Today, in what I like to call the civilized world, disputes are resolved in courtrooms. Sure, that's a step in the right direction. But surprisingly, the strategies and tactics of today's business disputes are remarkably similar to those used by past leaders on the battlefield.
What's changed the most, on the other hand, is that today's leaders are surprisingly unprepared to lead their "troops" into battle. It's shocking, frankly, how naive and ill-equipped most executives and business leaders are, both before and after they enter the modern-day legal battlefield.
Luckily, my career was full of complex negotiations and legal battles with technology giants like Intel, Microsoft, Texas Instruments, IBM, Samsung, and Toshiba. As a result, I've got some advice on legal and negotiation strategy that every manager should know, and that means you.
- Legal strategy and planning begins before negotiations start, not after they fail. From the very first meeting, the battle has begun. Before you go in, you need to have a pretty solid understanding of your goals and what you're willing to risk to achieve them.
- If you don't have a war chest, don't start a war. Attorneys aren't cheap and neither is litigation. If you don't have what we call a war chest - the resources to battle to the end - the other side will know that and your position will be exposed and minimized.
- Legal battles have a funny way of outlasting the management teams that start them. This is often true in long, protracted battles with a lot at stake. It's important for boards, investors, and employees to know this, since executives rarely think past their tenure.
- Once you get in front of judge and jury, anything can happen. Not to say that all logic and sense goes out the window, but well, it can. Judges and juries are people, and people are, by definition, unpredictable. Even the most brilliant CEOs somehow manage to forget that.
- The risk and downside of a protracted legal battle is often worse than losing outright. With intellectual property, it's often a case of big-company defendants outlasting smaller litigants until their business has disintegrated or the patents run out. Oftentimes, it works.
- Fully analyze your vulnerabilities before you fire the first salvo. As in the case of Qualcomm v. Broadcom, Qualcomm was the initial litigant but Broadcom was able to countersue and win because Qualcomm violated its patents.
- Don't back yourself into a corner. Corporate litigation is almost always preceded by negotiation, and you don't want to threaten or be heavy handed to the point of forcing the other side to walk away from the table, thus leaving you with only one choice.
- Planning and strategy, even before negotiations begin, are your responsibility, not the attorney's. If it's your business, it's your responsibility. Of course, tap into your counsel's expertise and opinion, but ultimately, the critical decisions, like when to cut bait on negotiations and litigate, are yours.
- Always seek to raise your opponent's risk relative to your own. One of the simplest and most important lessons I've ever learned; its significance in business negotiations and litigation can't be overstated.
- If people had an ounce of common sense, lawyers would starve. Len Tillem, a lawyer and bay area radio talk-show host, says this all the time, and it's so true. If folks would stop and consider the risks and probable outcomes of their actions, they wouldn't be so quick to litigate.