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SAN FRANCISCO-The latest corporate scandals that forced out general counsel from several of the world’s biggest technology companies have stuck their legal departments with a leadership vacuum. These companies-Hewlett-Packard Co., McAfee Inc. and KLA-Tencor Corp., to name a few-are without a doubt trying to fill those crucial positions. And whoever steps into the shoes of their GCs will have to be superheroes among attorneys, said Silicon Valley recruiter Carl Baier. “They obviously need someone who is squeaky clean,” Baier said. “I don’t think they can afford to have another embarrassing situation. Especially for high-profile, large public companies, icons of Silicon Valley.” They’ll also want someone who is willing to push back on directors and the chief executive, someone who feels empowered to speak up when fuzzy accounting and other ethical breaches cross his or her desk, legal recruiters say. Company leaders will have to buy in to the idea of a straight-talking GC for this to work, of course. “They want to find the best person and not necessarily somebody who is going to be a status quo type, but somebody who might kick some butt,” said recruiter Sandy Lechtick. Apple’s internal team Apple Computer Inc.’s general counsel, Nancy Heinen, stepped down earlier this year before the company admitted to backdating 15 stock-options grants. It remains unclear what role she may have played. To replace Heinen, Apple may use its internal search team, which recruiters say regularly fills executive spots. The company has already received general counsel nominations from several major firms, according to one recruiter. Ann Baskins, HP’s former general counsel, resigned last month on the day of congressional hearings about the company’s use of “pretexting,” or lying, to get reporters’ and directors’ phone records for a leak investigation. Adding to the tally of companies that have lost general counsel are CNET Networks Inc., Boston Communications Group Inc., Comverse Technology Inc., iBasis Inc., Monster Worldwide Inc. and UnitedHealth Group Inc. Chief legal officers from those companies resigned or were fired around the time of stock-options investigations. More could step down before the scandal-which involves more than 100 companies-concludes. “Clearly there’s a change in the air. Tech companies can no longer act the way they’ve been acting for the last several years, and the legal ramifications are much more amplified and certainly more visible,” Lechtick said. Stars on the companies’ remaining legal staffs might have a shot, but the companies might also want to send a message by hiring from the outside, Lechtick said. “I personally think that bringing in talent from the outside with a slightly different perspective and a fresh way of looking at the world would be a good idea,” he said. The next general counsel may also have to deal with a tense relationship with outside counsel. Though outside firms technically work for the GC, sometimes firms and their partners have built a special relationship with the company that can transcend the authority of a chief legal officer. And during times of crisis, the GC’s relationship with outside counsel can become even more counterintuitive. For example, HP asked its outside counsel, Wilson Sonsini Goodrich & Rosati of Palo Alto, Calif., to conduct an investigation into the company’s “pretexting.” This meant Wilson Sonsini lawyers were grilling in-house counsel about why they allowed pretexting to occur. More broadly, a director or chief executive might value the outside firm’s input more than the general counsel’s, especially if the partner helped the company blossom from meager beginnings. “It does create an interesting dynamic,” said one legal recruiter. “There are CEOs of public companies that have had relationships with attorneys for 30 years. In some cases those attorneys are instrumental in helping the companies get out of the garage. It’s important for a general counsel going into a particular position to know . . . a CEO might run your advice by outside counsel.” The recruiter said the trust of outside counsel is often well deserved, and is something the general counsel will just have to accept. But there are pluses to these positions, too. Whoever comes in may find it easy to have a positive impact; after all, there’s nowhere to go but up.

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