Corporate Counsel: Stephen Coss
Stephen Coss is the top lawyer in an automotive empire where he could buy practically any car at a discount. So what does he drive? A light-blue 2002 Toyota Camry. The general counsel of Charlotte-based Sonic Automotive confesses that his choice prompts endless needling, but he says, “I have a great deal of respect for my money.” Jeff Rachor, Sonic president and chief operating officer, puts it another way: “Steve is very frugal, and that’s an asset in how he helps manage our business.”
Sonic Automotive operates 177 car dealerships and 38 body shops with about 12,000 employees in 15 states. Coss’ responsibilities include oversight of all legal matters, including corporate governance, securities, mergers and acquisitions, regulatory compliance, executive compensation, employee benefits and commercial contracts.
“We have a very high amount of revenue” — $7.4 billion in 2004 — “but also tight operating margins, so we have to be cost-sensitive,” Coss says. Thus the ever-frugal in-house lawyer keeps his department’s head count low: another lawyer, whose job is to direct litigation, two legal managers and a legal assistant. “It is the smallest legal department in our peer group of companies,” Rachor says. “Steve’s hallmark is his work ethic and productivity.”
Coss says car dealerships operate under tough consumer-finance, environmental and consumer-protection regulations. It is his team’s job to make sure Sonic is in compliance. He also manages relationships with some 40 law firms around the country that work on transactions for Sonic.
He started Sonic’s legal department from scratch in January 2000 after the company poached him from Charlotte law firm Parker Poe Adams & Bernstein. While there, Coss had worked on the initial public offerings by Concord-based Speedway Motorsports — owned by Sonic Chairman O. Bruton Smith — in 1995 and by Sonic in 1997.
When Coss came on board, Sonic had just acquired a large number of California dealerships. It had finished 1999 with revenue of $3.5 billion. At the end of 2000, Sonic reported revenue of $5.9 billion. The company has continued to increase revenue about 10% a year since, largely through acquisitions.
He grew up in Arlington, Va., where he played varsity football, basketball and baseball. As a freshman at Duke University, he failed in a tryout for the baseball team. Sensing that the major leagues were out of reach, he decided on another career. After graduating with a bachelor’s in history, he went to law school at the University of Virginia.
That’s where he met his wife, Jennifer, and together they picked Charlotte as a place to raise a family. She was an assistant district attorney for five years but quit after the birth of the couple’s second son. They now have three children, and Coss coaches his 5-year-old’s soccer team.
He started at Parker Poe after law school and decided, after three years, to specialize in securities law. “It was a very hot stock market with the Internet-technology boom.” That’s how he got involved in the IPOs of Speedway Motorsports and Sonic. Coss also worked on Speedway Motorsports’ negotiations to sell the naming rights for what became known as Lowe’s Motor Speedway in 1999.
Coss is known around the office as “gregarious and outgoing,” Rachor says, and he notes that the lawyer’s get-it-done attitude applies outside the office, too. “He always enjoys a good meal,” Rachor says, reporting that Coss has been known to put away a 28-ounce porterhouse steak and a 3-pound lobster at the same sitting.