In House Rants

This is a popular one, especially among legal assistants:

“Attention to file. 1.0 hr”

You’re kidding, right? Is anybody reading these bills before they’re sent? As we’ve asked before, if you were the timekeeper who made this entry, would you pay this bill? (”Work on case” is a variation on this theme.)

Also, nothing looks more like padded time than round numbers. We’re not saying anyone should change their actual time entries, but pages full of “1.0 hr, 2.0 hrs, 3.0 hrs” etc. just looks suspicious, and sends us a message about the timekeeper’s credibility and the billing attorney’s management skills.

Timekeepers, please describe what work you did (this is why the entries are called time descriptions). Billing attorneys, please review the bills before you send them.

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.

Please stop talking like your lawyer-grandparents. It’s not scholarly, it’s not professional, and it doesn’t impress anyone except non-lawyers. If that’s how you boost your self esteem, you’re in the wrong business.

For example take the antiquity, “please find enclosed herewith.” Yes, I still see this all the time — even in email messages from recent law school graduates.
What are you trying to say? “Please start digging through this mound of stuff and maybe, in here, with it, you will find something I’m sending you.” Of course not. All you’re trying to say is “I have enclosed X.” If that’s what you mean, say it. “Dear Rantor, I have enclosed the drafts I described this morning.”

Or how about “inter alia“, “supra” and “assuming arguendo.” Perhaps these gems have a place in formal legal briefs (I have my doubts), but they have no place in routine communications. What’s wrong with “among other things”, “above”, and “assuming for argument’s sake”?

If you want to keep your clients on your side, write using words they will understand — not the secret code of lawyer lingo. I’m not starting the “plain English vs precision” debate; we can do that another time. I am suggesting, however, that we drop the lawyerly affectations and write simply and clearly. Your clients might even read your letters for a change.

Vacations are always too short, and sometimes they don’t seem worth the effort. But they’re important, and we need to take them. I’m sure you appreciate time away with those close to you, and trusting your colleagues (both in house and outside) not to let the place fall apart while you’re flopped on a sandy beach, hiking in a national park or just doing something different.

So today, in the spirit of doing something different, I have not a rant, but praise.

While on vacation the immigration folks resurrected some regulations on what to do when you get a “no match” letter from the Social Security Administration. (Here is a link to the .pdf of the Federal Register listing, if you’re interested: http://tinyurl.com/27u3cw). This is a big deal for us because we have a lot of employees, and an overwhelmed human resources department. Driving to the airport, the news radio station chattered about the “stepped-up enforcement” policy, and something about social security, but my mind was on my vacation. Cue the smart outside counsel.

That evening, while checking voice mail (yes, we do that too while on vacation), one of our outside employment counsel left this short message (I’m paraphrasing): “Hi, I saw your “out of office” email notification, and figured you might not have heard about the new “no match” regs that go into effect September 15th. I know we’ve not talked about this, but I’m putting together a some guidelines for human resources departments on what to do with these letters to be sure you come within the safe harbor. Your company is a little different from most of my other clients, so I’m going to customize it for you guys, and will have it to you next week. If you think it’s useful, let me know. If not, there will be no charge. Hope you’re having a great vacation!”

Stress level at beginning of voice mail: moderate. At the end: low. Having a great vacation? You bet.

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.

It was only a matter of time before law firms started treating their clients as adversaries. Consider the now fairly standard boilerplate engagement letter provision in which the client consents to be sued by its own lawyer.

It’s never stated quite so directly. The waiver is always soft-pedaled with soothing, somewhat apologetic explanations that all boil down to this: We really aren’t a law firm, but are instead a collection of independent franchisees, and we aren’t gong to let the shortsightedness of one of our dopier “partners” stifle our chance to represent a much more lucrative client against you if the opportunity presents itself.

I’m used to seeing these provisions in the national firms’ engagement letters, but they’re even showing up in the smaller firms’ letters.

Of course I strike these routinely and have never had a firm refuse our business because of it. What’s more interesting is that I never get any push back. No hesitation, no negotiation, no comment. The paragraph just disappears. Which makes me wonder why it’s there in the first place.

How candid will the client be if he knows he could meet his own lawyer across the negotiating table on the next transaction . . . or worse: as opposing counsel in court?

I always knew this, and my former private practice colleagues frequently criticized me for it, but as a transactional lawyer you learn quickly that the business transaction is more important than the legal position. “But the client has risk if you do the transaction that way,” I frequently heard. “Well, yes, but that’s the client’s decision to make, not ours” I would remind them.

Early in my career a client had reminded me. After listening patiently to my explaining why he should abandon a transaction, he admonished me saying, “we are in business to do deals, not to not do deals.”

This is a lesson that is often lost on many of our outside counsel, and it’s one I have to teach (and re-teach) frequently. I find myself saying, “O.k. Fine. There are risks. What is your best advice on mitigating that risk?” — which is usually met with a few moments of awkward silence, followed by (on a good day), “let me think about that and get back to you.” Or on a not-so-good day, “We (the royal “we” as in THE FIRM) can not recommend you proceed with this transaction.”

“Don’t do it” is reserved for the suicidal. Everything else has more than one good alternative. Please assume we’re looking for the latter when we’re asking for your advice.

So today I have a very upset internal client calling me to complain that one of our outside counsel has “swapped” lawyers on him, and he’s obviously received someone from the “second tier.” This happened earlier this week without any kind of advance notice.

The lawyer is a C+ player at best. Slow response time. Not very insightful. Purely reactive.

Everyone in my internal client’s department has worked with this guy, and they all say the same thing: never again. A call goes to the managing partner with whom I have “the relationship.”

Naturally, he’s not in. I leave a message with his secretary. (Yes, law firms still have secretaries. We clients have assistants. What gives?)

He calls within the hour (good) to tell me he would have called me sooner but he was having lunch with [insert dropped name here] and was on his way to a meeting with [drop another name here] (bad).

“Listen,” I say, “we’ve got a very unhappy customer here. Y was working on project Xanadu, and my guy tells me that Y was assigned to another “urgent matter” and Z was going to take her place. Z is not hitting the ball out of the park. In fact, Z is taking strikes and balls all day, and won’t swing at anything. My guy has no confidence in him.”

And then the defensiveness starts: “But Z is one of our best! Order of the Coif! Law review!” Blather, blather, blather. Followed by blame the victim: “I’m sure there must be a misunderstanding. Are you sure your guy understands what a great lawyer Z is?”

“No misunderstanding. He’s non-responsive, tentative and lets the world wash over him. We need Y back on the team.”

“But Y is working on a deal for [insert Fortune 100 company (which we are not)], and is essential to that transaction. Your transaction is in the early stages and can handle a change of staffing.”

I just let him stew in silence for about 20 seconds. I couldn’t resist, “You’re right. I can call [partner at competing firm] and get them going on the matter while it’s still in the early stages. Good idea.”

“Now, c’mon, that won’t be necessary. Z will be great! He’s worked with you guys on a lot of deals,” he implores.

“Z is not great, at least in the eyes of my guy who has to work with him every day. Say, I’m a little confused why we’re still on this subject. If you needed to change the team on us, it would have been nice to know in advance.”

“I didn’t think you’d mind.”

“We mind. Seriously, we really need Y back on the team. Is that something you can take care of, or should we just make other arrangements.”

After a pause and deep sigh, “I’ll look into it.”

About an hour later, Y was back on the deal team. Managing partner calls, strutting, “Wow, it was like pulling teeth, but I managed it. Y is all yours.”

“Thanks. I appreciate the effort.”

But why should I? Why did I even have to debate the issue? Why was it that nothing was going to change until I threatened to change law firms?

I spoke to Y earlier today to welcome her “back” to the team. She was reluctant to talk about the transition, and was eager to help any way she could. After we hung up, I realized I had forgotten to give her some information, but when I called back her secretary said she was on the phone with my guy (good — already back in the saddle). I asked to have her return my call when she was finished. The secretary said “o.k.”, and then added, “it’s a good thing the [Fortune 100 company] transaction fell apart — I don’t know how she’d work on both transactions at the same time!”

That was an easy one. She wouldn’t have.

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.