After 18 years in courtrooms across the country, a few truths become obvious about lawyers and their clients.  One truth is this – outside litigation counsel are not the most effective members of their client’s business team.

It isn’t entirely their fault.  Litigators, are, by nature and training, mercenaries, soldiers for hire with no vested interest or understanding of the larger business interests of their clients.  “Winning” a conflict, whatever the conflict is, takes precedence over common sense and big picture, sound business judgment.

Let’s use the example of Joe’s Tool Shop and Bob’s Tool Manufacturers, Inc.  The two companies have a business relationship that has enabled both to build their businesses into multi-million dollar ventures over the past five years.  Everyone’s making money, everyone’s happy.  Then some disagreement emerges, often just a minor problem at the beginning.  Joe just had a fight with his wife when the problem hits his desk.  He’s in a bad mood anyway and calls up Bob and gives Bob a piece of his mind.  Bob is unamused, blames the problem on Joe, and demands that Joe fix the problem at his own cost.  Joe doesn’t want to spend the money, and has already blamed Bob, so Joe says “forget it, your problem, you fix it.”  Bob says “screw you, I’ll see you in court” and trots off to his law firm, Dewey, Cheatum and Howe, to file a lawsuit.

Now if Dewey were a counselor or psychologist, he would listen to Bob, acknowledge Bob’s frustration, then help guide Bob to some practical solution to the problem.  Dewey might even bring in Joe for a joint session and help the two realize that their business relationship is largely successful and that if they work together to solve this small problem, life can proceed lucratively for both of them.  They can shake hands, apologize for overreacting (everybody has a bad day once in awhile), and get back to work.  This resolution costs a couple hundred bucks and a couple of hours of time, but then its finished.  Problem solved.  Business relationship remains intact.  Done deal.

Unfortunately, Dewey is a lawyer, a Type A personality overachiever who has been specially trained in the art of courtroom combat.  Dewey only listens to Bob long enough to develop a battle plan to attack and defeat Joe at all costs (that being at Bob’s costs, not Dewey’s).  Dewey hasn’t met Joe, he has nothing personal against Joe, in fact, he doesn’t even know if Bob is in the right in this dispute, but Dewey’s been hired as a mercenary by a temporarily angry Bob to defeat Joe on his behalf.

First, Dewey makes sure he’s going to be paid for his mercenary services.  If he says “I’m going to charge you $400,000 to sue Joe, conduct thorough investigation and discovery into your entire business relationship, hire an expert, and eventually explain to a group of 12 strangers why you are right and Joe is wrong and hope they agree with you,” well, Bob is going to be shocked to his senses and say “gee, it not all that bad; thanks, but I’ll handle this myself,” and walk out the door.  Dewey can’t make any money that way, so he approaches it a little differently.  “Tell you what,” Dewey tells Bob, “I bet that if I just throw a hand grenade at Joe, it will scare him into defeat.  If that doesn’t work, I’ll just charge you by the bullet after that.”  Dewey pulls out his form agreement, charging Bob $5,000 for the hand grenade [a nasty demand letter] and $375/bullet [hourly rate] thereafter.  “How many bullets is this going to take?” asks Bob as he signs on the dotted line.  “Hopefully not many,” says Dewey (he means Bob’s “hope,” not his own.)

Second, Dewey starts earning his mercenary pay.  He fires his hand grenade (rarely an effective weapon) then starts shooting bullets from every angle (writing letters, filing motions, requesting every possible type of document, reviewing reams of unimportant and unnecessary documents, arguing with Joe’s lawyer whenever possible, arguing in court).  In fact, he becomes even more efficient by bringing in several associates to shoot bullets at the same time.  Ever wonder why a lawsuit complaint usually has at least three lawyers listed at the top?  A partner and several associates?  They all have remarkably bad aim, only maiming Joe and costing Joe a fortune in doctor (lawyer) bills, but not actually ending the battle (resolving the lawsuit) or even killing him (sending his company into bankruptcy).  Every month Dewey religiously assembles his bullet bill and sends it to Bob.  Cheatum and Howe pat him on the back for his success in shooting more bullets than anyone else in the firm.  Dewey Cheatum and Howe rise to the top of the ranks of the AmLaw 100 list of top grossing law firms in the country, thus justifying an increase in bullet prices to $500/bullet.  Bob keeps paying for bullets, and keeps getting pulled away from business operations to find documents, answer questions, be deposed, go to court . . . he’s losing time and money, and gaining stress.  When will this thing be over and when will life get back to normal?  Bob’s board of directors isn’t liking the excessive bullet bills.  “But I hired the most expensive gun-slinger with the most expensive bullets,” he explains to the board.

Bob needs a reality check.  He has hired a high-profile mercenary with expensive bullets whose qualifications are the ability to shoot more expensive bullets without actually ending a war than anyone else.  That is poor business judgment and if he’s not careful, what started out as a small problem could cost him his company.  Dewey doesn’t care.  As long as he’s paid, he will continue firing non-fatal bullets.  Dewey is doing what he loves, what he’s been trained for, and what he is good at - combat.  As long as he’s still standing, he’ll never voluntarily stop.

For a mercenary, winning any encounter with an opponent is crucial to survival and crucial to one’s reputation.  There is no compromise.  There is no meeting of the minds.  There is no agreeing to disagree.  It’s war.  At the end there is one winner and one loser.  And let’s be honest, that is just a waste of time and money for any sensibly run business.  Business relationships, even when there are disputes or problems, should not require a loser.  Both sides of the relationship should win something, that is the key to a thriving market economy.  Ever looked at the economy of countries constantly at war?  Everything’s blown up and poverty abounds.

So how can you start replacing mercenaries with team players?  Three simple steps will get you started.

1. Align your outside litigator’s interests with your own.  If you are hiring counsel to efficiently resolve a business dispute, arrange a fee structure where there is a financial benefit for prompt resolution.  If you are seeking a large, monetary award, make at least a portion of their pay contingent on the size of the award.  Build in incentives to bypass common time-wasters in litigation and you’ll be amazed how your counsel will learn to be efficient

2. Analyze the firm’s work habits.  If your lawyer is available to you 24/7, that means he or she has no work-life balance and is likely suffering from chronic sleep deprivation, scientifically proven to reduce one’s problem-solving capacities.  Hire counsel who can be a creative problem solver, not someone who will merely spend sleepless days and nights writing about it, arguing with others about it, or shuffling paper relating to it.  If your counsel cannot make good life decisions for themselves, how can you trust them to make good business decisions for your company?

3. Hire for skill, not prestige.  Okay, I know it sounds cool to say your lawyers are from Harvard or Yale, or whatever, but I promise you that those credentials do not guarantee you sound business advice.  Recently I did a little non-scientific research on this topic.  I posed the following question to a wide variety of people: “what is the quickest way to become CEO of a company?”  Most people couldn’t answer the question, at least not without a little prompting, but I got the sharpest contrast in responses on a single day of a business trip.  When I posed the question to a group of prestigious law school students, poised to go out and become your outside counsel, none had any idea what the answer was.  However, when I sat on an airplane next to a professional martial arts fighter and asked him the same question, he immediately responded “you start your own business.”