In-House Counsel, Practice Pointers

House Rules: Nothing Less Forgivable

Sometimes the customer is right. Once in a while, the customer is so very correct that I will go to the trouble of writing down a noteworthy quote or two. Recently, during a call with a CIO of a major corporation, she told me (and several others on the call) that what had occurred was at the level of “nothing less forgivable.” And she was absolutely dead on in her assessment of the situation. I dropped my usual schtick of “lawyer,” and had an honest and candid conversation with her. I sought her counsel on what solution(s) she would propose to the problem, and I promised to get back in touch.

The facts of this situation had to do with HIPAA compliance. Now, if you’re running a financial firm, it’s unlikely that you are overly concerned with HIPAA; instead, you have to worry more about Gramm-Leach-Bliley. And if you run a fireworks stand, you really need to focus on keeping sources of flame away from your establishment. My point is this: in no matter what field your business exists, there are acts that could cause a cataclysmic problem for you and your future.

As an in-house attorney, you must always be on both sides of the field with these issues — offense as well as defense. You must be vigilant about interactions with other entities, and you will sometimes be on the receiving end of criticism flowing back to you. Neither is much fun (though, as an old litigator, offense is still kind of enjoyable now and again), but both are absolutely essential. Especially your response skill set….

An epic failure, if you will, can cause share prices to drop, public relations to be damaged, and force your company to take two steps back in an economy where the headwinds make it a grand struggle to move forward. When you find yourself in one of these situations — and you will — I recommend honesty above all else. Integrity is the one thing that no one can take from you, and an ethical manner of dealing with failures is something that your customers and clients will remember. Maybe not as easily as they’ll remember the failure, but how you handle the issue can act as a healing salve on a serious wound.

In the instance described above, the wrong thing had occurred, and it caused the CIO to get on the phone. She admitted that she wasn’t there to seek remuneration or even an apology; she simply wanted to express to us the potential seriousness of the situation. Luckily, no violation had occurred and this was more of a customer relations call, but the severity of the issue for those burdened by HIPAA regulations is not taken lightly. A strong enough breach of confidential patient information can be highly damaging. Therefore, it was important for me to truly listen and not respond with lip service.

We are a large operation, with over 140,000 people all bound by strict policies and procedures, especially when it comes to confidentiality. Inevitably, with numbers that large, there will be human error. You cannot eradicate error, but you must attempt to educate and reeducate your workforce on the issues that rise to the level of nothing less forgivable. How to do that when you are a cog in the wheel of the OGC, and the sales force is global in scope? Start at home.

By home, I mean start with your immediate supervisor. Apprise them of the situation. One, so they have a heads up, and two, so you can brainstorm next steps. Chances are, you’ll not need to expand your issue to a company-wide notice. In the issue described above, it is the sales force and service technicians who are on the front lines of installing equipment and performing services for the health care industry. So, the next logical step would be to inform the leaders of those divisions of the issue and ask for their support in conveying the message to their people. How they wish to do that will be their call, but you’ll have made them aware of a potential minefield, and chances are that you may be called upon to draft a reeducation message, or some sort of communication for disbursement to their supports.

Finally, ensure that you circle back to the customer, and inform them of steps that you’ve taken with regard to their suggestions. This may endear you (the company) to the customer as an entity that “listens,” but it can also go a long way toward repairing any vestigial damage. If I am honest in speaking to an audience of lawyers (vendors), I will say that the customer is often wrong. Sometimes the wrongheadedness is petty, and sometimes it can be more serious. But often, yeah, the customer doesn’t know the intricacies of UCC-2A, and is misinterpreting the contract that they didn’t fully read in the first place. Or they’ve hired an attorney who is on the clock, and churning away at the issue. But outside of the more common is the rare opportunity for you to take hold of an issue with honesty and candor and seek out a real solution for a customer. Because some things really do rise to the level of nothing less forgivable.

BTW — happy 60th Birthday to Neil Peart, a hero of mine with whom I share this day.

After two federal clerkships and several years as a litigator in law firms, David Mowry is happily ensconced as an in-house lawyer at a major technology company. He specializes in commercial leasing transactions, only sometimes misses litigation, and never regrets leaving firm life. You can reach him by email at

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