Itkowitz PLLC Legal Project Management

LEGALPROJECTMANAGEMENTA better way for lawyers and clients to work together. By Michelle A. Maratto

ItkowitzPLLC305 Broadway New York, NY 10007 (212) 822‐1400 www.itkowitz.com

http://www.itkowitz.com/

Copyright 2013 by Michelle A. Maratto; www.itkowitz.com; Yes, indeed, this is attorney advertising.

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LEGAL PROJECT MANAGEMENT

A better way for lawyers and clients to work together.

By Michelle A. Maratto Partner

ITKOWITZ PLLC 305 Broadway

New York, New York 10007 (212) 822‐1400

www.itkowitz.com [email protected]

Copyright 2013 by Michelle A. Maratto

No part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted in any form or by any means – electronic, mechanical, photocopying, recording, or otherwise – without the prior permission of the author and publisher. Requests for permission or inquires about the author should be directed to [email protected]. While every precaution has been taken in the preparation of this book, the author and publisher assume no responsibility for damages resulting from the use of the information herein. Receipt of this book by any person or entity does not create an attorney and client relationship between the recipient and the author or her firm.

***** The author wishes to acknowledge the assistance of Jay B. Itkowitz with this publication.


http://www.itkowitz.com/lawyers/marattoprofile.php


http://www.itkowitz.com/lawyers/itkowitzprofile.php


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Contents

CHAPTER 1: LEGAL PROJECT MANAGEMENT .............................................................. 3 1.1 Legal Project Management -- Introduction and Definition .................................... 3 1.2 Why LPM is a Better Way for Lawyers and Clients to Work Together ................. 5 1.3 Principals of Legal Project Management ................................................................ 7 1.4 The Legal Profession is Recognizing the Indispensable Role of Legal Project Management ......................................................................................................................... 9 CHAPTER 2: INFORMATION GATHERING ..................................................................... 11 2.1. Backstory ................................................................................................................. 11 2.2. Questions to Ask a New (or Existing) Client That Will Enable You to Better Meet the Client’s Needs .................................................................................................... 17 2.3. Who are the Players? ............................................................................................. 21 CHAPTER 3: UNDERSTANDING AND DEFINING THE CLIENT’S GOALS .................... 25 CHAPTER 4: PROJECT CHARTERS ............................................................................... 27 4.1 “Legal Project Management Letters” .................................................................... 27 4.2 A Collaborative Process between Lawyer and Client.......................................... 31 CHAPTER 5: COMMUNICATION WITH THE CLIENT ..................................................... 33 5.1 Sharing Information with the Client ...................................................................... 33 5.2. A Fighting Chance – More Lessons and Client Communication ........................ 35 5.3. Meetings the Legal Project Management Way ..................................................... 37 CHAPTER 6 – SCHEDULING AND DEADLINE MANAGEMENT ..................................... 41 CHAPTER 7: ALLOCATING RESOURCES, BUDGETING, AND COST CONTROL ....... 45 7.1 Estimates and Alternative Fees ............................................................................. 45 7.2. Why Commercial Contingency Fees are Bad for Clients and Lawyers ............. 47 7.3. Law is an Apprentice Profession -- Younger Lawyers and Their Role in the Delivery of Legal Services in a Value Driven Model Such as Legal Project Management ....................................................................................................................... 51 CHAPTER 8: CRITICAL THOUGHT ................................................................................... 53 8.1. "I hired you because you were the only lawyer who did NOT tell me that you could win my case." -- Legal Project Management -- Critical Thought and Client Communication .................................................................................................................. 53 8.2. Chess – Really? -- Legal Project Management -- Critical Thought ..................... 55 CHAPTER 9: LAWYERS AS RISK MANAGERS .............................................................. 57


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CHAPTER 1: LEGAL PROJECT MANAGEMENT

1.1 Legal Project Management -- Introduction and Definition

I wrote this book to teach Legal Project Management to three groups of people: (1) My clients, and potential clients; (2) The lawyers who work with me; and (3) The legal profession in general.

In some chapters I am obviously speaking to the client. In other chapters I am obviously speaking to the lawyers. It doesn’t really matter which way I am directing my instructions and arguments, all chapters are relevant for both clients and lawyers. Legal Project Management is an inherently collaborative way of working and its success depends upon the buy-in of both lawyer and client. Project management is classically the stuff of manufacturing, construction, technology development, and other fields. When project management principles are imposed upon the practice of law, you get Legal Project Management.

The definition that we have developed at Itkowitz PLLC for Legal Project Management is: Legal Project Management is the discipline of managing resources to bring about the successful completion of the specific goals of a legal case, while honoring the constraints of the matter. Or, to break it down a little further:



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Why don't more lawyers utilize Legal Project Management? Your guess is as good as mine, at this point. The below graphic takes a stab at figuring it out.

In the next sub-chapter, we discuss why LPM is a better way for lawyers and clients to work together.


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1.2 Why LPM is a Better Way for Lawyers and Clients to Work Together

Legal Project Management (“LPM”) is a better way for lawyers and clients to work together, as compared with the vast dynamic that exists between attorneys and their clients as I write this in late 2013. In what I call “the old school model of delivery of legal services” (see below graphic), because initial assessment is expensive, lawyers tend to do less of it. Less in-depth initial assessment necessarily leads to a lawyer and a client with a lesser understanding of the issues in the case, and a lesser understanding of the meaningful choices that exist. Less in-depth initial assessment also means that more of the assessment is done simultaneously with the execution, and, thus: things take longer there are more surprises it is harder to meet deadlines, and it is harder to stay within a budget. Further, because the client was offered less choice, he has a smaller role in deciding on a course of action. Therefore, the client accepts less responsibility for the ultimate outcome of such action. If the outcome is not one expected by and/or welcomed by the client, then tension develops between lawyer and client. Under the old-school approach, the client becomes a necessary evil, gets updates grudgingly, and is not viewed as a partner in the legal project.


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In Itkowitz PLLC’s Legal Project Management system, the case is comprehended as a series of manageable stages (or “Scopes of Work”) For each Scope of Work there is a cycle of:

Assessment Client Choice Execution, and Outcome.

After an Outcome is reached, the information gathered during the Scope of Work feeds right back into the next stage of the case, and Assessment begins all over again for the next Scope of Work. With Legal Project Management (see below graphic), the Assessment phase is in-depth. By focusing the client and the firm on information gathering, risk assessment, and critical thinking from the inception of each stage, the client is better able to make choices. Thereafter, in the execution phase there is more room for allocating resources, budgeting, cost control, and deadline management. The client is, thereafter, not surprised by the outcome of the Scope of Work and owns the results, because the client is making educated, informed choices. Again, after an Outcome is reached, the information gathered during the Scope of Work feeds right back into the next stage of the case, and Assessment begins all over again for the next Scope of Work. With the Legal Project Management approach, there is communication at every phase, and lots of client involvement.

In the next sub-chapter, we discuss eight main aspects of Legal Project Management and start to explain how it works specifically.



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1.3 Principals of Legal Project Management

How does LPM work specifically? For Itkowitz PLLC, Legal Project Management is a unique, systematic, and stimulating approach to practicing law that stresses heightened attention to the following: 1. Information gathering.

We seek to attain a deep understanding of your business model and your legal matter.

2. Understanding and defining the client's goals.

We constantly seek to clarify your goals for the engagement, even as they evolve. We document and circulate those goals in a project charter.

3. The utilization of an evolving project charter to guide the case.

Every significant project needs a Project Charter. And your litigation is a significant project. Your case is of vital importance to you, you are spending a lot of money on it, it is complex, and there are many people involved both on the client side and on the firm side. Therefore, your case deserves a Project Charter to keep the lawyer-client project team focused on success. At Itkowitz PLLC the Project Charter is expressed through a series of “Legal Project Management Letters”.

4. Communication with the client.

We communicate with you frequently and preemptively, in a variety of ways, and with absolute clarity.

5. Scheduling and deadline management. Scheduling and management of deadlines is one of the most difficult things we do as lawyers.

6. Allocating resources, budgeting, and cost control. We provide you with realistic cost estimates and discounted and capped fees, if appropriate.




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7. Critical thinking.

Around here – we think. That is the core of what we do.

8. Risk management. We help you to identify, assess, and prioritize risks in your case, and then coordinate resources to minimize and monitor the probability and/or impact of bad events.

The eight concepts listed above are covered by the next eight chapters of this book. In the next sub-chapter, we describe the widening acceptance of LPM in the legal profession.


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1.4 The Legal Profession is Recognizing the Indispensable Role of Legal Project Management The New York City Bar Association has recognized the indispensable role that Legal Project Management plays in the modern practice of law. That's why they included a session on the topic in their July 24, 2013 16-Hour CLE entitled "Bridge-the-Gap: Practical Skills, Ethics & More". The session was called "Effective Project Management Techniques for New Attorneys", and had a seat at the table with the other classes offered that day, including "Introduction to Franchising Law", "Making the Most of Trail Graphics", and "Basic Legal Writing". I was honored to be on the panel presenting this exciting session with a Senior Manager of Project Management & Pricing for Goodwin Proctor LLP, the president of a top consulting firm that works with large law firms, and the Project Director for Hospital Corporation of America – all thought leaders in the area of LPM. I believe we put together a truly unique presentation that illuminated Legal Project Management for new lawyers. Our program was designed to give the attendees practical skills that they could walk out of the session with that day and begin implementing in their practices -- whether they were associates at large firms, had just opened a solo practice, or were somewhere in between.

I am scheduled to teach another CLE on LPM at Lawline in December 2013.


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Legal Project Management is a way of life at Itkowitz PLLC. We are constantly studying material on project management, our application of project management to the law evolves with each engagement, and we discuss and write about project management. Our Legal Project Management material can be viewed in 3 ways: As a free hard copy book. On our Legal Project Management Blog as an ever-evolving series of

posts at http://itkowitzlegalprojectmanagement.blogspot.com. As a free PDF E-Book downloadable from our website

www.itkowitz.com. In the next sub-chapter, we begin to examine information Gathering.



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CHAPTER 2: INFORMATION GATHERING 2.1. Backstory

At Itkowitz PLLC we spend a great deal of time at the outset of a matter, typically at little or no charge to the client, gathering all types of information and trying to understand what is really going on. It is not always so obvious, even when dealing with a very professional and focused client. Of course, we elicit the hard facts - the names and the dates and the documents. But there is often so much more that a lawyer needs to understand in order to represent a client well. Here is a roofer analogy. If a building owner hired a roofer, certainly one would acknowledge that the roofer needs information before starting to install a new roof on the building. When was the last time the roof was replaced? Was the upper structure damaged in some way the roofer should know about? Is the owner planning to put heavy loads on this new roof, or only normal stressors? Does the owner want a “Green Roof”? What is the budget? Can the building occupants be relocated during the installation, or must they be worked around? Too many lawyers jump in and start doing the legal equivalent of replacing the roof before understanding the big picture. In order to obtain good results for clients in an economical way, lawyers need more than a few hard facts and marching orders from their clients. Lawyers and clients need a deeper understanding of the overall situation that gives rise to the engagement. The sooner this understanding is obtained, the better. Below is part of the materials I prepared for the New York City Bar Association CLE on LPM that I mentioned in the last chapter, and it provides an example of LPM in action in a busy, small law firm.



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LEGAL PROJECT MANAGEMENT IN ACTION IN A BUSY BOUTIQUE FIRM

In order to demonstrate some of the concepts that we are covering today, we are going to dissect two routine, introductory conversations between an attorney and a potential new client in a busy, small firm – one that does not employ LPM concepts, and one that seeks to incorporate LPM methods. No LPM Client: I am a book store in Manhattan and my landlord is evicting me. Attorney: Why? Client: My lease expired. Attorney: Don’t worry. Come in and give me $10k and I will fight the landlord

and keep you in as long as possible. With LPM Client: I am a book store in Manhattan and my landlord is evicting me. Attorney: Why? Client: My lease expired. [ATTORNEY FIGURING OUT HOW CLIENT MAKES MONEY, WHAT’S CLIENT’S BUSINESS MODEL?] A: What type of bookstore are you? C: We are a wholesale book company, we sell textbooks. A: Wholesale? You mean the inventory is there in the store? C: Yes. A: No retail, no off-the-street business? C: No. A: What is a wholesale business doing paying Manhattan rents?! If you are

essentially a warehouse couldn’t you be located anywhere? Long Island, for example?


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C: Well, not exactly, because what we do is sell more than just books, we sell books as sets, as entire curriculums. So we have school principals and teachers come in a sit at our tables and wander our shelves for full days, crafting curriculums. We consult with them as these packages are assembled.

[ATTORNEY TRYING TO ASCERTAIN C’S REAL NEEDS AND GOALS.] A: So you feel you need to be in Manhattan? C: Yes, it’s essential. A: Business is good? C: Booming, we are thinking of expanding into adult learning textbooks. A: Are there parts of your business that you could locate outside of

Manhattan to keep the costs down? Does the entire inventory have to be right there with you?

C: Maybe not, interesting suggestion… A: Have you begun looking for a new space? How close are you? Do you

have a broker? C: Yes, but we haven’t been looking very hard. I really love this space, and it

will be so disruptive to move. We have been here for years…my dad started this company…

[ATTORNEY ACCESSING NEED TO JUMP RIGHT IN TO LITIGATION.] A: How serious is your landlord about displacing you? Why doesn’t he renew

your lease? Does the Landlord want more money? Does it make sense for you to pay more money? Your rent in a new space will be comparable; rents are going up all over Manhattan.

C: Well, the Landlord wants my space for her son’s business. She seems

pretty serious about wanting us out. I guess I have to get more pro-active about our next move.

A: I can keep you in for a while via litigation, but that costs legal fees. Of

course, I need to see your lease and the correspondence from your Landlord. I also want to speak to your broker and architect and figure out how long this move will take, then we need to see if we can get the time from the Landlord, in exchange for legal assurances that you will vacate. If not, you need to plan for the legal fees, which we can estimate.


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[ATTORNEY WANTS TO KNOW WHO THE PLAYERS INVOLVED ARE, A DOESN’T JUST ASSUME IT’S WHO IS ON THE OTHER END OF THE PHONE.] A: Are you the only decision maker in your business? C: I handle most day-to-day stuff, but my brother and his wife are part

owners, they may want to be in on this. I also have my regular business lawyer who doesn’t do the real estate stuff, he is interested in this litigation.

A: Well, I am going to prepare what we call a LPM Letter, where I apprise

you of your options, their costs, and their likelihood of each course of action helping to achieve your goals. Then you can review it with your team and we can go from there.

The Author’s Morning Glories.


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What’s the Difference in the LPM Firm?

In the firm that doesn’t approach its work with LPM:

The Attorney was responding robotically.

The Attorney was making assumptions about the client’s goals and needs.

The Attorney provided assurances he probably should not have, without having more facts.

The Attorney was grabbing a retainer quickly, seeking to protect his chance at a fee.

In the firm that practices using an LPM framework:

The Attorney was trying to figure out how the client makes money. Who is this company?

The Attorney was trying to ascertain the client’s goals and needs. And trying to get the client to articulate them.

The Attorney wanted to know who the players are, who her audience is, who the decision makers are.

The Attorney was trying to be part of a solution for this client.

The Attorney was being curious – an important attribute in our profession!

The Case for (and Against) LPM

Why would this dichotomy exist in our profession? The above example was obviously set up to present the LPM way as more appealing. Why wouldn’t everyone practice in this way?

In the real and busy world that we all live and work in, why would the experienced lawyer in our first example criticize the way the lawyer in the second example handled the phone call?

He would probably have the following criticisms:

LPM is more time consuming.



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LPM results in a higher cost of doing business. Clients don’t want to think, they want you to solve their problem. With LPM, there is a higher chance that litigation will be avoided

altogether, lowering the potential legal fee.

Reason LPM Carries the Day

In response to the above criticisms, the follow response is offered:

Spending more time at the beginning on an engagement on information gathering, understanding who the players are, understanding the client’s business model, goal identification, and having the client’s buy in to the legal approach taken, will cause the matter to proceed more smoothly in the long run.

Being a better lawyer and business problem solver will inure to the benefit

of your career and your pocket book far more over the course of your time at the bar than the quick and easy approach we started by looking at today.

The LPM way produces a more satisfying way of engaging with clients.

You will enjoy your life more when you engage in this way.

In the next sub-chapter, we expand upon the concepts elicited in this example by providing lists of general sample question a lawyer should ask a client and himself about every engagement.


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2.2. Questions to Ask a New (or Existing) Client That Will Enable You to Better Meet the Client’s Needs After reading the client’s website, studying what you can find about the client (both good and bad) online, and perhaps calling anyone in your personal network connected with the client’s industry, here are some suggested questions to deepen your understanding of what the client is all about. Let your curiosity guide you. If you are wondering about something, it is probably a good question.

Questions to Ask a New (or Existing) Client That Will Enable You to Better Meet the Client’s Needs

(1) What is your business model? How do you make money? I see online

that you do X. Is that the bulk of your business? (2) I see you are in X Industry. Do you do domestic or international? Retail or

wholesale? What stage of the X process do you focus on – the beginning or the end?

(3) How long have you been in business? (4) How big is the company? [THIS CAN BE ANSWERED AND FOLLOW UP

QUESTIONS REFINED IN MANY WAYS] How many customers, gross sales, in comparison to their competitors, etc.

(5) What is your workforce like? How many employees do you have? Do you

outsource? (6) Who are your main competitors and what distinguishes you? (7) What, in general, are your company’s current problems? What do you

worry about? What keeps you up at night? Do you face threats from the economy, from legislation and regulation, from public relations issues?

(8) What are your general plans for the company’s future? (9) Who are the decision makers in your company? (10) Are the decision makers at odds with one another? In other words, does

your company have any competing agendas or directions that it would be helpful for me to understand?


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Next, are examples of some even deeper questions that we at Itkowitz PLLC will likely seek answers to when representing a new client.

Fundamental Internal Questions A Law Firm Should Ask Itself at the Beginning of an Engagement

(1) What battlefields will the engagement be fought on - in the courts, in an

arbitration, in the press?

(2) What is really at stake for this client? Is this a routine matter, or an existential litigation?

(3) Are there personal as well as business related motivations involved in the

case?

(4) What is the back-story between the parties, the history?

(5) What is the client not telling me yet?

(6) What is really going on here? (7) Why is the firm taking this case? Are we going to make money?



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At many firms (not Itkowitz PLLC), associates’ roles are narrow, and their contact with senior lawyers and clients is so limited that the big picture of the engagement they are working on is obscured from them. If you are an associate at such a firm and are far removed from the client, because of the structure of your firm -- That’s ok. In that case, the same spirit of inquiry can still be of value. Below we suggest ten slightly modified questions about the client and about the partner or associate for whom you work, which can be addressed to the partner or associate at an appropriate time. Perhaps these questions could be introduced by saying, “In order to do a good job on the assignments you have given me, might I just ask you a few questions about the client and their industry, so that I can get a glimpse of the big picture?”



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Ten Questions to Ask the Partner or Senior Associate You are Working with That Will Enable You to Better Meet the Client’s Needs

(1) What is our client’s business model? How does the client make money? I

see online that they do X. Is that the bulk of the client’s business?

(2) I see the client is in X Industry. Does it do domestic or international? Retail or wholesale? What stage of the X process does the client focus on – the beginning or the end?

(3) How long have you been representing this client? Do you enjoy it?

(4) How big is the company? [THIS CAN BE ANSWERED AND FOLLOW UP

QUESTIONS REFINED IN MANY WAYS] How many customers, gross sales, in comparison to their competitors, etc.

(5) What does the client outsource?

(6) Who are the client’s main competitors and what distinguishes the client

from them?

(7) What, in general, are the client’s current problems? Does the client face threats from the economy, from legislation and regulation, from public relations issues?

(8) Where would you suggest that I look to find more information about this

industry or this client?

(9) What would you, as a senior lawyer serving this client, want me, a junior lawyer, to know?

(10) What are the client’s goals?

In the next sub-chapter we ask ourselves -- “Who are the Players?”


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2.3. Who are the Players?

Once the backstory is established, it is important to understand all of the players that are involved in the matter, whether those players are immediately apparent or not.

Scenario: Bob at Law Firm A interfaces with Raj at Client B. Bob and Raj have a very friendly relationship. Bob handles Raj’s requests, and Raj is happy with Bob's work. Bob updates Raj periodically about the matters that Firm A is handling for Client B via brief phone calls or informal emails. But note that Bob is just one mid-level lawyer at Firm A, and there are many other people at Firm A involved in the actual work to service Client B. Similarly, while Raj is a mid-level manager at Client B, there are many other decision makers behind Raj at Client B. In fact, Raj only makes routine decisions. The Problem: Bob and Raj are two tips of two icebergs. To Raj, Bob FEELS like the lawyer. What is worse is that to Bob, Raj FEELS like the client. But this is not really the case. There are many people -- who we like to call "hidden players" -- on each side. And those people matter. A New Wrinkle: Now let us add in that Client B is a large property management firm, representing a building owned by a limited partnership. Client B brings the partnership to Firm A for an important engagement.


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Analysis of What is Wrong with this Picture: First of all, Client B is not really the client - the partnership is. What follows is a list of people that the law firm, in this example, should seek to identify and learn as much about as possible:

(1) The property manager, who is Firm B’s contact at "the client". (2) More senior property managers, who are the contact's superiors. (3) The real client, namely the partners in the limited partnership. (4) The people who work for the limited partnership. (5) The partners’ spouses, siblings or other close advisers. (6) Future partners, i.e. the next generation of the partnership, if they are

imminently on their way in. (7) General Counsel for the partnership. Why are we thinking about this? Too many lawyer-client relationships, even between larger firms and bigger companies, are based on discrete personal relationships between one lawyer at a firm and one contact at the client-company. From a business development point of view, this might be fine. But when considering how to best represent a client, a law firm has to consider who all the players, hidden and revealed, are. I recently represented a client, a sophisticated business person, in a real estate related litigation. The matter was well underway when the phone rang. Who was it? The client's son, an attorney, someone I had never met, barely heard about, and wasn't even sure that I had authorization from the real client to be speaking to. Once I confirmed that I was authorized by the client to speak to his son, I gladly did so. Fortunately, I had sent the client a series of Legal Project Management Letters, a type of communication that we will talk about in a subsequent chapter, and the client’s son knew exactly what was going on. It was a good starting point for our conversation, and a good reminder that I was being closely watched by more people than just the client. I like to refer to all the people on our side of a litigation caption who are concerned with our work as our "client audience".


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Law often feels like a very personal business, and a lawyer handling the day-to-day aspects of a matter can come to feel like the client audience is one person, i.e. his contact on the end of the phone. With even the simplest matters, however, that is often not the case. A lawyer has to first understand that the client audience is filled with people who are giving the matter different degrees of their attention, many of whom may be sitting in the shadows. The second thing the lawyer has to do is to try to understand as much about the client audience as possible.

A good way to look at your client is as an audience. When you are on stage, you can only see the people in the first row. The auditorium is often filled, however, with people many rows back, who you can’t see. You need to be documenting your work for those hidden players as well as for your main client contact.


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We start by simply Googling a new client and everyone attached to them. Another thing that a lawyer can and should do at the outset of a new relationship when gathering information and trying to figure out who is out there in his client audience, is simply ask the main contact. A lawyer should not be afraid to ask his client about client’s inner workings. Who will be making the decisions here? Will those people be interfacing directly with the firm? What are they like? Do I have your permission to communicate directly with corporate counsel? The big picture matters a great deal, and it is shocking how many attorneys ignore it. In the next sub-chapter we will explore utilizing all of the Information Gathering we have done to Define the Client's Goals.


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CHAPTER 3: UNDERSTANDING AND DEFINING THE CLIENT’S GOALS

“I want to sue the board!” “I want Mr. X deposed!” “I want to expose her fraud!” These, and the other statements in the above list of client statements shown in the graphic -- these are NOT goals. This is ranting. And most clients do it when they first call their lawyer up, even the pros. The problem is that all too often, zealous lawyers, especially those who are delighted at the billing opportunity, shoot first and ask the really important questions later. At Itkowitz PLLC, as part of our Legal Project Management protocols, we work very hard to identify realistic client goals at the outset of a matter, and to make sure that we and the client are in absolute agreement thereon. Inasmuch as goals sometimes change as a matter unfolds, we seek to make sure that we all remain on the same page. Sometimes, the goals of an engagement are obvious. But so often in today's complex world there are so many possible outcomes for a matter, that a lawyer is crazy to make any assumptions about a client's goals and priorities. I recently got a real estate partnership as a new client. The principal at the partnership is a very, very smart person, who owns many buildings, and understands real estate litigation. She gave me a series of cases to work on - commercial tenants, behind in their rent. My first question -- What is your goal here? Do you want these tenants to get into compliance and pay on time from now on? Or do you want these spaces back to do something else with? Or some combination thereof?



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Her answer, "Keep the pressure on!" OK, I said, I am happy to keep the pressure on, but pressure for what? What are we going after here? Again, she told me in no uncertain terms, "Keep the pressure on!" Again I asked what the goals were. At that point, she seemed annoyed with me. Why couldn't I understand that she wanted me to "keep the pressure on"? A day later she called back and, as if the first conversation had never happened, and calmly told me that with three of the tenants she wanted them to catch up on payment, and stay caught up, and she had payment plans worked out with them already. For two others, she wanted the spaces back. But only one of the two was urgent, because she had something else lined up for the space that was quite imminent. She and the other tenant had a long relationship, and she wanted to allow them to relocate successfully. This client is a pro, and gets that a lawyer needs to understand the client's goals. It just took her a day to focus on, and answer, my question. The scary thought is how many lawyers fail to ask these questions, and instead just grab the "Keep the Pressure on!" banner and run with it. When this happens, six months, and six very high legal bills into a representation, the client calls up and asks why the bills are so high. The lawyer then answers, "Well, you said to keep the pressure on." This is not a good answer. But it isn't always a thirst for a billing frenzy that keeps a lawyer from asking questions to discern the client’s goals. Some lawyers just never really learned how, or somehow do not feel that they have the right to challenge their clients. Lawyers need to learn how to talk to clients about client goals. It is amazing how many clients want to run into the wind and fight an adversary “because of the principal”. That is, until they get a realistic time and cost estimate for the epic battle they are planning. At Itkowitz PLLC we use the Information Gathering steps mentioned in earlier chapters --“Backstory”, “Questions to Ask a Client”, and “Who are the Players?” to help us understand who to have frank conversations with about the client's goals for the engagement, and what factors should be brought into that discussion. Thereafter, we repeatedly re-confirm client goals in Legal Project Management Letters, which are key tools in our LPM system, which we will discuss in the sub-next chapter.




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CHAPTER 4: PROJECT CHARTERS 4.1 “Legal Project Management Letters”

Every significant project needs a Project Charter. And your litigation is a significant project. Your case is of vital importance to you, you are spending a lot of money on it, it is complex, and there are many people involved both on the client side and on the firm side. Therefore, your case deserves a Project Charter to keep the lawyer-client project team focused on success. At Itkowitz PLLC the Project Charter is expressed through a series of “Legal Project Management Letters”.

The best way to describe our Legal Project Management Letters (“LPM Letters”) is as extremely comprehensive case analysis memos (on steroids), directed to the client team. LPM Letters are prepared at the beginning of an engagement, indeed often before the engagement officially begins, and they are also prepared at every juncture in the case. Taken together, the series of Legal Project Management Letters form the Project Charter.



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A Legal Project Management Letter will Typically Contain the Following Sections:

(1) Facts. A review of the facts and a synthesis of the "hard" data (such as

dates and names, contract provisions, summaries of substantive emails, etc.) with the "soft" information that was elicited in the Information Gathering phase.

(2) Law. A survey of the law relevant to the case, with particular attention

to the elements of each cause of action, so that the client understands exactly what needs to be proven or dis-proven, and who has the burden of proof for each element.

(3) Status. An update on the exact status of the matter, taking into

account the relevant developments since the case came to the firm, and/or the accumulated procedural history. The Client needs to really understand the procedural posture of the case, even if it is complicated. We find that clients often like to see a road map - a diagram, showing them where the case has been, where it is now, and what is coming next. Clients need to know where the detours might be, and where they might lead. A simple graphic can take the place of, or at least illuminate, pages of text. See the sample graphic at the top of this chapter.

(4) Goals. A clear restatement of the client’s goals, so that we can be

sure that the client and the firm have an identical understanding of what success looks like for the client. See our earlier chapter on Defining Client's Goals.

(5) Options. A presentation of available options. For each option, we

provide:

(a) Pros. (b) Cons. (c) Time. (d) Cost. (e) Risks. (f) Percentage chance of the option advancing the goals.

(6) Out-of-Scope Statement. We define and clarifying the scope of the

engagement and explicitly stating what is not being done and why.

(7) Money. A frank discussion about the case’s budgetary constraints and of legal fees, and suggestions for fee arrangements that are alternatives to hourly billing.


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(8) Communications Plan. We establish a communications plan. Especially if there are many people involved in the case at the firm, at corporate counsel, at the client company, etc.

(9) Recommendation. A recommendation for a course of action.


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Once a client experiences the Legal Project Management way, they are never again satisfied with counsel who merely shoot an email or update them via a phone conference, especially if they are relying upon the advice of other decision makers in their company or family, or if the matter is complex. The process of utilizing LPM Letters is a dynamic back and forth process between lawyer and client; it is not static, and the exercise is not one-sided, with the information flowing only from the lawyer to the client, as we will see in the next sub-chapter.


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4.2 A Collaborative Process between Lawyer and Client

The last chapter was about how every significant project needs a Project Charter to keep the lawyer-client project team focused on success. At Itkowitz PLLC the Project Charter is expressed through a series of “Legal Project Management Letters” (“LPM Letters”), extremely comprehensive case analysis memos directed to the lawyer-client team, which address for the case at that point: the facts, the law, the status, the client goals, current options -- and for each option – the pros, cons, time., cost, risks, and likelihood of the option advancing the goals, what’s out-of-scope, legal fees, a communications plan, legal fees, and a recommendation. But the firm sending the client an LPM Letter is not the end of the process. LPM Letters are not static, and drafting them is not one-sided, with the information flowing from only the lawyer to the client. LPM Letters are designed to involve the client -- To get the client to really think about their options, their chances for success, the resources that need to be brought to the project, etc. About six months into our launch of the Legal Project Management system at Itkowitz PLLC, a colleague and I spent about a week writing a thirty page LPM letter for a client in the midst of a big litigation. It was a great letter. But we got one section very wrong – our restatement of the client’s goals. The client loved the letter, was happy about the analysis, but was upset by our articulation of his goals. He thought we were reaching too high, substituting our own hopes for the





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outcome of the case for his, which were more modest. What the client’s goals had been at the initiation of the matter were not what the client’s goals have evolved into. It did not matter if we, as his lawyers, agreed with his scaled back goals, all that mattered was that we understood and honored them. The client asked me to re-write the letter with his true goals in mind, which I did. This back and forth on an LPM Letter is a fascinating process. Upon completion, there is little doubt that both the lawyers and the clients are all on the same page, and ready for the next step in the litigation. This is lawyer and client communication and partnership on a completely new level. The next sub-chapter deals with other ways, both routine and creative, for lawyers and clients to stay in communication.


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CHAPTER 5: COMMUNICATION WITH THE CLIENT 5.1 Sharing Information with the Client

Other than the detailed and comprehensive Legal Project Management Letter that we discussed in detail in an earlier chapter, there are many natural opportunities for a lawyer to update a client. For clients for whom we handle multiple matters, we provide a free, weekly or monthly status report on all cases. But below I share some less intuitive examples of opportunities for client communication. Recently, I was asked to compete with another law firm for a client account. One of the tasks that I had to do, in order to render the client an opinion as to the merits of its case, was to do Freedom of Information Law Requests at various New York City administrative agencies. Each request unearthed a ton of paper -- four reams of paper from one agency alone. On top of that, the client also sent me the hard copy of a closing binder that was another four reams of paper. My office, of course, scanned and coded all of the documents. And I went to work on it. I completed an analysis for the client, which annexed several key documents as exhibits; needles in the haystack of paper. I wanted the client to have access to ALL of the documents, which, after all, he had paid for. Therefore, I had my tech staff upload all of the documents onto a password-protected online platform that allows us to host large documents and share them with our clients.


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For a moment, I thought wistfully - now the client will give access to all of this paper I amassed and organized to the competitor firm, and they will get the benefit of me having put all this information conveniently together in one spot. But there is never a downside to sharing information freely and conveniently. We live in an era where you do not get ahead by restricting access to important information. Rather, you get ahead by being a steward of information, and helping your client and all their advisors have easy access to it. Honestly, I have no idea if the client ever gave the other firm access, because he hired us. Here is another story. I am often responsible for commencing new lawsuits, and I train and supervise a team of in-house New York State licensed process servers. These servers are equipped with (Global Positioning Satellite) GPS technology that records where they are when they serve papers. The process servers are also trained to take photographs of where they are when they serve process. With each attempt at process service, even if the attempt is unsuccessful, I send my clients a report on the attempt, a screen shot of the GPS confirmation that the server was where she said she would be, and pictures. Recently, I sent a client who was eagerly waiting for a litigation target to be served, a picture of the service target -- with the papers in his hand…the guy was not smiling! But the client undoubtedly enjoyed being a part of the process and understanding what and how we were advancing his goals. The next sub-chapter delves into the specifics of how to speak to a client about likelihood of success.


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5.2. A Fighting Chance – More Lessons and Client Communication

In May 20, 2013, I attended an excellent online seminar where the instructor asked a virtual classroom full of attorneys to ascribe a percentage likelihood of success to the words "fighting chance". In other words, if a lawyer told you that you had a "fighting chance of winning" what percentage of winning would you think you had? The fascinating online results poll revealed (and remember these are attorneys answering these questions) that a quarter of the audience thought that a "fighting chance of winning" meant a 75% chance or better of winning. Half of the audience thought that "a fighting chance of winning" meant between a 25% and a 75% chance of winning. And the final quarter of the audience thought that a "fighting chance of winning" meant only a 25% chance or less of winning. The Merriam-Webster Dictionary definition of "a fighting chance" is, "a chance that may be realized by a struggle." Which is not very much help. Because depending on the context that the phrase is used in, the tone of voice of the lawyer saying it, and the hopes and needs of the client-listener -- "a fighting chance" can mean almost anything to anybody. This is why I speak to clients in terms of numerical percentages. Colleagues have criticized me, asking, "Michelle, how can you know that the client has a 35% likelihood of winning the motion?" The answer is that after 20 years of experience, consulting with the other lawyers in my firm, considering the history of the case, and researching the judge's general disposition to similar issues -- 35% is my best guess. In any event, "a 35% likelihood of winning the motion" is simply CLEARER than "a fighting chance of winning the motion." "A fighting chance" can mean lots of things to lots of people. But "35%" means about one time out of 3 times, to EVERYBODY!


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However...what a client does with the information that they have a one in three chance, is up to the client. Which is where the decision making belongs - with the client. Let's look at the problem from the after-the-fact angle. The lawyer tells the client that he has a 35% chance of winning the motion, if the client decides to make the motion. The lawyer also tells the client about the cost of making the motion, the time frame, other pros and cons, and, of course, his alternatives to making the motion. The client takes all the information, consults with his team, thinks about it, and decides to make the motion. Then the motion gets made...and lost. Let's consider the conversation between lawyer and client after the loss. If the lawyer had told the client, "You have a fighting chance of winning the motion...", the client may very well end up saying to the lawyer (indignantly), "But you told me we had a fighting chance!" On the other hand if the lawyer told the client, "You have a 35% chance of winning the motion...", what can the client say then? "But you told me I had a one in three chance of winning!" Yeah...and you lost, which you had a two out of three chance of doing! This is not about a lawyer covering himself with the client. This is about communication. This is about clear and precise communication. This is also about analysis. Frankly, when a lawyer and his firm colleagues force themselves to think in terms of percentages, rather than in terms of emotionally charged language, they too often end up seeing the case in a clearer light. The next sub-chapter carries the theme of client commination forward as it talks about meetings.


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5.3. Meetings the Legal Project Management Way People hate meetings. So in the last few years, a lot has been written about how companies can have fewer meetings. But the have-less-meetings movement is going the way of the do-my-job-from-home movement, it doesn't really work. Sorry. You need to have meetings in your law firm for the same reason you need to, perish the thought, actually be at work. And that reason is because people need to...well...meet. To lay aside other business, to come together at a specific time, face to face, and interact with one another for the purpose of dealing with a certain issue. That's how things get done. Client meetings, especially, are a lost art. You might have written voluminous sets of winning papers for your client and conducted many brilliant oral arguments. But maybe your client doesn’t really read the papers and never comes to court. The main way that many clients experience their lawyers is in meetings with them. Such meetings should leave the client feeling like he is getting what he’s paying for. Moreover, don’t you ever get tired of just getting through the day? Don’t just tolerate another meeting. Embrace it, and get something out of it. A meeting is an opportunity, not a chore. Instead of having fewer meetings, let's have much better meetings. There is a Legal Project Management way to have a meeting, which I describe below. (1) Agenda.

Make an agenda and send it around ahead of time with a meeting confirmation. "Karen, confirming that we are meeting on Monday, June 10 at my office at 305 Broadway, 7th floor, at 2:00 pm. Here is my cell number in case something changes. I took the liberty of creating an agenda for the meeting. Let me know if you would like to add something." Include in the agenda that you want to re-confirm the client’s goals.

(2) Be Prepared.

Be prepared. Making the agenda helps me to prepare for the meeting. I go to the electronic file and re-read recent things -- emails, court documents, and foundational things - like the lease or the contract.


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Readiness is all. Treat the meeting like you would a court appearance, or something you consider really important. Have the things that you need – such as copies for everyone of a key document.

(3) Be on Time.

Be on time. Being late says to the world, "The hell with you, my time is more valuable than yours, so I think I will waste yours and you can sit here and wait on me." It’s terrible.

(4) Alert your Receptionist.

If someone is coming to your office to meet with you, tell the receptionist who you are expecting. That way he can say, “Hello Ms. Nyberg, Michelle has been expecting you."

(5) Tea.

Hospitality is important even in the smallest of meetings. At the very least, always have bottled water there.

(6) Absolutely No Personal Tech in Meetings.

Don't take calls or look at your device or have beeps going off. (7) Set the Tone.

Open the meeting boldly and set the tone. With clients I always go with some version of, "OK we are here to work let’s dig in." This is one way in which the “opportunity” mentioned above comes in. This is your opportunity to be a leader. And it’s your opportunity to get something done. Seize it.

(8) Acknowledge the Elephant in the Room.

Acknowledge the elephant in the room. There usually is one. Usually it has to do with money. But it could have to do with anything – a weakness in the case, a conflict between decision makers, etc. Do NOT dance around the tough stuff. You are a lawyer, a grown up. Deal with whatever it is – head on.


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(9) Stick to the Agenda.

Stick to the agenda. You made it for a reason. Try not to get too far off track. And save the small talk for the end.

(10) Use Visuals.

Make handouts, a PowerPoint, or bring in a mark and wipe board with dry erase colors (don’t forget the eraser). Looking at things together, or better yet creating things together (I love the mark-n-wipe), is a good way to work effectively.

(11) Take Notes.

Take notes even if it isn’t required. It keeps you focused. And it keeps you from forgetting things.

(12) Listen and Be Gracious.

There are libraries written on the art of actually listening to another human being. For purposes of this short article, I would simply suggest practicing the following skill. When someone says something complicated or important, say, “I am hearing that you are saying [repeat what they said back to them in your own words]. Is that correct?” Be gracious. Give the speaker your attention. Even if you hate them and they bore you. Treat others in the way that you would want to be treated.

(13) Action Plan Conclusion.

Make an action plan toward the end of the meeting. What is the main take away, what did we accomplish? Who is doing what and by when?

(14) Transcribe a Record of the Meeting Immediately After.

As soon as the meeting is over, go sit down and type up your notes into a meeting follow up email memo that gets saved to the file and preferably shared with the client if applicable. Include in the memo who has been assigned to do what by when. This is very important step and easy to leave off.


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(15) Clean Up After.

After the meeting, straighten the chairs. Carry out from the meeting room whatever garbage you created and whatever else you can carry. Even if it is not your job to do so.

The next sub-chapter is about Scheduling and Deadline Management.


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CHAPTER 6 – SCHEDULING AND DEADLINE MANAGEMENT

Scheduling and management of deadlines is one of the most difficult things we do as lawyers. Why should this be the case? People in today’s world are busy. And when you are tasked with coordinating the work schedules of several busy people on a project, it is challenging. The other thing is simply this – there is a human tendency to procrastinate, which must be constantly overcome in any organization. Below are seven considerations that a project manager needs to ponder when attempting to schedule the progress of a project that involves multiple lawyers and the client. (1) When is the deadline? Double check.

People make mistakes. You don’t want to make a mistake about a deadline. Double check.

(2) What are the component tasks in the project?

Be realistic when breaking the project down into tasks. Make the list in conjunction with the people who are actually going to be doing the work.

(3) Do the tasks have to be done in a certain sequence, or can certain tasks

be happening simultaneously?

I will never understand why some firms wait until all the writing is done to start gathering exhibits for a motion. As the writing progresses the writer is identifying which 125 page leases she needs, etc. This information should be imparted to the paralegal on the project as you go along.

(4) Who does what task?

It can save a lot of time and hassle if you establish ahead of time who exactly is responsible for what.

(5) How long does each task take?

Again, be realistic. Get estimates from the people who will actually be doing the work. Make sure that two people are not simultaneously doing the same task, or that no one is doing a particular task.


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(6) What are the constraints?

“Constraints” are the problems that will get in the way of your schedule. For example, if the associate who has to draft something has another deadline, if the partner who is supposed to review the papers will be on trial, or if the client who needed to review and sign the papers has a vacation scheduled. Flush out possible constraints and you will save yourself tons of problems.

(7) Do you need any special tools for a task?

Say you have a large draft of important opposition papers for a client and perhaps the client’s in-house counsel to review. The client not only wants to see your draft, but the original motion papers, the complaint, and a large contract. Emailing large documents often fails and it can also be confusing if too many emails go back and forth and no one is sure they are looking at the same documents. In situations like this we post the relevant documents to a secure online space where the lawyers and the clients can access the same documents. If you need to contact your tech department ahead of time to get such a space set up, it makes sense to include this tool in your plans early.


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Below is an example of an associate and I planning exactly how we are going to use the next six weeks to get a brief done on time:

ITEM/TASKS/CONSTRAINTS START DATE END DATE

TODAY 11/4/2013 11/4/2013

associate to clear calendar by Fri 11/8 11/4/2013 11/8/2013

associate writes first draft; needs 3 days 11/8/2013 11/15/2013

veterens day 11/11/2013 11/11/2013

associate to finish first draft and give to

JBI; JBI to look at associate draft over

weekend 11/15/2013 11/18/2013

associate incorporating JBI changes,

writing 2nd draft; needs at least 2 days 11/18/2013 11/20/2013

JBI to look at one more time; associate

last changes 11/21/2013 11/22/2013

to client that Friday; client to return

papers to us with comments the

following Wed. 11/27 11/22/2022 11/27/2013

thanksgiving 11/28/2013 11/29/2013

Client on vacation from Thanksgiving

until and including Sun. Dec 8 11/28/2013 12/8/2013

Incorporate client comments wile client

on vacation, then back and forth with

client 12/9/2013 12/11/2013

Jay on trial mon 12/9 to fri 12/13; not

available 12/9/2013 12/13/2013

Jay and associate final changes 12/16/2013 12/16/2013

final proofread 12/17/2013 12/17/2013

OUR BRIEF DUE 12/23/2013 12/23/2013


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Why Wouldn’t Everyone Work This Way All the Time? And The Real Costs of Not Working this Way There are many tomes, much more detailed and scholarly than this, which can explain to you how to schedule a project. What I like to think that my work adds, not just to the topic of scheduling and deadline management, but to the whole of the body of LPM, is an exploration of why things in the legal profession typically never get done this way, and how we can look at things different and bring about positive change. In real life, the associate tasked with creating the schedule chart is already busy. She has not only standing assignments, but things that pop up unexpectedly. When I go and ask her if she has completed the scheduling chart for the Smith Motion, her internal reaction might be this: “I am very busy here. Why are you hassling me about an excel chart, Michelle? In the time it takes me to contact the client and check Jay’s schedule and make a color coded chart, I could be researching and writing. You are adding busy-work to my life, Michelle”

There are several answers to this criticism, i.e. to this cognitive resistance.

(1) If, in your mind, you divorce basic project management procedures from

the legal work, then you are doing a great disservice to yourself and the client. Why? Because making sure that you successfully meet a deadline IS legal work, and it is just as important as research and writing. Lawyers who hold themselves above what they consider administrative detail and lock themselves in a tower of intellect (I want a dime for every guy like this I have met in my career) are learning throughout the legal industry that there is great beauty in the details, not just in the big thoughts. In other words, if your big thoughts are encapsulated in a sloppy set of papers that missed the deadline, then those thoughts may well be ignored by the court.

(2) It is both impressive and comforting to a client to get a chart like the one

above. It says to the client that you are very much on top of the project. (3) It is not enough to simply meet a deadline. It is important to be able to

meet a deadline comfortably. By that I mean that it is a drag to always be in crisis mode, to always be rushing toward the next ill-planned for deadline. This creates a culture of tension and blame in a firm. Making a thoughtful chart, like the one above, helps instill grace under pressure.

(4) The quality of your work product will not suffer by spending a half hour on

a chart like the one above. The quality of your work, will, however, suffer from a misstep in planning. The next sub-chapter is about on estimates and fee alternatives.


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CHAPTER 7: ALLOCATING RESOURCES, BUDGETING, AND COST CONTROL 7.1 Estimates and Alternative Fees

Litigation is expensive, time consuming, and stressful. Therefore, you should not enter into it lightly. To mitigate the downsides of litigation, Itkowitz PLLC has developed a unique way of working with clients, which grew directly out of our Legal Project Management exploration. At the beginning, and at all key stages of the engagement, the firm prepares detailed Legal Project Management Letters (“LPM Letter”) for the client. Itkowitz PLLC usually charges a reduced rate for the preparation of the LPM letters. LPM Letters are extremely comprehensive case analysis memos directed to the lawyer-client team, which address for the case at that point: the facts, the law, the status, the client goals, current options -- and for each option – the pros, cons, time., cost, risks, and likelihood of the option advancing the goals, what’s out-of-scope, legal fees, a communications plan, legal fees, and a recommendation. After the client is presented with a LPM Letter, the client and the firm review the client’s goals and expectations, and the client decides which option to pursue. Thereafter, the client and the firm will review the estimate for the option and




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agree to the "Scope of Work". The “Scope of Work” is defined as a set of tasks and/or a period of time upon which the client and the firm agree.

Next, the firm proposes and the client agree to a discounted and capped fee for the Scope of Work. Finally, the client pays the discounted capped fee in full and in advance of the work commencing. In other words, the cap and the discount are the quid pro quo for the advanced payment. The firm keeps track of the hours spent working on the matter using a regular hourly billing method, which we say more about in our standard retainer agreement. If the Scope of Work concludes and the compensation arrived at using the regular hourly billing method is less than the capped fee, then such unearned portion of the fee will be returned to the client. The purpose of this method of working and compensation is to: (1) Keep the Client and the Firm engaged in a productive working

relationship (2) Clearly and unequivocally define exactly what will (and will not) be done (3) Make the legal fees predictable for the Client, and (4) Avoid undue delay in payment for the Firm Clients love this. And it works well for the Firm. When I first started developing and refining this system, I would run it by other lawyers. I heard two objections over and over. One - you will never get clients to pay you ahead of time; and two - even if you do, you will have great difficulty making a profit when limited by a discount and a cap. In reality -- these objections have proven very wrong. From the point of view of our typical client, there is great value in knowing exactly what a stage of litigation will cost ahead of time, and knowing that such fees will not be increased. Many clients’ biggest complaints (about any firm) are the way legal fees spiral out of control. This approach prevents that. The advantage to the firm, which is a small business, is improved cash flow and an assurance that we will never have to chase the client around for money. Suffice it to say, that our rigorous Legal Project Management approach has led to our clients paying less, being happier, and the firm actually making more money. The next sub-chapter is about why commercial contingency fees are bad.


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7.2. Why Commercial Contingency Fees are Bad for Clients and Lawyers I recently had the privilege of speaking to 120 people on a topic called, "Tenant Buy Outs, Making Them Happen", at the Terra CRG Brooklyn Real Estate Summit at the Brooklyn Academy of Music. After the presentation, I had many conversations with people. I tried to talk as much as I could about Legal Project Management and its fee alternatives to the billable hour. Twice, I heard the "C" Word - Contingency Fee!!! People said, "Yes your alternative fee arrangements sound great, but can't I hire you and only pay you if you get the tenant out?" In other words, why can't my firm work on contingency? Here are the five reasons why no client or firm should feel comfortable with a contingency fee billing arrangement on a commercial litigation of this type. (1) Although I would love to be...I am not really your partner.

Let's face it -- you (the client) own the real estate. I (the lawyer) am merely your vendor. If I could switch places with you and I could own the real estate -- i would! People like to say that a lawyer should be like "a partner" with their real estate clients. But, alas, I am not really your partner, am I? If I get a low rent, statutory tenant out of your building, so you can put a market rate tenant in, then your building is worth a lot more. You can borrow more against it, you can sell it for a higher price, the rent roll is higher and you can pay your investors more, and they are more likely to do another project with you. The benefits are exponential -- for you! Now what do I, as the lawyer, get? I get paid -- once. And well after the fact of the work I actually did, so the fee is arguably not as big as it looks because I was financing the salary, rent and tech to get the job done on spec. Now let's say I don't get the tenant out. The downside is exclusively mine. I spent my salary and technology dollars and my time away from my paying clients, business development and my family, and you spent -- nothing. In other words, "partnership" is the wrong word for this type of fee arrangement. The upside is both yours and mine -- but way more yours. The downside is all mine. That's a bad deal for any firm. As if that wasn't bad enough –


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(2) When the risk is all the lawyer's, the client has no incentive to make reasonable decisions.

When you (the building owner) gamble with my (the lawyer's) time and money, you have absolutely no incentive to behave reasonably. It is easy to reject a good settlement offer and let it ride -- moving on to complicated motion practice, discovery, or trial -- on the lawyer's dime! Which leads me to the most fundamental point –

(3) Commercial contingency fees make us adversaries, not partners.

Thus, I often postulate that commercial contingency fees are unethical. In a commercial contingency fee arrangement I only get paid for a clearly defined, particular outcome. But in real world real estate litigation there are many outcomes that might work well for the client -- many of which are creative and not apparent on the day a case begins. These are not personal injury cases where the only possible outcome is a sum of money. I do not want to be, and indeed I should not be, in a situation where I only get paid for a certain outcome and thus am not looking at the client's problem holistically. Moreover, and perhaps almost as importantly –

(4) You get what you pay for in this world.

Undoubtedly, you can always find a lawyer to take your real estate work on contingency. But is that the lawyer you want? Given what I have said above, the only lawyer who would take your real estate work on contingency would be someone with not a lot else to do. But even a hungry lawyer will have some actual paying clients around. Your case, no matter how potentially lucrative, will drop to the bottom of that guy's pile because paying work is always better than work on spec, if you can get it. The moral here -- serious attorneys get paid a fair price. Lawyers who you pay nothing to for sophisticated cases, will likely deliver in kind. But back to the fundamental problem –


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(5) What about my Johnson Rod?

Did you see the Seinfeld episode where Jerry has a fight with his long-time mechanic and finds a brand new one. Jerry tells George, "This new mechanic is great!" George asks Jerry, "How do you know? What do you know about cars? He could tell you the problem is your Johnson Rod and how could you know if that's right or wrong?"

Thus, a guy at the Real Estate Summit said to me, "The problem is that if you tell me that writing a set of motion papers takes 20 hours, how do I know that it takes 20 hours?"

What about my Johnson Rod?

Here is my answer -- try reading them. I am not being facetious. You are a smart person -- you own the real estate! Read what your lawyer produces (and the papers they are responding to), ask questions, attend the oral argument. Was the work convincing? Was it tailored to your facts and circumstances or did it seem rote and cut and pasted? What is your lawyer's track record on other projects for you? For other clients? What do other firms charge for the same kind of work? You can ascertain what a fair price for quality legal work is.


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I seek, through my Legal Project Management protocol, to empower my clients. Be empowered! What I cannot do with a clear conscience, however, because it benefits neither you nor I, is work on contingency.

The next sub-chapter is on the topic of younger lawyers and their role in the delivery of legal services in a value driven model such as Legal Project Management.


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7.3. Law is an Apprentice Profession -- Younger Lawyers and Their Role in the Delivery of Legal Services in a Value Driven Model Such as Legal Project Management

There was a November 19, 2011, New York Times article that spoke about a large law firm that had recently initiated a class where entry level associates were being taught how to work on a corporate transaction. This was apparently newsworthy, because the focus of the article was how shocking it was that law schools generally do not teach very much about actually practicing law, and thereafter, law firms do not either. All the more interesting a topic, the article opined, because at Big Law they charge huge hourly rates for associates with no knowledge or experience. I think the down economy has also produced a similar phenomenon when it comes to very small firms. Solo practitioners and small firms who previously couldn't afford to hire an associate have been able to do so in this market glutted with new lawyers hungry for experience. But alas, some of these firms think that they don't have the time or the inclination for very much associate training either. Law is an apprentice profession. It always has been; it has to be. There is too much to know, with more to know all the time. Experienced lawyers have to teach new lawyers. Think of it from the client's perspective. Let us use the plumber analogy, another apprentice profession. Would you want to pay $600 per hour for a guy just out of plumbing school to be there on your job and just stand there holding the tool box? Would you want a guy just out of plumbing school to be cutting into your main sewer line with an acetylene torch, even if he only cost you $10 per hour?


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No. But, as the client you SHOULD want the new plumber somewhere on your team. Entry level associates have a lot to offer. I had dinner with a partner from a 100-attorney firm the other day, and she asked me, "How can your firm take entry level associates? Aren't they a hassle?" And I said, yes it's a lot of work, but laterals often don’t know so much anyway, or they know just enough to be dangerous! New lawyers are an important element in the delivery of legal services in a value-driven model. And not just because they are a cheaper line-item on a client invoice. It is healthy to train someone up to your standards. And the energy and enthusiasm an entry level brings to the table are unmatched. That is -- when entry levels are closely supervised and properly trained, entry levels are an excellent choice. The Itkowitz PLLC Legal Project Management protocol builds training into every phase of the work and encourages young lawyers to think.

The next sub-chapter begins our discussion of Critical Thought.



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CHAPTER 8: CRITICAL THOUGHT 8.1. "I hired you because you were the only lawyer who did NOT tell me that you

could win my case." -- Legal Project Management -- Critical Thought and Client Communication

Last year we got an exciting new client -- a real estate brokerage company. The principal approached me at a conference with a query about a unique commission dispute involving issues of eminent domain. I asked him to send me the brokerage agreement, the lease, etc. We did a bunch of research, we asked the principal many questions; we actually had to pull some other court files regarding a related matter. See our Information Gathering chapters to get an idea of how we do things. It took about a week. We wrote the prospective client a Legal Project Management Letter, for which we did not charge in this case. The client spent what seemed like a long time thinking about it, and finally came back with questions. We answered the questions. The client hired us. We did not obtain the best results imaginable, but we did not promise to. The client knew the risks, took a chance, and recovered something that made the legal fee worthwhile. The client had lunch with me and some other attorneys in the firm thereafter. I asked him, why did you hire us? He asked, "Do you want the truth?" (No, lie to me.) He said:

"I consulted about a dozen lawyers on this. You were the only one who did not tell me that you could win my case. You were the only one who did not say, 'Yeah sure, of course, you can win.' Instead you sent me a long, thoughtful analysis, and you concluded, 'maybe'. You were the only one that thought about it."

That was a profound moment for me -- "You were the only one who did not tell me that you could win my case." That's why we got hired. And, frankly, that's


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why it went well. The client understood that the decision was his, and his expectations were managed such that he didn't have high hopes of recovering every penny that we sued for. He understood there were hurdles. He understood the risks. We went in with our eyes open and with shared goals. Clients are not paying for lawyers to tell them what they want to hear. Somewhere along the line, the legal profession (especially in the commercial litigation context) became glutted with "yes-people". I call them "Yes-Lawyers". Yes-Lawyers are lawyers who agree with everything that a client or prospective client says and wants to do. "Yes, Sir, certainly we will win that motion!" The Urban Dictionary defines a "Yes Man" as someone who always agrees with authority and does what he's told, even if it is stupid or illegal. I asked a lawyer outside my firm why our profession increasingly operates in this sycophantic way, and he responded, "Because there are 77,000 lawyers in the New York City metro area, and if you do not tell the prospective client what they want to hear (especially the rich and powerful ones who are used to hearing just that), then they will hire someone who will." I reject that. Clients are not stupid. I have had prospective clients grill me on my less than enthusiastic takes on their situations, but that seldom sends them running. I have this one guy who has called me three times recently. Each time he calls me he says, "We'll, another lawyer told me that for sure I could do X successfully.” So hire him! Why are you still talking to me?” But he and I both know why. Clients should be paying lawyers for meaningful analysis and for paths toward solutions. When you take a thorough and searching look at something, especially the law and the facts at the forefront of a sophisticated commercial litigation, you usually need to admit that there are no "slam dunks". Oh how I hate that phrase! It takes patience and commitment to practice the Legal Project Management way. But wouldn't you (and I am speaking to both the lawyer and the client here) rather have the courage of convictions born of a structured process of real thought and attention to the matter at hand, as opposed to just ...bluster. The next sub-chapter picks up on this theme – it’s called “Chess—Really?”


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8.2. Chess – Really? -- Legal Project Management -- Critical Thought

People often say that if you are a good chess player then you will be a good lawyer. I, think, however, that being a good chess player really only means one thing – that you will win a lot when you play chess. Chess is a board game where no piece can move contrary to the rules and where no one gets hurt. In real life, real business and real litigation, the pieces and the players do not always behave according to the rules we all think we know. How often in the last two decades has something happened that has fundamentally changed what is possible in our lives? A good chess player can, and should, think many moves ahead. I am not so sure that this is good advice in litigation any more. Too many lawyers spend so much time thinking (and endlessly talking) about what might happen ten steps ahead, that they miss the only step they can really do anything about – the next one. Your ability to accurately predict and estimate is inversely proportional to the span of time and number of events for which you are trying to make a prediction or estimate. Try diagraming what you think might happen in a case from inception forward. If you are honest with yourself, it is impossible. See the chart at the top.


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Now spend some time on only the step right in front of you. Do NOT ignore the possibility of taking no action at all – “no action” is always a possibility, and one that should be looked at more often.

A fundamental goal of my firm’s Legal Project Management work is being able to give clients real, meaningful information about the choices before them. Throughout the course of the engagement, the firm will prepare for the client a detailed Legal Project Management Letter (“LPM Letter”). The firm will sometimes not charge or charge a reduced fee for the preparation of the LPM letter. LPM Letters are extremely comprehensive case analysis memos directed to the lawyer-client team, which address for the case at that point: the facts, the law, the status, the client goals, current options -- and for each option – the pros, cons, time, cost, risks, and likelihood of the option advancing the goals, what’s out-of-scope, legal fees, a communications plan, legal fees, and a recommendation. After the client is presented with a LPM Letter, the client and the firm review the client’s goals and expectations and the client will decide which option to pursue. On the topic of looking ahead – The next sub-chapter is on Risk Management.


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CHAPTER 9: LAWYERS AS RISK MANAGERS

In our last sub-chapter on Chess I said that too many lawyers spend so much time thinking (and endlessly talking) about what might happen ten steps ahead, that they miss the only step they can really do anything about – the next one. I would like to pick up on that theme here, but specifically with respect to the topic of Lawyers as Risk Managers. First, let us define Risk Management. At Itkowitz PLLC we believe that, in the context of your litigation, your lawyer should help you to identify, assess, and prioritize risks; and then coordinate resources to minimize and monitor the probability and/or impact of negative events. Many lawyers today, however, lead clients to believe that risk management means something else. And many clients are happy to believe that risk management means something else. That something else is that clients expect lawyers to: (1) ameliorate risk; and (2) if the risk cannot be ameliorated, clients expect lawyers to absorb the risk. Neither of these outcomes are realistic or even possible. Nothing can eliminate risk. And if negative events happen, they happen to the client, not to the lawyer. It really achieves nothing for either the lawyer or the client to pretend that such is not the case. Back to the honest definition of Risk management that works: In the context of your litigation, your lawyer should help you to identify, assess, and prioritize risks; and then coordinate resources to minimize and monitor the probability and/or impact of bad events.



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How is this achieved? An experienced lawyer who is also a businessperson with an understanding of your industry will have a strong advantage in this regard over a young, less experienced practitioner. We have that advantage at Itkowitz PLLC. But experience alone is not all you need for Risk Management, and any lawyer, no matter how fresh to the practice of law, can optimize his or her proficiency at Risk Management by utilizing the Legal Project Management concepts of Information Gathering, Client Goal Identification, Formulating a Project Charter, Communication and Engagement with the Client, Allocating Resources, Budgeting and Cost Control, and Critical Thinking. Meaningful Risk Management requires looking holistically at the client and the matter, considering the big picture and how your involvement as a lawyer will tend to further the client’s goals. So, for example: (1) If your client is about to sue a celebrity, you need to consider the impact

that the press will have on the engagement, and perhaps engage and consult with the client’s Public Relations advisers.

(2) If your client is a shareholder about to sue his co-op board, you may want

to consider whether the client wants to sell that unit in the near future and what impact litigation will have for the prospects of such a future sale.

(3) If your client is a commercial landlord who wants to prompt the

Department of Buildings to violate a tenant for allowing defective conditions at the subject premises as a vehicle for a lease default, you may want to consider the effect of such violations on the building in the long run.

Legal Project Management, as discussed in these chapters, facilitates this type of Risk Management thought.

I could go on all day…but this is the last sub-chapter of the book, so far. Look back periodically for updates, we are always adding more.




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MORE INFORMATION

Itkowitz PLLC is a boutique law firm in New York City that serves the commercial real estate and business communities. Our practice encompasses sophisticated commercial litigation, trials and transactional work. We litigate complex lawsuits, from inception through trial (both jury and non-jury), as well as appeals, in State and Federal Courts. We handle all types of commercial real estate transactions, including purchases and sales and leasing for both landlords and tenants. We also represent parties in all sorts of business matters. Itkowitz PLLC brings together great lawyers, the most advanced legal technology, and innovative legal project management, to deliver unmatched value to its clients. You can find more great books like this in e-book format on our website, as well as mountains of other great information. Contact us anytime.

ITKOWITZ PLLC 305 Broadway

New York, New York 10007 (212) 822-1400

www.itkowitz.com





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ABOUT THE AUTHOR Michelle Maratto has been practicing real estate law, specializing in the area of residential and commercial landlord and tenant law in New York City, for twenty years. She is also very experienced in all manner of real estate transactions and in general commercial litigation. She has been with Itkowitz PLLC since 1997. Michelle publishes and speaks frequently. The groups Michelle has taught for, or presented to, and the publications she has written for include: Lawline.com, Lorman Education Services, The Association of the Bar of the City of New York, The Practicing Law Institute, The New York State Bar Association, Real Property Section, Commercial Leasing Committee, Thompson Reuters, The Cooperator, The New York State Bar Association CLE Publications. Michelle is currently co‐authoring the New York State Bar Association's New York Commercial Landlord and Tenant Law and Procedure Book. Michelle authored a manual on evictions in New York City for Lorman Education Services, and co‐authored a chapter on lease remedy clauses for the New York State Bar Association Commercial Leasing Manual. Michelle's twelve‐hour, five‐part continuing legal education program for Lawline remains one of that provider's most popular programs. The three most recent classes taught by Michelle were: Document Review and Production Platforms in the Boutique Law Firm Environment, Learning Motion Practice in an Apprentice Profession, and Post‐Foreclosure Evictions in New York City. Michelle is admitted to practice in New York State and the United States District Court for the Southern District of New York. Michelle is a pioneer of Legal Project Management, a unique and better way for lawyers and clients to work together. Michelle writes and speaks extensively about Legal Project Management. Ask Michelle about our alternative legal fee options! (This is her favorite topic.) Michelle went to Union College where she received a Bachelor of Arts in Political Science in 1989. She later received her Juris Doctorate from Brooklyn Law School in 1992. Michelle is also a managing member of an executive office suite company and a founding member of an internet startup company that launched in 2012. There are lots of ways to keep up with Michelle. Michelle's Legal Project Management blog is becoming very popular. Michelle publishes and speaks frequently. And when Michelle tweets, which is not an obnoxious amount, you can not only actually understand what she is saying, but glean useful stuff about real estate, business, and the legal industry that you might miss between the headlines. Michelle would be happy to speak to you.

Michelle A. Maratto Itkowitz PLLC 305 Broadway

New York, New York 10007 (646) 822-1805

www.itkowitz.com [email protected]

Twitter: follow @m_maratto





https://twitter.com/m_maratto

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Itkowitz PLLC Legal Project Management

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