Back in the old days, before he became General Motors Corp.'s general legal counsel, Harry J. Pearce was known as a trial lawyer's trial lawyer. A tougher customer you've never met in a courtroom: dogged, meticulously prepared, a master of technical detail. A friend recalls that Pearce's cross-examination of one expert witness was so withering that the poor man began chewing his tie. Pearce still relishes the memory, too. "It was one of my better moments," he grins.
Lucky thing he hasn't forgotten. Pearce needs that kind of tenacity now. On Apr. 30, GM refused to comply with a government request to recall 4.7 million C/K pickup trucks made from 1973 to 1987. GM's hard-line stance sets the stage for the fiercest battle Pearce has faced yet: In the face of intense negative publicity, the 50-year-old North Dakota native hopes to convince the public and the feds that GM's trucks are as safe as any on the road.
Pearce faces a bruising fight. Consumer groups and plaintiffs charge that GM's trucks are "rolling firebombs," prone to lethal fires when struck broadside. Their campaign gained momentum in February, when an Atlanta jury awarded $105 million in damages to the family of a teenager killed in his 1985 GMC pickup. GM is challenging the award.
Just four days later, though, Pearce took the next round with a stunning knockout punch to NBC Inc. In a two-hour press conference, Pearce so compellingly argued that the network had rigged a fiery crash in a Dateline NBC episode that the network was forced to publicly apologize.
IMAGE PROBLEM. Now, Pearce faces a dilemma. A recall could cost GM up to $1 billion and might be seen by lawyers and juries in the dozens of liability cases as an admission of guilt. But Pearce knows that a long court battle--even if he wins may damage GM's image even more. The National Highway Traffic Safety Administration would likely hold public hearings, with a parade of burn victims and grieving families indicting GM.
Pearce knows how hollow some courtroom victories can be. In 1984 and 1985, as a lawyer out of Bismarck, he used powerful technical arguments and a vivid video to convince a federal judge not to order the recall of GM X-car models such as the Chevy Citation--the only recall trial the feds ever lost. Nonetheless, Pearce says the bad publicity of the trial "killed the car."
But backing down isn't Pearce's style, either. His father and grandfather were also lawyers, and he prefers hammering opponents with the cool, dispassionate dissection of their arguments. In past cases, his technical spadework has usually carried the day--the kind he used when he recovered the GM pickups NBC had burned and proved that the fires had actually been set off by toy rockets. This technical bent is a holdover from his engineering training at the Air Force Academy--only color blindness kept him from becoming a pilot.
SCREAMING JUROR. Pearce established his style early on. In 1970, at his first civil trial, he successfully defended GM's Chevrolet Corvair, partly because a film Pearce had made reconstructing a Corvair accident was so vivid it drew a scream from one juror. After a string of other wins for GM in private practice, he joined the company's legal staff in 1985.
Once he moved up to head the legal department in 1987, he quickly reshaped it. He pushed out more than one-third of its 150 lawyers, replacing GM careerists with experienced talent from outside. He also pressured GM's nonstaff lawyers to reduce their fees. His star continues to rise. On top of being the company's top lawyer, he was named head of GM's Hughes and EDS divisions in November.
The question now: Will Pearce continue to fight the pickup recall--or cave in? Pearce hates to yield, but he hints he might have to if criticism of GM gets too intense. For now, he is amassing evidence to fight. If he can win, it will just be one more big victory for the legal ace from North Dakota.Kathleen Kerwin in Detroit