Microsoft vs. Google: Waging War In-House Style
March 6, 2007 | Filed Under Compliance, In the News
Microsoft takes up the banner of copyright today against Google. It’s lead warrior is none other than one of its in-house lawyers, Associate General Counsel Thomas Rubin.
The New York Times reports that Mr. Rubin will give a speech today to the Association of American Publishers, and draw a bead on arch-nemesis Google:
“Companies that create no content of their own, and make money solely on the backs of other people’s content, are raking in billions through advertising revenue and I.P.O.s,” said Mr. Rubin, who oversees copyright and trade-secret law.
Google responded last night, before Mr. Rubin uttered a word:
David Drummond, Google’s senior vice president for corporate development and its chief legal officer, said in response that Google worked with more than 10,000 publishing partners to make books searchable online and had recently added the BBC and N.B.A. as YouTube video partners.
“We do this by complying with international copyright laws,” Mr. Drummond said, “and the result has been more exposure and in many cases more revenue for authors, publishers and producers of content.”
This copyright-fight by Microsoft against Google was carefully choreographed. The Financial Times seems to have broke the story, since it just happened to have an article by Mr. Rubin dated today on its web site last night (that link only works for FT subscribers). One excerpt:
Google, for example, says its book search technology will one day make available a copy of every book ever published in a vast online database of indexed content. A worthy goal, to be sure. But in pursuit of that goal, Google has taken a unilateralist approach by contending that it is entitled to grab books off library shelves and copy them wholesale without obtaining the permission of the publishers and authors who own the copyrights in those works.
It’s certainly a sign of the pressure that Microsoft feels from Google that it takes a public-service position before a publishers association. While one focus of Mr. Rubin is Google’s book indexing project, certainly YouTube is on its mind and in its cross-hairs.
The text of Mr. Rubin’s speech is here; the related Microsoft PressPass interview with him is here (where he mentions Microsoft’s own Live Search Books initiative).
In fact, this appears to me to be a sign that Microsoft has decided to use copyright as a legal weapon in this one battle as part of its larger war against Google. It’s almost as if Microsoft is taking on the entire business model of Google.
I bet Google already has a war room (or war-wiki?) going on this, as evidenced by the quick response from its CLO, Mr. Drummond. Perhaps ace Google copyright counsel William Patry will take this up on his copyright blog.
Game on! Maybe Microsoft will release “Halo 4 — Copyright Wars” for the XBox 360.
Another GC Becomes CEO
February 27, 2007 | Filed Under GC as CEO Springboard, In the News
And this time it’s not a Jeff or a Frank: it’s an Angela!
Health insurer Wellpoint announced the appointment of general counsel Angela Braly as CEO. Ms. Braly then becomes the highest-ranking of the 10 female CEOs on the Fortune 500, according to USA Today.
It’s about time that a woman joins the fraternity of such ex-GC CEOs as Pfizer’s Kindler and Home Depot’s Blake. To say nothing of lawyer-CEOs at the helm of Goldman Sachs, Time Warner, Citigroup, Marsh, and Waste Mangement, to name more than a few.
Ms. Braly was an architect of WellPoint’s recent acquisition strategies and also was responsible for public affairs. Given the substantial regulatory and policy challenges faced by health insurers, a legal background here is a natural, and has some strong parallels to the appointment of Mr. Kindler at Pfizer.
I fully expect some press reports to comment on Ms. Braly’s experience in a somewhat negative way (such as this from the Chicago Tribune; it fails to note that she was previously CEO of a subsidiary). Perhaps down the road the appointment of a GC as CEO won’t be news on this fact alone, and a legal background will be seen as an asset.
Code Red for jetBlue
February 21, 2007 | Filed Under Crisis Planning, In the News
Sometimes it seems like you can’t catch a break.
So it seems for jetBlue, an airline finally returning to a normal schedule after sending a different Valentine to some customers in the form of 10-hour waits on the JFK airport tarmac.
CEO David Neeleman has been a fixture on all news channels. The poor man looks like he could use a getaway to Aruba.
Mr. Neeleman dutifully followed crisis communications 101, and was out front stating that jetBlue was aware of the situation, heard the (irate) customers, acknowledged that jetBlue’s performance was intolerable, and was focused on making it right. Unfortunately for jetBlue and Mr. Neeleman, a combination of continued bad weather, communications and logisitical snafus, and FAA duty regulations all conspired to turn a bad day into a worse week.
Once you’ve said “I’m sorry” it’s hard to come up with something more for the next day (or news cycle).
So, in an attempt to shift the focus of the debate, jetBlue has offered up its own customer “Bill of Rights,” which includes a video on YouTube.
Former law review members can catch a footnote at the bottom of the BOR, probably courtesy of jetBlue Legal:
*These Rights are subject to JetBlue’s Contract of Carriage and, as applicable, the operational control of the flight crew.
Delays are defined in terms of a “Controllable Irregularity” which I will resist commenting on.
This approach may help, but it may appear a bit hollow right now, given their own shortcomings (when measured against the BOR) over the past six days. In addition, while compensating for delays is better than nothing, most people I talk to cringe at the notion of anything more than an hour’s wait on the ground. When you approach 10 hours, many passengers are thinking less about rights and more about self help.
(To be fair to jetBlue, part of the impetus for their BOR is the cacophony in Congress on the subject; if only that body would read the original BOR from time-to-time).
In the end, jetBlue will regain terminal velocity with great service for fair value (safety being a given).
And I’d advise against serving this:
Running Out of Options
February 19, 2007 | Filed Under On The Dock, Compliance, In the News
You go away for a week, and you know something is different when you see a former GC doing a perp-like walk on the CNBC monitor in the airport.
A good summary of the GC angle on the options backdating mess is from Bloomberg News, via the Philadelphia Inquirer; here’s a highlight:
The exodus is unprecedented among the ranks of corporate attorneys, who ensure the legality of commercial transactions, said Susan Hackett, vice president of the Association of Corporate Counsel. The departures reflect added responsibility that in-house lawyers now bear for company actions, she said.
“I have never seen as much turnover in high-profile positions,” said Hackett, who has been at the Washington-based group representing 8,000 corporations for more than a decade. “This has been a watershed.”
One interesting point is the description of one of the duties of corporate attorneys (and by implication particularly GCs) to “ensure the legality of commercial transactions.” As we are seeing in the options backdating cases, the level of involvement of the GC and the legal department can vary. Rather than looking at just at legality, some of those involved could have started with propriety.
A former officer of ACC gets it right:
“Ten or 15 years ago, general counsels were mainly just asked whether a corporate action was legal or not,” said Al Gonzalez, 52, a past vice president of the Association of Corporate Counsel and currently general counsel at Tyson Foods Inc., based in Springdale, Ark., which is not involved in the scandal. “Today, the first questions they are asked is, ‘Is it ethical? Does it conform to the company’s code of conduct and core values? Is it the right thing to do?’ “
A sign that things may have gone way past “legality” is contained in today’s Wall Streeet Journal ($$$) which recounts alleged options practices at Mercury Interactive. The story quotes documents produced in a court proceeding as referring to “magic backdating ink,” presumably the sort that can lead to a change in an option grant date.
I don’t remember hearing about “magic backdating ink” in law school. But it doesn’t sound like something that would require much research. Perhaps a case study for this upcoming show on Fox?
New GC for HP
February 8, 2007 | Filed Under Governance, In the News
Hewlett Packard announced that Morgan Lewis partner Michael Holston has been appointed as general counsel. HP CEO Mark Hurd highlighted key attributes of Mr. Holston:
“Mike is a first-rate lawyer, with extensive trial and government-relations experience, as well as a deep knowledge of HP and its culture,” said Hurd. “I am delighted that he has accepted this position.”
The AP story is here.
Mr. Hurd relied on Mr. Holston heavily during the director leak investigations last year. Mr. Holston (and his firm) took a front line position in the matter, and was seen as helping stabilize a very volatile situation.
Mr. Holston joined Morgan Lewis in 2005 from Drinker Biddle.
The HP GC position is one of the premiere openings in the last few years. While HP faces legal challenges on many fronts, these matters can also provide opportunity to move the company (and the legal department) forward.
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