SuperConference 2009: Reports from the In-house Bar's Premier Conference

Like the many before it, this year's InsideCounsel SuperConference was a success. The 2009 show kicked off with a lively keynote from Robert Bauer, general counsel for Obama for America, who discussed lobbying and legal ethics. David Boies served as the keynote for Day Two, focusing his discussion on alternative fee arrangements.

The conference attendees also were treated to breakout sessions covering a variety of relevant topics. One well-attended session, "The Future of Fees," allowed in-house and outside counsel to hash out the dos and don'ts surrounding alternative fee arrangements. "The Changing Face of Green Business" offered insight into the legal responsibilities of a company going green. And two "Ethics Boot Camp" sessions provided a review of the ABA Model Rules of Professional Conduct and best practices for conducting internal investigations. The conference closed with a chat among judges about the challenges of e-discovery and a GC panel discussion about the role of senior legal executives in restoring confidence in business.

While this is just a small sampling of the learning that took place at the 2009 SuperConference--held May 5-6 in Chicago--the following pages offer several highlights from the event.


Diversity Difficulties

Now that the U.S. has a black president, an attorney general with roots in Barbados, a Jewish White House Chief of Staff and a Hispanic Supreme Court nominee, some people might say our country is post-racial.

Not true at all, agreed the three "Meeting the Diversity Call to Action" panelists. Despite an increasingly colorful West Wing, the growth of diversity in the legal profession hasn't come close to keeping pace with government.

As it long has been, boosting raw diversity numbers remains a major concern, but focus also has shifted to retaining diverse attorneys once a company or law firm hires them.

"Challenges of retention go beyond the early days of [physical] characteristics," said J. Michael Brown, secretary for the Kentucky Justice and Public Safety Cabinet. "It's now quality of life issues and economic issues. It's a much more transient group of young people who are not necessarily going to stay at your organization for 20 or 30 years."

The retention problem is worse at law firms, where it can take decades of toiling at one firm to make partner, and where repetitive work can lead to burnout. Many young workers--regardless of race--don't stick it out. Panelists said the best way to retain minority lawyers is to make sure they receive valuable work.

"You need to understand what diverse lawyers are doing," said LexisNexis Deputy General Counsel Mary Clark. "No litigator wants to spend five years reviewing privilege files. They want to have real opportunities."

And to be successful, a diversity program should track such information. Clark pointed out that tracking is the only way to ensure law firms are actually giving real opportunities to diverse lawyers. It was a point the panel emphasized: Reliable monitoring will lead to greater success in diverse recruitment and retention.

"If you can't measure it, you can't change it," said Hossein Nowbar, deputy general counsel at Microsoft, which employs a scorecard system with financial incentives to encourage outside firms to promote diversity.

The EFCA Debate

The Employee Free Choice Act (EFCA) was stalled in Congress, but that didn't impede a lively SuperConference debate on the bill between advocates for business and organized labor--with impassioned comments from the audience thrown in.

EFCA would make it easier for unions to organize by eliminating the secret ballot election if a union gathers signatures from the majority of the workers. It also would require arbitration if the two sides fail to agree on a contract after 90 days of negotiation and 30 days of mediation. And it would increase penalties on employers who fire or threaten union supporters.

Not surprisingly, the panelists disagreed on the most fundamental issue--whether EFCA is needed--as well as on the specifics of the bill.

Orrin Baird, associate general counsel of the Service Employees International Union, described the current process as too slow and too weighted toward employers, who he said often coerce workers to vote against the union. He also underscored the need for an arbitration provision in the bill. "Even when the union wins the election, it often has a very difficult time getting to a first contract, which is the goal of the organizing campaign," he said.

Randel Johnson, vice president for labor, immigration and employee benefits at the U.S. Chamber of Commerce, responded that passing EFCA to correct what he described as minor flaws in the current process "is like using a sledgehammer to kill a fly." He cited Bureau of National Affairs statistics showing that unions won two-thirds of the 2008 certification elections as evidence that EFCA is unnecessary.

The most troublesome aspect of the bill, he added, is the arbitration provision: "Members of the U.S. Chamber are not going to turn over the way our companies are run to a panel of arbitrators. It's a complete nonstarter."

Leonard Court, director at Crowe & Dunlevy, urged employers to counteract union efforts by training supervisors not to threaten employees but rather to emphasize how the company benefits them.

"You have to talk about the good the company does and treat employees the way they ought to be treated," Court said. "You will be ahead if you do this."


Learning the Biz

If there is one thing all in-house counsel seem to have in common, it's the desire to be more involved in the business side of the law. After all, that's often why they choose this career path. But getting fully up to speed on what that means to each specific business can be a challenge.

One well-attended SuperConference session may have helped answer questions in-house counsel have about how to gain the knowledge they need. In "The Business Education of Lawyers," panelists Marti Wronski (GC of the Milwaukee Brewers), Karen Wishart (GC of TV One) and Alan Tse (GC of LG Electronics MobileComm USA) presented 10 easy-to-implement best practices for achieving this goal:

1. Think like your CEO: See the big picture and know how decisions will impact the profitability of the company.

2. Learn the language: Understand how things like cash flow, competition, prioritization and return on investment affect the company.

3. Ask the right questions: Consider
the connections between performance
and results.

4. Pick your team carefully: Hire
world-class talent for both inside and
outside counsel.

5. Understand the reality behind the numbers: Learn the basics behind what makes the company profitable. Visit the factory floor for a day, for example.

6. Understand business issues in negotiating sales contracts: Make sure the sales contract process is set up to keep revenue flowing. A legal department shouldn't be considered the "sales prevention department."

7. Trust other employees' integrity and ability: Have faith in your staff to make decisions.

8. Understand the trends in your business: Speak with employees, attend conferences, accompany other executives on business trips and read industry-related press.

9. Develop teamwork: Take a strategic approach to diversity and multiculturalism and to strengthening personal competencies.

10. Simplify and face reality: Keep the message simple, particularly when saying something people won't like.

Minding the Gap

For better or worse, Generation Y--generally defined as those born in the late '70s to early '90s--is growing up and entering the workforce. And like Gen-X and the Boomers before it, this group of young people is shaking things up. But in the SuperConference session "Dealing With Gen-Y at Work," the generation gap in the room wasn't so apparent as the in-house-outside counsel gap. If the reaction of both panel- and audience-members is any indication, the in-house bar is more ready and willing to adapt to the needs of Gen-Yers.

Solo practitioner and criminal defender Scott Greenfield found little value in the population he finds selfish, whiny and incompetent. "As a generational group, they couldn't care less," he said.

Moderator J. Daniel Hull of Hull McGuire had a similar view, citing his own experiences with clueless, entitled Gen-Yers making unreasonable demands and shirking their responsibilities in the name of work-life balance. "Most general counsel aren't coming to me and saying, I hope you have work-life balance," Hull said.

"I do," weighed in one general counsel in the audience, noting he wants his lawyers to have a life outside the office. That attitude seemed to set the in-house crowd apart from the law firm attorneys.

Anthony Zana, corporate counsel with Intergraph Corp.--and, at 29, a bona fide Gen-Yer--explained that his law firm mentors expressed regret over missing out on time with their children and warned Zana not to do the same. But putting in fewer hours doesn't mean the quality of work has to suffer, he said.

"[We can achieve] a mutual adjustment between the generations, and that's the real solution to help [Gen-Yers] get to where they want to be with their personal lives and also be productive in your organization," Zana said.

William Morelli, general counsel for Ingram Industries Inc., agreed. It took him some time to get used to the thought of an attorney sitting at home in pajamas working on a brief, he said--until he realized that he could still have it on his desk first thing in the morning, with no diminished quality. The key, he said, is setting boundaries.

"Make it very clear that there are non-negotiable elements to your relationship: honesty, character, quality of work, customer service and quantity," Morelli said. "If you tell the Millennials and young people what the non-negotiables are, then you can talk to them about the negotiables--the how, where and when of getting this work done."


Billing Innovation

SuperConference attendees were treated to multiple keynote sessions this year. Robert Bauer, chair of the political law group at Perkins Coie, general counsel for the Democratic National Committee and general counsel for Obama for America during the 2008 election, kicked off Day One of the conference. Bauer offered a look at lobbying and the always-developing ethical considerations around the profession. Day Two featured a panel of respected judges speaking about e-discovery. Cook County Circuit Judge Peter Flynn, U.S. Magistrate Judge Nan Nolan and retired U.S. Magistrate Judge Ronald Hedges offered advice on discovery rules every lawyer now must grapple with, providing a unique view from the bench.

Day Two also offered a keynote speech from David Boies, chairman of Boies, Schiller & Flexner. Boies' discussion about the future of law firm billing resonated with audience members. Not surprisingly, they were especially interested in law department economics this year.

Boies has been involved in some of the most visible trials of the past few decades. As a longtime partner at Cravath, Swaine and Moore, he defended IBM in its years-long antitrust battle with the Justice Department. After leaving Cravath in 1997 to found the firm that bears his name, he took the other side, representing the government in its antitrust case against Microsoft. He also represented Al Gore in Bush v. Gore--which led to Ed Begley Jr. portraying Boies in the movie based on the 2000 election's fallout.

At SuperConference, Boies delivered what he hoped would be a wake-up call to law firm and in-house lawyers alike, declaring the industry's adherence to the billable hour lazy and outdated, an anachronism from the times when one- and two-lawyer firms dominated the legal landscape. But, he said, the economy is now forcing a re-evaluation.

"The billable hour is a defective model, and the defects become more apparent in tough times," Boies said. He described how the time-based model is a target for pressure, especially among up-and-coming young lawyers. There's also the innate conflict the system creates between the law firms that want to make money and the clients who want to resolve their matters as quickly as possible. Boies related that due to increased efficiency, alternative fee arrangements can even make a firm more profitable.

Boies had a few words of advice for matching a matter with an appropriate billing structure. For huge matters, do away with hourly billing, he said. A blended arrangement of fixed and contingency fees proves effective for more traditional matters. When the corporation is the plaintiff, contingency fees work for both the lawyer and client, he said. As for adapting contingency fees to defense work, which is much harder to value, Boies is still working on it. Another billing system he is developing awards law firms for certain events and criteria, such as winning summary judgments.

Boies concluded with a call to action: Alternative billing arrangements lead to the happiest clients and provide the most value and predictability, he said. And now is the time to work at adapting practices to the future.

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Christopher Danzig

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Editor

Cathleen Flahardy

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Melissa Maleske

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Mary Swanton

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