20 January 2010

A Round Tuit (16)

A Round Tuit

When it comes to legal blogging, there seems to be no shortage of writing worth reading once one gets around to it.

What's that? You have no round tuit? My friend, you are fortunate indeed, for never before in human history have round tuits been so readily available. If you need one, Carbolic Smoke Ball Co. has them in stock.

While you place your order, I'll share a few posts which are worth your attention.

O'Brien and Leno

When Conan O'Brien took over The Late Show from David Letterman in the early 1990s, I watched the program regularly and, truth be told, liked it more with him at the desk than when David Letterman hosted. I enjoyed the luxury of late-night television at the time, being a student and something of a night owl.

By the time O'Brien was announced as the next host of The Tonight Show a half-dozen years ago, I was no longer a student and if I happened to be up at half past midnight, I was either working on something and not watching TV or out socializing and not watching TV. Nonetheless, I saw the announcement and thought, "Well, good for him. When he's on earlier, I'll start watching him again." And yes, smartass, I do think in complete sentences.

By the time O'Brien took over The Tonight Show, I had long since given up even the early round of late night TV. If there's a funny bit, someone will send me a YouTube link the next day. If someone I'm particularly interested in was a guest, I'll see if there's a recap of the interview online somewhere. There's no good reason for me to be watching late night TV even occasionally, let alone regularly enough to have anything like an opinion on it.

I may not be an avid late night TV watcher and I can hardly care less which network or host prevails in the ratings battle, but I've been closely following the fiasco NBC created when it tried to juggle one too many hosts and came up a time slot or two short. Why the sudden interest? In short, because this week late night was all about contracts and intellectual property and was on at a reasonable hour.

Jay Shepherd became an O'Brien fan when he released a statement explaining his decision to reject NBC's offer of a shorter Tonight Show at 12:05 AM rather than the customary 11:35 PM slot:
Now normally, when you hear that someone "released a statement," you immediately think boring nothingness generated by lawyers. But here's where Conan really shined. First, he almost certainly wrote it himself (probably with help, but that's OK). Second, he completely avoided coming across whiny, pouty, angry, or victim-y. Third, he chose not to trash anyone, not even NBC. He favorably mentioned Carson, Letterman, and his "Late Show" successor Jimmy Fallon (who's really getting screwed by being bumped to 1:05, where he could lose both his viewers). Fourth, he spoke respectfully, with much language about the tradition and importance of "The Tonight Show's" six decades following the late local news.

And fifth, and I think most important, he was funny. I don't mean LOL funny; but with a light-hearted irreverence that humanizes him and his message without making the reader question the seriousness of his feelings.

And that's the real trick. Too many people — employers, employees, and their lawyers — hide behind a thin veneer of pomposity, haughtiness, verbosity, and legalese. That never works — ever.
Eriq Gardner and Matthew Belloni speculated about the specifics of O'Brien's contract with NBC and what legal issues were raised by the proposed shuffling of the NBC late night lineup:
If Conan's deal says his "Tonight" will be broadcast at 11:35pm (or the equivalent post-local news slot in the few markets like Phoenix that air him earlier), then NBC would be in violation of his contract by attempting to bump him. If there isn't any time-slot language in his deal, Conan's refusal to take the 12:05 slot would put him in breach if he doesn't do his show, presumably allowing NBC to void his deal without paying him off.

NBC already has staked its position in today's NY Times:
The contract, NBC is arguing, guaranteed Mr. O'Brien would be installed as host of 'The Tonight Show' — and unlike many other deals for late-night stars, Mr. O'Brien's contract contains no specific language about the time period the show would occupy, NBC executives said.
David Letterman, for instance, has time-slot language in his deal, so some are already blaming O'Brien's lawyers for not thinking ahead and specifying his slot. But it's likely not that cut-and-dried a legal issue.

If the breach-of-contract claim ever got to court, perhaps O'Brien could argue that specifying a timeslot was not necessary because "Tonight" has aired in essentially the same time period for decades.


NBC's move seems slippery at best and, at worst, in violation of the state's requirement that parties negotiate deals in good faith.
Erik Gerding also touched on the contract's purported silence on the time slot issue, but suggested that legal uncertainty rather than the strength of either side's arguments would drive a settlement:
Conan may not have the strongest legal arguments, but he still has leverage. Legal uncertainty hurts both parties. A media circus on Conan's status will only help NBC's ratings for a while - they can help Conan and Fox in publicity for a lot longer. Part of this stems from the fact that Jay Leno -- who is staying at NBC -- can't and won't milk this for laughs much longer if at all.

Will his contract lawyers now have to vet Conan's monologue?

At the same time Conan and Fox have to do an elaborate dance to avoid looking like they are entering into direct discussions, which would give NBC a quiver of new arguments (tortious interference with contract among them).


If Conan argues that "The Tonight Show" is not the "Tonight Show" he will likley need to rely on extrinsic or parol evidence to go beyond the ex plicit language of the contract to aid in contract interpretation. If the contract is governed by California law, he is in luck, as California has traditionally been more open to parol evidence... [a]lthough there are hints that California courts may be stepping away from this more loose interpretation of the parol evidence rule.
Lawrence Cunningham offered the most comprehensive analysis of the various contract issues involved, including the time slot uncertainty, good faith, mitigation, and non-competition. Discussing the mitigation issue, Cunningham wrote:
Supposing NBC is in breach of contract, either based on a time clause or good faith obligation, it may yet credibly assert that it is taking steps to reduce resulting damages, by offering Conan the alternative arrangement of a later time slot. If so, this implicates contract law’s mitigation principle and influences the relative stakes and power between NBC and Conan.

In general, aggrieved contract parties cannot recover damages that they could avoid with reasonable diligence. That sometimes means their damages are reduced by amounts that they could obtain through substitute performance. But in employment cases like this, the doctrine is applied with some scrutiny.


In our case, Conan would emphasize how the Tonight Show is a unique franchise, one with a 60-year history at 11:35, right after the local news. Even a slightly later airing is both different and inferior so NBC, if in breach, owes him full contract damages. NBC would contend the difference is not so consequential and is the only thing that distinguishes the two deals.

A fact-intensive and judgment-laden disputation arises. The burden of proof would be on NBC. But the fact of the offer, and the single factual difference, gives incrementally greater power in the current high stakes discussions to NBC, not Conan.
Following-up on a number of comments to his original post and from his contracts students, Cunningham discussed the parol evidence and non-competition issues in greater depth; in concluding, he also noted the uncertainty inherent in the situation: "Ongoing discussions between NBC and Conan illustrate the notion of bargaining in the shadow of the law, working out arrangements in light of known or probable legal claims and consequences."

Though O'Brien's dispute with NBC may be somewhat removed from the workaday concerns of your average Joe Lunchpail, some employment law bloggers advised that there are workplace lessons to be learned from the network's missteps. William Bowser recommended that employers consider this matter a reminder that employment decisions can cause collateral damage to contract arrangements; he wrote that employers "should always make sure that any material changes affecting a key employee are in compliance with the terms of any employment agreement with that employee. If not, a court may refuse to enforce any non-competition provisions contained in the agreement."

Other bloggers suggested that the struggle between Conan O'Brien one one side and NBC and Jay Leno on the other is manifested in many workplaces as a generational struggle between Baby Boomers and younger Gen X or Gen Y employees. Discussing a post by employment journalist Chris Penttila, Michael Fox wrote:
Members of Generation X are waiting, not all that patiently for the Baby Boomers to retire and get out of the way so that they can move up to the bigger jobs. And they see Leno (Baby Boomer) shoving O'Brien (an aging Gen X'er) back down, and they don't like it.

Of course, it's not like O'Brien is making it easy. I am sitting in the airport and just saw a re-run of his latest comment - that if NBC wants to make sure he is not seen on TV for three years, they should just leave him on NBC.

If in fact there's something to what Chris says, and I must admit it does have a ring of truth, it no doubt will manifest itself in ways that will end up on employment lawyers' desks all across the country, where unfortunately it won't be all that funny.

Various news sources were reporting yesterday that NBC and O'Brien are close to a settlement arrangement whereby the network will pay as much as $40 Million to O'Brien and his staff and in return would keep the rights to O'Brien show creations, including "Triumph the Insult Comic Dog" and the "masturbating bear". Perhaps next week's blogosphere will be abuzz with discussion of the intellectual property issues raised by a settlement. If it allows the network to do what it seems inclined to — return Jay Leno to an hour-long Tonight Show starting at 11:35 PM — they probably won't need Jeremy Telman's thoughtful and Lettermanesque list of ten possible replacements for Conan O'Brien. I'll not be so churlish as to point out to him the glaring omission of a cost-effective choice — Arsenio Hall is probably available for the high five figures annually. Instead, I'll offer my takes on his suggestions:
10. No.
9. Definitely not.
8. Hells, no.
7. Perhaps the version of her I saw on South Park.
6. Only if he does every other Tuesday as "Nat X".
5. Stranger things have happened — cocaine is a hell of a drug.
4. If they have "Triumph", NBC doesn't need to neuter another comedian.
3. This one I can picture. Not watch, but picture.
2. This would be a smart choice, so that rules it out.
1. Sure, she was a OK in Mr. Wrong, but has she done anything since?
When Conan O'Brien lands a new gig, I probably won't be there to watch (though I would make a special effort to stay up to see Jay Leno attempt to interact with a masturbating bear). Personally, I'd rather see a roundtable of legal types discuss Conan's Fox contract or the intellectual property implications of his new recurring characters — but only if the roundtable's finished before 10:00 PM. Besides, I'm not one of those people who always imagined himself famous enough to be a guest on The Tonight Show or one of the many other late night programs. I don't want to be Conan O'Brien famous, or Jay Leno famous, or even Wanda Sykes famous; I only want to be just famous enough to drive the reasonably-priced car on Top Gear.


Google's recent announcement that it had been on the receiving end of considerable pressure from the Chinese government to maintain an active role in censoring search results in that country and that it would consider abandoning the market there rather than complying were shocking to say the least. Many have written to praise Google's stand, while others have questioned both its complicity with the Chinese regime to this point and its "true" motives to make a very public change. While Google's statement on the matter was issued by David Drummond, the company's Chief Legal Officer, its contents were not comprised of complex legal concepts or arguments:
We have taken the unusual step of sharing information about these attacks with a broad audience not just because of the security and human rights implications of what we have unearthed, but also because this information goes to the heart of a much bigger global debate about freedom of speech. In the last two decades, China's economic reform programs and its citizens' entrepreneurial flair have lifted hundreds of millions of Chinese people out of poverty. Indeed, this great nation is at the heart of much economic progress and development in the world today.

We launched Google.cn in January 2006 in the belief that the benefits of increased access to information for people in China and a more open Internet outweighed our discomfort in agreeing to censor some results. At the time we made clear that "we will carefully monitor conditions in China, including new laws and other restrictions on our services. If we determine that we are unable to achieve the objectives outlined we will not hesitate to reconsider our approach to China."

These attacks and the surveillance they have uncovered--combined with the attempts over the past year to further limit free speech on the web--have led us to conclude that we should review the feasibility of our business operations in China. We have decided we are no longer willing to continue censoring our results on Google.cn, and so over the next few weeks we will be discussing with the Chinese government the basis on which we could operate an unfiltered search engine within the law, if at all. We recognize that this may well mean having to shut down Google.cn, and potentially our offices in China.
Ashby Jones explained that Google resorted to the court of public opinion because the courts of law are unavailable:
In many other contexts, after all, there would be legal action. Had the censorship occurred in the U.S. or many other nations with histories of and commitments to freedom of expression, suits likely would have been filed. Were the identities of the alleged hackers known, suits likely would be filed (they allegedly stole some of Google’s intellectual property.) Had the alleged hackers been operating from another part of the world, perhaps law-enforcement authorities would be hot on their trails.

But in the absence of a legal system that resembles our own, there can be no legal action. Or, said another way, business action becomes legal action. Google can’t sue or make legal appeals to the Chinese government. But it can make its grievances public — very public — and exercise its power of the purse, by depriving Chinese citizens its product.


Will Google’s action work? Will it spur Chinese authorities to commit to greater freedoms and providing more help in tracking down perpetrators of cyber crime? It’s too soon to tell.
Larry Ribstein has written before that during Google's unconventional public offering, the company predicated its image upon corporate social responsibility themes. With this episode in China, he contends, Google is seeking to reconcile that image with the realities (at least to this point) of doing business in Communist China:
Google understands it may take a brand hit if it stays in China without significant concessions by the Chinese government to lay off.


Google's decision also illustrates the trickiness of corporate social responsibility that cannot be defended as profit-maximization. What is the socially responsible thing for Google to do? On the one hand, a Google pull-out could motivate... "exit-affected" interest groups to agitate for more political openness.

On the other hand, Chinese politics differs from... European and U.S. politics....


In other words, a Google pullout may be just what the Chinese government wants.

These political imponderables dictate that Google should make its decision in its own long-term interests, including its interest in preserving its reputation for honest searches, even if it chooses to sell that decision as socially responsible support for Chinese democracy.
Tom Smith takes a limited view of corporate social responsibility which appeals to me. He argues that while corporations are not and should not be bound by the most expansive individual views of morality and moral obligation, neither should these behave immorally or without concern for the human costs of their profit-seeking. Vis-à-vis Google and China, he writes:
Just because I am acting on behalf of others, say to maximize their profits, does not relax in any way duties which I have not to harm others in certain ways. So there will be many things I simply cannot do as a matter of morality even if it would profit the corporation to do so. So Google may not cooperate with the persecution of people who are simply fighting for their basic human rights just because it might be or even would definitely be in the interests of Google shareholders to do so. I am thrilled that Google seems to see it this way too. I predict we don't here much from anybody who would say, hey, wait a minute Google, get in there and make money no matter how many Chinese it enslaves. But if that's really what they think, they should speak up.

This is granted a weak view of corporate "social responsibility" and I would not even call it that. It's just a view that moral obligations don't somehow cease to apply just because some people decide to act collectively to make money.


As to Google and China, it could be that having a Russian born founder, as Google has, gives it a certain, uh, appreciation of communism. My guess is that the usual relativism you can get on most college campuses about how those darn communists are just pursuing an alternative blah blah blah doesn't get you very far with those who have had some experience with it, at least within their family unit. Communism don't look so cool from the gulag or the laogai or even if you know they are more than words. It thrills me no end that America's hippest big company is putting its money where its mouth has been. If you say Don't Be Evil, and you're not just being cute, then you must believe there is such a thing as evil. Like maybe putting somebody in prison because he aspires to be free. Saying Don't Be Evil is just a less pretentious way of saying, We Will Not Be Evil. Big words, and ones Google is evidently trying to live up to. American capitalism standing up to communism on moral grounds. I love it. Good for them.
While we applaud American capitalists standing up to Communists abroad, however, let's not excuse those American capitalists who accommode law enforcement overreach here at home. It was revealed this week that the FBI collected more than 2,000 call records illegally between 2002 and 2006; a considerable number of these records were obligingly-provided by phone companies upon informal request from the Bureau. As Eugene Volokh notes, such cooperation is not uncommon; the processes described in the Electronic Communications Privacy Act are routinely used to provide cover to providers for what are essentially voluntary, not mandatory, disclosures. Volokh gives us an excellent summary of the applicable law and possible violations committed by the government and/or the phone companies:
First, at various points the Post story seems to suggest that the legal violation was the failure to follow-up an exigent circumstances letter with an NSL [National Security Letter]. But if that’s the claim, then the story is rather misleading: There is no legal requirement that an exigent circumstances letter be followed up. The choice to follow up an exigent circumstances letter is apparently a policy choice by the FBI, but it’s not something the privacy statutes contemplate or require.

A second possibility is that the FBI was making false statements in the exigent circumstances letters themselves. It’s not entirely clear what the technical violation is in that case, but presumably the FBI becomes civilly liable for the disclosure violation that it induced. (That is, presumably the FBI can’t misrepresent the facts of what the emergency is to get the provider to have a good faith belief and then voluntarily disclose.) At the same time, I can’t quite tell in the story if that’s what was allegedly happening: The lead sentence suggests so, but there are other parts of the story that suggest that the authors may be thinking of the failure to follow up as the problem.

A third possibility is that the FBI was filing exigent circumstances letters properly, but was then getting NSLs after the fact improperly. That is, the technical violation was based on the FBI’s self-imposed policy: By following-up even when the law did not require it, the government ended up getting NSLs that did not satisfy the NSL standard. Again, parts of the story seem to suggest this, but it’s hard to know with certainty.
Mike Masnick writes that these latest revelations should come as not surprise, considering that the FBI has previously admitted improperly using NSLs to obtain information it was not entitled to have. Masnick doesn't let the phone companies off the hook, though:
Of course, lost in all of the attention over the FBI's process is the rather serious unanswered question of why the telcos didn't seem to push back when handed a bogus demand to hand over records that did not match the official process and violated the law. Shouldn't the telcos have some responsibility for actually making sure that a random FBI agent yelling "terrorism" has some sort of official basis to get information out of the them?

Odds n Ends Shop

Last evening, little-known (before the past few weeks, anyhow) Massachusetts state senator Scott Brown defeated that state's Attorney General Martha Coakley in a special election and will take over the United States Senate seat left vacant by Senator Edward Kennedy's death. Though anticipated by polls taken in the closing days of the campaign, the victory of a Republican candidate in a state that's amongst the bluest of the blue was nonetheless astonishing. Late in the campaign, President Obama made a stop on behalf of Coakley and, as Ann Althouse points out in her fisking of Obama's speech, it was a pretty perfunctory effort. Althouse writes that she was "struck by the lack of anything actually about Martha Coakley, the candidate he came to support" and found that the speech boiled down to "the Democratic Party needed another vote in the Senate, and Coakley was the Democrat."

The debate has already begun amongst political pundits whether the Massachusetts election represents a rejection of the Democratic agenda or is simply the result of an unusually poor campaign run by a poor candidate. Some support for the latter, more limited position can be found in a pre-election post from Patrick at the Popehat blog. Patrick is — I'm taking a wild stab here — a card-carrying Democrat or at least a left-leaning voter; nonetheless, he found Coakley's professional conduct in the notorious Amirault, Woodward, and Winfield cases so beyond the pale and so injurious to freedom and justice as to make her unfit for elected office, regardless her party affiliation or the policy stakes of the day:
Under ordinary circumstances, Coakley would be a shoe-in as a Democrat, but she appears to be running about even with Brown. Especially given the stakes this race presents, on which the President’s health care reform bill may ride. History is in the making.

But it’s past history that should concern us. I’m writing to urge any Massachusetts readers we may have to suck it up and to vote for the bum the Republicans found lying in the street. Martha Coakley is less suited for high office than anyone on the national stage. Less suited than Sarah Palin. Less suited than Carrie Prejean.

Prosecutors are called to do a tough job, but the exercise of discretion is part of that job. Based on the evidence, Martha Coakley, in almost twenty years as a prosecutor, has exercised her discretion in every instance in favor of the State, in favor of her own ruthless ambition, and in defiance of any sense of compassion, or common sense.


If one is a liberal, it’s tempting to think that this election is just about health care, the burning issue of the day. What damage can one Senator do? Of course, one might ask the same of a prosecutor, and consider Coakley’s career. But a prosecutor doesn’t make law. A prosecutor merely enforces laws written by others.

Freedom in this country is under constant assault, from forces right and left. Massachusetts voters, liberal, conservative, or none-of-the-above, should consider whether Martha Coakley is suited, by temperament and experience, to inflict her views on the rest of the country. To take her ego, and her views, onto the national stage.

I say no. Vote for the bum the Republicans found on the street. It’s important.

Though a legal academic herself, Sarah Waldeck has a word of advice for prospective law students who are uncertain about a career in law, going to a middle-tier or lower-tier school, or paying their own ways with loans — don't. She writes:
I’ve been thinking hard about what advice I would give prospective students and this is where I’ve landed: Only go to law school next year if (1) you have always dreamed of being a lawyer; or (2) you are accepted by a very prestigious institution; or (3) you are offered a full scholarship.


Of course, this year law school applications will be partly driven by the lack of opportunity costs. Graduating college students face generally dismal employment prospects regardless of what field they want to enter. But I suspect that optimism bias plays just as large a role in student decision-making. No matter what the economy, some lawyers will be wildly successful. Many prospective students are inclined to think that they will be part of this group, no matter how daunting the odds against it. On the more rational side of the analysis, it’s also true that law school historically has proven itself a relatively good place to weather out bad economic times.

What is different this time around, however, is that no one is yet sure whether the changes in legal markets and in law firms are permanent, or whether things will eventually return to what we had come to think of as normal. If you haven’t always wanted to practice law, or if you’re considering a law school that is not one of the best in the nation, or if the law school isn’t offering to pay for you to attend, my advice is to wait to see how this plays out.


Given the current legal climate, one would hope that decreasing applications would force law schools to grapple with these questions. But markets, including those for law students, are imperfect. The most I can hope is that prospective students think hard about whether, at this particular point in time, a legal degree is worth the investment.
Scott Greenfield has often been critical of the role law schools have played in producing a generation of underemployed and underqualified lawyers — there are simply too many lawyers in the market, too many weeds choking the life out of the garden, and too many defenders of the status quo which brought us to this:
Forget the ABA. Forget the lawprofs. Forget the crippling debt that law students will carry with them as they pursue their careers in used car sales, enhanced by their critical thinking skills. And forget the lawyers who sit waiting by the phone for someone to feed them a case so they won't starve. None will save the legal profession.

Law school, and the legal profession, has become a crap shoot thanks to all of the above. Few law students, just as few lawyers, belong in the profession. It's time to come to grips with the fact that we not only produce far too many lawyers, but far too many lawyers who either lack the ability to practice law, are too selfish or narcissistic to put in the effort demanded of an excellent (or even competent) lawyer or lack the mindset to be a professional whose responsibility is to serve their client.

The future of the law is survival of the fittest. Law schools will churn out as many lawyers as they can, no matter how unneeded, how ill-prepared or how ill-suited to the profession. The ABA will continue to approve new schools as long as they can draw a picture on the back of a matchbook. Lawprofs will continue to lecture on the theories behind Law and Television Sitcoms, while Biglaw collapses, solos sit by the phone and social media gurus craft websites to make dumber than dirt lawyers look like Learned Hand.

Our own inability, more precisely refusal, to recognize the obvious will bring this house of cards down around our heads. So mommas, save your retirement funds for that new Cadillac, because throwing it at junior to make him a lawyer is a total waste of money. But if you decide to do it anyway, you're the one who will have to live with the bad bet.
Christine Hurt remembers the firm economics of the early 1990s, the downturns and cutbacks throughout that decade, and the resulting realities of practice which have given way to further upheaval in the current downturn:
My fellow associates and I often would joke about how long a person could stay employed, taking home great money, and not do a darned thing. We all agreed it was at least three or four years. A story of mythological proportions was told to us about a senior partner in our section of an associate who was down right horrible. At a partners' meeting, it was all agreed that he should be fired, but a year later, every partner was waiting for someone else to do it. In my partner's words, "No one likes to tell someone they should be in a different line of work." Even if associates were fired, they were usually given 6-12 months to vacate, which often became extended. But then came the next downturn, beginning in 2000. All of a sudden, associates got one year at the same law firm. If your billables were low after one year, you were out and no 6-12 month hanging around, either. Suddenly, billable benchmarks became billable minimums. Law firms that had increased salaries twice or three times in the late 1990s were suddenly saying that the pay required performance, and there is nothing more stressful than trying to spin billable hours when there isn't any work. (I was pretty good at going up and down the halls in 1994 like a beggar, asking partners and senior associates if they needed help.)

So in 2007, did no one remember 2001, much less 1993? Yes, this is a brave new world now, and associates won't get a golden ticket, but I think some great marketing must have been going on if anyone believed they were still printing those. However, this downturn does seem worse than earlier times, and so the expectations that are being lowered so dramatically may not bounce back so quickly.
My daughter asked me a few weeks ago whether I hoped that she'd grow up to be a lawyer like daddy. Perhaps that was a suitable moment for something hopeful along the lines of, "Sweetheart, if you study hard and work hard, you can do whatever you want in life." I couldn't bring myself to give her platitudes. "No, sweetheart," I told her, "I hope you don't become a lawyer. Whatever you do, don't become a lawyer."

Header pictures used in this post were obtained from (top to bottom) Carbolic Smoke Ball Co., MSNBC, Search Engine Roundtable, and Paris Odds n Ends Thrift Store.

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