Secret Formula by Frederick Allen

Author:Frederick Allen
Language: eng
Format: epub
ISBN: 9781504019835
Publisher: Open Road Media

Hobbs’s path to the top was unorthodox, to say the least.

In the late 1930s, the fertilizer and cotton oil business run by Nell Woodruff’s uncles in Athens, Georgia, was losing money at a $10,000-a-month clip and falling rapidly into bankruptcy. Anxious to rescue his wife’s family and preserve their livelihoods, Woodruff assigned Hughes Spalding to straighten out the company’s affairs.

Joining Hodgson’s, Incorporated, as an outside director, Spalding discovered a mess. A tenth of the company’s stock was listed in the name of the Lord, reflecting the Hodgson family’s devotion to the Baptist church, and it seemed their accounts receivable books were based on faith as well. Ned and Harry Hodgson underpriced their fertilizer, sold it on credit, and rarely managed to collect what they were owed.

With commercial banks in Athens and Atlanta refusing to renew the company’s loans, Woodruff and Spalding decided the only way to keep Hodgson’s going was to obtain new financing from the federal government. At Woodruff’s prompting, the Hodgsons applied for a loan from the Atlanta office of the Reconstruction Finance Corporation. They were turned down. Spalding then traveled to Washington, where he encountered a bright young RFC lawyer named Bill Hobbs. In short order, Hodgson’s, Incorporated, was the recipient of a five-year, $450,000 loan. As Spalding explained it to the Hodgsons, with biblical glee, “We blew the trumpets, the walls of Jericho have fallen down and we have entered into the Promised Land, overflowing with financial milk and honey.”

Either out of gratitude, or more likely to ensure that the RFC loan would be renewed in the years to come, Spalding invited Hobbs to move to Atlanta and join King & Spalding as a partner, which he did. Hobbs was an engaging man, and before long Spalding developed a genuine admiration for his abilities.

King & Spalding took care of a great many chores for Coca-Cola and enjoyed a correspondingly large flow of legal fees. In hopes of bolstering the relationship, Spalding persuaded Woodruff to hire Hobbs as an assistant counsel in the company’s Legal Department where, presumably, he would be able to guard the firm’s flank.

Hobbs made a fine first impression, especially on the department’s secretaries. He was tall and good-looking, full of charm, the sort who would break into a soft shoe and make the young women giggle. He worked his magic on Woodruff as well. “Hobbs was a great listener,” recalled Howard Kurtz, Jr., who served as his aide, “and frankly he was a sycophant. Woodruff [liked] him, and Hobbs saw to it that that appeal was strengthened.”

One of the lawyers in the department described Woodruff as becoming “enamored” with Hobbs. A nephew put it more bluntly: “There were people who knew how to work [Woodruff], who played on his goodwill and affection, people—real ass-kissers, to use a common term—who advanced through it.” Hobbs, the nephew believed, was one of them. Within a year, Woodruff promoted Hobbs to vice president and made him manager of the Legal Department, with a mandate to reorganize the operation.

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