Published in Super Lawyers Business Edition 2012 magazine
By Joe Mullich on August 15, 2012
When Ted Ullyot was named general counsel of Facebook in 2008, some Wall Street analysts were puzzled, and many employees of the social networking company were wary. Ullyot was a Washington, D.C., attorney with deep ties to the Republican Party—he’d clerked for Supreme Court Justice Antonin Scalia, served as associate counsel to President George W. Bush and served as the White House deputy staff secretary during the Bush administration. This strongly conservative pedigree put him on a different side of the aisle from some Facebook staffers, who were concerned about how his personality would mesh with others at the company.
The blogosphere caught fire. One blogger wrote an entry titled “Ask Facebook to de-friend Ted Ullyot!” A small protest group of general Facebook users even launched a page on the social network demanding the company fire Ullyot, citing Ullyot’s tenure as “the right-hand man” of controversial Attorney General Alberto Gonzales (Ullyot was the first chief of staff to Gonzales).
“I became controversial when they announced my hiring, which was very weird,” Ullyot says. “[The bloggers declared] ‘This guy is sort of a Zelig character, this Forrest Gump, who’s there when all the scandals took place.’ I all of sudden became the guy who ‘outed’ [CIA operative] Valerie Plame, the guy who fired the U.S. attorneys that happened a year-plus after I left the department, among other allegations. … I laughed because it was so preposterous. The allegations were wildly inaccurate and demonstrably false.”
Still, he called Facebook founder Mark Zuckerberg and apologized for causing such an uproar. “I told him I stood by my experience and was proud of what we accomplished collectively as an administration and everything I’d done in my career,” he says. “I was apologizing because a general counsel should be quieting things, not creating new problems.”
Zuckerberg didn’t care about the firestorm in the blogosphere. He suggested Ullyot—on his first week on the job—join him that Friday for his weekly Q&A in front of Facebook employees, who could ask the new general counsel anything they wanted. “There were 600 employees at the time and very few Republicans,” Ullyot says. “It was a great way to be introduced and a good discussion. It was cordial and funny at times, and a tribute to Mark’s openness and style.”
It was also a hint that Facebook was going to be a very different kind of job from his previous posts as partner at Kirkland & Ellis in Washington, D.C., as general counsel at AOL Time Warner, and as general counsel at investment fund ESL Investments Inc., based in Greenwich, Conn.
Despite his lengthy resume, Ullyot is in his mid-40s. He has boyish good looks, a friendly manner and an articulate style of speech. His standard office attire consists of a blue sweater, a Brooks Brothers shirt, jeans and wing tips, though it’s something he eschewed shortly after arriving at Facebook when he came to work one day in a jersey of his favorite football team, the Minnesota Vikings—which was unique even for the informal tech company. “No one had ever worn a football jersey to work,” says Pedram Keyani, engineering manager at Facebook. “I remember thinking, ‘He doesn’t look like a general counsel.’ It was cool to see.”
Ullyot, who competed on the varsity cross-country team and the junior varsity lacrosse team as an undergraduate at Harvard University (class of 1990), also joined the Facebook running team. “It’s a good way to get to know people after-hours and get them to see you as a reasonable person and a normal person,” he says. “Most normal people don’t want to hang around lawyers, and engineers and other Facebook employees are no exception.”
Ullyot knew the unique nature of Facebook required him to gain the trust of employees, especially the engineering staff, and deeply integrate the legal department into how the rest of the company operated; those who know him well say this inclusionary attitude is part of his personality.
“Teddy goes out of his way to make everyone feel valued, wanted and included, and it’s genuine,” says Paul T. Cappuccio, general counsel at Time Warner and a longtime mentor who helped hire Ullyot at Kirkland. “His incredibly intense Marine brother describes him as the sweetest soul on the planet. At a cocktail party, he’ll go up to someone who’s a little awkward and make him feel part of the gang. People who want to hate Ted Ullyot end up loving him.”
“At the same time,” Cappuccio adds a moment later, “he’s a very unique combination of a spectacular lawyer who can be brilliant and as tough as he needs to be. He can take your f—ing head off. No one’s going to shake down Facebook.”
Ullyot was raised in San Francisco, where his parents were both physicians. He had expected to follow them into medicine, but a couple of events—volunteering for the gubernatorial campaign of Bill Weld in college and serving on a jury—convinced him law was his calling. He would graduate from the University of Chicago Law School in 1994.
After clerking for Judge J. Michael Luttig of the United States Court of Appeals for the 4th Circuit (Luttig is now Boeing Co.’s senior vice president and general counsel) and then for Supreme Court Justice Antonin Scalia, Ullyot was recruited to Kirkland & Ellis’ Washington, D.C., office by Cappuccio and Kenneth Starr in 1996. “[Starr’s] advice to me during the interview process was to find a great firm, work hard, and make that the home base for your career,” Ullyot says. “Ken and Paul [Cappuccio] stepped off to do public service, or go in-house, and sometimes they go back to Kirkland.”
Stepping off and coming back to Kirkland has been a pattern in Ullyot’s career. Cappuccio recruited him to AOL Time Warner in 2000, where Ullyot was later appointed to senior vice president and general counsel for AOL Time Warner Europe. In 2002, Brett Kavanaugh, another former Kirkland attorney who was then working at the White House (and is now a federal judge), suggested that he interview for an open spot in the counsel’s office at the White House under the George W. Bush administration.
It was a job Ullyot enjoyed, working for a man he admired. Serving in an administration, Ullyot says, was something that had always appealed to him and that his mentors had done and encouraged over the years. He continues, “Plus I was a fan of George W. Bush in particular and had done volunteer work for his campaign in 2000.” One of Ullyot’s most vivid memories of Bush was when the president would visit the families of fallen soldiers. “He didn’t put it on his press calendar or talk about it [publicly], but he held [that] these were brave Americans who had made an amazing sacrifice, and it was appropriate and right for the president to spend time with their families,” Ullyot says. “He’d come out clearly moved.”
His White House position was similar to his Facebook job, he says, in this manner: “You don’t have time to do a to-do list because so much stuff is flying in.” As deputy staff secretary, Ullyot or the staff secretary were the go-betweens for any piece of paper—a bill to be signed, a speech, a treaty, an executive order, a cable from a foreign leader, a decision memo, anything—that went to the president. He had to make sure it was completely ready to be signed to become law then and there. He had to be able to answer any and all questions the president might have about the substance of the document. And he had to double-check that a document was free of typos and think through all angles so that a document wouldn’t create unintended problems, like alienating a member of Congress.
“It’s like being a general counsel—it’s ultra-detailed work, with a broad range of material and countless angles,” he says. “[President Bush] was incredibly detailed-oriented. I started to learn that when I was in the counsel’s office and would go in and present judicial candidates. It was not perfunctory, and he would have absorbed the package [of information] about the candidates. He was the master of asking the one hard question you were hoping he wouldn’t ask.”
Thankfully, Ullyot had honed his detail-oriented skills under Scalia. Ullyot prepared “bench memos” before arguments and first drafts of opinions as a law clerk. Scalia required him to collect all the sources cited in a draft. In those pre-Internet days, Ullyot would go to the library with many huge wooden carts to gather books containing every case that was cited in an opinion draft. Then he and Scalia would pore through the material. “It was amazing and highly instructive to see his mind in action,” Ullyot says. “You’d cite a case and he’d say, ‘You haven’t done enough with this case,’ and he’d go to his computer to revise the opinion. I saw it as watching Article 3 in action.“
A year ago, Ullyot took his three children—now 10, 8 and 5—to watch the Supreme Court announce some of its decisions. “We were sitting in Justice Scalia’s box; I was afraid our 4-year-old would [begin crying from tiredness because of the length of the argument] but he held it together,” says Ullyot. “Justice Scalia was absolutely charming with them and spent 20 minutes with the kids showing them the animal heads in his chambers.”
In late 2007, Cappuccio called Ullyot. Cappuccio said he had been asked to recommend candidates for the general counsel position at Facebook and revealed Ullyot was one of the few names he was recommending for the job. “He told me not to get overly excited because [the candidates he suggested] all had strengths and weaknesses relative to each other so it would probably turn on unpredictable factors like chemistry,” Ullyot says. “In the interview, Mark [Zuckerberg] and I hit it off better than you might expect. He’s famously a fan of The West Wing, and he was interested in what it was like to clerk for the Supreme Court and work in the White House.” In that interview, Ullyot says Zuckerberg struck him as a person he wanted to work for: “He’s such a smart and intellectually curious guy, and he wants to learn more about subjects he doesn’t know much about.”
When the offer came, Ullyot wondered whether it would be disloyal to leave Kirkland, which he had returned to only a short period before.
“That tells you about his character,” Cappuccio says. ”This was an offer that had a 90 percent chance of turning him into a hundred-millionaire, and his first reaction was whether this was convenient for the law firm. It took me and some of the other guys at Kirkland to convince him not to worry about it.”
Ullyot says his initial sense of Facebook, which still remains the same, was that it was “a humble team of serious people who understood the magnitude of the challenges before them. They were a more serious operation than I might have thought. They were a sober, serious team, and not high-fiving, self-congratulatory.”
It was significant to Ullyot that Sheryl Sandberg, who had been chief of staff at the Treasury Department during the Clinton administration, had come aboard as Zuckerberg’s No. 2. Coincidentally, she had married one of Ullyot’s college roommates. Before Facebook, he had perhaps three interactions with her, including one at her wedding, in 2004. Ullyot was working at the White House at the time of the wedding and at one point during that weekend, she started debating with him about the war in Iraq and the No Child Left Behind public-education program.
“I thought, ‘This is your wedding. I come in peace and I’m happy to be your token Republican,’” he says with a laugh. “She loves to debate and has a great sense of humor. She turned out to be a great booster of mine with Mark in the process [of being hired as general counsel].”
“My main concern,” says Sam O’Rourke, deputy general counsel of intellectual property at Facebook, “was not related to his political affiliation, but was he going to come in and change everything—bring in his own people, and his own outside law firm? To his credit, he took a long time to understand the business and the people he had, and didn’t make any structural changes for five or six months.”
As with many quick-growing startups, the legal department had developed by happenstance, and Ullyot organized it in a more logical way, around the triad of IP, product/regulatory/litigation issues, and corporate and commercial law. But his most important task was strengthening the ties with the engineering department. “We need to adapt our style and be respected by the engineers,” he says. “In an engineering company [like Facebook], we need to go the extra mile and show we get it.”
Before his family moved from D.C. to join him, Ullyot started going to Facebook’s hackathons. At these storied events, programmers and people from other departments get together to work through the night on impromptu projects they don’t have time for during the regular day.
“That was cool to see a senior executive at a hackathon at 11 or 12 o’clock at night,” Keyani says. “It was kind of mind-blowing.”
In the fall of 2008, after newly arriving at Facebook, Ullyot organized the legal department to participate en masse in a hackathon. Over the years, a few legal team members, like Ullyot himself and the department’s open source lawyer, who has a programming background, even won the coveted “Hackathon Hero” award, which is given for outstanding achievement during each of the sessions.
Such efforts certainly brought the legal and engineering groups closer together, as did Ullyot’s openness (or “transparency,” a favorite Facebook term). “He posts pictures of himself and his kids at the Vikings training camp on his Facebook page,” Keyani says. “He’s sharing his life, and it humanizes him. People feel free to ask him questions. The whole legal team follows his example.”
Sandberg praises Ullyot’s commitment to the startup’s culture. “We have a saying at Facebook that you should ‘bring your whole self to work.’ Ted does this every day, and he infuses his teams with our mantra to move fast and be bold.”
Indeed, the legal team was organized to work in the same way engineers do—fast. “Our ability to move fast is a competitive advantage,” Ullyot says. “Most companies, and most legal departments, take longer to reduce a handshake deal to a legally binding deal. But we tell our outside firms they need to move fast too.”
For example, when Facebook spent $1 billion in cash and stock to purchase Instagram, a photo sharing company, it was widely reported that Zuckerberg acted as a lone wolf. Ullyot bristles at the suggestion that the legal department was not deeply involved. “When a deal gets done very quickly, it’s not the case [that] the lawyers were not involved,” he says. “The lawyers were working around-the-clock with a move-fast attitude on that deal.”
That philosophy also influences day-to-day activities. Keyani recalls emailing a member of the legal team about a new idea he and a colleague had been working on. The lawyer he called “set a meeting immediately, quickly came to a decision, and followed that up with another meeting,” he says. “The legal department operates fast, like engineers. You’re not shooting an email to them and getting a response two to three business days later. I’ve been at other big companies, and legal does slow you down from launching things.”
This partnership was crucial in convincing the engineering staff of the value of patents. “We’re an engineering-centric firm, and there’s a healthy skepticism for patents,” O’Rourke says. “The engineers have come a long way from not wanting to be in disclosure meetings related to patents to understanding they are a necessary evil. Now they look at patents as a means to an ends. If we want to build good products for the user, we have to minimize the distractions that keep us from achieving that—like the Yahoo litigation.”
Ah, yes—Yahoo. As Facebook was preparing for its IPO, Yahoo Inc. sued Facebook claiming patent infringement. Within a few weeks, Facebook answered the complaint—denying liability—and filed counterclaims that accused Yahoo of infringing on 10 of Facebook’s patents.
“People were surprised at our willingness to push back and go to trial in a patent case two years ago rather than settle,” Ullyot says. “We have a high profile, and that attracts a lot of people who think you can be intimidated or pushed around into an easy settlement. That’s not our style or my style. If you try to take a pound of flesh, we’ll fight back very hard. I am a Kirkland-trained litigator, and I like litigation.”
For his part, Ullyot says that Facebook will continue to require “outside-the-legal-box” thinking because of its prominence and its position on the leading edge of privacy and other technology issues. He points to The Social Network, the Oscar-winning movie that depicted the beginnings of Facebook by screenwriter Aaron Sorkin, creator of Zuckerberg’s favorite TV show. The movie was based on a book, so everyone at Facebook could anticipate the movie’s perspective, especially with its advertising tag line “You don’t get to 500 million friends without making a few enemies.”
“The traditional legal strategy should have been to threaten litigation or litigate,” he says. “But we’re a company that’s about expressing views and openness. We have a thick skin and can take it.” Ullyot says the lawyers at Sony, which made The Social Network, were surprised that he expressed interest in seeing the movie during his last phone call with them. On opening day, Zuckerberg took the entire company to view the film.
“Mark is not a dark, brooding person as depicted in the movie,” Ullyot says. “He’s really the antithesis of that. He’s upbeat and optimistic. Other than that characterization, I thought it was a good movie, and overall I thought he came off well.
“I was pleased how prominent lawyers were in it,” he deadpans, “and they made depositions seem much more interesting than really they are.”
There are plenty of other interesting developments for Ullyot and his team to handle. Facebook’s initial public offering on May 17, with a price of $38 per share (which has since fluctuated greatly), raised $16 billion, landing it in the position of third-largest public offering in U.S. history (General Motors and Visa hold the top two spots). The IPO started trading at $42 a share on Nasdaq after a half-hour delay due to technical glitches. As of market closing three days later, the price had fallen to $31. Since then, Facebook has stayed in the spotlight as suits were filed over the disastrous IPO. Facebook, along with its IPO underwriters, including the lead underwriter, Morgan Stanley, have been accused of withholding financial projection information from clients. While Ullyot doesn’t comment, Facebook has issued this statement: “We believe the lawsuits are without merit and will defend ourselves vigorously.”
“Ted is an exceptionally driven person,” says Sandberg. “Many people are aware that Facebook held an all-night hackathon … the night before we went public. What is less well known is that Ted and a small group of hardcore Facebook employees did a ‘Facebook “race” down memory lane’—running [almost] 11 miles starting at 11 p.m., from our current Menlo Park office to our previous office in Palo Alto and then to In-N-Out Burger in Mountain View. Ted got to In-N-Out Burger first—at about 12:15 a.m. Everyone else followed. This is the kind of person you want on your side.”
Ullyot provides a slight correction to the story: “I did organize the run [and plotted out the route] and I was leading the pack most of the way, but I faded in the last mile to fourth out of 12 as the young guns kicked by me.”
Going public presents its own challenges, and Sandberg has no doubt Ullyot and the rest of the legal department are prepared. “Ted’s team has established a seamless rhythm of working with engineers and other teams across the company to help ship products, get deals done and protect Facebook against litigation,” Sandberg says. “Even as a private company, we’ve had an array of legal challenges—deals, litigation, regulatory matters—that is comparable to what large public companies face, and we’ve faced intense scrutiny. So I expect the change to be one of degree, not one of kind. Ted and the team are well suited for it.”
Bronze Award given by the Minnesota Magazine & Publishing Association (MMPA) in the Best Profile category.
Finalist Award given by the LA Press Club’s SoCal Journalism Award in the Magazine Personality Profile category.
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