The Coca-Cola Co. announced Wednesday that it is moving legal chief Bradley Gayton to a “strategic consultant” role less than a year after he joined the company and promoting in-house lawyer Monica Howard Douglas to general counsel.
Gayton, who joined Coca-Cola on Sept. 1 and recently announced ambitious new diversity requirements for the company’s outside lawyers, will immediately become a strategic consultant to Coca-Cola chairman and CEO James Quincey.
“I, along with the company’s leadership team and the board of directors, thank Bradley for his service as our global general counsel,” Quincey said in a statement. “I look forward to working with him in this new role.”
Gayton echoed that sentiment in a statement of his own. “It has been a privilege to do such important work with my amazing colleagues in the legal department and to be part of Coca-Cola’s dynamic leadership team,” he said.
Coca-Cola spokesman Scott Leith, when asked about the impetus for its general counsel change or whether Gayton’s strategic consulting role is a permanent or temporary position, said the company would have no additional comment.
Gayton’s online biography on the company’s executive leadership page had been removed as of midday Wednesday. Coca-Cola said in its statement that Gayton will work with Quincey “to drive certain key objectives.”
Pay Details
Coca-Cola disclosed the details of Gayton’s consulting agreement, which could be worth up to nearly $12 million, in a securities filing Wednesday.
The deal gives Gayton a lump sum “make-whole payment” of $4 million, a waiver of “repayment obligations of certain benefits” related to his initial employment agreement with the company, and a nearly $670,000 monthly consulting fee starting in May 2021 and extending through April 2022.
The payments are contingent on Gayton’s “continued compliance with certain restrictive covenants contained in the consulting agreement,” the filing said.
Gayton received about $4.7 million in total compensation from Coca-Cola last year, according to an annual proxy statement filed by the company March 4. Gayton’s pay package included nearly $3.5 million in stock awards, a $576,000 cash bonus, and roughly $253,300 in prorated base salary.
He currently owns over $4 million in Coca-Cola stock and nearly $2.9 million in Ford Motor Co. stock, according to Bloomberg data. Coca-Cola hired Gayton last year from Ford, where he spent almost three decades in-house, the last four of which he served as the top lawyer for the Dearborn, Mich.-based automaker.
The legal leadership switch at Coca-Cola comes after the company’s arch rival PepsiCo Inc. recently promoted its former deputy general counsel and chief ethics and compliance officer David Flavell to succeed David Yawman as general counsel.
Diversity Champion
Gayton, who wasn’t immediately available for comment, spoke with Bloomberg Law earlier this year about new diversity guidelines underway at Coca-Cola, including a potential 30% holdback in legal fees for non-complying law firms.
Atlanta-based Coca-Cola has been swept up in recent weeks in political controversy surrounding a new Georgia voting law drawing the public opposition of many companies and law firms. Coca-Cola has criticized the law, but as of April 14 Gayton hadn’t signed on to a statement from about 100 law firm and law department leaders opposing voter disenfranchisement.
Douglas is a former Troutman Sanders associate and 17-year veteran of Coca-Cola’s law department, where she has been recognized for diversity and inclusion efforts. She was most recently chief compliance officer and associate general counsel for the company’s North America operating unit.
Last year she joined the board of VICI Properties Inc., a real estate investment trust in which Douglas owns $286,500 in stock, per Bloomberg data.
“Monica is an outstanding legal leader who has deep experience working across our company and system,” Quincey, Coca-Cola’s CEO since 2017, said in a statement. “She will oversee the continued evolution of the legal function at the company while also serving as a valued voice in helping lead our overall business.”
Douglas didn’t immediately respond to a request for comment about whether she was previously a candidate for Coca-Cola’s top legal role.
The company’s promotion of Douglas makes her its third general counsel in two years. Former Coca-Cola general counsel Bernhard Goepelt retired in early 2020 after nearly a decade as legal chief. Gayton was hired last summer as his successor.
Coca-Cola and Gayton released diversity numbers in January revealing that 53% of the company’s in-house lawyers in the U.S. are women, while 51% are ethnically diverse. Of the latter group, 23% are Black, 18% are Asian, and 10% are Hispanic.
Legal Advisers
Littler Mendelson, Patterson Belknap Webb & Tyler, and Goldberg Segalla have collectively handled about 32% of Coca-Cola’s federal litigation work within the U.S. during the past five years, according to Bloomberg Law data.
Alston & Bird, King & Spalding, Kirkland & Ellis, and Shook, Hardy & Bacon are other go-to litigation firms for the company during that time.
Federal disclosures show that Coca-Cola paid $10,000 to Sidley Austin last year for the firm to lobby Congress on the Uyghur Forced Labor Prevention Act, a bipartisan bill designed to check that American companies are not benefiting from forced labor by ethnic minorities in China. Coca-Cola has reportedly worked with other major U.S. companies to amend the proposed legislation.
Coca-Cola hired former federal appellate judge J. Michael Luttig in January to serve as a special tax adviser to the company and its board. Luttig retired in late 2019 from the Boeing Co., where he was a longtime legal chief for the aviation giant.
Luttig, whose advisory role is exclusively focused on a dispute between Coca-Cola and the Internal Revenue Service over a $3.4 billion tax bill, said he had nothing to add about the company’s general counsel change.
Laurence Tribe, a prominent professor at Harvard Law School, was retained by Coca-Cola in February as a constitutional legal adviser on the tax case. Tribe also told Bloomberg Law he had “no relevant information to share” regarding Gayton.
With additional reporting from Sam Skolnik.
https://news.bloomberglaw.com/business-and-practice/coca-cola-shakes-up-in-house-legal-team-switching-out-gayton
