I’m writing this wearing my new bifocals. They take some getting used to after years of regular glasses and contacts. But, after watching me examine small print like I was Mr. Magoo, my wife convinced me that it was time to take a symbolic plunge toward middle age. I admit to no small amount of trepidation at the prospect of wearing “old folks” glasses. But the risk of not seeing properly finally outweighed my vanity, and a change had to be made.
And so it goes with some legal decisions in-house. When faced with a dilemma, you weigh the risks versus rewards, and pull the trigger on what you hope is the right decision.
In a company the size of mine, people have performed risk/reward analyses on legal issues for years, down to the proper placement of semicolons in contract clauses. To borrow from the iPhone ads, yep, there’s a committee for that. We have Lean Six Sigma belts of all colors who are subject matter experts in every facet of our business. There are folks with many years of experience, who own any number of policies from which I am to draw when making decisions. It sounds on paper like filling in the blanks will get you where you need to go, but that is far from reality.
In a perfect world, for my job anyway, a Customer would receive a proposed agreement, see the inherent fairness in the document (and the work that went into carefully crafting all those clauses and semicolons), and sign on the dotted line. But sadly, life isn’t perfect, and I have yet to receive a contract back without so much as a redline….
And I want to know when lawyers will stop using opportunities to give referrals as a panicked strategy of covering their asses.
You know what I’m talking about — the “three names” idiocy?
Whether you’re on a list-serv and the 27th “I’m looking for an excellent, aggressive, and inexpensive lawyer” request of the day has donned your computer screen, or someone actually thinks you are worthy of a phone call or email requesting a lawyer to save their life or fortune, let’s just agree to stop being wimps and meaninglessly passing along names, and start giving real referrals.
I know, you were taught this. You never give one name. Why? Because what if it doesn’t work out? Then you’re going to have some sort of imagined problem that someone told you could be very, very bad.
And yes, I know, people like choices. You feel like you’re doing them a service by giving them lawyers from which to choose. But you’re not. You’re just uselessly giving out names.
One of the deep, deep dark secrets (shh) of being successful in small-firm world is your ability to be more than just a paper-pushing, time-keeping drone. The ability to be a “connector” is just as — or more — important than your ability to practice your trade. If you are in a niche practice, there are more people who won’t need your services than will, but that doesn’t mean they shouldn’t have a reason to call you — like the reason that you are the one person who always gives them the best referrals.
Have you received those emails? “I know you don’t do this work, but you always seem to put me in touch with the best people, so I’m now looking for _______.”
If you’re a lawyer, and some of you that read this are, you know it’s time to start trying to convince yourself that you’re going to do wonderful things “next year.”
Advice is readily available on the internet about the proper way to set goals, but as usual, I am here to help you ignore all of that. No reason to go to websites like mindtools.com that begin with a clear shot at Biglaw by stating: Many people feel as if they’re adrift in the world. They work hard, but they don’t seem to get anywhere worthwhile.
Anyway, here is my surefire way to have a great 2012 as a lawyer….
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?”
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….
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?
Suppose your firm has one incompetent partner, and our joint has the misfortune to be working with that person.
This guy consistently misses important issues. He sends us briefs that read (as did one draft I recently received): “In response to ALR’s motion to dismiss the OC, [plaintiff] added an allegation in the FAC that . . . .” We comment, over and over again (as we did recently), that briefs on our behalf must be written in English, not gibberish. Even if you’ve set up short forms, no reader sees “OC” and “FAC” and thinks “Original Complaint” and “First Amended Complaint.” Use words, not alphabet soup.
To no avail.
We suggest that the partner include on the litigation team a gifted writer (because we’re too nice to suggest that the partner include on the litigation team “a lawyer who’s worth a damn”). But nothing ever changes; the partner never hears us. Confronted with an avalanche of criticism and suggestions, no law firm partner has ever said to us, “Why, thank you. Now that you mention it, I realize that I am in fact inept. To better serve your legal needs, I’ll replace myself with a real lawyer.”
No, no, no. Instead, the partner continues to send us bad briefs, making the same mistakes over and over, but seemingly thinking that we may not care the next time around. It’s Einstein’s definition of insanity: “Doing the same thing over and over again and expecting different results.”
Up to that point, the fault is the partner’s. But then I personally make two mistakes….
Caveat: I did not write the following dialogue. It is from the “comments” section of one of my columns where I mentioned I’d be writing about HIPAA and GLBA. Unfortunately, I cannot attribute the comments to the persons who wrote them, as they are anonymous; however they are quite apropos of today’s subject:
1) “I wish vendors would get it into their heads that indemnity for being sued on a confidentiality basis doesn’t cut it for financial institutions and other customers/clients that have affirmative obligations without being sued in the event of a breach of confidentiality.”
2) “I wish financial institution customers would get it into their heads that the ‘customer information’ they’re obligated to protect is not the sort of thing they would ever disclose to the vast majority of their vendors, and stop using their ‘affirmative obligations’ as a tool to cram unnecessarily restrictive confidentiality terms down the throats of vendors.”
Perfect. Those two comments capture the schism between vendors and customers when dealing with private financial or personal confidential information….
Are your in-house working hours recently rivaling the billable hours you thought you had permanently discarded? Is your workload getting way too heavy — i.e., it’s really getting difficult to watch Glee on a timely basis? Do you find yourself working on pretty much the same form of contract over and over and over and over and over and over and over, ad infinitum?
It may be time to take a break and evaluate the problem of Low-Value Work.
What’s Low-Value Work? It’s work that has three main characteristics….
So, the Customer wants you to take on unlimited liability for breach of confidentiality, indemnify (and hold harmless) for any and all bad acts of your employees, and to carry a multi-million dollar insurance policy. What do you do?
First, begin by triaging these from simplest to more complicated. During a negotiation it can be helpful to appear to “give” as much as possible up front when you’re down to a few points. This way, when the final hot button items arise, you appear reasonable.
Insurance requirements are usually no-brainers, and as long as the amounts demanded are not grotesquely high, your Risk folks will approve the proposed language with very light editing, if any. Today, it is also not unusual for the Customer to demand to be named as a payee in the event of a loss; this is often fine, and usually not an issue. More practice pointers, after the jump….
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We currently have a number of active openings for associate roles at US and UK firms in HK / China, Singapore and two new in-house openings. As always, please feel free to reach out to us at email@example.com in order to get details of current openings in Asia, as well as to discuss the Asia markets in general and what we expect for openings later this year. Our Evan Jowers and Robert Kinney will be in Beijing the week of March 25 and Evan Jowers will be in Hong Kong the week of April 1, if you would like to meet them in person.
The US associate openings we have in law firms are in the usual areas of M&A, cap markets, FCPA / white collar litigation, finance, and project finance. The most urgent of our top tier (top 15 US or magic circle) law firm openings in Asia (among many other firm openings that we have in Asia) are as follows:
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The last time I flapped my wings your way, I tried to make at least enough noise about your mobile phone to make you more than a little bit uncomfortable. I hope I did. If enough of us become anxious enough about the known and unknown unknowns and knowns in our mobile phones, then we can start making wise decisions about how to manage that information and its resultant investigations.
Today, I’d like to put a finer point on the last installment’s topic by asking a question that seemed to catch most attendees off-guard at a conference panel that I moderated last week: is there discoverable personal information in a mobile app? Our panelists’ answer was a uniform “yes” with one stating that, if he had to choose only one type of data that he could discover from a mobile phone, he’d choose app data. Why? Because there’s simply so much of it and because almost all of it is objective – not just user-created like an email – but machine-tracked like GPS, usage duration, log in and log out times, browsed web addresses, browsed actual addresses. Also, most of us seem to have the idea that data doesn’t actually “stick” to our mobile devices the way it “sticks” to our hard drives. Maybe there’s a disconnect based on the fact that our phones are mobile so we assume the data is mobile to?
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