Mark Herrmann

Posts by Mark Herrmann

Inside Straight: What’s The Difference Between A Lawyer And A Doctor?

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What’s the difference between a lawyer and a doctor?

Lawyers often do not need second opinions.

Let me explain: Many corporate transactions (or decisions) require advice from an outside adviser — an investment bank; an accountant; a lawyer; whoever. (Back when I was an outside lawyer, I used to think that lawyers were special. Now, you all look alike to me.) In many of those situations, the corporation needs one, strong outside opinion. If someone offers (or requests) a second opinion, then you should think hard. In a few situations, you might want a second opinion. But, frequently, obtaining a second opinion may do more harm than good.

Let me illustrate with two examples….

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Inside Straight: ‘Litigation Highlights!’ And Law Firm ‘Annual Reviews’

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An in-house lawyer receives an email from a law firm with the subject line, “Litigation Highlights!” Does she pop it open?

Probably not; it sounds like an advertisement.

Is there a subject line that stands a better chance of success?

Yes: Something that specifically identifies a subject that might matter to the recipient. Maybe: “The Constitutionality of ‘ObamaCare’: A Preview of the Arguments.”

The recipient might or might not care about that subject, but, if she does care, at least she knows to open the email.

My not-so-hypothetical “subject” line — “Litigation Highlights!” — is off-putting enough, but, if you made the mistake of opening that email, the substance could be even worse….

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Inside Straight: Loving The Ignorance, Part II

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I wrote last week about how an in-house lawyer overwhelmed by volume should stop worrying and learn to love the ignorance. Talking about ignorance plays to my strength, so I’m choosing here to expand the discussion.

When you’re at a law firm, it’s likely that you sell in part substantive expertise. You’ve assembled a “deal list” to prove that you know more about technology licensing than any other person on earth, or your “case list” shows that you’re better able to handle 10b-5 class actions than all those other pretenders. You may be selling certain things beyond substantive expertise — experience, relationships, presence — but substantive knowledge is part of the package.

When you move in-house, you’re no longer selling anything, because your poor corporate client is doomed to work with you, no matter what your state of ignorance. You’ll no longer polish your deal or case lists, because no one cares anymore.

But it’s worse than that: You won’t simply stop polishing your deal and case lists. You’re actually likely to lose some chunk of your substantive expertise….

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Inside Straight: When Is ‘Expensive’ Cheap?

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One lawyer offers to represent you for $1000 an hour. Another lawyer offers to represent you for $400 an hour. Who’s more expensive?

The correct answer is: You don’t know.

You don’t know for three reasons. First, some $1000-an-hour guys are remarkably specialized.

The efficiencies triggered by specialization are obvious: If I need a lawyer to call the local real estate office and cause my form to be moved from the bottom of the pile to the top, there may be only one person in town who can make that call. He charges $1000 an hour; I buy a half hour of his time; I get off cheap. The $400-an-hour guy can assign a troop of $150-an-hour associates to research local real estate procedures until the cows come home, but that firm is not going to be cheap.

Specialization can yield efficiencies for other reasons, too. If I have a question about a particularly obscure subsection of some obscure law, there may be two ways to get an answer: (1) Call the $1000-an-hour lawyer whose entire practice is devoted to subsection VI(B)(2)(a)(iii) of the Obscurity Code, and have him respond in two hours with an answer, or (2) Have the $400-an-hour lawyer try to figure out the answer from scratch. Who do you suppose is cheaper?

But specialization is the easy case. $1000-an-hour guys can be inexpensive for other reasons, too….

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Inside Straight: How I Learned To Stop Worrying and Love The Ignorance

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When you work as a litigator at a law firm, you know your cases. You know who said what to whom when. You know the recipients and dates of the critical emails. You know the precise terms of the contracts. You know what the opposing expert said at his deposition and how you’re going to attack him at trial.

In short, you know stuff.

When you move in-house — or, at a minimum, to certain in-house positions — those days may vanish. You may never know — really know — anything again.

The little cases may become barely a rumor: The employee was entitled to five weeks severance; he hired a lawyer and filed a lawsuit; we want authority to settle for ten weeks severance. You may kick the tires on the case for a few minutes, but that’s it. If you crave to know who said what to whom when, then you’re in the wrong job.

I feel a bit irresponsible having written those words, because they imply — indeed, they say — that folks in positions such as mine are doing their jobs without full knowledge. To many lawyers, that’s the ultimate sin. Yet in-house lawyers consistently say that a big piece of the transition from a firm to a corporation is learning to make decisions and take actions based on incomplete facts. (One of my colleagues recently said that he suffers from “in-house ADD.”)

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Inside Straight: If Law Don’t Get No Respect

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I recently heard a horror story from an in-house lawyer at another corporation. This may not sound like a horror story to someone who works at a law firm, but if you reflect for a minute, you’ll see the birds gathering on the monkey bars in the background.

Three people — one from finance; one from a business unit; and our hero, the lawyer — were speaking on a panel to a couple hundred people in a business unit. The business-unit panelist said something outrageous and brazenly illegal to the assembled group. Assume it was something like, “As you know, we simply ignore that law,” or, “It’s easier to raise prices if we just conspire with the competition.” You get my drift.

Our hero, the lawyer, involuntarily gasped into his (or her) microphone, “My God, Smith, you can’t say that! How many times do I have to tell you?”

Smith looked over, thought for a minute, and said to the assembled crowd: “That’s just Legal.”

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Inside Straight: ‘Flattery’ or ‘Lies’?

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When does permissible “flattery” become impermissible “lies”?

I’ll use three real-life hypos — situations that I’ve lived — to explore the question.

First: I was a partner at a law firm. The client had just hired a new, junior in-house lawyer to oversee (among other things) the set of cases we were defending. The client called an all-hands meeting. Four or five of us from the firm attended, as did the general counsel of the company, a couple of deputy general counsel, the global head of litigation, and the month-old, new in-house guy, who we didn’t yet know from Adam.

My senior partner spoke first: “Before we get started, I just want to say that [the new, junior in-house guy] is a great addition to your law department. It’s not often that you work with someone for just a few weeks and immediately know that you’ll be able to do better work, more efficiently, with the new person on board. But you did just that with this hire. Congratulations! What a great lawyer!”

The junior in-house guy was beaming ear-to-ear. Later, in private, your senior partner says to you: “That’s how you cement a client relationship.”

So, what do you say: Permissible (intelligent, praiseworthy) flattery? Or unethical lies?

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Inside Straight: On Being ‘Light’

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How do you keep a client (or a boss) happy? Be “light.”

Everyone has worked with people who are heavy, and everyone has worked with people who are light. Light is better.

You ask a heavy to do a job, and he says that he will. But you’re not at all sure that the job will actually get done. You call two weeks later to ask for a status report, and you receive back an ambiguous response about what’s happening. As the deadline passes, you ask for the finished product. It finally arrives, a couple of days late.

That’s a heavy load for you, the supervisor, to bear. Multiply that by eight direct reports (in a corporate law department) or 20 associates (working under your supervision at a law firm), and the burden is unbearable. All that heaviness crushes you, and, next time around, you go in search of light people.

What does it mean to be light?

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Inside Straight: The Injustice Of Trust

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I have two memos sitting unread in my inbox.

One of the memos is great; the other one is terrible. I know which is which. And, as I said, I haven’t yet read either one of them.

Isn’t trust terribly unfair?

Think about the many ways that establishing trust permeates a business relationship. Once the superior (whether that be partner, client, boss, or whomever) trusts the underling, the underling can do no wrong. And once the superior mistrusts the underling, the underling can do no right.

Which of the two unread memos in my inbox is great? The one from the guy I trust. All of his earlier memos have been great. They’re crisp, incisive, intelligent, and lucid; the one that I haven’t yet read is surely a thing of beauty, too. Which memo stinks? The one from the guy I don’t trust. All of his earlier memos have left me gripping my head in agony, trying to figure out what in God’s name this clown was trying to communicate and why anyone would think it was worth trying to communicate that drivel.

Trust permeates everything; it’s terribly unfair. Trust infuses more than just the memos I haven’t yet read. Trust permeates silence, too. How can trust permeate silence?

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Inside Straight: Creating The Wrong Incentives

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I won’t say whether I actually heard these conversations or I just dreamt them.

First: The head of the business unit confronted with a new litigation matter:

“This is an outrage! How could they have accused us of this? We want to fight! Fight! Fight!”

“The defense costs will be charged to your business unit, which will reduce your bonus pool.”

“Settle!”

Second: One partner at a law firm — who wants to visit a client, make a presentation, and take the client to dinner — to a second partner — who is the relationship lawyer for the client:

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