In House - The FindLaw Corporate Counsel Blog

January 2018 Archives

When the news broke that the once highly acclaimed gymnastics doctor, Larry Nassar, was accused of child molestation and possession of child pornography, the Michigan State University community was probably more taken aback than any other. Nassar had not only practiced sports medicine for the university's athletes, he also taught osteopathic medicine.

As a result of the Nassar scandal, fingers are being pointed at the university's lawyers, and potentially rightly so. Recently, MSU's general counsel, Robert A. Noto, stepped down amid demands from the board. Noto, who has been the school's GC for almost 25 years, is not the only university lawyer to come under the microscope either.

When Sexual Misconduct Costs a Company $2 Billion -- in a Day

Steve Wynn, the billionaire casino owner, knows something about high risks.

But he had no clue about how devastating his high risk behavior could be to his company. When allegations about his sexual misconduct became very public recently, Wynn Resorts lost $2 billion -- in a day.

That's how the market responds to stories that don't sell so well these days. In the Weinstein era, it is especially bad business to let sexual harassment go unchecked.

While the Softbank deal with Uber came to a close before the end of the year, Benchmark's lawsuit over the Kalanick's appointment of two Uber board seats was only recently dismissed. Though the case settled months ago, the settlement was contingent upon the Softbank deal successfully closing.

As part of the settlement agreement between Benchmark and Uber, both Benchmark and Kalanick were able to sell off significant stakes, which, given the critical reception of Benchmark's lawsuit and Kalanick's repeated questionable actions, seemed to be what the majority of investors wanted anyway.

Sports Fantasy Companies Could Pay 15 Percent Revenue Tax

Two things are certain: taxes and the death of an industry.

At least it could be that way for fantasy sports, which is in the crosshairs of lawmakers in Massachusetts. The legislature wants to impose a 15 percent tax on fantasy sports companies there, including the biggest players in the industry.

At the same time, the U.S. Supreme Court is expected to open up betting on real sports everywhere in America. So does it portend the end of fantasy sports betting? Don't bet on it.

When companies evaluate their legal departments, generally, the most important metric involves cost: Did the lawyers save the company more money than they cost? However, this metric is incredibly elusive, as litigation/legal exposure is about as far from an exact science as it gets.

In addition to the various dollars and cents metrics that companies have used for years, there are quite a few metrics that go beyond the usual. Below you can read about three less common metrics you can use to evaluate your in house legal team.

It's no secret that the legal profession, like every other industry, has not rid itself of the invidious scourge of sexism and discrimination. In fact, a recent study revealed that the not-so mythological "old boys club" plays a significant part in why female partners are selected less often than male partners by clients.

According to a recent study, the numbers are rather jarring. Male clients will choose a female partner to handle their matter only 17 percent of the time. Almost more shocking, when it's a female client, the number only increases to 25 percent. Interestingly, and making the dismal numbers even more disappointing, as Above the Law explained, the statistics on performance quality between male and female led teams of attorneys tend to be about equal. Additionally, single gender teams performed worse than teams that included both genders. 

For service industry employees, from attorneys to food servers, sexual harassment is a serious and pervasive problem. And it isn't just coming from bosses and co-workers, but customers and clients contribute to the problem as well.

The problem of customer sexual harassment is exceedingly prevalent in the restaurant industry, particularly for food servers. Often compounding the problem, frequently, a manager's response to an incident of customer harassment will solely be to remove a server from the particular customer's table. While seemingly appropriate, it does little to discourage the behavior and potentially penalizes the server. However, the very thought of a manager speaking to a customer about not sexually harassing staff is likely to send chills down the spine of business owners.

Yelp Leadership Misled Investors, Lawsuit Claims

A group of Yelp investors are suing the review site for misleading them about the company's financials.

According to a proposed class action, shareholders say Yelp withheld negative financial information in the last quarter of 2016. They say it came to light when the company released its next earnings report.

Adding insult to their injury, the plaintiffs say, the company's chief executive officer sold off $25 million in stock during that time when it was artificially inflated. Talk about a bad Yelp review!

Handling a CEO Who Thinks He Is Above the Law

Some people will do anything as long as they can get away with it.

If that somebody happens to be the chief executive officer, it can be a bigger problem than just one person. Bad behavior can literally take down a whole company.

If you are the general counsel, now it's your problem. So what to do with a CEO who thinks he or she is above the law?

According to the brilliant minds over at the Harvard Business Review, employers can help identify those employees with the highest potential to succeed thanks to some scientific research. They explain that doing so is critical as you need to identify your top performers in order to make sure you retain them, and best utilize them.

Surprisingly, the three factors cited in the HBR report don't seem very scientific at all. But, apparently, the three primary indicators for an employer to identify its star employees are:

Starz' New GC Hits the Ground Running

Audrey Lee is not just stepping into the lead role as general counsel for Starz, the entertainment network.

Lee moved over from Lionsgate, the company's corporate parent where she served as deputy general counsel. In accepting the new assignment, she said she looks "forward to helping chart the course for business during a time of rapid change for our industry."

But just as soon as she walked into her office, Starz promptly filed for emergency injunctive relief against a cable company that turned off its programs. Lee has hit Beverly Boulevard running.

After AI, How Valuable Is Your Company's Data?

Economists say data is the new oil.

It suggests that data is the world's most valuable resource. And if your company has it, then you may be sitting on an untapped source of money.

Like an oil rig, it could be a gusher. Or it could blow up in your face. Here are some precautions to consider before you start drilling.

Billionaire venture capitalist Peter Thiel is making people wonder about whether it is morally (and legally) okay to purchase the crushed remains of your former legal adversary.

Thiel has been making headlines over his desire to purchase Gawker, whom he played a large part in destroying. He did so by funding the Hulk Hogan sex-tape lawsuit, which resulted in a verdict and settlement in 2016 which basically ended the internet media company.

Tesla, one of the hottest and most followed companies, is facing yet another international lawsuit. For the second time, the inspired automaker is being sued by customers in Norway that claim the company's P85D was misrepresented and not advertised properly to buyers.

If you think this sounds familiar, well, it is. The lawyer handling the matter pretty much explained that it is the same type of case that settled last year, with a new batch of owners. He further explains that the new batch of owners that filed suit are looking for the same sort of settlement that was reached in the prior case.

Burger King to Pay for 'Modified' Sandwiches

Buy-one-get-one-free deals can be really costly if your company sells a ton of them.

It's not the typical loss-leader sales; it's the typical class-action lawsuits. In Burger King's case, it was a $4 breakfast sandwich that turned into $185,000 in attorney's fees and $10,000 in expenses.

That's how much the company has agreed to pay the plaintiffs' attorneys, plus $5 or a $2 gift card for customers who claim they were overcharged for a modified sandwich. Guess that's what happens when a company says you can have it your way.

Marijuana 'Compliance Company' Planned Illegal Pot Party

Capitol Compliance Management offers to help businesses comply with laws that affect the cannabis industry.

So it came as a surprise when city officials shut down the company's "Holiday Budtender Bash" before it started. It was supposed to be an event for attendees to "smoke out with your favorite budtenders" and try out the "dab bar" where people could sample the latest products.

Somehow, the company attorney didn't get the memo because that party was against the law.

Improve Your Presentations With Storytelling Structures

Nobody tells a story like a good storyteller.

Kurt Vonnegut, the acclaimed American author, had a structure for crafting stories. He said one is the Cinderalla story, and another is the Man in a Hole.

"People love that story," he said. That about sums it up for corporate counsel, especially when they have to present company successes and failures.

Look Out for New Data-Breach Notification Laws

The Securities and Exchange Commission is tightening rules on cybersecurity, but in a way it's like that horse already left the barn.

The SEC announced its plans after the massive Equifax data breach, which compromised the personal information of 145 million Americans last year. But what was worse, the SEC failed to disclose that it was hacked a year earlier.

Now the agency wants us to increase cybersecurity?

Beyond reviewing the places where in-house attorney jobs get posted and then actually applying to the postings, there are quite a few things you can do to increase your chances of actually getting hired.

Like any job, if you know what the actual duties of the job will be, tailoring your resume and cover letter to highlight your most relevant experience is critical. And if you don't have in house experience, you'll really want to stress prior transferable skills, training, or if you don't have either of those, then just hope your connections will be able to carry you through the door.

Below you can find five of the best tips for getting hired in house.

Why In-House Lawyers Should Be Practical, Not Academic

In the movie Wonder, a child shares the wisdom of choosing between right and kind: "Choose kind."

It's a quotable precept in a story about a boy adjusting to life with a birth defect. It is worthy of repeating in any life, but with a twist for the life of in-house counsel:

When given a choice between an academic or practical approach, choose practical.

Every year, without fail, there will always be scandals that result from in-house attorneys dropping the ball, or maybe just not doing their jobs well enough.

Maybe you can't always blame the attorneys for the mistakes of the top level brass; after all, most in-house attorneys are relegated to specific functions rather than top level decisions. Basically, if you've read between the lines, it's the general counsel that are to blame.

And since learning from our mistakes is the best way to avoid making them again, below you can find five of the top corporate legal scandals from 2017 that you can learn from.

IP Issues for Startups in 2018

With every new year comes a new startup. Then another. And another.

It's the heritage of American industry to start a business -- from a $1 mousetrap to a $1 billion ABCmouse. With all that history, you would think entrepreneurs would have learned something about how to trademark and protect intellectual property.

That's where in-house counsel has to be creative. This is about helping startups avoid IP issues in 2018 and beyond.

Tips for Getting Out of a Meeting

Here's the absolute, best idea ever for a meeting: a brain-storming session on how-to get out of time-wasting meetings.

Seriously, who really wants to go to office meetings anyway? Exactly. Not even the presenter wants to be there.

So let's just think out loud, theoretically speaking, because thinking is an internal process, about the best reasons to dodge a meeting.

When it comes to leading a company, c-level executives have quite a bit of power and discretion. Apart from the legal liabilities executives and officers can incur on behalf of a company, poor decision making can lead to financial losses. As such, it makes sense for corporations to heavily vet and screen potential c-level hires.

However, a question that sometimes arises when discussing how to ensure a top executive is fit for duty is whether a company can (and should) subject top executives to mental health evaluations.

Tips to Improve Office Meetings

While walking to deliver a speech at NASA, President John F. Kennedy got lost and found himself in a janitor's closest.

The President encountered a man there, cleaning a mop, and asked what he was doing at the facility.

"Oh," the startled worker said, "I'm putting a man on the Moon." According to legend, that inspired JFK to "ask not what your country can do for you, ask what you can do for your country."

It was an idea that propelled a nation to the Moon, and it has the power to transform your meetings into inspirational moments. It's about purpose.