Marschall Smith safeguards 3M's intellectual property
Published in Corporate Counsel Edition® - 2008 magazine
By Andy Steiner on August 1, 2008
Marschall Smith knows something about being one of the few and the proud.
“I learned a lot about leadership in the Marines,” says Smith, who served in Vietnam and today is senior vice president and general counsel for 3M Company. “The most important thing was, ‘Never ask anybody to do what you can do yourself.'”
He’s kept to the credo while ascending the world of corporate law, now an executive at an international behemoth with $24.5 billion in annual sales.
“This 3M job is very different from any other general counsel position I’d ever held,” Smith says. “By necessity, my job here is largely administrative. It’s my responsibility to translate our chairman’s vision of where the company needs to go into a set of guidance for the lawyers we need to get us there.”
After moving into his executive suite last summer, Smith set up a secondary office on the ninth floor of the 3M tower in St. Paul, Minn. That way, he’s sitting next to some of the 165 attorneys who are arguing the patent cases and filing copyrights for 3M’s 55,000 products.
“My first goal is to do no harm,” he says. “The company and the people who work here are so impressive that my first impulse is to be pretty hands-off. … Robert E. Lee once said, ‘When you criticize, do it very gently. When you praise, do it very loudly.’ I like to think I work in that style.”
After graduating from Princeton University with a history degree in 1966, Smith joined the U.S. Marine Corps and served for a decade, including five years of active duty and 13 months of combat in Vietnam.
Why did an Ivy League-educated citizen sign up for the military during such a tumultuous time in U.S. history?
“I didn’t know any better,” he says. “I was young. I thought that was what you did when you graduated college.” A military brat, Smith was the older of two children born in San Antonio to a U.S. Air Force officer father and a homemaker mother.
His year in Vietnam was harrowing—”I am still so moved by it that I can’t speak about it without crying,” he says—but Smith believes his years of military service were some of the best in his life.
“I had an opportunity to be of service, which is very important to me,” he says. “I also forged the kinds of bonds of friendship that you do under extreme conditions.”
After returning home in 1968, he stayed in the Corps for two more years of active duty before attending the University of Virginia Law School. At first, his parents weren’t thrilled about his decision. “In my family, there was the expectation that I would be a career military officer like my dad,” recalls Smith, who served in the reserves for six more years. “But deep inside I always knew that wasn’t what I was going to do. I never viewed myself as the kind of natural leader who would be a good executive, so the law seemed like a wise choice for me.”
Smith landed his first legal job in 1973 as an associate at New York’s Debevoise & Plimpton, where, he says, “I worked seven days a week, 12 hours a day. I did mergers and acquisitions, bond work, and a little work for academic institutions.” Then he moved to another New York firm, Paul, Weiss, Rifkind, Wharton & Garrison, where he worked for former John F. Kennedy speechwriter and counselor Ted Sorensen, whom he followed into the Carter administration as his aide. “[Sorensen] was a really formative factor in my life and career,” he says. “He is one of the most intense and analytical minds I’ve ever worked for.”
Smith downplays any intrigue of the job, though it eventually led to a brief stint as an assistant for George H.W. Bush when he was CIA director. “This was way before he was president,” he says. “I was mostly just a briefcase carrier.” Still, the future commander in chief left a definitive impression: “He was the finest gentleman I’ve ever known. He is a lovely, gracious man.”
But Smith’s foray into politics didn’t last long. “The harsh reality was,” he says, “there really wasn’t a [permanent] job for me in the Carter administration. So I went on to do the work I was meant to do.
“My mom says that when I was 12, I told her I wanted to be a corporate lawyer.”
He started out with the British firm Imperial Chemical Industries, and then took on a series of general counsel positions, including jobs at Digitas and IMC Global.
Smith is a formidable foe in any legal battle, says Bill Brewer, founding partner of Bickel & Brewer, a national litigation firm that Smith hired as outside counsel on several high-stakes cases, including a risky international insurance recovery action that ultimately netted IMC Global (Smith’s firm at the time) a $200 million settlement.
“Once Marschall’s done an analysis of a situation, he’s a tough guy,” Brewer says. It may be Smith’s military background, Brewer theorizes, but “if he thinks he is right, Marsch is willing to roll the dice and try to make it come out as it should for his shareholders.”
Most recently, Smith was general counsel for Brunswick Corporation, a Lake Forest, Ill.-based manufacturer of boat, bowling and billiards equipment with annual sales of $5 billion. Lloyd Chatfield, Smith’s successor at Brunswick, sheds light on another side of Smith’s demeanor: “Marsch has an understated style. He has a very disarming nature. He’s a classic, old-school gentleman. He’s very easy-going, almost professorial.”
At 3M, many of the legal battles involve patent protection, and as such, Smith maintains his department’s role as guardian of the company’s intellectual property.
“Patent law is our sword,” Smith says. “3M is essentially a technology company, and our success has been driven by an incredibly creative group of inventors who need to have protection for their work. We have more patent lawyers than we do general lawyers on staff. Protecting our intellectual property is the first priority of my job.”
3M has 35 business units—everything from graphics to security to transportation—with operations in 60 countries.
“Our most important intellectual property case in the last year or so was an action against a number of Japanese companies that we thought were infringing on our technology in high-tech batteries,” he says. “These were some of our major customers. Eventually, they all settled with us and agreed to pay a royalty for the technology they’d been using.”
Though the economy is tight, 3M’s CEO, George W. Buckley, a friend and mentor to Smith, is pushing the company to bring profits back up to historical levels. “We are not growing in the way we had in the past,” Smith says, “and we need to pay attention to that. We need to find the next Post-it.”
3M’s international presence requires Smith to do his fair share of traveling. “The majority of our sales are outside of the United States,” he says. (In 2007, foreign sales totaled 63 percent, or $15.4 billion.) “Soon, I’ll be going to Asia. I don’t really like to travel, but this is a company where you simply have to get out.”
He’d rather enjoy his new home in St. Paul’s historic Summit Hill neighborhood, which he recently purchased with his wife, Debra Mitts Smith, a professor at Dominican University in Chicago. “I love old houses,” he says. “Debra and I have grown to love St. Paul. We think Grand Avenue is one of the greatest places in the world.”
The couple owns a second house in nearby Marine-on-St. Croix. Both avid gardeners, Smith and his wife enjoyed springtime in their country home. “When we were buying our house, our Realtor said, ‘Everybody in Minnesota has a lake house,’ so we bought a house with 20 acres,” Smith says. “The dogs love it.”
Smith, whose blended family includes five children and four grandchildren, is active in many conservative legal organizations, including the Federalist and Christian Legal Societies. “I think they are doing some great work with the quality of the federal judiciary,” he says.
His wife’s politics, however, lean left. “It’s always fun to watch their interchanges,” says Larry Schubert, president of Cummings Advertising in Rockford, Ill., and a close family friend. “She is extremely liberal. He comes from a pretty conservative background. But they manage to keep a very fine marriage despite that.”
When Schubert first met Smith, he didn’t realize that the man who loved playing with his dogs and digging in his garden was actually “the chief big dog for Brunswick.” Then, slowly, through casual conversation, the truth came out.
“That’s Marsch. He’s this regular guy who’s not at all afraid to get his hands dirty. And,” Schubert says with a laugh, “I’m not just talking about gardening. Anyone who knows him, anyone who’s worked with him, will tell you that Marsch loves to be right there in the thick of things, digging in the dirt, so to speak. I think that’s why he’s been so successful.”
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