Chapter 2 Hard Times Andrew Squire died in the middle of the Depression when the American public was in no mood to listen to "reasoned appeals." The country blamed the Republicans for the Depression, and the Depression ravaged Cleveland. Bread lines curled around churches. Once prosperous banks closed their doors. Corporations went bankrupt and some of their owners papered the bar of the exclusive men's club, the Tavern Club, with colorful but worthless stock certificates. Franklin D. Roosevelt swept the country and Ohio in a landslide election in 1932. It was even greater than that on which Hoover had glided into office just fours years before. Only a few months before the election, Hoover had proposed a sheaf of far-reaching remedies to deal with the Depression. The most important of these was the creation of the Reconstruction Finance Corporation. The RFC was empowered to lend $2 billion in federal funds to banks, savings institutions, insurance companies, corporations, and other private and public entities. Seeking to mute partisan opposition, Hoover in July 1932 appointed Squire, Sander & Dempsey's celebrated Democratic partner Atlee Pomerene, then 69 years old, to head the RFC. In making the announcement, Hoover referred to the fact that Pomerene's law firm was "counsel for the Reconstruction Corporation's work in the Fourth District." The firm under Sterling Newell's supervision had been representing the RFD in the heavily industrial Federal Reserve Fourth District, encompassing Ohio, western Pennsylvania, and parts of Kentucky and West Virginia. Pomerene advised Newell he had promised President Hoover that Squire, Sander & Dempsey would continue in its RFC representation. On the same day that Pomerene accepted the appointment, Newell proceeded to the local RFC headquarters in the Federal Reserve Bank and opened a satellite office for Squire, Sanders & Dempsey's lawyers. Shortly after Franklin Roosevelt took office in 1933, he replaced Pomerene as head of the RFC, but the firm continued the representation. Jesse Jones, the Texan who subsequently served as RFC chairman, praised Squire, Sanders & Dempsey in his RFC history, Fifty Billion Dollars. "The firm's services were exceptionally satisfactory and the cost to the RFC per dollar volume was much smaller than in any of our other agencies," wrote Jones. As a result, Jones noted, President Roosevelt himself agreed to keep Squire, Sanders & Dempsey as RFC counsel even though, later on, a Cleveland law firm with Democratic ties was hired to assist in some of the chores. Until the late 1940's, many of the firm's lawyers—more than a dozen, all told — worked day and night for the RFC and its wartime subsidiary, the Defense Plant Corporation. Often they were awakened in the middle of the night by telegram or telephone to assemble at the RFC office to handle emergencies such as completing legal details to enable the Bank's armored trucks to deliver cash to client banks before opening time. The national "bank holidays" and the machinery for quickly examining and licensing banks to reopen for business — or not to reopen — was set in motion by President Roosevelt in his inaugural address on March 4, 1933. Many Fourth Federal Reserve District banks did not have the cash to open their doors. They lived in the hope that the appointed "conservators" would somehow raise fresh capital and miraculously clear away their difficulties. The affairs of these troubled banks were handled by Squire, Sanders & Dempsey and that work often involved the firm in novel activities. The largest of the Cleveland banks, the Union Trust Company, failed to obtain a license to reopen. The Roosevelt-appointed conservator for the Union Trust was Oscar Cox—not to be confused with the Oscar Cox who headed the firm which 40 years later would become the nucleus of Squire, Sanders & Dempsey's Washington office. Cox found that among the bank's assets were shares of the McKinney Steel Holding Company, which owned 48 percent of the Corrigan McKinney Steel Company. McKinney has a large business in semi-finished steel and pig iron. The new and growing Republic Steel Corporation was anxious to take over McKinney. Conservator Cox was agreeable and so were the management and shareholders of the two companies. The U.S. Department of Justice, however, brought suit to enjoin the proposed transaction under the Clayton Act, claiming a merger would stifle competition. Cox hired Squire, Sanders & Dempsey to represent McKinney. Clan Crawford, one of the most imaginative and talented trial lawyers in the firm's history, was successful in convincing the court that the proposed transaction was not an illegal merger but an acquisition by Republic Steel that would allow the company to make steel at a lower cost rather than create a monopoly. Clan Crawford did not go to law school. He read law in Pennsylvania, passed the state bar, and later graduated from Kenyon College in 1913. After serving in World War I as an infantry captain, he came to Squire, Sanders & Dempsey in 1919, passed the Ohio bar and joined the trial staff. Although Crawford became Sterling Newell's right hand, he was progressively incapacitated by Parkinson's disease, which did not affect his mental acumen. In fact, he spent his last years in the firm's library, surrounded by young trial lawyers seeking advice on pending cases. Firm lore has it that Crawford would frequently struggle from his chair, totter his tall but stooped frame to the stacks, tap his encyclopedic knowledge, and pull the decisive case from the shelf.