In House Rants

Among other things, lawyers are recognized as the only humans with more than two hands. This is evolutionary, of course. Centuries of equivocating require appendages appropriate for proposing multiple alternatives without having to commit to one. “On the one hand, you could A, but then the plaintiff could do B in response, or possibly C, so instead of A you could do D; on the other hand, doing A and D together would box the plaintiff in. Still, you could try E followed by A, which is a little aggressive, but will send the right message. What do you think?” Too many hands. Too little analysis. No recommendation. This kind of advice just isn’t advice.

The failure (refusal sometimes) to make a recommendation is one of our greatest weaknesses as lawyers. Perhaps we’re trying to make sure clients don’t blindly jump to a conclusion without understanding the thorough analysis needed to arrive there, but I suspect there’s really more anatomy covering going on than anything else.

Garden-variety lawyers can always come up with another theory. But as business people, clients don’t deal with the theoretical; they have to make decisions. The best lawyers advance this process by making recommendations. Like the criticism we level at memoranda that merely explore the parties’ “best arguments” (i.e., the “on the one hand/other hand” treatment), preparing a legal analysis without a recommendation is unfinished work. Even if the best choice is so clear that anyone would recognize it, go the extra step, and tell us what you would do if you were in our shoes.

When you make a recommendation, you’re telling us that you approached the assignment as though it were your money, your liability or your reputation at stake — not just another research project.

As a GC you get lots of lunch invitations from lawyers who want to start a business relationship. I turn most of them down because they’re generally a waste of time.

The other day I had lunch with a lawyer I used to work for when I was with The Big Firm(TM). It had been a while since we had talked. We hadn’t been particularly close, but I thought that maybe, just maybe, with all his experience, I could (for once) have lunch with a “pro” who knew how to make it rain. It would be fun to admire an expert in action, and share some of his better techniques in this blog. Unfortunately it didn’t work out so well and it was another wasted afternoon.

This lunch, like so many others before it, was the “blue plate special” of marketing lunches.

• Small talk before ordering
• How big the firm is
• Where our offices are
• Our practice areas
• My practice area
• Is there anything we can do for you? We’d sure like your business.

What’s missing from this list? Oh. Right. How about a question about MY company? What’s going on with MY industry? What’s on MY stay-awake list? Is MY staff sufficient to support the increasing demands from our internal customers?

That’s right, it IS all about me.

Let me let you in on a secret: We love talking about our company, our challenges, our successes, and our industry. Simply put, we like talking about ourselves.

Your job is to fill my needs. How will you know my needs without asking? Better yet, how will you help me discover my needs unless you probe the periphery? You should be doing no more than 50% of the talking.

Ask me about me, and then listen.

A show of hands, please. Who has ever considered hiring a law firm after reading an unsolicited brochure? That’s what I thought: nobody.

Yet these tired warhorses of “legal marketing” report dutifully to the in-box daily. Why? So that law firm marketing departments can point to an “accomplishment” at budget time. I don’t mean to pick on the marketing departments. In fact, we get most of our unsolicited brochures directly from lawyers, most of the time with nothing more than a business card stuffed in the little cut-out slot.

We’ll be writing more on how to market legal and professional services (at least to our company). But let us start with one very simple recommendation: dump the brochure. They all say the same things, and they all stink. If you think you’re distinguishing your firm because you “seek cost-effective solutions to difficult challenges,” or if you’re the “go-to firm for ‘bet-the-company’ litigation,” get in line. Everyone else thinks so too. Even fancy Wall Street firms seem to have hired the same advertising/marketing consultants as the mid-Western regionals. Remember, $200/hr insurance defense lawyers can say they represent “Fortune 100® companies” if they get a case or two from an AIG subsidiary every now and then. Avoid generalities.

There are other channels that will be much more effective. Yes, more work is required, but you already knew that.

More on what works next time.

One theory says my outside counsel should know my case better than I. He’s scoured the transcripts, grilled the witnesses (ours and theirs) and poked the experts thoroughly. On the other hand, as in house counsel, I know which of my clients and colleagues has the better memory, the better work habits, the troublesome idiosyncrasies and so forth.

No matter what, however, he should know the facts as least as well as I do.

Case in point: Employment counsel prepares and files a position statement with the EEOC. He knocks these off in his sleep, so he figures I don’t need to review it first. I finally get a copy when I have to call and ask, “Say, didn’t we have to file a position statement a while ago in this case?”

He replies, “Oh, didn’t we send that to you? We filed that last week,” and proceeds to blame his secretary. Shortly a copy arrives by email. I glance at it, and immediately see that he identifies our parent company as the employer. Wrong. (The complaining employee works for a subsidiary.) He says the parent company does business in the state. Wrong again — only the subsidiary does.

I mark up the document with the necessary changes and send it back to him with a note asking him to amend the statement, as failing to do so threatens to place our parent company’s multi-million dollar income stream at the mercy of the state’s taxing authority. This would be bad. Apologies abound, promises are made, and another lesson learned. For the both of us. Facts count.

Litigators who say they specialize in “business litigation” ought to know something about business. Unfortunately many don’t. Accounting or other business courses are not found in traditional humanities-based undergraduate “pre-law” curricula. And while most law schools offer rudimentary accounting and business electives, these are often under-enrolled.

For example, in recent months, we’ve come across counsel (on both sides of litigation) who’ve had no grasp of:

– How a balance sheet “balances”

– The difference between a cash flow statement and a profit & loss statement

– Accrual versus cash methods of accounting

– Payments due in advance versus due in arrears

– Amounts “realized” versus “recognized” under the tax code

– The concept of “aged” receivables

Earth-shattering? No, of course not. It’s more embarrassing than anything else, and not likely to lead to repeat business. Yet it becomes more on-the-job training (make that: on-my-invoice training).

Google tells us that in 0.11 seconds one can get several pages of search results for the query “accounting basics.” This seems like a reasonable investment of time for any lawyer whose practice depends on resolving business disputes.

Have you found yourself in this mini-tragedy?

You and your outside counsel agree you need to have a three-way call with his tax partner. You will call him, and he will tie in his partner through their phone system.

The time arrives for the call. You dial him up.

You: Hi Jim. Ted here. I’m ready for our call with your tax partner.

Jim: Okay. Ah . . . just . . . one . . . second while I, um . . . lemme see if I can remember how to make this thing work . . . . . . . . . Hang on.

(The line goes silent for about 10 seconds. Then Jim returns.)

Jim: You still there?

You: Yep.

Jim: (somewhat embarrassed) Heh heh, okay, I think I’ve got this down. Here we go.

(More silence. This time about twice as long.)

Jim: Sarah?

You: Nope. Still me.

Jim: (nervously giggling) Ted, I’m sorry, but, heh heh, you know . . . these phones . . . heh heh. Let me just try another thing . . .

(And off in into silence you float for a third time. After about half a minute, Jim climbs back onto the line.)

Jim: (confidently) Ted?

You: Yep, I’m here.

Jim: Sarah?

Silence.

Jim: Sarah? . . . oh damn. She was just there. (Deep sigh)

And so it continues, with many variations on this theme. Like most tragedies, it ends with lots of regret. On all sides. Unfortunately, this real-life episode added 10 worthless minutes (actually 12, since this firm rounds up to the next tenth of an hour) to our invoice.

Today we enjoy (suffer from?) instantaneous information transfer, yet it’s remarkable that so many lawyers haven’t mastered the simple act of working the telephone. This does not instill confidence. Why on earth would we trust outside counsel to exercise good judgment under pressure (such as, say, DURING A TRIAL) when he or she hasn’t invested an ounce of firm time – not client time – to learn the two or three basic steps to completing a three-way call?

If the firm’s telephone system came with this feature (we don’t know of any that don’t), it also came with an idiot-proof “cheat sheet” on how to use its features. Dear outside counsel, please find it and use it. This isn’t splitting atoms; three-way calling is 1960s technology. Like hourly billing.

Outside counsel shouldn’t expect us to sympathize either. These are basic skills. Like meeting deadlines and following procedure. Tittering and blaming the phone system won’t cut it.

Who writes this time entry on a legal bill and expects it to be paid?

Research. 4.1 hrs.

Well, someone does. In fact, this time entry was on a whole page of similar ones like “Read letter. 0.3.” and “Answer email. 0.2″.

It’s remarkable that lawyers who don’t hesitate to labor over their briefs to capture every second of the reader’s attention fail to spend a fraction of that time composing what needs to be their most persuasive monthly work: the fee statement. Neither I (nor the business center manager whose budget is carrying this cost) should ever have to wonder what we received for the time billed.

A well-written legal bill should fully describe the work performed, with a view toward the relevance of the task to the engagement. Doesn’t “research applicability of 3-year statute of limitations to plaintiff’s recent claim for repetitive stress injury and summarize findings in short memorandum. 4.1 hrs.” sound like real work was done, instead of “Research. 4.1 hrs.”?

Each time entry should be self-justifying, and should never prompt an inquiry. In other words, a well-written legal bill is so clear and so transparent as to compel its recipient to pay it without question; its value is immediately apparent.