Today I received some copies of my co-authored first edition undergraduate textbook “Business Law and Strategy.” This project has been an ongoing effort spanning two and a half years. I’m excited to be able to finally physically hold the fruits of this collaborative effort. My hope is that this book will allow students and instructors to appreciate how business law can be used strategically as an instrument for good and value creation. Oh, and the cases/ examples are really fun. Enjoy!
There are troubling signs of an “efficient infringement” model within large companies that knowingly trespass on smaller companies’ patents. Not only is it a strategic business decision, but according to this great article it is a duty that falls upon managers to enrich the company’s stockholders!
But this all seems to beg the question(s). What does compliance have to say about all this? Should compliance jump in early to assess ethics and other strategic options, such as cooperation and taking a license? Should compliance take a 360 perspective and advise management accordingly? What role does compliance have when it comes to patent infringement?
That’s how I feel working on the final details of my forthcoming undergraduate textbook Business Law and Strategy, available January 1 though McGraw-Hill.
Right now I’m creating an end-of-unit exercise that involves e-scooters because they raise so many interesting legal issues and students can relate to this topic.
My manuscript titled A Systems Theory of Compliance Law was accepted for publication over the weekend from the stellar folks at U. Penn. So many of my respected colleagues in Legal Studies at Business schools have published in this premier law review. I briefly considered expediting to other law reviews but reconsidered when the Editor-in-Chief of this journal left me a voice mail and mentioned that he was a fellow FSU Seminole (College of Business alum no less!).
I look forward to publishing more works in the interesting field of corporate compliance.
Best,
-Prof. Orozco
458 and counting. Thank you. We academics love citations.
Large New York law firm Weil will partner with Columbia Business School to train lawyers on business basics such as accounting, corporate governance and negotiations. Sounds like a smart move to develop more strategically qualified attorneys. As I’ve written about before, very few lawyers understand the language of business and therefore often cannot provide the cutting-edge legal advice clients need to stay ahead of the game or to fundamentally shift gears in a fast-changing world. One subject area Weil may want to stress in their relationship with CBS is strategic management. The concepts of value chain analysis, business models, and dynamic capabilities, e.g. are critical to business and thinking strategically to co-create and capture value for clients.
I’m now in that part of the semester when I teach contracts. It’s ironic that contracts was one of my least favorite subjects in law school but now it’s one the areas I most enjoy teaching. I’ve gained a strong interest in the subject since I’ve seen business success, contract drafting and negotiating all go hand in hand. None of that was taught in law school. Instead, we focused on abstract theories and cases that seemed far removed from everyday life and how business people engaged in the process of negotiating and deal making.
My approach to teaching contracts to business people integrates important doctrines with real-world examples and applications. From my perspective, contracting is another example of how the law can be used strategically. This leads me to the topic of how I teach people to engage contracts in a strategic manner. I view this as a fundamental business skill that can be followed in 5 steps:
1. Don’t be afraid to engage the document with a focused and critical eye. Read all the terms carefully and appreciate that nothing in the document is there by accident. Every word has a purpose and will have either a negative or a positive impact.
2. Not all terms are equally important. Identify the most important terms and rank them in order of most to least important. For example, in an employment contract it may be that salary, duration, the non-compete and termination are ranked among the highest. Be prepared to spend more time assessing and negotiating the key terms.
3. Assess the language of key terms to determine vagueness or specificity. Vague language offers more room for interpretation, which can be a good or bad thing depending on the circumstances. The opposite can be said of specific terms.
4. The best contract negotiators mark-up and edit the document with changes that reflect their preferences. This includes changing the language to be more specific or vague, striking unfavorable terms or modifying terms. Negotiating style and strategy can play an important role in this step.
5. Add language that’s missing. There is no such thing as a perfect or complete contract.
I always advise business people to engage in this practice to develop a strategic contracting legal capability, and of course to review the document with capable legal counsel just to be safe.
Patent reform is back in the news as both the House and Senate have proposed their own versions of legislation in this complex legal area. The aim of patent reform is to further curtail the activities of the so-called patent trolls, which are companies that own patents, do not make any products and use patent law to sue large companies to collect jury verdicts or settlements.
Since technology and innovation are growing in importance as drivers of wealth creation, it is natural that patent law would rise in importance. Since the economic stakes have increased, so have the stakes in the political and legal arenas. This could all be predicted by anyone who observes how powerful parties try to alter the legal and political system for their own advantage. From an academic standpoint, this was marvelously theorized and explained by the pioneers in the field of non-market strategy, who deduced the importance of engaging the legal, regulatory and legislative system as a form of strategic behavior.
My recent writings in legal strategy support the view that law can be used to achieve competitive advantage. My most recent work addresses the abusive aspects of this practice and ways that can limit what I call “strategic legal bullying.”
What’s fascinating to me is that legal strategy is indirectly driving some important political wrangling in the current iteration of patent reform. From press accounts I’ve read, a hedge fund manager is using a transformative legal strategy to exploit a process to challenge drug patents while betting against the drug companies’ stock. Now, the drug companies want a legislative carve-out in place that would shield them from these administrative challenges. Their reaction to the hedge fund manager’s legal strategy is to change the law as it applies to their industry.
What I’m starting to realize is that legal strategy has often been the agent of legal change, for better or worse. Think of Sony, Napster, Aerio, Uber, Tesla and the “patent trolls.” Their business models are closely tied to legal strategy. In some cases they successfully enacted legal change, and in other cases the status quo prevailed. The systems where this strategic behavior takes place is complex, consisting of companies, courts, administrative agencies, the media, and the legislature. Legal strategy lies at the core of the process and helps parties re-write the rules of the game, or at least try to do that.
I recently had the honor to participate as a speaker at several intellectual property workshop in Buenos Aires organized by the Argentine National IP Office and the World Intellectual Property Organization (WIPO). The workshops were targeted to university administrators, IP managers, attorneys and entrepreneurs.
This was my third involvement in such an endeavor, with prior engagements in Latin America and the Carribean. I love participating in these international workshops because I get the sense that there is a real need to move forward with local development in the area of innovation, entrepreneurship and value creation. I often teach these subjects in the U.S., but in these regions the thirst for learning and applying the material is palpable.
I also personally benefit from these trips, which often take me to places that I would rarely consider visiting otherwise. In these trips, I gain a broader understanding of the world and the unique challenges each region faces. I also get to experience the warm hospitality that each region provides. For example, on my last day in Argentina a local attorney graciously provided me and another presenter with a day-long private tour of Buenos Aires. I’ll never forget that experience.
These travels help me understand the differences and similarities across regions. Among the differences are various levels of development, historical trajectories, and resource endowments. The similarities include national pride, unique opportunities and a desire to advance and compete in the global economy.
Now that I’m back home I can look fondly on these experiences. I can also hope that I’ll be asked to participate in future international workshops, as they always provide an opportunity for professional and personal growth.
A great post from top compliance expert Tom Fox at the FCPA Blog.
I conclude this exploration of the uses of social media in doing compliance by exploring why the compliance function is uniquely suited to using social media tools. Long gone are the days when Chief Compliance Officers (CCO) or compliance practitioners were lawyers housed in the Legal Department or the General Counsel’s (GC’s) office writing policies and procedures and then putting on eight hour training programs on same. Donna Boehme has written passionately about CCO 2.0 and the structural change to separate the CCO role from that of the GC because of the differences in focus of a CCO and GC. Simply put, a GC and legal department is there to protect the company while the CCO and compliance function exists to solve problems before the company needs protections from them.
Freed of the constraints to write policies and procedures by lawyers for lawyers, the profession has moved to integrating compliance…
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