delidacostin

Confessions of a General Counsel:  Give Oxygen To The Law And Apply It To The Business

This is the third part in a four-part series about IRAC as a management tool for the new general counsel. It explores ways to apply the rule of law to the specific issues in your company. *Before reading on you might like to read the first post and the second post.

INTRODUCTION:  WHAT IS IRAC?

IRAC is the framework that every law student uses to write her first legal memo. The first section of the memo states the issue, the second section recites the rule of law, the third section applies the rule of law to the particular facts and the last section is the conclusion. IRAC is also a great tool to manage the legal function.

"A STANDS FOR APPLICATION" WHAT IS YOUR RECOMMENDATION? 

By now you have figured out the issues or problems that you are expected to help solve. You've spoken to enough people to understand stakeholders' different perspectives and you've prioritized the issues based on importance to the company. You've also become fluent with the applicable rules of law by consulting your team, your network and available legal resources.

The next step is to apply the rules of law to the problems presented to you.  

1. Be the law's voice. Our roles may demand that we provide business advice, but we are often the only executives who can provide legal advice. Don't let the business analysis drown out the relevant legal analysis. Give oxygen to the rules of law; find ways to integrate them appropriately into decision-making discussions. We are the only ones in most discussions with this responsibility.  (See my second post for tips in learning new areas of law. http://ms-jd.org/blog/article/confessions-of-a-general-counsel-hire-hang-out-and-hover-to-find-the-rule-o.)

2. Become a business advisor; develop your corporate point of view. Sometimes, straight legal questions land on our desks. More often, the legal questions mask business questions. Go the extra step and answer the masked questions.

  • First, surface the masked business concern, if any. For example, your boss asks whether non-competition clauses are enforceable. Maybe she is curious and just wants to learn the answer. Likely she wants to know "what would happen if we put that provision into our employment agreements;" "are we permitted to ignore that provision in a contract that we signed;" or "is there something we can do to protect our trade secrets?" (Re-read the first post of this series and think about the problems you are being asked to solve.)
  • Second, look at the applicable law and determine what guidance it provides. This is the "legal advice" portion of the analysis that summarizes the law, sets forth possible legal outcomes of different actions, and weighs the risks that those outcomes may occur. Many lawyers stop at this point and leave it to their clients to make the business decision.  
  • The third step is one of the value-added steps for in-house counsel. Do a business analysis. Consider non-legal inputs that might impact the masked question such as corporate strategy, performance and priorities. What risks, legal or otherwise, should be weighed?  Which risks are worth taking? 
  • Finally, ask yourself what is **my** point of view about the question presented? If you were the ultimate business decision-maker, what would you do and why based on everything you know about the legal landscape and the business landscape?  

3. Understand the difference between legal advice and business advice. Legal advice is protected as a privileged communication. Business advice is not. In-house counsel deliver both, sometimes integrated together. Understanding the distinction will allow you to discern which type of advice is appropriate at any given time. When you determine that privileged legal advice is appropriate, understanding the distinction will help you and your teams meet the requirements to preserve privilege under state or federal law.   

Next month's post will discuss how to communicate your conclusions.  

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Delida Costin is the former general counsel of Pandora Media and lynda.com. She is also a proud alumna of Boston University School of Law. She often speaks about leadership, legal practice and diversity.  

Learn more about Delida on her website:  www.delidacostin.com

Follow her on Twitter.

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