Space – the final frontier it may be, but when your company has a dozen satellites in orbit, with more than 220 countries picking up the broadcasted signal, keeping your legal contracts airtight is pretty important.
Launching satellites and managing a worldwide communication spectrum keep Inmarsat’s small legal team challenged, with the company’s work across borders pushing the boundaries of regulation.
Inmarsat was founded in 1980 as a UN body to operate an international marine satellite safety network. It has evolved through a privatisation in 2000, and a leveraged buyout by private equity houses Apax and Permira in 2003, to a $3.5bn (£1.99bn) company that went on to shake the industry with its innovative competitive IPO on the London Stock Exchange in June 2005.
The company now provides satellite communication and data services to the US Army and Coastguard, the BBC, CNN, Reuters, governments, aid agencies and oil, gas, construction and other companies requiring planetwide coverage. Inmarsat’s equipment keeps Dame Ellen MacArthur in touch with the world, for example, and has allowed the media to report from the front line of the Iraq war.
Overseeing Inmarsat’s legal function is Rupert Pearce, the former Linklaters partner who guided the magic circle firm through the dotcom boom before moving in-house to join the venture capital world. He is also one of The Lawyer’s Hot 100 for 2006.
Pearce joined Inmarsat in January 2005 to oversee the company’s headline-grabbing IPO and is now focused on the planned worldwide rollout of its satellite communications services.
“[The IPO] was innovative work for us. We were a sexy stock in a sexy industry at a good time, and the IPO experience we have here is extensive,” says Pearce. “It was a great innovation, but it needs to be handled carefully and with wisdom. You have to maintain your analysts’ independence.”
Pearce left Linklaters in 1999 after 13 years at the firm, including five as a partner running the IPO group. He then took on the role of chief operating officer at venture capital organisation Atlas Ventures. He became head of corporate finance at Atlas, spending “five happy years doing truly fascinating work”, before being lured by Inmarsat.
“To get up there [in space] poses enormous legal challenges, with construction and launch contracts which are extremely complex and specialised,” says Pearce. “And once you’re up there you can’t send a man out with a screwdriver to fix it, so we also have to be good on litigation, arbitration and contract negotiations.”
Pearce is a big fan of his general counsel Nick Rowe, who he describes as “one of the most experienced satellite contract lawyers in the world”. Rowe plays the hands-on role with the four lawyers in London and the two in the US. There is also a specialised regulatory non-lawyer team of five under Rowe’s command.
“My role here is not one of a conventional general counsel,”says Pearce. “I’m much more focused on business development than everyday regulatory matters. The last half-dozen years I’ve not even been a lawyer, but working in a corporate finance and M&A dimension at a senior level, and now it’s about new business development and securing market position for new opportunities. The title may be group general counsel, but the joke here is that the emphasis is on ‘general’.”
But all the big deals or high-value distribution contracts still cross Pearce’s desk, and the list of external counsel the company uses is extensive.
Perhaps surprisingly for a proud ex-Linklaters alumnus, Pearce does not use the firm as outside counsel. Instead, magic circle rivals Clifford Chance and Freshfields Bruckhaus Deringer are favoured in the UK, with employment work going to Eversheds. In the US Latham & Watkins is the firm of choice, with Arnold & Porter, Milbank Tweed Hadley & McCloy and Wilkinson Barker Knauer also securing regular instructions. In addition, a long list of local regulatory specialist practices is used.
“These firms have had their feet under the table since I joined. I’m happy to meet new people, but I’m also about loyalty,” says Pearce. “I’m sure we’ll use Linklaters at some point going forward. I don’t think we’re big enough to warrant the formalities of a panel, and I’m happy with the way it works now.”
Pearce will not reveal the company’s yearly legal spend, but says: “It will always be a seven-figure legal spend, and that’s going to ratchet up in the coming years as we grow. We have a small budget for a role that plays a big impact – it’s one of the fun things about working in a medium-sized organisation – there’s a real ability to make a difference.”
And when an Inmarsat satellite is used to save the life of someone stricken at sea, to help reunite families torn apart by a hurricane or to coordinate tsunami disaster relief efforts, making a difference is definitely something these lawyers are in the business of.
Group general counsel
|Turnover||Not available – the company floated in June 2005|
|Group general counsel||Rupert Pearce|
|Reporting to||Chief executive officer Andrew Sukawaty|
|Current global panel||Clifford Chance, Freshfields Bruckhaus Deringer and Latham & Watkins|