Lover of life, paramour of women 1/10th his age -- J. Howard Marshall did it all

Ed. Note: Yes, I admit it. I'm a geek. How do I know? Because I found the following article published on the website of the American Bankruptcy Institute to be absolutely fascinating. I know, I know. I should get out more. Enjoy.

By Jack Ayer, ABI Resident Scholar (Visiting Prof. of Law, NYU Law School)

Long before he was an oil billionaire, husband of Anna Nicole Smith and the deceased figure at the center of this week’s probate dustup at the Supreme Court, a young J. Howard Marshall achieved notice in the Columbia Law Review on the topic of bankruptcy administration. ABI Member Bob Barnes of San Diego discovered Marshall’s name as an author of a 1932 article appearing in the Review. Howard partnered with a historical figure of the Supreme Court and in bankruptcy lore, William O. Douglas, to write “A Factual Study of Bankruptcy Administration and Some Suggestions.” (32 Colum. L. Rev. 25 (1932)).

Both Douglas and Marshall were serving on the Yale Law School faculty at the time. Douglas had joined the faculty at Yale in 1928. Marshall, according to an online biography, had graduated magna cum laude from Yale in 1931. The bio says that “Marshall was invited to join the Yale faculty and served as assistant dean,” and various sources, including the New York Times, report that Marshall was a professor of trusts and estates. Reading the dates in context, it seems likely that Marshall was Douglas’ research assistant during Marshall’s last year as a student.

Before he joined the Supreme Court, Douglas had made his name as a scholar of bankruptcy and corporate finance. He was one of the architects of modern securities law and an early chairman of the Securities and Exchange Commission. During his time at Yale, he authored or co-authored a number of articles about bankruptcy, particularly about bankruptcy in practice. He was a pioneer in the extension of law scholarship into empirical research.

In terms of research, the Douglas/Marshall article isn’t an original effort; rather, the authors draw on two new empirical studies of bankruptcy law at the time: the “Donovan Report,” conducted under the direction of William J. Donovan, and the “Thacher Study,” directed by Thomas D. Thacher with the assistance of Lloyd K. Garrison. (Apparently it was enough to get into the Yale Law Journal in those days simply to read and digest the work of others). Douglas and Marshall offered “avenues of attack to a few of the major problems confronting bankruptcy administration today (circa 1932) and suggest methods for making that administration more effective.”

In their conclusion, they offer seven suggestions. Some call for more aggressive examination of debtors (“bankrupts,” as they were then still known). Some urge expansive use of provisions on discharge. Perhaps the most interesting is the sixth recommendation: “Providing for amortization of debts by salaried bankrupts at their option, sufficient flexibility being provided to allow for partial amortization and readjustments of funding programs and no penalty being imposed for mere failure or refusal to amortize in full or in part” – in other words, chapter 13. Chapter 13 (“Chapter XIII,” as it was then known) became part of bankruptcy law in 1938.

Douglas left Yale in 1934 to join the SEC and was then appointed to the Supreme Court in 1939 by President Franklin D. Roosevelt. Apparently, Marshall preceded him to Washington, D.C., as his biography says he left Yale in 1933 “to work for the Secretary of Interior, Harold Ickes.” As Secretary of Interior, Ickes had an important role in resource and energy policy—a natural platform for Marshall, who would go on to make his fortune in the oil business. There is no evidence that Marshall ever brushed with bankruptcy law again—except, of course, from beyond the grave.