In-House Counsel Talking to In-House Counsel
Corporate Counsels 25th Annual General Counsel Conference took place in New York last week, and CorpCounsel.com published several stories as it unfolded (read them here, here, and here). But the two-day agenda offered an even wider variety of talks and panels, so below is a collection of some other highlights from sessions on crisis management, bringing e-discovery in-house, and learning to be a GC.
A recent corporate crisis thats gotten a lot of attention occurred on April 24, when a clothing factory collapsed in Bangladesh, killing more than 1,100 people. Many multinational retailers were immediately linked to the factory in media reports. One of them was Benetton.
The company issued a denial the very same day. But later it had to release a revised statement acknowledging that a Benetton order had been shipped by one of the manufacturers in the building.
Thomas Campbell and Ken Quinn, partners at Pillsbury Winthrop Shaw Pittman, talked about this incident as an example of how poor crisis management can jeopardize a companys credibility.
At their morning session on June 5, the lawyers explained that the clothing manufacturer violated some basic tenets in the crisis management playbook. Their own advice would be this: First gather the facts to determine the veracity of media reports before responding. In the meantime, use a holding statement to express concern and engagement.
They gave an example of a holding statement in their handout:
Our thoughts and prayers go out to those affected by this tragic accident. As the cause is under investigation, drawing any conclusions at this stage would be premature. We are fully cooperating with governmental authorities and will provide updates on the investigation as soon as possible.
The lawyers noted that all companies experience crises. Quinn asked the conference audience how many of them expected a crisis in the next year. Few hands went up. Then he asked how many felt prepared to deal with a crisis. Even fewer attendees raised their hands.
The general counsels office should be the epicenter of any crisis management effort, the Pillsbury partners exhorted, by coordinating legal, public relations, insurance, and victims assistance responses. They need to help control the timing and content of any communication while preserving attorney-client and work product privilege.
The new wrinkle in company communications is social media. In the old days, Quinn explained, a company could control the flow, and the press could be fed information in just a few well-managed sessions.
Now, it often begins outside of official channelsand it never stops. More than ever, a company needs a well-trained spokesperson, and companies themselves must use all available social media and Internet communication tools.
The company also needs to carefully monitor all of these communications, the lawyers said, because in addition to the spokesperson and critics, company employees may also chime in. And their unauthorized messages may confuse the public and clash with company strategy.
It sounds like a no-brainer: In a time of belt-tightening, companies can save money if their law departments bring e-discovery in-house. Maybe so, but think carefully before you dive in. That was the takeaway from the final panel discussion on June 5.
First, one caveat: the two speakers who took turns punching holes in this proposition both work for companies that provide e-discovery services. But they did make important points that could help a legal department, no matter what route it decided to take.
Rich Cohen, vice chairman at Renew Data (and once GC at Ohio Power), thinks theres a growing trend among companies to bring discovery in-house. At the same time, he said, law firms are volunteering to handle it, and vendors are saying: Step aside. We can do it all.
What should law departments do? The first step, Cohen said, is to take stock of your companys needs. Whats your litigation profile? What kind of discovery job are you contemplating? Dont go into it blindly, he warned.
One purpose of buying e-discovery services, he noted, is to expedite analysis of data in order to tell the businesspeople whether they have a problem. And vendors may be better suited to this task than in-house lawyers.
Panelist Drew Lewis, e-discovery counsel at Recommind, suggested that legal departments may not want to take on the complete e-discovery job in their big cases . They may be better off tackling a manageable portion. Its also important to remember, he added, that your goal isnt to look through all the documents; its to find the 20 that will determine the outcome of the case at hand.
Moderator G. Daniel McCarthy, a director in the Gibbons corporate law department, asked the panelists how inside lawyers, outside lawyers, and service providers are supposed coordinate their discovery activities.
Cohen said that can be a real problem and sketched the following scenario: A companys law department hires an e-discovery outfit and outlines the scope of work it will pay for. But its outside law firm is trying the case, and a partner calls the vendor and describes what the firm needs, which extends beyond the limits of the work ordered. The vendor hesitates, but the firm insists.
Then it gets ugly. The vendor calls the in-house lawyers, who countermand the directive and tell the law firm to cut it out. The law firm turns around and calls the vendor, threatening never to hire the shop again. And this isnt a hypothetical situation: True story, said Cohen. It happens all the time.
McCarthy asked who should be in charge.
The panelists agreed on an answer: the general counsels office. The GC needs to own the process, Lewis said, and make it clear to company executives who is in charge. The law department is also responsible for record retention during litigation, Cohen pointed out.
When the law department is ready to establish an e-discovery policy or change an old one, McCarthy suggested that the best approach would be to call a summit meeting with all the constituencies involved.
Before this discussion, summit meeting would have sounded a bit hyperbolic. But by the end of the session, it seemed perfectly apt.
What was perhaps the conferences most intriguing discussion was the last one on GC Easts second day. Four general counsel talked about the process of becoming a GCand how they train their companies lawyers. It was moderated by Cynthia Dow, who works at Russell Reynolds Associates, where she helps companies recruit their top in-house lawyers.
Jennifer Daniels, now general counsel at NCR Corporation, was a litigator at IBM when she started thinking about advancement, she told the audience. What she found out, she said, was that shed have to broaden her experience to have a shot at the GCs office. Specifically, shed need to show that she could close deals.
Daniels said she was torn. She loved what she was doing, and commercial transactions held very little appeal for her. Besides, she wasnt sure that shed be any good at it.
She decided to take a chanceand discovered she'd been wrong about doing deals. She loved transactions. She learned to listen more and talk less. She learned that, despite her doubts, she could command the attention of a group. And she could stay calm.
Daniels worked her way up to be GC of the Americas at IBM, and later was general counsel at Barnes & Noble before moving to NCR in 2010.
Some of the adjustments in-house lawyers need to make may sound like small matters of style, but they can be important. Sarah McConnell, general counsel of ABM Industries Inc., said that lawyers need to learn to talk to business colleagues about ordinary things, like sports, rather than always speaking asand sounding likea lawyer.
Kathy Leo, chief legal and people officer at Gilt Groupe, said that shed only been at her company for two months when members of the executive team criticized her for not speaking up enough. She was taken aback, but she realized that a small shop like hers requires close and candid relationships. And there were no exceptions for newcomers to the legal department.
For Adam Rosman, who was also a litigator before he became group general counsel at Willis North America, it was important to build companywide trustso that any employee could feel comfortable coming to see him. It can get tricky because of privilege, he added, but he considers it one of the most important parts of his job.
Theres one aspect of the job thats particularly hard, Rosman noted. He loves to be part of the business, and help it do better. But there will come a time when you will have to say red light or yellow light. And that isnt always easy.
It gets easier over time, Daniels said, if your business colleagues have seen that your track record is to say yes more often than no. That credibility makes it easier to say noand easier for your colleagues to accept.
Near the end of their conversation, the panelists discussed training the young lawyers they hire and shared both their peeves and their perspectives.
Rosman cringes when his lawyers send emails filled with legal jargon.
Likewise, McConnell instructs her lawyers not to write emails that expand into legal briefs. Im a big believer in the phone, she said.
For Leo, the big challenge is training company lawyers to be real business partners, not just the people who tell the business folks about the law.
Daniels summed up the attitude theyre striving for. Im on the team, she said. Thats whats important. Her role is like playing third base. But first and foremost, its about being on the team.