Thursday, May 19, 2011

The Importance of Intake Incites Introspection...

King & Spalding made news in April when it took on the defense of the "Defense of Marriage" act on behalf of the US House of Representatives. The move caused significant public controversy and the firm quickly extracted itself from the matter. From a risk management perspective, this situation highlights the importance of client intake process and policy.

When it announced that it was dropping the case, King & Spalding implied that it should have never taken it in the first place. It explained that the matter was "not properly vetted" by its intake processes, which would have rejected the request. This claim is backed up by media reports citing multiple sources who relayed that the:
  •  "...the DOMA matter was not fully submitted to King & Spalding”s business review committee, a firm requirement, before Clement signed a contract obligating the firm. They said the committee immediately began reviewing the case the day after the firm learned of the contract—and rejected it the next day."
  • "Any matter that is controversial in any way or where there is a discounted rate goes through the business review committee,” one of the sources told the Daily Report, noting that the DOMA engagement was both controversial and had a discounted rate."
Interestingly, the firm has a very rigorous intake process which could take several days to complete. As documented by the Blog of the Legal Times:
  • The firm vets all new clients through a centralized "Business Review Committee" that operates independently of the general counsel's office
  • A traditional conflicts check is conducted
  • The firm also evaluates "business conflicts" which don't violate professional rules, but may upset its client community (for example: "its construction practice generally represents construction companies and not contractors.")
  • In the case of matters involving public policy, the issue would also be reviewed with the firm's lobbying practice (particularly since the agreement in this matter included provisions that would forbid the firm, or any employee from any personal lobbying activity adverse to the Defense of Marriage Act.)
However, complicating that narrative, at least one member of firm management made public comments suggesting that the matter would not have been rejected, writing: "...despite the fact that our standard client/matter review process was not followed, it was reasonable for him to believe that the firm would accept the matter."

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