In-House Counsel, Litigators

Thinking Like A Non-Lawyer

In-house columnist Mark Herrmann says that sometimes, it’s best not to think like a lawyer.

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dartboard pen inside straight“Sue the bastards! This case is a laydown! They just copped a plea with the feds! You can’t lose, and you’d recover at least $10 million!”

“But your proposed defendant is a client of ours. It pays us $40 million in revenue every year.”

“Don’t worry about it! The defendant broke the law, not you. The feds caught the defendant red-handed! It can’t retaliate against you; that would be illegal. Not only that: We’re suing the same defendant for other clients, and the defendant hasn’t retaliated against a single one.”

“Suppose they fire us.”

“Huh?”

“I’m not worried about them counterclaiming against us. I’m worried about them firing us. They might prefer not to do business with someone who sued them for $10 million. Can’t they just fire us?”

“I suppose so.”

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“So you think we should give up $40 million in annual recurring revenue for the sake of a one-time $10 million recovery?”

“Maybe you’re right. Forget about it.”

“Why do I have to forget about it?”

“Because, if you sue, they’ll fire you. That would be a stupid idea.”

“Suppose I don’t sue, but I still ask for the money?”

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“Huh?”

“We obviously know lots of people who work for your proposed defendant. After all, the company’s paying us $40 million every year. Couldn’t we have one of our senior executives call one of their senior executives, and ask for some money?”

“Ask for money? No one just gives away money.”

“We might say something like this: ‘I just read in the newspaper that your company engaged in a fraud that hurt many people. In fact, I see that your company pleaded guilty to criminal wrongdoing. I know that you’re an upstanding person, and I’m sure that you weren’t aware that low-level employees were stealing from your customers. You must be outraged that this happened.

“‘I’m also sure that you didn’t intend to steal money from us. I was just wondering what you, an upstanding business person, are thinking of doing to compensate longstanding customers from whom your employees have stolen money. Are you offering cash payments? Are you offering discounts on future services? What are you doing to make your longstanding customers whole? Do you want to take a few days to think about that and get back to me?'”

“They wouldn’t give you the $10 million.”

“Probably not. But they might give me something, and it wouldn’t cost me $40 million a year in revenue.”

“Hmmm . . . . ”

I understand that you’re a litigator, so you’re thinking of this as litigation. But we’re a business, and we have other things to consider.

We might not be able to sue your preferred defendant. Can we sue someone else? Recover a portion of the money without suing? How can we recast, or do without, your proposed lawsuit?

Or perhaps you’re finding opposing counsel to be simply impossible; you can’t make any progress negotiating with her.

Can our business folks call their business folks? Maybe we can work something out?

Or you can’t imagine where you’ll find the $5 million needed to bridge the gap between the settlement demand and the offer.

Does our company offer any products or services that might interest the other side? Maybe we can find something that’s worth $5 million. Better yet, maybe we can find something that’s worth $5 million to the plaintiff, but costs us only $1 million to provide. Or, better yet, maybe we can lock our opponent into a long-term contract with us, yielding revenue for years to come in exchange for providing a discount today.

Or who knows what.

There’s one topic as to which many litigators at firms seem to have a blind spot: Having spent years settling cases only by extracting cash from the unwilling, many litigators don’t consider that big companies may have personal relationships, or business clout, or goods or services to offer, or something else that’s worth a great deal in a negotiation.

Our in-house lawyers are keenly sensitive to this (although often not instinctively when they first come aboard).

Outside lawyers should think about this, too.

Sometimes, it’s best not to think like a lawyer.

Mark Herrmann is Vice President and Deputy General Counsel – Litigation and Employment at Aon, the world’s leading provider of risk management services, insurance and reinsurance brokerage, and human capital and management consulting. He is the author of The Curmudgeon’s Guide to Practicing Law and Inside Straight: Advice About Lawyering, In-House And Out, That Only The Internet Could Provide (affiliate links). You can reach him by email at inhouse@abovethelaw.com.

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