Bloomberg Law is reporting that corporate law departments are spending more, but less of that that money is landing in Big Law coffers, according to a new survey.

Altman Weil’s 19th Annual Chief Legal Officer survey revealed that most companies increased their spending between 2017 and 2018. But about a third of legal officers shifted work to lower-priced alternatives, the data indicated.

Survey participants said they received quality work and service at considerable reductions in cost with shifts to smaller firm, reports Bloomberg’s Elizabeth Olson.

Read the Bloomberg Law article.

Bloomberg is reporting that an experienced securities lawyer has left Tesla Inc. just as the company needs one under its fraud settlement with U.S. regulators.

Phil Rothenberg, a vice president in Tesla’s legal department who joined the company in 2011, became general counsel at Sonder, a hospitality startup, on Nov. 5, writes Bloomberg reporter Dana Hull.

Before joining Tesla, Rothenberg was an attorney-adviser for the U.S. Securities and Exchange Commission and has extensive securities law experience.

Read the Bloomberg article.

NAVEX Global has published a new report discussing how to assess your program maturity, gain organizational buy-in and understand the value of a comprehensive third-party due diligence program.

The report can be downloaded from the NAVEX website at no charge.

“Third parties are an extension of your business and expose your organization to reputational and business risks,” NAVEX says on its website. “Help protect your organization with the latest insights, benchmarks and trends around how to manage these business partners.”

The report answers questions such as:

• What strategies do organizations use to manage third-party risks?
• How do organizations employ risk-based procedures to manage third-party risks?
• How do respondents measure the effectiveness of their program?

Download the report.

The International Association of Defense Counsel (IADC), an invitation-only global legal organization for attorneys who represent corporate and insurance interests, has published its fourth quarter 2018 Defense Counsel Journal (DCJ) with articles on current trends in the practice of law.

The current DCJ issue’s articles explore asbestos tort reform on the state level, the growth of punitive damages in Anglo-Canadian contract law, and legal hurdles that manufacturers face when launching products in the United States.

In a release, the organization, said the DCJ is a quarterly forum for topical and scholarly writings on the law, including its development and reform, as well as on the practice of law in general. DCJ articles are written by members of the IADC, which is a 2,500-member, invitation-only, worldwide organization that serves its members and their clients, as well as the civil justice system and the legal profession.

The DCJ is available for free and without a subscription via the IADC’s website.

The current DCJ issue is the first to be overseen by new editor and former IADC board member Kenneth R. Meyer, a partner in the products liability practice group at McCarter & English, LLP, in Newark, N.J. The issue also is the first under the leadership of new IADC president Craig A. Thompson, a partner at Venable LLP.

Following are brief summaries of key articles included in the fourth quarter 2018 issue of the DCJ:

— “The More Things Change: Bankruptcy Trust Reform and the Status Quo in Asbestos Litigation” – The article debunks plaintiffs’ lawyers’ arguments that trust transparency reforms would delay litigation, deny compensation to the most sympathetic of plaintiffs, and divest plaintiffs of their traditional control over the trust and tort systems. The authors explain how trust transparency reforms have not delayed litigation and have, in fact, accelerated compensation from the asbestos trusts. The article also describes that, where reforms have been enacted, they have achieved their purpose of fostering communication within the two-tiered system of asbestos compensation so that juries can properly account for all of a plaintiff’s exposures to asbestos.

— “Moving Beyond Uberrima Fides? The General Duty of Honesty in Contractual Performance and Punitive Damage Awards in Anglo-Canadian Contract Law” – The article’s authors suggest that the characterization of punitive damages as “the bane of corporate defendants” has perhaps never been more true under Anglo-Canadian contract law. This article demonstrates that while punitive damages for pure breach of contract are undoubtedly exceptional remedies at common law, they are generally larger and more common than ever before, which marks an extraordinary development in Anglo-Canadian contract law considering that only 30 years ago punitive damages were barred for pure breach of contract.

— “Entering the U.S. Market: Legal Hurdles That Manufacturers Must Overcome” – Investigates the life cycle of a product’s development and marketing and provides insight into some of the most common legal hurdles – especially consumer protection lawsuits – faced by manufacturers entering the U.S. market.

The  National Association of Corporate Directors has published its 2018 Report of the NACD Blue Ribbon Commission on Adaptive Governance: Board Oversight of Disruptive Risks to provide directors with valuable insights and tools.

How can directors do a thorough job of assessing disruptive risks and then of guiding their companies toward effective responses? More broadly, how can directors fulfill their core responsibilities for overseeing performance, strategy, risk management, and enterprise content management when volatility, uncertainty, complexity, and ambiguity (VUCA) are the only constants?

The report provides:

• a functional definition of disruptive risk
• characteristics of the current environment—and their implications
• a definition of adaptive governance as a framework for overseeing disruptive risks
• the essential components of adaptive governance
• recommendations for putting adaptive governance into practice

Download the complimentary report.

David Drummond, the  chief legal officer of Google parent Alphabet Inc. and a one-time Wilson Sonsini Goodrich & Rosati partner, was cited in a New York Times report about the allegedly lax approach that Google has taken to relationships between supervisors and their subordinates.

Bloomberg Law focused  on the part of the report that detailed an alleged extramarital affair involving Drummond and a subordinate, an in-house senior contract manager at Google. The affair resulted in the woman giving birth to Drummond’s child, the Times reported.

“The report, which cited [Jennifer] Blakely and other Google employees, said she and Drummond had a son in 2007,” Bloomberg reports. “Thereafter, it said, Drummond disclosed the relationship to the company—and Blakely was asked to leave because relationships between managers and subordinates were ‘discouraged.’”

Read the Bloomberg Law article.

NAVEX Global will present the 2018 Ethics & Compliance Virtual Conference as an online event Thursday, Nov. 8, 2018.

This year’s ECVC focuses on putting the ideals of ethics and compliance into practice. Find out how your program should perform through regulatory scrutiny, leadership influence and program enhancements, then deliver quantifiable proof of success.

The conference will feature:

• 4 Learning Tracks
• 3 High-Profile Keynotes
• 13 Hour-Long Sessions
• No Travel; No Cost
• 6000+ Peers for Networking
• Dozens of Free Resources
• Live Speaker Q&A
• On-Demand Access

Register for the virtual conference.

Zapproved recently partnered with Corporate Ediscovery to commission an in-depth survey of corporate ediscovery professionals. The resulting benchmark report uncovers key insights about the ediscovery community, including common challenges, aspirations, and approaches to managing each stage of the EDRM.

The 2018 Corporate Ediscovery Benchmarking Report can be download from Zapproved’s website at no charge.

The results and detailed benchmarks include:

• The volume and types of matters that require ediscovery support
• How corporate teams are managing each stage of the EDRM – from data preservation through document review
• Common challenges and goals for 2019 and beyond
• Best practice adoption rates and barriers

Download the report.

Image by Steve Jurvetson

Of the all fixes the SEC wants Tesla Inc. to make in the wake of Elon Musk’s now-infamous tweet, one stands out for its novelty: “An experienced securities lawyer” to review all social media communications by the company’s senior officers, reports Bloomberg Law.

“In resolving its fraud claims against Tesla and Musk, the Securities and Exchange Commission specified in the fine print of its settlement proposal that the lawyer hired or designated to vet tweets must have qualifications that’“are not unacceptable to the staff,’” writes reporter Peter Blumberg.

The head of the legal department now is a lawyer who represented Musk through two divorces, Todd Maron.

Read the Bloomberg Law article.

Bad corporate directorship can be incredibly detrimental to a company or organization. From inattention to detail to feelings of entitlement, bad board members can seriously impede board operations, waste precious resources, and stifle best-practice corporate governance.

The National Association of Corporate Directors has published  “A Field Guide to Bad Directors,” in which four-time corporate chair and CEO of Special Investigations Michael Pocalyko

• lays out the defining characteristics of a bad director,
• identifies 14 of the most prevalent bad director archetypes, and
• offers suggestions for mitigating the effects of a bad director.

Additionally, Pocalyko interviews three seasoned directors about their personal experiences with deficient board members and what management styles and personal qualities are beneficial in maintaining a high-performance board.

The article can be downloaded at no charge from the NACD website.

Download the article.

Legal experts say the penalties that the SEC doled out to Elon Musk for  “false and misleading” statements made on Twitter could have been much, much worse for Musk and his car company, reports Wired.

Reporter Aarian Marshall writes that “Musk and Tesla will have to each write $20 million checks for the misadventure, which will be disbursed to investors harmed during the wild market swings that occurred after Musk’s tweets.” Musk had tweeted that he planned to take Tesla private and funding had been secured.

“Not settling with the SEC could have led to a more dire outcome,” Marshall explains. “The SEC’s initial suit sought to bar the CEO from becoming an officer or director for any public company, perhaps for life.”

Read the Wired article.

A new article published by the National Association of Corporate Directors discusses the steps a company needs to take before deciding to embark upon a board-led investigation, and provides insight into essential actions the company should take to “weather the storm of an investigation,” like assigning committee responsibilities and having disinterested directors.

Based on best practices discussed at this spring’s AC Committee Chair Advisory Council meeting, this article outlines the key considerations for boards beginning an investigation:

• Early decisions have far-reaching impacts
• Keep the external auditor informed, while maintaining privilege
• Take a proactive approach to remediation
• Get ahead of reputational damage
• Discuss whether the circumstances warrant self-reporting

The company said this article helps directors develop an internal investigation protocol to follow should an issue arise, and equips directors with a framework to mitigate the effects of an investigation both internally and externally.

Download the article.

NAVEX Global will present the online master class “Herding Big Cats: Improving Executive & Board Engagement” on Thursday, Sept. 20, 2018, beginning at 10:30 a.m. Central time.

Getting positive buy-in needed from an organization’s executives and board members is a common issue for most businesses, NAVEX says on its website. “And, it can be especially difficult for compliance professionals needing to demonstrate the true ROI of their programs. In this Master Class, you’ll learn how to wrangle top-level decision-makers to ensure all executives and board members understand their responsibilities for compliance oversight. Effectively protect your organization from compliance and behavioral risk, and learn why active board engagement is critical for establishing a strong ethical culture from the top down.”

This master class will cover:

• How to contribute to the goals of the board
• Rules of engagement for difficult board discussions
• Common communication mistakes to avoid
• Meaningful board training methods
• How to position compliance to get critical program buy-in

Register or get more information.

As budget season approaches, a post on the Xakia website takes a look at the financial side of corporate legal operations – from alternative fee arrangements to special considerations for smaller departments.

The post offers some benchmarks to help gauge how a department’s budget compares with others. While every team and company is different, benchmarks can help establish context – or give you fodder to ask for a budget increase, the company says.

Headings include: Legal Budget as a Percentage of Revenue, Legal Budget by Department Size, Legal Budget by Location, Legal Budget by Industry, and Why Budget Matters.

Read the article.

Outside companies that provide services to Microsoft Corp. will be required to provide their employees 12 weeks of paid family leave, announced the company’s new general counsel, Dev Stahlkopf.

The Washington Post reports that, under the requirement, mothers and fathers who perform work for Microsoft — biological and adoptive — must receive 12 weeks of leave at two-thirds of their wages or up to $1,000 weekly. The new rule applies to outside contractors, such as those providing culinary, housekeeping and receptionist work.

“Microsoft now partners with more than 1,000 firms across the U.S. — half of which work outside Washington state,” writes reporter Danielle Paquette.

Read the Washington Post article.

Michael Best Strategies has partnered with Robert Gross, who will also serve as senior counsel for Michael Best & Friedrich LLP.

As a senior advisor at Michael Best Strategies LLC, Gross will provide a national perspective on corporate governance for both public and privately-owned companies. He has experience in mining, energy, environment, higher education areas, and the banking and financial services industries, the firm said in a release.

Gross has served as a bank president and CEO, general counsel, and corporate secretary. He also served six years as a state government cabinet-level executive director. Gross was appointed by the George W. Bush administration to serve in Baghdad as a senior advisor to the Iraqi Ministry of Labor and Social Affairs.

“Robert adds an unmatched depth and dimension to our team,” said Rob Marchant, President of Strategies. “He brings an unparalled understanding and knowledge of corporate finance and governance, which will greatly benefit our clients across the country.”

“I’m so pleased to join the Michael Best team,” said Gross. “It’s a tremendous opportunity to blend my experience and relationships in business, law, and government to help the businesses we serve.”

“Robert offers unique skills in a specialty trade that requires both legal and business management expertise,” commented Jeff Hartley, Michael Best Strategies partner based in Utah. “Growth in a startup company, mergers and acquisitions, succession in family-owned businesses, and many other reasons may create a need for a board of directors to evolve the structure of its governance. A board of directors with a healthy governance model is good for the board, good for management and good for shareholders. With Bob’s experience as an attorney, a bank president, the director of a large state government agency and as the current president of Robert C. Gross Associates, Robert is in a position to add tremendous value as a member of the Michael Best Strategies team.”

The Association of Corporate Counsel has published an in-depth, self-reported compensation survey for in-house counsel and legal operations professionals.

For companies seeking to stay competitive in the marketplace and lawyers considering career moves, access to detailed compensation data for in-house counsel and legal operations professionals is essential, the ACC says on its website.

Based on responses from more than 5,000 lawyers in corporate legal departments from 65 countries and 39 different industry sectors, this first-ever ACC Global Compensation Report is available from the organization.

Download the report.

Image by Steve Jurvetson

CNBC reports that some securities lawyers said they were shocked by a tweet from Elon Musk that said Musk was mulling a take-private transaction for Tesla, his electric car company. The tweet even named a target price, $420 a share, and said financing was lined up.

Reporter Liz Moyer quotes Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware, who told her, “I do not believe this is the appropriate way to suggest going private.”

If the content of the tweet wasn’t true, lawyers said, it could set up Musk and the company for regulatory action and private lawsuits.

Read the CNBC article.

The Society of Corporate Compliance and Ethics has announced the lineup of keynote speakers for the 17th Annual Compliance & Ethics Conference. The event will be Oct. 21-24, 2018, at Caesars Palace in Las Vegas.

Scott Eblin, author of The Next Level and Overworked and Overwhelmed, will speak on Monday, Oct. 22, 8:30-9:30 a.m.

Amber Mac, a TV/radio host of Internet of Things, will speak on Tuesday, Oct. 23, 8:15-9:15 a.m.

Ty Francis, MBE, a global governance and ethics advisor, will speak on Monday, Oct. 22, 3:15-4:15 p.m.

On Tuesday afternoon, a panel discussion will consider “What We Need to Know About #MeToo.”

Panelists will be Jenny O’Brien, JD, CHC, CHPC, Chief Compliance Officer, UnitedHealthcare; Rebecca Walker, Partner, Kaplan & Walker; Paul E. Fiorelli, JD, MBA, Director, Cintas Institute for Business Ethics and Professor of Legal Studies, Xavier University; and Robin H. Everhart, Senior Vice President and Chief Diversity Officer, Cintas Corporation.

Register for the conference.

CNBC is reporting that Google has promoted its general counsel and long-time employee Kent Walker to senior vice president of global affairs.

In his new role, Kent Walker will  oversee Google’s policy, legal, trust and safety, and corporate philanthropy teams.

“In this more public-facing position, his role will be similar to how former CEO Eric Schmidt often represented Google’s interests to governments, before he stepped down from his executive chairman role last December,” explains reporter Jillian D’Onfro. “It’s also similar to the role Brad Smith plays for Microsoft.”

Read the CNBC article.