Just Plane Smart

When Madeleine Johnson joined Southwest Airlines in May 2008, a faltering economy and skyrocketing fuel costs were concerns, but more immediate was a $10.2 million fine proposed by the Federal Aviation Administration for alleged safety violations.

Meanwhile, shareholders were preparing to sue, and Southwest executives were defending their actions on Capitol Hill. Throughout, national news media were unsympathetic. “Everything was highly publicized in an election year,” says Johnson, who left Fish & Richardson to become general counsel of the Dallas-based carrier. “It was baptism by fire.”

Within a year, Johnson negotiated a settlement with the FAA. The agency lowered its fine to $7.5 million, while Southwest committed to open records and an overhaul of its compliance policies. Nine months later, she settled the shareholders’ lawsuit for $3.5 million. And she managed all of this legal wrangling with minimal reliance on outside counsel.

“Another general counsel who came up through the ranks would have a different skill set,” she says. “But it turned out that I had a background of working for the federal government. I knew what it was like to be on the enforcement side. So I understood how to approach federal agencies and negotiate with them.” 

It was a tour de force for Johnson, who majored in French at Bryn Mawr College, traveled to France for graduate school, taught English in Turkey and served as a French-English interpreter in Iraq—all in her 20s, before opting for a career in law.

She was temping in London and on the verge of becoming an administrative assistant to a wealthy Dubai sheik “when reality set in,” she says. “I knew I had to get serious about a job and a career. It was almost an impulsive decision. I had no idea what kind of law would interest me.”

She won an academic scholarship to Tulane University Law School, where she made law review and graduated near the top of her class in 1984. Although she embraced her studies, she was not enamored of the law school experience.

“It was very competitive—all about who was going to get the highest-paid, most prestigious jobs,” she recalls. “I even heard stories about people ripping pages out of law books, to deprive other students of copies to key cases needed to prepare for classes or to write briefs. Here I was, back in my own country, and I was having one of my most foreign experiences. I really didn’t like that spirit. I didn’t feel that I had to compromise my personal ethics to get ahead.”

Johnson’s contemporaries describe her as having an underlying sense of decency. “She’s calm, she doesn’t get upset, she focuses on what’s important and she’s very conscious of other people’s feelings,” says Barry Barnett, a Dallas attorney who clerked with her on the 5th U.S. Circuit Court of Appeals. “And she helps people arrive at a consensus. I think that helps explain why she’s done well in positions of responsibility.”

After her clerkship and a few years with Thompson & Knight, Johnson took a post in the Texas Attorney General’s office in Austin as chief of its opinion division. “It was going to be a two-year hiatus, but it turned into 14 years of public service,” she says.

For five of those 14 years, she served as assistant U.S. attorney for the Northern District of Texas, prosecuting federal white-collar crime, public corruption and national security cases. In one high-profile case, she convicted a Dallas Independent School District superintendent of public corruption for charging the district $20,000 for home furnishings and of bribery and embezzlement for taking kickbacks from roofing contractors.

In the mid-1990s, James Jacks, the U.S. Attorney for the Northern District, worked alongside her in winning convictions against two men charged with selling radio replacement parts to Libya, a violation of national security. One of the men pleaded guilty and the other went to trial. “In such cases, there is just a huge amount of evidence that has to be collected and getting witnesses to come forward and cooperate,” Jacks says. “She was very good at taking a lot of facts and exhibits, organizing them and putting them in front of a jury.”

These cases often involved classified evidence, which meant Johnson had to exercise discretion and good judgment. She also had to deliver bad news to law enforcement officers at the FBI or Drug Enforcement Administration when the U.S. Attorney’s office didn’t have sufficient evidence to bring a case, says Jacks.

Johnson, however, may be best known for her stint as Dallas city attorney. From 1999 until 2005, she managed an office of 90 attorneys and answered to numerous constituencies. Upon taking the post, she knew the city attorney could be a lightning rod, attracting attention from city employees, the Dallas news media, community groups, local businesses and ordinary citizens. All proved true.

The first day she arrived on the job, staff members were on high alert and outfitted in their best attire. The mood in the office was one of wary nervousness, if not outright fear, says former assistant city attorney Robert Doggett. “But she came in, dressed informally, wearing pants, and basically told the staff, ‘We’re all in this together. What can we do to solve problems?’” 

Her office sued Ford Motor Co. in a highly publicized case after several police cars nationwide—including one in Dallas—caught fire in rear-end collisions. She also initiated a way to swiftly move prosecutions of code violations through municipal courts, and worked with a city council commission on a new ethics code for public officials. Under pressure to use outside counsel more sparingly, she hired people who brought a real sense of passion to their duties. “She has an eye for talent,” says Veletta Lill, a former city council member.

Johnson persuaded Doggett, whose career had been marked by suing the city over housing issues, to join her team and battle local slumlords. “The city has a lot of powers, and I was very familiar with those powers,” says Doggett, now a Legal Aid attorney in Austin, “but there hadn’t been a willingness to use them.”

In the past, the city treated violations of the housing code as a criminal offense and violators were ticketed, prosecuted and fined, but the housing remained substandard. But now, thanks in large part to efforts by Johnson and Doggett, the city council rewrote the housing laws to make violations subject to civil code. This lowered the burden of proof in litigation, allowed the city to file injunctions for relief and resulted in repairs as well as demolition if necessary.

Johnson also forced a settlement in a longstanding court battle between the city of Dallas and the local sex industry, winning an ordinance requiring such establishments to be at least 1,000 feet away from residential neighborhoods, schools, churches and parks.

“She had the courage and vision to take some positions that were not always the most popular,” says her successor as Dallas city attorney, Tom Perkins. “She negotiated a resolution that allowed the clubs to stay where they were for a period of time, but she gave them a deadline with strong remedies. After years of litigation, the establishments are now in the areas for which they are zoned.”

All of this work kept Johnson in the public eye. Chris Heinbaugh, a former television reporter who is now chief of staff to the Dallas mayor, says Johnson was always cordial and transparent. “I remember we had a lawsuit over the pay of police and firefighters that had been around for years and years and even had its roots in a 1979 referendum,” he says. “Madeleine walked in to our meeting with a giant stack of papers and went through the whole thing with me.

“When there were lawsuits filed against the city,” he adds, “it would have been easy to walk away and say that you can’t discuss a pending lawsuit. But she was very good about making sure I understood the broader issues. It’s not often you find people willing to do that.”

Johnson likens her job at Southwest, the largest U.S. domestic passenger carrier, to her past work for the city. Instead of council members and a mayor, she has the top management and board of directors. Instead of voters and citizens, she has thousands of employees, shareholders and passengers. The airline flies into 66 U.S. cities, she says, each of which has its own ordinances governing the use of airports as well as hiring, employment and discrimination practices.

These days Johnson is reviewing the company’s corporate governance policies and its use of outside counsel. In the aftermath of its recent safety violations, she created an associate general counsel position that reports directly to her on FAA compliance and regulatory matters. She is also finding ways to integrate her 14-person legal team more deeply into the regular workings of the company.

“Ideally we’ll have more input and counseling on the front end and less litigation on the back end,” she says. “Of course, utopia would be the airline doing such a good job that the legal department becomes irrelevant.”