A bit ago here in New York a dinner was held with the legendary Ben Heineman (GE SVP/GC from 1987 to 2003, Harvard BA and Yale JD [editor-in-chief of the Yale Law Journal], Rhodes scholar, Potter Stewart clerk) and 50 or so GC’s or senior inhouse counsel from Fortune 500’s.

I wasn’t there, more’s the pity, but what follows is from an impeccable source.

As you can imagine, much of the conversation focused on the GC/law firm relationship. I won’t saddle you with more stress than your day may already hold, but I was told the level of hostility towards outside firms was palpable.

That’s not why I’m writing.

I’m writing to urge you to have spine and backbone when you counsel your clients. Yes, even if it’s an unnatural act to deliver bad news. Particularly if that’s the case.

Why should I need to point that out? Isn’t that your job and much more than your job—your solemn professional obligation? I would have imagined and so, I hope, would many of you, Dear Readers, assume that to be the case. The sun rises in the east, we breathe oxygen, etc., and we advise our clients with the “punctilio of an honor the most sensitive.” (Go ahead, read the whole thing: Meinhard v Salmon, 164 N.E. 545 (N.Y. 1928) (Cardozo, J.))

It gives me no pleasure to continue, but the story I’m about to relate concerns a Fortune 10 corporation and at least three different n AmLaw 15 firms.

During the dinner, the question predictably arose: What would it take for you to fire a law firm?

And the answer the Fortune 10 GC gave went like this: “We’re in a major piece of litigation; our outside firms tells us, ‘happy face,’ ‘happy face,’ ‘happy face,’ ‘happy face,’ ‘happy face,’ and then a year or so in it gets to be the eve of trial and they tell us, ‘We can’t possibly try this case; it would be a full-blown calamity, meltdown, and disaster. You need to settle this ASAP.'”

That, our GC reported, got the outside firm on his company’s permanent blacklist. (I don’t know if he told the firm this or not, but if he’s a typical GC, the firm never actually informed–the phone just never rang again.)

Closely related, and also a true story:

Imagine a bakeoff or RFP among a few firms for another heavy-duty piece of litigation. One firm presents a dark vision of what the client is facing: This is going to be painful, protracted, immensely costly, and damaging; ultimately you’ll almost certainly lose.  That’s just the way it is. Two other firms present rosy scenarios: We can handle this at minimal expense, easily, and make it all go away, don’t worry; we can clean it up in no time.

Client hires one of “rosy scenario” firms, but a year later comes back to Firm #1 saying they made a ghastly mistake, that everything Firm #1 predicted had come true. They should have hired Firm #1 to begin with, and next time they would. They might not have wanted to hear what Firm #1 said at the time, but they had gained the client’s respect while they had lost all respect for Firms ##2 & 3.


Before I heard these stories, I didn’t think there would be a need for, or any utility in, my writing a piece like this.

This really is the bedrock of our profession, and you can’t dig underneath and find anything more foundational; this is it.

And we do, or should, know this in our hearts. Does this sound familiar?:

It shall be unlawful for any person, directly or indirectly …

(a) To employ any device, scheme, or artifice to defraud,
(b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or
(c) To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person.

Or if that comes across as too legalistic, try this condensed version:

Thou shalt not bear false witness.

—Exodus 20:16

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