Born in Princeton, Illinois, Lay received a Bachelor of Arts degree from the University of Iowa in 1949.

[1] Lay was nominated by President Lyndon B. Johnson on July 11, 1966, to a seat on the United States Court of Appeals for the Eighth Circuit vacated by Judge Harvey M. Johnsen.

[2] One of Lay's most notable rulings was Jenson v. Eveleth Taconite Co., a landmark sexual harassment case that was the subject of the 2005 film North Country.

[citation needed] The Supreme Court of the United States agreed with his 1971 dissent on behalf of two Iowa convicts whose parole was revoked without trial in Morrissey v. Brewer and his dissent in Jaycees v. McClure, which compelled the Jaycees to admit women.

[citation needed] Lay dissented in United States v. $124,700 in U.S. Currency, a case that still stands, upholding the civil forfeiture of properties possibly connected to drugs.