Like term sheets, business-friendly forms are a bad idea. Like running back into the barn to see if the farm-implement-wielding killer is really dead kind of bad. Like building a hotel for the rich and obnoxious on an ancient burial ground kind of bad. Like moving into a house after the realtor slipped up and told you the last family went crazy and offed each other kind of bad.
And yet, we all feel the pressure of the business when it comes to forms. The business wants to move faster. The business wants to be more streamlined. The business wants to be more efficient.
Since our business partners seldom look inward when reflecting on how to operate better, they will gravitate toward perceived low-hanging fruit outside of their own dominion. They will zero in on legal forms because inevitably some sales person has come from some burgeoning company that didn’t even have a lawyer and the sales person did all his own forms from a software package they bought on the internet. On the freaking internet. And there never was a problem, so why can’t we have forms here?
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Now, if you’re like me, you’ll push the vision of a corporate version of The Lord of the Flies out of your mind (it’s hilarious, but not helpful) and remind the sales person there’s a reason he or she left that company and came here. That reason is probably money. But you’ll phrase it better than that and wax poetic about opportunity for greater reward and with that comes greater risk, higher stakes, and the need for legal oversight. With great power comes great responsibility and a spidey suit and all that jazz.
What the business person will hear is you refusing to do the work to create a form because you’re too lazy or you’re more interested in job security than what’s best for the company.
Hearing that used to really bother me early on in my in-house career. But now that I’m dead on the inside, I find this line of dialogue easier to defeat than others.
First, I always try and reframe the argument. We do actually have a multitude of forms that we can give to the business for their use. Like confidentiality agreements. These can be more or less customized to a one-size-fits-all approach (or at least good enough to cover most modern-day disasters) and at least 12% of the time, the business might actually fill out the other party’s legal name correctly and remember to have both sides sign it.
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Or depending on the nature of your business, maybe some service agreements and statements of works for general services or off-the-shelf parts that require a little more meat than standard purchase order terms and are under a certain dollar threshold. Or churn-and-burn vendors that you work with all the time and the relationship between the parties is constant and without surprises, so a form makes sense.
But the bulk of issues that rise to the level of needing legal oversight cannot be done through forms. Because even with a good base, there are enough nuances and compromises that will ripple through each deal like a stone thrown into a still pond that will require an actual adult to effect the changes throughout the entire document. And not just through the recitals. Looking at you, Marketing.
My personal favorite perennial request for a form concerns the development of joint intellectual property. Joint intellectual property is the bane of my existence and if I ever meet the attorney who came up with the idea to share intellectual property between unrelated parties with ever-changing interests and needs, I’m going to kick him or her in the giblets. And then run like hell.
So when a business person comes and tells me they want a joint IP form, I will tell him or her that I want to win the Powerball. And not one of the regular Powerballs, but one of those record-breaking ones which goes to deserving small-town plant workers and hard-working nurses. I’ll tell them all about how I plan to pay off my law school loans and buy my parents a retirement house and give a crapton of the money to philanthropic causes I actually care about. And buy a modest island with the rest of it. Nothing too crazy.
Then I give them the bad news that we don’t have a form like that, but would be happy to put one together if they will help me outline what it would look like. Nine out of ten times, the business partner will bolt when they realize what a Sisyphean task that is. But even in that rare instance, when the business person sits with you, what they actually end up doing is helping you map out a specific agreement that works for just that deal and no others. And everybody wins.
Ultimately, most commercial transactions aren’t one size fits all, and neither are forms. That’s the conceptual problem.
The second issue is the execution. Not by you. You’re wonderful. I bet your forms are things of carefully crafted beauty.
And then you let the business put their grubby mitts on them and all hell breaks loose.
When I first started, it was like the dark ages. I would send a form to the business person for the purposes of negotiation and it would come back a broken, ugly, twisted things with angry cross outs (“too long,” the handwritten comment in the margin by the indemnification section proclaimed; “don’t need” read the scrawl above where the warranty section once stood) and vague, new things appearing in the footer like, “agreement good for 5/7 years.” Awesome, which is it?
Then came the age of enlightenment, when our legal department invested in some slick third-party software which affords more control than most over the form process. For instance, we can now lock forms and receive notifications for when things are approved and signed. But even then, there are still ways around it. The business can still print out the form in PDF and do bad things to it. Unspeakable things.
Like all things in-house, pick your fights over forms carefully. Do them when you must. Take the time to train the business on them (they’re still going to run wild with them, but then it’s really not your fault) Then duck and cover. Hope for the best.
But when it doesn’t make sense to do a form, stand your ground and cite your reasons as for why this is as asinine as New Coke. Get a pitchfork and brandish it in the face of an angry mob if you must. And if that fails, run like hell.
Kay Thrace (not her real name) is a harried in-house counsel at a well-known company that everyone loves to hate. When not scuffing dirt on the sacrosanct line between business and the law, Kay enjoys pub trivia domination and eradicating incorrect usage of the Oxford comma. You can contact her by email at [email protected] or follow her on Twitter @KayThrace.