Admittedly, I take on some large issues in this column. But this is neither a treatise on contract law, nor the forum to attempt one. I am simply attempting to give some pointers for negotiating commercial contracts. I do very much appreciate the emails that I receive that suggest where I missed some salient information, or that offer critiques to some of my strategies. I’ve even used some of them and credited the authors, to the extent they’d allow. Funny thing about this site, most people don’t want to be identified. It’s almost end of year, so here goes:
Let’s say you’re in the heat of a commercial lease negotiation and the customer says to you: “What are these payments in the event of default? Why should I be penalized if your product doesn’t work as it should? Are you telling me that I have no remedies? Don’t you stand behind your products?”
It’s hard to generate sympathy for lawyers – especially when the group of people you’re milking for sympathy is other lawyers.
At first glance, that seems counter-intuitive. I’m writing about your fellow attorneys, after all, and they’re in miserable straits. I feel sorry for them. I want to help. But then, I’m a bleeding heart psychotherapist.
I even felt sorry for them back when I was a lawyer, too – incontrovertible proof I was never “cut out” for the profession…
A story I often tell is about the first time I took a deposition. I got there early, and I thought that the most important thing was to control the witness. I didn’t realize the first time around that the way you control somebody is not by intimidating them. But I adjusted the chair that I was sitting on so that I’d be really tall, and could look down imposingly on the witness. But I raised it so high that as soon as I sat down, I toppled over and fell backward.
In 1997, Congress was about to pass a law that would have been great for America, but horrific for business at the law firm at which I then worked. The firm thus (intelligently) created several committees to try to create new practices that could keep lawyers busy if the promised bill became law. I was asked to chair the “drug and device product liability business development committee.”
At the time, my firm did essentially no pharmaceutical product liability work. I’d helped to defend a set of medical device cases, which was about as close as anyone had come to actual experience in the pharmaceutical products field, so I was the natural choice to lead this effort. When given that assignment, what do you do? How do you build a practice essentially from scratch?
An in-house lawyer (let’s call her Athena) was recently offended by a statement made by a law firm attorney (let’s call him Hercules). Athena shared a conversation in which Hercules had told her that his firm would never stoop so low as to represent any companies in her industry (let’s say it’s the tobacco industry).
When Athena informed Hercules that, well, his firm actually did represent her company, he told her that she must be mistaken. She responded by bringing up a picture on her mobile phone of an attorney at his firm who was working on one of her tobacco cases, and Hercules replied, “I’ve never seen her before. She can’t be very important.” With a high and (al)mighty look, Hercules then went off to clear his head by having a few smokes.
As Athena complained about this incident, she was so upset that she had trouble blowing her usually perfectly-circular cigarette rings into the air. My initial reaction (knowing how Hercules can be a jovial kind of deity character) was that Hercules had been kidding (and probably had a bit too much ambrosia, as well), and that Athena should lighten up a bit and get a sense of humor, for gods’ sakes.
A couple of years ago, my thoughts about the matter would have ended there, and I would have forgotten the incident completely after returning to my humble, mortal abode. This time, I had some other takeaways….
My suggestion has always been short and pointed: “Say something smart. Say something funny. Ask a good question. And get the heck out of there.”
What about on the other side of the table? I really don’t trust interviews. I don’t believe that it’s possible to tell during a half hour or an hour whether someone is truly competent or a great bluffer. I never thought I learned much from forcing people to talk about their résumés. So when I was interviewing candidates for jobs at a big law firm, I’d try to identify something that the applicant claimed to know — a practice area, a procedural issue, a case the person had defended — and engage the person on that subject. I figured that I was thus showing interest in something about the applicant while giving myself a chance to assess whether the applicant was sentient.
But now I work at a place that sells human resources consulting as part of its business. That requires folks to think a little harder about interviewing techniques. After all, if you’re offering professional advice about conducting interviews, you ought to interview your own job applicants effectively. I’ve recently been educated on this subject and, as a dutiful blogger, I’ll share with you what I’ve learned. What is behavioral interviewing, and why is it better than traditional interview techniques?
I wrote about these contractual issues the week before Thanksgiving. I received so many emails that I thought it best to flesh these topics out a bit more. Also, some of these headings are from the anonymous “comments” section on this site, so I can’t attribute them (and I’ve also edited them for language).
1) “Real life example: Company A hired to refurbish shipping vessel owned by Company B. Contract obligated Company B to indemnify Company A fully, worded broadly enough and specifically enough to require indemnification for Company A’s own fault. Company A sets the boat on fire through clearly negligent actions and then tries to put it out with a garden hose. Fifth Circuit Court of Appeals tells Company B that yes, Company A was at fault; yes, you are out quite a bit for the value of the boat and the lost income, but you must eat it as you have to indemnify Company A for your own claim.”
Why on Earth someone would agree to indemnify a Customer for their own negligence is beyond me. I have been through this scenario many times, and I always inquire as to how I am expected to indemnify my Customer for its own negligence. In the B2B arena, indemnity should be limited (if possible) to third party claims against the potential indemnitee, at which point the indemnitor would take on the payment.
This raises another point: even if I indemnify you, who is going to defend you?
While practically every attorney is familiar with the market rate for Biglaw salaries, not as much is known about salaries for in-house lawyers. Unlike Biglaw’s lockstep salaries, in-house salaries vary widely depending on a broad range of factors such as industry, size of legal department, years of experience, etc. Additionally, since in-house salaries are often negotiable, in-house attorneys tend to avoid discussing their individualized pay with one another.
ALM Legal Intelligence has helped to demystify in-house salaries through its 2011 Law Department Compensation Benchmarking Survey. This comprehensive survey analyzed compensation data from 4,951 lawyers employed at 225 corporate law departments. The 2011 median salaries for various management and non-management law department positions are reported in the tables after the jump, along with their changes from 2010….
Here’s a puzzle for you. What decade am I discussing in the following paragraphs?
I’m doing something a little different here. The entire text of this column appears before the jump. I’ve hidden only the citations after the jump. Ponder while you read these paragraphs when the source materials supporting these words were written:
The excessive cost of legal services is not a function of the economy that will abate as the recession finally fades. In the words of one recent report, “Don’t fool yourselves that when the recession passes things will return to normal.” That report quoted the general counsel of a major financial institution as saying, “The way we are now is the way it is now, not a temporary situation . . . . [I]n the [decade omitted] we’re going to see straight hourly billing die.”
Surveys confirm the concerns about the high cost of legal services. For example, in a [year omitted] general counsel survey conducted by [the firm you know as PriceWaterhouseCoopers], a majority of the 350 respondents agreed that “legal fees have gotten out of control and are crippling businesses,” and pressure to reduce costs was a “major theme” of the survey responses. Surveys of corporate law departments conducted by Endispute, Inc. in [two years omitted] reveal that a third of the respondents faced actual cuts in their legal budgets and that, as the size of the legal departments increased, so too did the pressure to reduce legal costs. A [year omitted] Louis Harris survey of executives and legal officers of Fortune 500 service corporations reveals cost containment as a top priority for law departments, and a survey of major corporate clients in the United Kingdom demonstrates that this is now a worldwide issue.
The pressure to move away from standard billing, based on the billable hour, is likely to increase. Indeed, [name omitted], the recently appointed general counsel of [company name omitted], is leading an intense campaign to adopt alternative billing mechanisms. Her efforts have been broadly publicized and resulted in a highly visible panel at the [year omitted] ABA meeting.
In what years did these things occur? What decade are we discussing? And who the heck was the recently appointed general counsel of what company? Those citations and more after the jump….
Specialty bar associations can be great opportunities for in-house lawyers to grow their network and develop their careers. Unlike some mega bar associations, they tend to feel more intimate and collegial, even if their membership numbers are pretty large, because the members share a common interest.
A couple of weeks ago, I attended the NAPABA (National Asian Pacific American Bar Association) convention in Atlanta. This organization represents the interests of over 40,000 attorneys and about 65 local bar associations. And let me tell you, they had a lot going on at their annual gathering. And I don’t just mean the after-hours partying….
If you are considering a virtual law practice, you know that many of today’s solo firms started that way. But why are established, multi-attorney law firms going virtual?
Many small firms are successfully moving part—or even all—of their practice to a virtual setting. This even includes multi-jurisdictional practice spanning several states and practice areas, although solo and small partnerships are still the largest adopters of virtual law.
Can you do the same? The new article Mobile in Practice, Virtual by Design from author Jared Correia, Esq., explores how mobile technology bring real-life benefits to a small law firm. Read this new article—the next in Thomson Reuters’ Independent Thinking series for small firms—to explore how a mobile practice:
Reduces malpractice risk
Enables you to gather the best attorneys to fit the firm, regardless of each person’s geographic location
Leverages mobile devices and cloud technology to enable on-the-spot client and prospect communication
Transitioning in-house is something many (if not most) firm lawyers find themselves considering at some point. For many, it’s the first step in their career that isn’t simply a function of picking the best option available based on a ranking system.
Unknown territory feels high-risk, and can have the effect of steering many of us towards the well-greased channels into large, established companies.
For those who may be open to something more entrepreneurial, there is far less information available. No recruiter is calling every week with offers and details.
In sponsorship with Betterment, ATL and David Lat will moderate a panel about life in-house and we’ll hear from GCs at Birchbox, Gawker Media, Squarespace, Bonobos, and Betterment. Drinks, snacks, networking, and a great time guaranteed. Invite your colleagues, but RSVP fast, as space is limited.
Ed. note: The Asia Chronicles column is authored by Kinney Recruiting. Kinney has made more placements of U.S. associates, counsels and partners in Asia than any other recruiting firm in each of the past seven years. You can reach them by email: email@example.com.
It’s that time of year again when JDs are starting to apply for 2L summer jobs and 2L summers are deciding which practice area to focus on.
For those JDs with an interest in potentially lateraling to or transferring to Asia in the future, please feel free to reach out to Kinney for advice on firm choices, interviewing and practice choices, relating to future marketability in Asia, or for a general discussion on your particular Asia markets of interest. This is of course a free of cost service for those who some years in the future may be our future industry contacts or perhaps even clients.
For some years now Kinney’s Asia head, Evan Jowers, has been formally advising Harvard Law students with such questions, as the Asia expert in Harvard Law’s “Ask The Experts Market Program” each summer and fall, with podcasts and scheduled phone calls. This has been an enjoyable and productive experience for all involved.