Born in Baltimore and raised in Brooklyn, Flom graduated from Harvard Law School in 1948. After unsuccessfully interviewing with several larger firms, the Harvard placement office told him about a young start-up, Skadden, Arps & Slate, with no clients, and one day he met its founders for lunch. They spent the entire time warning him away but he joined the firm. “You have a two- or three-hour conversation and you either like the cut of their jib or you don’t,” he said.
Of his first M&A cases, a proxy contest involving General Industrial Corporation, which came about in the mid-1950s, he said, “It was like a duck taking to water. I loved it. It was also an area where the large firms wouldn’t bother getting involved with so I had the field to myself.”
Flom called proxy contests bare-knuckled affairs.
“Back then, the majority of shares were held by individuals, and you were basically trying to convince the individuals to vote for you, and every letter could revoke the previous proxy,” he said.
A shift in both the size of and attitude toward hostile takeovers occurred in 1974 with the acquisition of Electric Storage Battery Company by International Nickel Company of Canada, who were being advised by Morgan Stanley. Flom worked on the takeover with Morgan Stanley.
“You’ve got to know that at that time the investment banking world was in turmoil. Fixed fees had gone by, there wasn’t a helluva lot of underwriting business floating around. And when they got involved in this and it turned out to be successful, all of a sudden everybody said, ‘Hey, here’s another way to make money.'”
By 1978, Skadden, Arps, known as the “Flom Firm” in a headline in The American Lawyer, was the biggest money-making firm in the country. Businesses would hire him just to make sure opponents would not.
We had the privilege of interviewing Flom last spring for the 2010 issue of New York Super Lawyers. What stands out from that Q&A, “The Fourth Lesson of Joe Flom,” is the succinctness of his replies. The closing was indicative:
SL: Skadden is now one of the biggest law firms in the country but back in ’48 you guys were small and hungry. Is there-
Flom: We’re still hungry.