September 29, 2006
How Much Legal Research Should Hunsaker Have Done?
As in-house counsel, I would routinely encounter "problems" that, if construed with the most negative inferences and splashed on the New York Times, would be embarrassing to the company (and me) at best and life-threatening to the company (and possibly personally career-limiting) at worst. This was not a rare and occasional moment, nor were they accompanied by blazing neon warning signs. Instead, I encountered them almost every day, and they were interspersed among a long list of mundane to-do items.
In-house counsel typically deal with this constant inflow of problems in one of two ways. One approach is to respond to every problem as if our actions will be evaluated on the front page of the NYT. In-house counsel who adopt this approach tend not to be very successful in their jobs; the burnout factor is high, and they don't win a ton of friends within the company.
Instead, most in-house counsel triage issues—they calculate the probability and quantum of risk and invest time and resources accordingly. This is a logical response because the chance that any particular problem will explode is mathematically low, so it typically does not make sense to provide industrial-grade solutions for every problem. Plus, there are simply too many problems to treat each one as mission-critical.
With this perspective, let’s take a look at how Kevin Hunsaker dealt with the legal evaluation of pretexting. Once he had identified that pretexting was being used, he did an hour of online research. He also asked for—and got—strong assurances from the investigations vendor. This response is entirely consistent with a triage. He needed to figure out how big a problem pretexting was. Based on the two independent sources (his research and the vendor’s assurances), he concluded that pretexting was an acceptable risk.
We could second-guess this decision. The vendor’s assurances were worthless because of the vendor’s self-interest/conflict. As for his self-research, it’s hard to get a good broad overview of an issue in 60 minutes of online searching. Further, I have to imagine that even cursory research revealed that pretexting was controversial and potentially legally impermissible. If he was looking for the truth, then I would think his cursory research more than enough yellow/red flags. If he was looking to validate a pre-formed hypothesis (or to avoid rocking the boat), he might have found enough material in his research that pretexting wasn’t clearly illegal to support the hypothesis.
However, I think it’s unfair to second-guess his research approach. He did exactly what most in-house counsel would have done in this situation—he discounted the long odds that this issue would be front page news, and he did just enough research to determine that there was some support for concluding that pretexting was legal (the vendor’s representations, plus the mixed data from his own research). Excluding in-house counsel who have pre-existing knowledge about pretexting, I bet 90%+ of in-house counsel dealing with this issue would make about the same research choices as he did.
When Baskins (and others) pressed Hunsaker on his legal conclusions, Hunsaker double-checked his work by (1) speaking with a lawyer that has represented his investigations vendor, and (2) arranging for a conversation between that lawyer and Hunsaker’s business client (Gertilucci). This second round of research is more susceptible to second-guessing. Why isn’t Hunsaker turning to in-house HP privacy experts (of which there are several)? Why isn’t Hunsaker turning to HP’s normal outside counsel? Why isn’t Hunsaker doing more of his own research?
Instead, he turns to a lawyer who, though knowledgeable about pretexting law, is not a neutral source. This situation is filled with conflicts—if the investigations vendor paid the legal fees for this call, then Rule 1.8(f) applies. But more importantly, can the lawyer really tell client A that pretexting is legal while telling new client B (and customer of client A) that pretexting isn’t legal? This seems to be a conflict under Rule 1.7 and sets up a “fouling your nest” situation. As a result, this lawyer wasn’t a credible source, and Hunsaker’s apparent failure to recognize that seems like a significant error. In addition, I would hope that many lawyers would be reluctant to render advice to a client’s customer in an analogous case; it’s just too risky and conflicts-filled.
While I think Hunsaker didn’t do enough follow-up research, I also think Baskins (as Hunsaker’s boss) didn’t adequately supervise him. She asked Hunsaker at least twice if the investigation methods were legal. However, it’s not enough for her merely to ask her lieutenant if everything is OK. She needed to probe a little deeper, ask what Hunsaker did, and evaluate its credibility.
Through the right questions, she easily should have been able to determine that Hunsaker had reservations about pretexting, and that he had satisfied his concerns by (1) doing 1 hour of online research, (2) asking the vendor for assurances, and (3) talking to the vendor’s lawyer. I think many supervising lawyers would have discounted the credibility of all three sources; a natural response would have been to ask for a second opinion from an in-house expert or more neutral lawyer. It isn’t always easy as a supervisor to express doubts about a subordinate’s work, but here there should have been enough yellow flags for her to request a more thorough answer—especially if she now wants to finger-point at Hunsaker.
While it appears that neither Hunsaker or Baskins exercised the kind of care we might expect, at the same time, I’m a little sympathetic to their plight. As an in-house counsel, having our judgments questioned on the front page of the NYT is our ultimate nightmare. I'm comfortable with most of the choices I made as in-house counsel, but I'm also glad that none of them have been dissected by the press.
UPDATE: Rob Hyndman weighs in: "I doubt that Baskins’ mistake was counselling an investigation that she knew to be improper; I suspect it was over reliance on a subordinate when her own instincts were telling her subordinate might well be wrong."
UPDATE 2: The WSJ Law Blog notes an article in Financial Times which says "Corporate lawyers live in a perpetual grey area...There are large gaps between what is required or forbidden by law and what may be done ‘legally’, and corporate lawyers are asked to bridge that divide every day."
September 27, 2006
It seems like there were 1,001 disclosures made in our disclosure package when we bought our house, and yet not one of them mentioned the risk of squirrel attacks. (Cuesta Park is less than a mile from our house).
UPDATE: The squirrels are facing the ultimate retribution for chomping on the 4 year old boy. FWIW, we're staying away from Cuesta Park for now.
UPDATE 2: The city has brought in the squirrel-crusher.
September 26, 2006
Website Publishes Professors' Past Grades
From the Chronicle of Higher Education: Pick-A-Prof, one of the numerous websites providing student reviews of professors, publishes the grading histories/practices of professors for many of the 170 schools it covers. Obviously, many schools do not provide this data willingly, but Pick-A-Prof's believes such data is a public record, thus forcing some public institutions to fork it over. Sometimes, lawyers are needed as attitude-adjusters. See the story about its lawsuit against UC Davis, which just last month concluded favorably for Pick-A-Prof when UC Davis relented.
Should we simply put this in the "more-information-is-better" category? Unquestionably, this information is highly relevant and interesting to students picking among courses. Further, it's existed in some limited fashion forever--certain professors get a reputation for being easy or hard graders, and these impressionistic reputations will be replaced by hard data.
However, will students use past grading data wisely to improve their decision-making? There are plenty of reasons to believe they will not. Instead, there remains significant concern that students will flock to the easy-grading professors, regardless of pedagogical merit, while tougher professors either will have their enrollments suffer or, worse, will change/lighten up their grading standards as a marketing ploy to prop up course enrollments or to win popularity contests.
To be clear, I've routinely published my own grading data (for example, see the 11 years worth of exam writeups for my Cyberlaw course), so I'm not philosophically opposed to the public availability of this data. However, to the extent that democratized grading information contributes to students viewing a course simply as an economic transaction to acquire a grade, I think we all suffer.
September 22, 2006
AmLaw on IP Associate Satisfaction
Congratulations to Finnegan Henderson for ranking second in American Lawyer's midlevel associate satisfaction survey. In discussing Finnegan Henderson's success, the article talks a little about the relevant satisfaction of IP associates compared with other associates:
Throughout our survey, IP midlevels reported slightly higher satisfaction levels than their non-IP counterparts. Of the 6,568 associates who participated in our survey, roughly 8.3 percent said they are primarily IP lawyers, and, as a group, they gave their firms higher scores than the non-IP associates on all 12 of the questions that we use to determine a firm's composite score. The five areas where the gaps between IP respondents and non-IP respondents were greatest are likelihood of being at the firm in two years (3.96 for IP respondents; 3.65 for non-IP respondents), interest level of work (4.24; 4.02), satisfaction level of work (4.07; 3.85), management openness about finances (3.59; 3.39) and how clearly the firm communicates about partnership chances (3.14; 2.97). IP respondents also had an edge over non-IP respondents in training and guidance (3.73; 3.6) and overall satisfaction with their firm (4.21; 4.05).
These scores may have something to do with the field itself and the midlevels it attracts. IP associates tend to be older and have significant work experience or training outside the law, often in science or technology. In addition, IP is intellectually abstract -- a still-developing body of law that increasingly commands the attention of big business and the public.
No industrywide studies have been done on the composition of the IP bar, but our survey results and interviews with practitioners suggest that IP associates are more likely to have taken time off between college and law school. While 57 percent of non-IP associates in our survey took a break between the two, 65 percent of IP associates did. In most cases, IP associates spent that interim period either getting an advanced degree in science, technology or engineering, or working in one or all of those fields.
"Very often [IP associates] are second-career attorneys," says Anna Tsirulik, a managing director with the recruiting firm Major, Lindsey & Africa. "Either they are young guns with a computer science degree who worked as a software engineer for two years or, very often, people who had a true career practicing as a mechanical engineer for 10 years. With that seniority come wonderful traits like maturity and judgment."
IP associates with a background in academic science or technology relish the opportunity to pursue that intellectual passion in a different venue. Most didn't leave the lab bench for the legal bar because they were tired of studying science; rather, they were tired of doing research. Finnegan associate Nicole Valtz says that as a researcher, "only 5 percent of what you do works." But as an IP lawyer paid to learn about cutting-edge science and technology, "we only see that 5 percent."
September 20, 2006
"I shouldn’t have asked...." = Wrong Answer
Another email exchange has emerged in the HP pretexting investigation, this time between HP's "Chief Ethics Officer" (CEthO) and a line manager from January 30:
CEthO: "How does [the PI] get cell and home phone records? Is it all above board?"
Line manager: the PIs "call operators under some ruse...I think it is on the edge, but above board. We use pretext interviews on a number of investigations to extract information and/or make covert purchases of stolen property, in a sense, all undercover operations."
CEthO (entire response): "I shouldn’t have asked...."
Offhand, I can't think of a single situation where "I shouldn't have asked" is an appropriate response from a CEthO. In any situations where a client's response makes the CEthO uncomfortable, the right response is "I'm glad I asked" because the CEthO can then proactively implement remedial steps to ensure conformance with good ethical practices (regardless of minimum legal standards).
Stated differently: inevitably, in-house counsel will look under a rock and find some worms. Sometimes, the only logical course of action is to put the rock back down and try to ignore the worms. However, I don't see "returning the rock" as a viable option for a CEthO--I think the entire organization depends on a CEthO to attack the tough topics that everyone else would prefer to avoid.
This exchange also illustrates how bad corporate practices can continue for years, even if they are not legal or ethical. As you can see, the line manager's response was basically--we lie all the time. This systemic lying becomes self-reinforcing. Each new person who confronts the practice must wrestle with the weight of precedence, conclude that everyone who previously evaluated the practice was wrong, and have the courage of convictions to stand up and say that they reject the status quo. Few people have enough self-confidence to believe that their analysis is more accurate than others and the courage to act on it. Instead, people often back away, rubber-stamping bad practices by inertia.
I have not yet figured out how to overcome this tendency. At minimum, I think we need better payoffs for those with the courage to reject industry-standard bad practices, and worse payoffs for those who defensively rely on the cover of industry standards to perpetuate bad practices.
UPDATE 2: This appears to have been a career-limiting response by the CEtho.
September 19, 2006
AALS Panel on "the Ratings Game"
How much do law professors hate the USNWR law school rankings? So much that at the big annual meeting for law professors, an entire day-long workshop has been organized on the "ratings game," including panels with descriptions like:
"In this session, speakers will confront the #@%$&**@ U. S. News and World Report rankings system"
"In this session, panelists will imagine creative alternative ways to assess law schools that may entail rating, not ranking, and ignore the U.S. News"
It takes a fair amount of antipathy to motivate spending a whole day to collectively figuring out how to moot the USNWR rankings! Unfortunately, I suspect this workshop won't succeed in doing so, although I do support the endeavor.
September 17, 2006
Professor Sells Podcasts of Lectures; Is Asked to Stop
From the Chronicle of Higher Education:
Robert L. Schrag, a communications professor at North Carolina State University, recorded his classroom lectures and offered them for sale on a website for $2.50 each. There wasn't a great market for them (only 12 bought, with a total of $11 going to Schrag), but the practice nonetheless raised some difficult questions. NCSU, like many universities, allows its professors to retain their copyrights, so Schrag wasn't infringing on the University's copyright (however, a different result might obtain at other schools with different policies). Yet, the practice of a professor getting double-paid for classroom duty implicates some complex fairness norms, plus there is at least a hypothetical concern that some students might be willing to pay to bypass classroom attendance for the convenience of podcasted lectures.
After the communications dean indicated that she was bothered by the practice, Schrag stopped. However, surely we haven't heard the last of this practice--or of other ways that enterprising professors can generate alternative revenue streams.
UPDATE: I've learned that a site, TeachersPayTeachers.com, is trying to make a market for teachers to sell lesson plans to other teachers.
September 16, 2006
WaPo on Silicon Valley Ethics
By Eric Goldman
The Washington Post runs an article entitled Silicon Valley's Golden Past Tarnished by Latest Probes, a retrospective/catch-up on the evolution of Silicon Valley ethics, with quick stops in round-tripping, stock option backdating and the HP scandal. As we've repeatedly learned, hero worship cannot withstand scrutiny, even in the Silicon Valley.
September 12, 2006
Betting Against the Packers Pays Off Big
From an AP story: The Green Bay Packers haven't been shut out in 233 games. Brett Favre hasn't been shut out in his 16 year career. So it seems like a safe bet that the (sometimes hapless) Chicago Bears aren't going to shut out the Packers on opening day. Randy Gonigam, owner of the Gonigam's World Furniture Mall in Plano, IL and a big Bears fan, takes that bet. He promises his customers that their purchases (up to $10,000 each) will be free if the Bears shut out the Packers on opening day. 206 customers, $300,000 of sales and one shutout later, Gonigam describes himself as a little "shell-shocked." But, to his credit, Gonigam made a smart move--he has bought prize reimbursement insurance that covers this event--so a truly happy day for *everyone* in Plano, IL. As for Wisconsin, well, I presume that Monday was a day of mourning.
September 08, 2006
As academics, it's not often that we get our hands on a real email exchange between attorney and client that we can use for pedagogical purposes. Fortunately, the WSJ has republished the email exchange between Larry Sonsini and Tom Perkins regarding the HP board's supervision of its own directors and others. As the comments indicate, this email thread is a great issue-spotter. In the future, I may very well use this email as a test question. Among the issues it raises: client identity, competence/diligence, confidentiality and the attorney-client privilege, and false statements by a lawyer. Good stuff.
UPDATE: Larry Sonsini was the subject of the lead front page article in the Mercury News today.
UPDATE 2: Yet more questions raised about Sonsini's choices--in this case, the decision to chair the emergency board meeting (from which Dunn recused herself because of conflicts) even though there is potential adversity all around.
September 07, 2006
Santa Clara Women's Soccer Team
It turns out that Santa Clara University has a strong women's soccer team. The San Jose Mercury News ran a lengthy story on its successes--the women's soccer team "has reached the national semifinals 10 times, won an NCAA title, visited the White House and been featured in the movie Bend It Like Beckham." Coach Smith tried to explain his success by describing the special approaches to coaching a woman's team, which I'm offering up without comment:
Tactically, technically, physically, there isn't much difference between coaching men and women....But psychologically, there's a huge difference. With guys, it's `How can I get mine?' With women, it's `Is the chemistry right? Are we happy?' Women are much more concerned with each member of the group being happy and healthy, and they want to do what they can to make it right"....Guys don't care about [feedback], but with women, it's critical. If a kid is having a bad day, I want to know it so I'm not as critical of them, or so we can talk before practice. They need to know that you care, that you're aware of their family and personal life.
September 04, 2006
Dina Turns 1!
Hard to believe it, but Dina turned 1. I'm sorry to say that I've been remiss about disseminating photos of her. I feel guilty for succumbing to second child syndrome. Despite that, if you want the latest poorly edited photo gallery, see here. Apologies in advance for Jacob's nudity.
We celebrated Dina's birthday with a gathering of my parents, my sister and brother-in-law, and their two daughters. We enjoyed Pizz'a Chicago, the haul from our farmer's market excursion, and Carvel ice cream cake on our patio during another picture-perfect California afternoon. Dina consumed her ice cream cake as only a 1-year-old can. Fortunately, we were outside, so we just put her and her high chair in the grass and hosed her/it down.
September 03, 2006
Ferry Building Farmer's Market
Lisa and I took a quick 18 hour get-a-way to San Francisco this weekend. This finally gave us time to check out the Farmer's Market at the Ferry Building, reputed to be one of the best in the country. It was amazing! There must have been over a hundred vendors there, selling all kinds of produce, flowers, dairy, baked goods, meats, condiments and other goodies.
We got some things we had never seen before, like an "Israeli melon" (I'm not sure if it was a Galia or an Ogen melon) that was like an aromatic honeydew, and a Pink Pearl apple with pink flesh and a sweet-tart flavor (this was a big hit with our nieces). We loaded up on fruits (red grapes, green grapes, white nectarines, golden Pippin apples, red and yellow raspberries, dried kiwi) and vegetables (radishes, pineapple heirloom tomatoes, English peas, sugar snap peas, onion sprouts, sprouted peas, cherry tomatoes, basil) and other yummies (goat cheese, baba ganoush, pesto, hummus, tofu jerky). The selection really was overwhelming, but despite the competition, the prices weren't that cheap. Lisa won't even tell me how much we spent (I don't think I want to know). Nevertheless, there really is nothing like fresh-from-the-farm produce, and there are few places like California where just about everything can be grown locally.