“Bill Burnham”:http://billburnham.blogs.com/about.html wrote a great piece called “Understanding Why Your VC is Acting Crazy”:http://billburnham.blogs.com/burnhamsbeat/2007/07/understanding-w.html where he leads off saying “Over the years I have heard many stories from entrepreneurs expressing various degrees of frustration and mystification over a position taken by their VCs . . .”
To say that I have heard stories of frustration with lawyers would be a significant understatement. In fact, when I sat down to write this I came up with so many areas of complaint that I decided to limit the column to addressing three of them:
*I.* my lawyer overcharges me for tiny projects
*II.* my lawyer wants to take over everything
*III.* my lawyer misses the big picture.
*I. My lawyer bills me huge amounts of money for nothing!*
This is probably the most common complaint I hear. Clients ask for something simple, and it turns into a huge project, or else the lawyer appears to spend a lot of time to produce a small amount of tangible product.
I won’t speak to any specific billing practices, but keep two things in mind here:
*a)* Almost every lawyer is under constant pressure to bill more hours
*b)* Failure to understand the background and context of any piece of work is a dead-certain recipe for a botched job, sooner or later.
Put these two facts together and your simple request takes your lawyer several hours to understand and address properly. You should express your concerns here. Do it professionally and courteously, and invite your lawyer to explain why the job took as long as it did. My own guiding principle is to take enough time to get the job done right. If I need to adjust a bill to match the scope of the project to the expense, I (like most lawyers) am willing to work with my clients- so long as the relationship benefits everyone in the long term.
*My lawyer wants to take over!*
Web developers obsess about scalability; lawyers obsess about the inter-relatedness of things. Clients only need help with a specific issue, but there is a whole range of facts, plans and ideas surrounding it that may affect the choice among available legal options to resolve that issue.
Some clients interpret this as the lawyer wanting to take over everything. It isn’t (usually). It just means that your lawyer is worried that without all the facts s/he will end up giving you a piece of work that satisfies all your requests, but is still worthless or positions the company wrong- just what you asked for, but not what you wanted.
The flip side is that once the whole story is out, the lawyer sees a range of issues going beyond what the client initially asked for, and a simple piece of work turns into a major undertaking- and drain on cash flow.
*There is a Two-Part Solution to both problems:*
*a)* Your lawyer has a near-absolute duty of confidentiality to you as client (as long as you aren’t going to kill anyone), so tell her/him everything even marginally relevant. A good lawyer will be sure to draw that all out of you in any case.
*b)* Your lawyer should explain the range of options available (does all the work need to be done now? all at once?). You, in turn, need to be clear about the range of options you are willing to pursue, and in what timeframe.
*My lawyer is so risk-averse that s/he misses the big picture!*
Lawyers can easily get caught up in the sense that their job is to help steer the company around dangerous waters. This is partly true- a good lawyer will help you evaluate and mitigate risk. Still, since lawyers usually aren’t involved in the business’s day-to-day, it can be easy to focus only on the rocks.
You may need to brush against some rocks to reach good open water, so be aware that:
*a)* Your lawyer may see risk avoidance as an important part of his/her job
*b)* Your lawyer probably doesn’t know your business the way you do, and may not be able to see as far over the horizon.
Ultimately, it is your lawyer’s job to highlight the risks as clearly as possible, but s/he can’t decide for you whether those risks are worth running.
Digg’s “crisis”:http://www.forbes.com/2007/05/02/digg-piracy-youtube-tech-cx_ag_0502digg2.html over the 09 F9 encryption key release is a fantastic example of this. Digg community members posted multiple links to a software key that could be used to decrypt HD DVDs. Digg’s liability for hosting the links was far from certain, but there was a risk that if the huge companies behind the code chose to pursue litigation, the effort of defending it (even successfully) could have crippled Digg. According “Kevin Rose’s public statement”:http://blog.digg.com/?p=74, management decided that the risk of losing the support of its users was greater, and allowed the links to go back up. To date, the decision appears to have gone well for Digg- I am not aware that the key’s owners have taken any action.
Look for my next post: *Why are lawyers so expensive?!*
I’ll post this when I finish my economics degree, and the answer may or may not reference the “sand dollar hour” payment system pioneered in west Marin County, California (where every person was paid an equal number of sand dollars per hour of work regardless of specialty) and why that never gained wider use. Until then, thanks for reading. I hope this helps people everywhere understand how they can work (more) effectively with their lawyers.