In-House Counsel

Inside Straight: Don’t Tell Obvious Lies!

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Okay, I confess: I made the headline intentionally provocative. You shouldn’t lie at all, and you should absolutely forbid witnesses from lying under oath. (If we, the lawyers, don’t obey the law, who will?)

I’m thinking today about a person who is not under oath and will be sorely tempted to tell an obvious lie. Don’t do that yourself, and advise others that it’s not great idea, too.

When are people tempted to tell obvious lies?

In the corporate context, a quarterly earnings announcement might boldly proclaim that the company earned $1 per share this quarter. The Street expected only 90 cents, so this appears to be great news. But there’s something else tucked into the earnings report that disappoints the analysts: revenue declined; margins compressed; organic revenue growth stalled; whatever. Thus, despite the happy headline, the stock price drops two bucks on the day of the earnings announcement.

The next week, you, or the head of your department, or the head of a business unit, or whoever, has to brief an internal audience about the quarterly results. The speaker will be sorely tempted to tell an obvious lie: He’ll pull excerpts from the slide deck used for the earnings announcement, emphasize that the company beat the Street’s consensus estimate by ten cents a share, and tell the gang that we had a great quarter.

Meanwhile, everyone in the room is thinking: “If we had such a great quarter, why did the stock price crater on the news? Do you think I’m an idiot? Why are you lying to me, and do you lie often?”

I’m no expert in corporate communications, but it strikes me that it’s a bad idea to tell obvious lies. How do you avoid telling obvious lies?

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House Rules: Getting Inside (Part I)

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Once you’ve decided — either on your own, or with the help of your law firm review — to make the move in-house, what do you do next? The first thing to decide upon is a method to your madness. Disclaimer: If you’ve been engaged in a search for some time, or you are happily ensconced in a position that you love (which is impressive!), my next few columns are not for you. They will be lacking in gossip, or inside baseball stories of life in-house. Because the majority of mail I receive is in regard to the jump to in-house life, I have decided to devote a few columns to the nuts and bolts of making the leap.

There are so many companies of all sizes that looking for an in-house job can make looking for a law firm job seem like child’s play. There are public companies, privately-held entities, government contractors, non-profits, and so on. Start your search by considering company specialty — what the company does needs to match something in your career background. You wouldn’t seek a transactional securities position without any knowledge of the securities laws. It also helps to have at least touched upon the area of law in your private practice. However, it may not preclude you from a position if you’ve not written the latest securities treatise. If the company is a small entity with zero to five current counsel, your general legal knowledge will get you noticed far more than knowledge in a discrete area of law.

Companies of all sizes can be funny animals when looking for legal advisors. The most sought after trait is sound business judgment — something that is rarely discernible in the interview process. It may surprise you, but a less valued item, at least in the business world, is the rank of your law school according to the U.S. News survey….

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Inside Straight: Is Our Lawyer Aggressive Enough?

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Why do so many people think that you must be a blowhard to be an effective litigator?

I’ve recently heard several tales of business folks (or in-house lawyers) worrying that outside counsel is not aggressive enough. What prompts the concern is the lawyer’s performance during a conference call or at a meeting: The lawyer is civilized. The lawyer speaks quietly, asks probing questions, gives intelligent advice, and appears to be an effective advocate.

After the meeting, one of the participants says: “Are you sure we should use that guy? He doesn’t seem very aggressive.”

Remarkably (at least to me), I’ve heard the same thing at law firms. I’ve heard transactional lawyers wonder about litigators who are calm and intelligent at the lunch table: “He’s such a nice guy. I’m not sure I’d trust him in court.”

What’s my reaction? On the one hand, we can’t ignore perceptions. If a lawyer is so low-key that he doesn’t inspire confidence, then that is a legitimate concern. If I don’t trust the lawyer who’ll represent me at trial to defend me during a vigorous cross-examination, then that’s a real issue; we shouldn’t hire that lawyer. Confidence matters.

On the other hand, if the concern is simply that the litigator is not a blowhard — the lawyer speaks quietly and intelligently during business meetings, where there’s no need for bluster — then I have a very different reaction. In fact, I have three reactions:

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House Rules: In Defense of Clerkships in Flyover Land

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Last week there appeared a column on this site that denigrated clerkships in the middle of the country. I could not decide if the author was attempting satire, but it seemed to be a straight piece. I would like to offer a counterpoint.

I began my career at Biglaw in New York City. The firm began to have troubles, and I saw the writing on the wall as my class dwindled from 40 to 30 to 20. I then heard from a family friend that a federal judge in Oklahoma City was looking for a clerk to assist with some topics with which I was familiar. I scored an interview, we hit it off, and I moved my wife and new baby to OKC for a year.

Full disclosure: I went to 15 schools before graduating high school, and OKC was the place I called “home.” Many decisions about this move were simple: it allowed us to live near family for a year, which was great support for the baby; my wife was working on her dissertation, so she had time to write; and I had a circle of friends from high school with whom I could reconnect.

Further simplifying the issue was that the government payscale is based solely on experience. How much did I earn, as a law firm associate turned law clerk?

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Inside Straight: Setting Performance Objectives

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Do law firms set performance objectives for their lawyers?

I worked at two different law firms over the course of 25 years, and I remember only one meeting where anyone sat down and talked with me about setting performance objectives. We set the objectives; no one ever followed up to see whether I’d achieved them; and the rest was silence.

Perhaps some firms regularly set performance objectives for lawyers, but that was nothing I’d experienced before I moved in-house.

Many corporate law departments set performance objectives for in-house lawyers, and many people do this poorly. “Setting objectives” is viewed as an annual chore inflicted on the supervisor that he cannot ignore; the computer system keeps nagging him about it and ratting him out to others up the ranks. The supervisor finally relents and types a few objectives into the system: “Meet budget. Work closely with business units. Negotiate alternative fee agreements.”

Now that’s out of your hair, and no one will bother you until next year.

Or, if you preferred, you could do it right . . .

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Moonlighting: What’s the Big Deal?

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Lawyers are great at thinking small — small picture, that is. We’re awesome at details, however painstakingly minor. We sport the “grammar police” badge proudly, even though we know that it’s the dorkiest one out there (wait, except for the “I memorized all of the two-letter words in Scrabble” badge — that one’s slightly dorkier). We find nit-picky, meaningless, hypothetical debates to be “intellectually stimulating,” while the rest of the world sees them as a complete and utter waste of time. And it’s all good. Details are essential to the practice of law. But so is seeing the big picture.

A law firm associate friend once represented a bank on a loan in which the borrower later ended up missing a payment date. Upon learning of the missed payment, he promptly drafted a default notice. When he presented the default notice to the law firm partner, the partner’s reaction was, “Whoa, Nelly… hold on there — no way are we sending any default notice.”

The associate was thinking small picture — how dare the borrower miss a payment to his client! In full gunner mode, he proceeded to take steps to ensure that the bank was paid the monies due (and, by the way, now at a default interest rate — haha!). He was only trying to zealously represent his client, right? Right? The partner, on the other hand, was thinking big picture….

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Lawyer of the Month: January Reader Poll

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The first month of the new year turned out to be a great one for lawyers, but as usual, we don’t exactly mean that in the nicest of ways. January brought us new legal controversies of all varieties, from all kinds of places.

With terroristic threats allegedly made by an associate at one Biglaw firm, and scandalous sexual allegations raised by a partner from another one, we knew that we’d have a crop of crass and sex-crazed behavior for this round of our Lawyer of the Month competition.

That being said, let’s check out our nominees for the month of January….

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Inside Straight: Tales From The Interview Crypt

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I wish I could name names; I really do. But I work at the world’s leading insurance broker for law firms, and I can’t go around offending the clients (or potential clients). You’ll just have to guess.

All of these interviews actually took place. I swear it.

First, there was the senior partner at a major New York firm, interviewing me at the start of my second year of law school: “You know, a lot of students want to make excuses for not having perfect grades. Sometimes, those excuses are pretty good: You hear from the single mothers. You hear from people who are working full-time and going to law school at night. The excuses aren’t bad.

“But I have to tell you something: If you have to give me an excuse, I don’t want to hear it. We have too many people who are perfect looking for jobs here. If you’re perfect, we’ll hire you. If you have to make an excuse, don’t even bother telling me. If you have to make an excuse, we’re not making you an offer.”

I didn’t say these stories were uplifting. I said only that they were true.

The next one’s at my expense:

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House Rules: RIF Is a Four-Letter Acronym

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When I was a kid, before many of you were born, there were ads during Saturday morning cartoons for a program called “RIF” -– an acronym for “Reading is Fundamental.” Started in 1966 in Washington, D.C., it is supposedly one of the oldest non-profit educational programs in existence. I mentioned RIFs in my last column, and trust me, in the corporate world, RIFs are not altruistic attempts to get at-risk youth to read.

RIF stands for “reduction in force” — i.e., layoffs, terminations, downsizing, etc. A RIF can take various forms. For example, a V-RIF, or “voluntary reduction in force,” is when a company offers early retirement or severance packages to certain employees. These are usually offered as a first attempt to reduce work force numbers, and they are the cleanest way to lower the population. At the other end of the spectrum is the I–RIF, or “involuntary reduction in force.” The term is self-defining.

I stated before that I have witnessed an I-RIF period, and that it was awful. By “awful,” I meant that seeing people let go from their jobs was uncomfortable for me, having come from private practice where such reductions were not (at the time) as publicized as they are today. My company handled the situation with as much grace as could be expected, and I honestly believed our then-CEO when she stated that the dignity of our people was at the forefront of how the reduction would take place….

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Inside Straight: Institutionalizing Mediocrity

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Here’s my thesis: We create rules to hedge against ineptitude, and we thus institutionalize mediocrity.

Here are the examples. First, someone — the Administrative Office of the Courts? God? — creates rules to hedge against incomprehensible judicial opinions, and we thus discourage judges from writing exceptional opinions.

When new federal appellate judges attend what is affectionately called “baby judges’ school,” the judges are told how to write opinions. An opinion should have five parts, the judges are told: An introduction (which does not have to be preceded by a separate heading); a statement of facts; the standard of review; the legal discussion; and a conclusion.

Do we impose these rules because every judicial idea is best expressed in this format? Of course not. These rules impose a basic organizational structure on decisions, so that even the worst appellate decisions will be marginally comprehensible. The rules hedge against ineptitude.

Most judges follow the rules, and society generally benefits; we understand most of what’s written. I suspect that many judges who would be capable of writing better opinions if they were not bound by the rules nonetheless choose to constrain themselves, opting to do as instructed. Society may suffer in those situations, because the opinions are not as well-crafted as they might otherwise be.

A few judges ignore the rules. Whatever your politics, for example, you probably agree that Judge Frank Easterbrook often writes great opinions; he regularly ignores the mandatory structure. (This isn’t a high crime or misdemeanor, so he’s safe.) We don’t complain when Judge Easterbrook strikes out on his own, because readers understand what he’s saying and often delight in how he expresses himself.

On the other hand, if Judge Nobody were to strike out on his own, the law might become a muddle. We try to control that judge by imposing a structure. Bureaucratic rules discourage greatness, but they hedge against ineptitude.

Here’s a second example:

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