Contract Power

Nobody said contract negotiation is easy

Well, somebody probably said it, but saying it isn't easy is so much more dramatic, so let's stick with that.

Thus it behooves one to come up with innovative negotiating strategies. I found a couple of these techniques in lawsuits filed last week.

First, there was this in a suit filed by a recording artist against a record company:

"(Executive) pressured her into signing the deal memo by threatening to kill himself if she did not...."

So she did.

Obviously, this was an effective strategy but one you should recommend to clients only if they're fairly sure it will work. If you're on the other end of the negotiation, you may have an ethical dilemma.

Consider the possibilities.

If you client refuses to sign, could she/he be liable for murder? Wrongful death?

If the client does sign under duress, at what point will it be safe to attempt to get out of the contract? Are suicide threats continuous or do they have an expiration date?

What if, after last week's complaint was filed, the recording executive commits suicide? Is your client liable or does the suicide threat apply only to the signing of the contract?

There are no good answers here.

On the other hand, you would think that a partner at a major law firm should know what he is doing, particularly if there are no suicide threats involved.

You'd think that, but, right now, I'm not all that certain. This is from a complaint filed in Los Angeles Superior Court, on behalf of such a partner against the national law firm he was partner in:

"Plaintiff was elected to partnership in the firm in April 2000 .... Neither prior to being elected to the partnership nor for a time thereafter was plaintiff provided with a copy of any partnership agreement, nor were any written terms or criteria for joining the partnership or maintaining one's equity partnership stated to him."

The plaintiff finally did get some information at a teleconference a little while later, but "no discussion of specific terms of the partnership agreement occurred or was invited ... no questions were asked, no negotiation was invited or expected, or allowed."

Pause. Consider this for a moment.

If a client had walked into the office of this partner at a major national law firm and asked if he or she ought to sign a contract without knowing what was in it, what do you think said partner would say?

Would he say, "Oh sure, sign away. What problems could there possibly be?"

Well, you can imagine how well things went for the lawyer here (especially since there's a lawsuit).

The negotiation lesson to be learned here is that lawyers can be intimidated by groups of other lawyers in their own firms and probably shouldn't sign contracts with them.

When you're ready to be made partner, go out and start your own firm.

How could this be? The explanation could lie in footnote 2 of a Kentucky Court of Appeals ruling called McDonald's Corporation v. Ogborn, that says this: "The experts in this case uniformly agreed that, as astonishing as these events seem, they occurred because of a strong human instinct to obey perceived authority."

Unless, of course, you're like me and have a strong human instinct to give authority a raspberry.

That, naturally, explains why no one has ever offered me a partnership.

In case you're wondering about the Kentucky case, it seems that someone pretending to be a police officer was able to call people working at McDonald's restaurants and convince them - more than 30 times! - to conduct strip searches "and even sexual assaults."

It can't be your fault if you're only obeying orders.

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