Nathan Harwell joined Rinnai America Corp., the Peachtree City-based maker of tankless water heaters, in 2015, as the company’s first general counsel.
A graduate of Mercer University Walter F. George School of Law, Harwell had worked at in-house counsel jobs at D.R. Horton, Exide Technologies and Medtronic.
At Rinnai, he was tasked with assessing the state of legal affairs for a company that was over 50 years old and in the midst of a rapid growth market. He had to build a legal department and establish relationships with the existing leadership team as a trusted ally.
He said he decreased outside legal spending by over 50 percent for two consecutive years and turned the legal department into a “profit center” by securing approximately $1.5 million in incentives toward a headquarters expansion project.
How have you reduced outside legal bills for Rinnai?
As the company’s first general counsel, I think it’s fair to admit that some of the initial cost reduction can be attributed to the mere fact that more tasks are being handled in-house. Prior to my arrival, all of the company’s legal—or even arguably legal—matters were sent to outside counsel for handling. One of the easiest cost reductions was achieved by pulling contracts in-house, aided by the creation of templates for most contract types. The legal department now personally drafts and reviews all major contracts rather than outsourcing them.
That said, the size of the reduction in spend, coupled with the continued year-over-year decrease, has been a bit surprising to me. I think the reason for that success can be attributed to my business-focused approach to the general counsel role. I try to remain highly engaged with my business colleagues and spend a lot of time studying and understanding the business. By placing such an emphasis on gaining alignment with the interests and goals of my client, I am able to move quickly on legal matters without spending a lot of time being brought up to speed. This also gives me more bandwidth to handle more matters despite my lean department.
How do you decide what matters should be handled in-house as opposed to sending to an outside lawyer?
The threshold question is usually whether a matter involves a niche area of law or a specific expertise with which I am not well-versed. I am fortunate to have been exposed to a pretty wide variety of legal issues throughout my career. That background has served me well as general counsel, and I think it has been one of my greatest assets in this role. That said, however, there are times when I have to enlist the help of outside counsel to deal with matters that require specific expertise (e.g., certain IP matters, government affairs, etc.) or require me to retain local counsel to assist with handling a dispute.
What’s your one piece of advice for a lawyer going through a crisis?
The answer likely depends on the type of “crisis” that lawyer is currently facing, and I think a few pieces of advice are universally true. First and foremost, the lawyer should ensure that a core leadership group has been formed to deal with the crisis, and that everyone in that group understands and agrees upon the guiding principle or objective the company is relying upon to deal with the issue.
In addition, it’s important to make sure the right hand always knows what the left hand is doing. As the company’s lawyer, she or he can serve a key role in ensuring effective and ongoing communications throughout the turmoil and is uniquely positioned to see around corners to know when to schedule calls and/or meetings at a moment’s notice.
I have been personally involved with crisis management efforts as an in-house attorney with a company that was facing multiple high-profile crises (e.g., shareholders’ class action, bankruptcy, etc.) that drew a good deal of media attention. In those instances, I would strongly encourage the lawyer to consider using separate PR firm to assist with crisis management efforts.