You'll enjoy my delicious stew even more in-house

Recently I tried reaching a midlevel associate in the US with whom I had spoken towards the end of 2010. At that time, the associate suggested that we talk again in about a year as he’d be ready to consider a move to Asia early in 2012. (I’ll use ‘he’ without meaning to specify the lawyer’s gender.) When we spoke in 2010, it seemed to me that this timetable would be ideal. The associate already had strong skills in his particular area, an area in which his very fine firm enjoys a premier reputation. He would still be a midlevel at the beginning of 2012, with presumably even stronger skills. More importantly, his skill set, which was somewhat unique, was becoming increasingly relevant in Asia. By early 2012 his practice area would be getting into full swing and, by definition, would be under-lawyered. Moving to Asia then, he’d probably have the opportunity to choose among a number of solid partnership tracks at different law firms.

When I tried to reach him recently, following up as we’d agreed, I learned that he had left during mid 2011 and moved in-house in Asia, hired by an institution for which his practice area is just a support function, not the institution’s principal focus.

In the days that followed as I thought about this particular move, an iconic image kept coming to mind over and over: it was the Old Testament scene of Esau selling his birthright for a plate of lentils. At first I thought I probably needed to get some rest, the image seemed so weird. But after a couple of days I understood the connection.

To explain, let’s quickly revisit the biblical story. Esau, the first-born son of Isaac, had a younger brother, Jacob. Esau was a very fine hunter, a high-performing individual who had command of a very relevant skill set during that era: he could hunt and bring sustenance. One day he was returning from a hunt, very tired from working hard long hours, hungry for some comfort, rest without pressure, recognition for his efforts. As he arrives home, he sees his younger brother Jacob, cooking a succulent stew of lentils. The wonderful smell draws Esau and he pleads for a serving. Certainly, says Jacob, but on one condition: that Esau forfeit to Jacob his birthright. Losing sight of the long-term benefits of being first-born and overtaken by immediate gratification, Esau agrees to transfer his rights as first-born for the instant pleasure of the plate of lentils.

Going back to the midlevel associate – and let’s name him Easy – the idea of taking an in-house position in Asia may have seemed irresistible. Put yourself in Easy’s shoes: he’d been billing 2200 hours each of the last several years plus additional discounted hours. He’d put up with counsels and partners who sometimes (or even more frequently than that) are offensive and oppressive. There was no guarantee that Easy would ever make partner. And even if he did, Easy would only have the additional, overwhelming, and systematic pressure of generating business for the firm. Easy might have have felt exhausted at the work, troubled by the lack of security and uncertainty of any payoff at the end of 8 years. Going in-house presumably meant a more digestible lifestyle, a more user-friendly corporate culture. Instead of being subject to partners’ and counsels’ schemes, Easy would be turning the tables, as now the partners and counsels would be working for him, taking him out to lunch. Easy would be sought after. The in-house position was tempting like a plate of lentils.

It all reminds me of a conversation I had some years ago with another midlevel associate about another associate whom we both knew. I asked how our mutual acquaintance was doing. “Great,” was the reply: our acquaintance was an in-house counsel at a biotech company and had an annual US$5 million budget to retain counsel. Partners at law firms would beg him for work, and so he was having a great time firing and hiring. Later he went back to a firm. Since then I’ve followed his career and he’s become a decidedly third-tier type practitioner, boxed into a firm that’s going nowhere and waiting for its demise. Evidently he didn’t make many friends while he was in-house.

But back to Easy. Even though the idea of going in-house addressed some drawbacks of practicing at a law firm, particularly in Asia, it won’t allow him to evolve as a high-end, competent, and therefore competitive senior lawyer in his specific practice area, which is growing in Asia.

Generally for in-house attorneys, the substance of the legal matter is negotiated and drafted by outside law firms, who think through and solve the peculiar complexities of whatever matter is at hand. This is especially so in Asia. Essentially the practice of law isn’t done in-house but at the law firm. The in-house counsel is excluded from this very substantive and extremely valuable activity, without which Easy’s legal skills in his particular practice area will atrophy. Granted, there are always exceptions and there exist in-house positions for midlevels in Asia which are definitely good and career building opportunities. But many to most in-house opportunities become largely an ambassadorial role on behalf of a US-based GC, who can’t be everywhere at all times and hires a ‘local’ in-house counsel to be a gatekeeper. The role involves immersion in the internal mechanics of the company legal department, which aren’t profit-generating activities for the company. (In itself, this increases Easy’s exposure, especially in the absence of a long-term contract.) All these factors hobble Easy’s chances to evolve into a competitive and relevant lawyer.

While Easy had been a midlevel at his law firm in the US, his marketability was high, relevant and broad – he was golden. Currently his marketability has diminished substantially and the longer he remains in-house the more it will diminish to the point, metaphorically speaking, it will be like losing the value of his birthright and instead gaining the value of a plate of lentils.