Law Firm Governance from the Inside Out
February 28, 2008 | Filed Under Law Firm Trends, Governance
Some firms are starting to recognize that a focus on the marketplace (i.e., client wants and needs) isn’t something that should be relegated to the time left over after a typical managing partner’s day. Especially when the days run long, with a demanding focus on things like hiring, compensation, development and mediating inevitable conflicts (both legal and personal).
Canada’s Financial Post notes that the Gowlings firm has adopted a rather novel way to ensure that client interests don’t get the short shrift.
It has split managing partner duties into internal and external groups, each of whom are on an executive committee with the firm CEO and COO. This committee then answers directly the firm board of trustees, akin to a corporate board of directors.
According to Scott Jolliffe, CEO of Gowlings:
The external-facing group is headed by Jane Steinberg and her committee consists of the leaders of the various practice groups and those in charge of marketing them, which is an added twist on the governance model.
“We’re making a statement to ourselves and the world that managing the external side of our business is just as important as managing the internal side of our business,” he says.
At first blush, this would appear to add to complexity, but there’s a method behind it:
While a second management group for the external side of the business arguably adds another layer of bureaucracy, Mr. Jolliffe stresses that it will allow the firm to better serve and respond to those who pay the bills. “I think it will distinguish us in the marketplace,” Mr. Jolliffe says. “It’s quite unique. We’re pretty enthused about it.”
The picture of large law firms is drawn in good measure by the focus of the legal press on sexy things like starting associate salaries and rising profits-per-partner. This can leave the the client feeling a bit left out. Or like the meat in the sandwich.
Anything that serves as a reminder of the reason there are law firms in the first place deserves at least two cheers.
aLawyer Reviews iPaper
February 21, 2008 | Filed Under Unplugged - Audio, Technology
There’s a new and potentially game-changing technology for viewing files on the web. It’s called iPaper, from the people at the document-sharing website Scribd. The image below is a copy of my 2008 preview that was provided to subscribers of Wired GC - Select.
The technology is free, and I bet a few document-sharing application providers are gnashing their teeth right about now.
An audio explanation is located below this image (it’s multimedia Thursday at the Wired GC). The slider at the far right of this document allows you to scroll throught the four pages.
Just click on the red arrow to hear a short overview of iPaper and Scribd.
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And you can click here for a full-page version.
General Counsel Liability
February 18, 2008 | Filed Under GC Liability, Compliance
The Fulton County Daily Report has an excellent summary of the state of GC liability. The list of those involved isn’t large in an absolute sense, but is growing.
According to Roscoe C. Howard Jr. of Troutman Sanders (and a former U.S. Attorney):
“There was a time, quite frankly, when you could be a director or officer and hide behind a corporate shield. Individuals weren’t held to any law enforcement accountability. Now, if you’re CFO, you’re going to jail. They’re going to turn to their GC and say, you need to keep me out of trouble.”
The challenge of course is that neither the GC nor the legal department can be looking over everyone’s shoulder all the time.
But that doesn’t always matter when the authorities come knocking…
Private Equity Pulse Check
February 8, 2008 | Filed Under Deals, Private Equity
The New York Times DealBook scored a coup when it landed Prof. Steven Davidoff to write “The Deal Professor.”
This good professor is certainly prolific, and his entry of this past Monday really caught my eye. Entitled “Is M&A Dead?“, quite a few private equity deals gone sideways are explored, deal point by deal point. A few examples:
* Reasonable Best Efforts Clause: The Alliance Data Services litigation has highlighted the legal ambiguity and uncertain meaning in the requirement a buyer use “best efforts” to obtain regulatory approvals and take other steps to complete a deal.
* Contract Drafting generally. URI/Cerberus highlighted the problems of overly-complex and short-hand drafting. The general distrust in the market has led to overparsing and scrutiny of contract wording for fatal ambiguity.
This is great stuff, and topics such as these allow business-inclined readers of the Times into dip a toe into the icy waters of corporate and contract law without the head-first dive of law school. I would imagine they’d be great in the classroom, taking students into the deals of the day and away (for a moment) from the musty cases of yesteryear.
The best part for me, however, was this closing observation of the state of deal forms in general:
But forms are slow to change. The person who typically keeps them is an overworked senior associate. In the interim and even beyond, I would also suspect that the distrust left by private equity firms has caused lawyers to tend towards overnegotiating language on an ad hoc basis. Risk-averseness can do that.
All I can say is amen.
Prof. Davidoff formerly practiced at Shearman & Sterling and Freshfields Bruckhaus Deringer, and now teaches law at my alma mater.
Google and Microsoft GCs work Super Bowl Sunday
February 4, 2008 | Filed Under Deals, In the News
Yesterday, most of us were watching one long commercial interrupted by snippets of football. Not the GC of Microsoft, Brad Smith, or the CLO of Google, David Drummond, however.
Clearly deeply involved in the hostile offer for Yahoo, Mr. Smith struck first yesterday with a press release, noting that a Microsoft-Yahoo merger would be a welcome competitor to Google in paid advertising and search, and offer additional benefits:
Microsoft is committed to openness, innovation, and the protection of privacy on the Internet. We believe that the combination of Microsoft and Yahoo! will advance these goals.
Not to let that comment just hang there in the ether unchallenged, Mr. Drummond followed up shortly with this posting in the Google corporate blog:
Could the acquisition of Yahoo! allow Microsoft — despite its legacy of serious legal and regulatory offenses — to extend unfair practices from browsers and operating systems to the Internet?
Later in the day, according to press reports, Google CEO Eric Schmidt “reached out” to Yahoo CEO Jerry Yang and offered to “help.”
A deal of this size is good for a flagging legal economy, at the very least.
Let the real games begin…
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