Another week, another negative headline for Uber, plus one general counsel’s reaction to the latest on Trump’s travel ban. And what do recent CEO departures mean for GCs? This week, I asked. Welcome back to Inside Track, where we’re covering key issues for in-house lawyers, answering your pressing questions and keeping you in the know about what your colleagues are up to.
I’m Jennifer Williams-Alvarez, covering in-house lawyering from New York City. If you have questions or something to share, you can email me at email@example.com or find me on Twitter at @jenkayw.
What’s happening –
THE TRAVEL BAN. The U.S. Supreme Court has kept the Trump “travel ban” alive for now while lower courts continue to deliberate the issue. And some companies (along with their legal leaders) are fighting back and speaking up.
➤ Companies. In September, 161 tech companies asked the high court to strike down the travel ban. The companies joining the brief ranged from Amazon, Facebook and Google to Airbnb, DoorDash, Lyft and Uber.
➤ It’s against our values. In response to the latest news, Keith Yandell, general counsel at DoorDash, told me in an emailed statement that his company prides itself on diversity and inclusivity. “The travel ban not only impacts our employees, Dashers, and merchants, it goes against our values as a company,” he said.
Yandell added: “DoorDash’s founder and CEO Tony Xu is just one example of someone who immigrated to America, and he proceeded to create a world-class company that employs hundreds. Today, more than ever, DoorDash stands with all people working to come to America in search of a better life.”
IT’S TIME TO “WORK YOUR BUTT OFF.” There have been a number of high profile shake-ups in the CEO ranks as of late (Blue Apron, Hewlett Packard Enterprise, Uber). Here’s why in-house counsel, especially those in the GC spot, should be on their toes.
➤ ”A CEO change is always difficult for the general counsel, primarily because you get used to the style and needs of the former CEO,” Sterling Miller, GC at marketing automation software company Marketo, told me in an email. “A new CEO may want more or less information, more or less face time, and may care more or less about legal issues in general. All of this is a shock to the system,” he explained. Despite these challenges, though, Miller said most GCs “will be able to adjust,” because you don’t get that title by being inflexible.
➤ Then, there’s job security, which Miller said tends to be a bigger issue for GCs when the CEO is hired from outside the company, rather than promoted from within.
If there’s a CEO from the outside, the in-house legal leader should redouble efforts “to learn what the new CEO wants from their general counsel, be prepared to show your value to the organization—and the new CEO—as its general counsel, and lastly, work your butt off right from the start because their first impression of you is the most important.”
Or to put it more bluntly: “Fat, dumb, and happy is not the attitude to have when there is a new CEO on board.”
And if the GC gets ousted? “It’s nothing personal, it’s just the way things might turn out,” Miller said.
UBER AND WHAT YOU NEED TO KNOW ABOUT MESSAGING APPS. The latest sensational news to come out of Uber’s lawsuit with Waymo is that the ride-hailing giant used secretive techniques to gather intelligence on its competitors. According to an email sent to Uber’s security team from the company’s new chief legal officer, Tony West, there’s “no place for such practices or that kind of behavior at Uber.”
That’s not all, though. Employees at Uber were also apparently using messaging apps such as Wickr in an effort to hide communications, raising questions about what legal departments can and should be doing about use of these self-destructing messaging apps.
➤ CEO speaks. Uber CEO Dara Khosrowshahi tweeted last week that there was no place for these apps at Uber.
➤ “Lose-lose for companies.” Standing alone, self-destructing messaging applications are not necessarily problematic, said Philip Favro, a consultant ate-discovery firm Driven, but they can create the “appearance of impropriety,” and that’s where companies and counsel can get into trouble. Pointing to a New York Times article, Favro also noted that these apps can create regulatory problems and may lead to information governance issues. “To me, self-destructing messaging applications are a lose-lose for companies,” Favro said.
➤ What’s the fix? “It’s difficult to prevent employees from using certain types of technologies,” Favro said. It may be easy to ban the use of these messaging apps, but it’s “difficult to police and enforce the ban,” he explained, though companies can do a better job if they allocate more resources. When a business faces litigation, Favro said, in-house counsel need to make it a point to find out if employees are using these apps, especially if there’s a litigation hold.
BEHIND THE SCENES. At the center of Meetup’s recent sale to WeWork is the former’s general counsel, David Pashman. My colleague Stephanie Forshee spoke to Pashman to go inside the deal.
Here are some highlights:
➤ The team. Pashman told Forshee he worked closely with Meetup CEO Scott Heiferman and CFO Brendan McGovern to lead the deal on the Meetup side. Pashman also looked to other execs on his team and Meetup associate GC Philip Karnofsky and he relied heavily on Adam Dinow and Garth Osterman of Cooley.
➤ The hours. Pashman said that during some periods of time while the deal was in progress, he worked “law firm hours” and even worried he might have to work through his entire honeymoon in Hawaii.
➤ The future. With WeWork’s purchase of Meetup, Pashman told Forshee he’s not quite sure yet what the fate will be of his legal department.Meetup had one office in the U.S., while WeWork has 170 locations, he said, so post-deal “the legal complexities and the legal decision-making process changes significantly.”
“I think that the most likely scenario where proprietary information is going to seep its way out is through employees. It’s not your cybercriminals.”
– Moshe Malina, director and chief patent counsel at Citigroup, speaking on a panel Monday at ALM’s 2017 cyberSecure conference in New York.
Question of the week –
In each briefing, we’ll answer a question for in-house attorneys by going to top practitioners in those areas. So if you have a pressing question you’d like answered, send it my way.
This week’s question:
What are the key components of an effective workplace investigation?
Workplace investigations benefit in-house counsel in several ways. One key benefit is being a golden opportunity to resolve an issue internally before outside third parties become involved. And by conducting an investigation within your company, other problems may be uncovered, allowing in-house counsel to correct issues of which it was previously unaware.
➤ Maybe the most important element of an effective workplace investigation is recognizing that one is needed. Employees often want to just let the employer know of an issue but do not want anything to be done. Of course, the employee’s wishes may not always be followed in this scenario, but employers should be sympathetic to the employees concern and decide appropriately. Another complexity with beginning an investigation is recognizing that an employee is making a report. A report of discrimination or harassment does not have to include any “magic” words, such as I am being subjected to a hostile work environment.
➤ Then, an investigator with the proper skill set and knowledge must be designated to conduct the process. Keep in mind the correct investigator may be a non-employee who is capable of maintaining the proper objectivity and confidentiality.
➤ Thirdly, an investigation must be initiated promptly to ensure the individual with the concern feels she or he is being listened to. The investigator should then identify who, if anyone, is a witness that should be interviewed and this too should be done in a timely manner. During the interviews maintaining confidentiality is important, but this may be difficult as the National Labor Relations Board has taken a position that even asking employees not to discuss the interviews may be viewed as interfering with the employees Section 7 rights to engage in protected concerted activity.
After interviews and other information gathering is completed, then the investigator should confer with other decision makers to determine a proper conclusion to the investigation. The ultimate findings should be documented and the results, to the extent possible, should be provided to the individual submitting the report and the person or persons who are the subject of the complaint.
➤ Finally, though not technically part of the investigation, the employer should conduct related follow up with both the employee who brought the issue forward and the employees or individuals subject to the investigation. The reporting employee should be asked, for some period of time following the conclusion of the investigation, if she or he believes the issue has been resolved and if any retaliation has occurred. The other individuals involved should be reminded of any consequences of the investigation and that retaliation is prohibited.
—Daniel Stern, member in Dykema’s labor and employment group. (Edited for clarity and length.)
Don’t miss –
Thursday, Dec. 14 – In the wake of the ongoing onslaught of sexual misconduct allegations – think Harvey Weinstein, Pixar and TED Talk conferences – Jackson Lewis attorneys will discuss in a webinar next week how employers can prevent workplace harassment and how it can be addressed if it does occur. Register here.
Thursday, Dec. 14 – Despite pressure from U.S. senators and consumer advocacy groups to delay the vote on net neutrality, the Federal Communications Commission plans to go ahead with the vote next week. In a statement to tech website Ars Technica, FCC Chairman Ajit Pai’s officesaid in response to the requests for delay: “This is just evidence that supporters of heavy-handed Internet regulations are becoming more desperate by the day as their effort to defeat Chairman Pai’s plan to restore Internet freedom has stalled.”
On the move –
Things that fly. On Dec. 11, Amy Tu will make the move from Boeing to Tyson Foods. Tu, who served as Boeing’s chief counsel for global affairs, will assume the general counsel role at Tyson Foods. She is taking over for David Van Bebber, who has been with Tyson Foods for more three decades, since 1986. Van Bebber will stay with the company until May to help with the transition.
When you’ve found your niche. Health IT software company Quality Systems announced Friday that Jeffrey Linton is stepping in as executive vice president, general counsel and secretary. The in-house veteran has also held the general counsel role at Applied Proteomics, Sequenom and Beckman Coulter. Linton took over Monday for Jocelyn Leavitt, who has been Quality Systems’ GC since 2013.
It’s time for outerwear. Oregon-based Columbia Sportswear revealed Monday that Jennifer Warner has joined the company as vice president of legal. Warner’s previous experience includes being GC of supply chain and logistics company XPO Logistics.
In-house to firm. It was once the case that attorneys who made it to the in-house ranks largely stayed there. More and more, though, I’m seeing moves like Paul Gilbert’s, who recently transitioned from being chief legal officer at LifePoint Health to joining firm Epstein Becker & Green as a member of the firm’s health care and life sciences practice.