Attorney Journal, San Diego, Volume 139 by Attorney Journals

SAN DIEGO

Volume 139, 2015 • $6.95

Proportionality— Are discovery costs proportional to the value and importance of the case?

Samantha Green

Lawyers in Relationship—Building Business, but Are They Connecting?

Sometimes You Have to Say “NO”

Robert Denney

Kimberly Alford Rice

Protecting Clients from Unnecessary Liability When Using Social Media in Recruiting and Hiring

Strategic Planning for Small Law Firms

Roy S. Ginsburg

Todd R. Wulffson & Lindsay Ayers

Don’t Lose Your Shirt When Raising Your Fees

Frederick J. Esposito, Jr.

Attorney of the Month

Ronson J. Shamoun The No Worries Tax Attorney of RJS LAW

2015 EDITION—NO.139

TABLE OF CONTENTS features 6 Proportionality

Are discovery costs proportional to the value and importance of the case?

by Samantha Green

10 Don’t Lose Your Shirt When Raising Your Fees by Frederick J. Esposito

12 COMMUNITYnews

EXECUTIVE PUBLISHER Brian Topor EDITOR Wendy Price

by Jennifer Hadley

24 Lawyers in Relationship— Building Business, but Are They Connecting?

PHOTOGRAPHY Bauman Photographers

WEBMASTER Mariusz Opalka

The No Worry Tax Attorney

by Robert Denney

CIRCULATION Angela Watson

CONTRIBUTING EDITORIALISTS Johnny Lee Norm LaCroix Roger Neu Monty McIntyre

16 Ronson Shamoun

22 Sometimes You Have to Say “No”

CREATIVE SERVICES Skidmutro Creative Partners

STAFF WRITERS Robert Denney Frederick J. Esposito Kimberly Alford Rice Todd R. Wulffson Lindsay Ayers Roy S. Ginsburg Samantha Green

ATTORNEY OF THE MONTH

by Kimberly Alford Rice

26 Protecting Clients from Unnecessary Liability When Using Social Media in Recruiting and Hiring by Todd R. Wulffson & Lindsay Ayers

28 Strategic Planning for Small Law Firms by Roy S. Ginsburg

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Editorial material appears in Attorney Journal as an informational service for readers. Article contents are the opinions of the authors and not necessarily those of Attorney Journal. Attorney Journal makes every effort to publish credible, responsible advertisements. Inclusion of product advertisements or announcements does not imply endorsement. Attorney Journal is a trademark of Sticky Media, LLC. Not affiliated with any other trade publication or association. Copyright 2015 by Sticky Media, LLC. All rights reserved. Contents may not be reproduced without written permission from Sticky Media, LLC. Printed in the USA

PROPORTIONALITY Are discovery costs proportional to the value and importance of the case? by Samantha Green Samantha Green is E-Discovery Counsel for DTI. She has advised, written and spoken on all phases of the electronically stored information (ESI) life cycle. She has worked on many government investigations, second requests and litigation crossing all spectrums. Prior to DTI, Samantha was the E-Discovery Attorney for Blank Rome LLP.

t is well-documented that e-discovery consumes increasing percentages of overall civil litigation costs. Judges and legal professionals are actively exploring a variety of initiatives to address the problem, and several recent conferences and legal rulings have taken up the theme of proportionality. Proportionality shifts attention from the general problem of high-volume, prohibitively expensive productions to a more focused analysis of whether discovery costs are proportionate to the value and the importance of the specific case in question. The American College of Trial Lawyers Task Force on Discovery has declared that “Proportionality should be the most important principle applied to all discovery.”1 Federal Rule 26(b)(2)(C)(iii), the existing procedural rule that addresses proportionality, is remarkably lucid and robust: On motion or on its own, the court must limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that… the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the action, and the importance of the discovery in resolving the issues. Considerable attention has been paid in the last few years to the many factors contributing to the growing “burden or expense” of e-discovery, yet it is striking in retrospect how quiet the judiciary has been, until very recently, about the concept of proportionality as it appears in the Federal Rules. The rule unambiguously states that the court must balance the scope of proposed discovery against case-specific variables such as the amount of damages and fees in question, the risks to the parties, the magnitude of the legal issues at stake and the relative importance of electronic evidence in arriving at a resolution. Although proportionality has often been ignored or overlooked in the past, it now appears that the judiciary is undergoing an important cultural shift. Before, judges may have been waiting for properly formed motions to invoke the proportionality requirement in considering broad discovery requests. That is no longer the case, as Judge Lee H. Rosenthal recently demonstrated in Rimkus v. Cammarata, where she makes explicit reference to the rule and cites proportionality as the decisive factor in determining what is “acceptable” and “reasonable” in “preservation and discovery conduct.” Judge David J. Waxse, author of several ground-breaking 6

Attorney Journal San Diego | Volume 139, 2015

A CASE STUDY In a recent example, a corporate client defending itself in a matter in which plaintiff’s proposal for expanded discovery would actually have cost more than the entire amount at issue in the case! The original discovery request was for seven core custodians, requiring collection of 38GB of data; of that, 1.4GB (or less than 4%) was determined to be relevant after searching the data with the latest technology, using client-supplied search terms. The cost of discovery for those seven custodians was a reasonable $10,000, but in a motion to compel, the opposition requested an additional 65 custodians. Looking at actual processing and searching performed for the original custodians, reasonable per-unit cost estimate was established and, in response to the motion, the court was provided with an affidavit showing tiered costs: actual costs for the original seven custodians, and cost projections that included half (39 total) and all (72 total) of the additional custodians requested in the new motion. Based on the original “sample” of seven, discovery experts were able to project collection of all additional custodians at a cost of $153,000, an amount clearly out of line with the $140,000 at issue in the entire case. In light of the documented lack of proportionality between the discovery request and the value of the case, and given the low percentage of relevant data in the initial sample from the most promising custodians, the motion to expand scope made little sense and was dismissed. decisions in e-discovery disputes, noted he was surprised when he recently re-read the rule and realized it set forth an explicit requirement—“the court must”—rather than a mere recommendation or guideline. Waxse now refers to the proportionality provision in the Federal Rules as “probably the most underused, valuable rule we have… Judges on their own are supposed to consider this…We don’t need to change the rule; we need to start using the rule.

WHAT DOES THE SHIFT TO PROPORTIONALITY MEAN FOR LITIGANTS? The new emphasis on proportionality has a number of practical implications for e-discovery. For starters, both the number and

the scope of discovery requests are likely to be subject to more limits and to closer judicial scrutiny, reducing costs. Adversarial conduct in the discovery process will be increasingly discouraged. Meaningful cooperation between counsel—which Judge Paul Grimm in Mancia has already called out as a clear requirement of FRCP 26(g)—will be paramount, and providing accurate, courtconsumable documentation will be the best means for counsel to demonstrate compliance with that standard and avoid possible sanctions. Aggressive, boilerplate discovery requests designed to overwhelm an adversary and force settlement clearly undermine proportionality and reasonable inquiry 26(g) principles and are increasingly unlikely to succeed. Whether your case involves massive volumes of electronic evidence from across the enterprise or just a single custodian, it is now essential that you have the means to quantify the impact of proposed discovery in terms of costs, time and risk, and be able to monitor your progress as discovery proceeds. In effect, both parties to a case will find it necessary to undertake a detailed cost-benefit analysis early in the litigation process. Parties should specify the anticipated impact of proposed discovery (in terms of such factors as cost, time, risk and disruption of day-to-day business activities), and then be prepared to weigh these burdens against the overall value of the case, the significance of its core legal issues and the anticipated benefits of the requested evidence for its resolution. Proportionality considerations effectively shift the focus in discovery arguments from broad, universal standards to databased, case-specific information: What is the average number of documents per custodian?

How much will it cost per gigabyte to prepare, review and produce a particular data set with a specified combination of file types?

What percentage of documents can we expect to be relevant, given a proposed scope of discovery?

And how might that percentage change if the scope were limited by a reasoned data reduction strategy?

In many cases, litigants will be urged to focus discovery efforts on the data that appears, from initial assessments, to be the most relevant to the issues and least burdensome to produce. Productions should be conceived as an iterative, phased activity in which the scope of each successive effort is narrower and more closely targeted to the core legal issues of the case. It’s clear that defensible data sampling and search techniques using advanced tools designed specifically for e-discovery will play an increasingly important role in this process. But before meaningful sampling can be employed, data must first be processed effectively and defensibly to expose underlying information that can be used to create useful and representative samples. Statistical data sampling using vetted, state-of-the-industry technology can be extremely valuable for testing search terms, specifying data quantities and types (and the per-unit cost of processing, reviewing and producing them), and identifying sensible, cost-effective culling and review strategies. Also, at various stages in the e-discovery process, attorneys using

WHEN SHOULD YOU ENGAGE AN E-DISCOVERY SERVICES PROVIDER? When your opponent’s discovery requests are disproportionate to the value and importance of the case

When you need third-party validation to back up claims or counterclaims about the scope and cost of proposed discovery

When a case involves complex file types or combinations of file types, such as multiple email platforms

When a case requires multiple rolling productions

When a case requires multiple productions to multiple parties

When your IT department is overtaxed (and perhaps already outsourcing some of its functions)

When you expect to be litigating multiple matters that are related or overlapping, and may be able to apply repeatable processes across those matters and increase efficiency

When you anticipate long-term litigation

When you face...

a government investigation of a class action suit

a high-stakes IP-related matter that threatens the business model

an employment-related matter

a robust review tool with a flexible, intuitive search interface can perform ad hoc sampling to test search terms and strategies as a way of validating and refining their discovery approach. Proportionality requires a more formal, quantified approach to discovery, and it is critical to engage project managers that have the legal and technical expertise to help you substantiate discovery arguments with detailed, data-based documentation. Of course, this intense focus on the details of e-discovery and data handling can distract attorneys from their primary responsibility, which is to focus on legal strategy. Involve your e-discovery partners early, because they understand cost drivers best. They can also help legal teams use the most precise methods and technologies available for projecting early on what scope of inquiry is reasonable and proportional to the value of the case, and provide timely reporting on the status of discovery activities as they proceed. The recent attention paid by judges and other legal experts to the proportionality requirement of the Federal Rules is a promising development in the battle against escalating discovery costs. The rule is clear, the judges have declared their intention to enforce it, and thus it is likely to become a valuable tool for defendants fending off overly broad discovery requests designed to force early settlement.When the volume of requested data and the burdens of processing it are disproportionate to the value of a given case and to the legal issues at hand, legal teams with the right partners, the technology and the expertise to provide defensible documentation will now be able to fight back. n Attorney Journal San Diego | Volume 139, 2015

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Attorney Journal San Diego | Volume 139, 2015

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As part of your law firm’s strategy, you want (ideally) to align your pricing methods, metrics and communications with your clients’ value proposition. That, of course, is easier said than done. Most firms struggle to achieve the delicate balance between the rates they need to charge and the rates clients are willing to pay. And all firms face the same fear: What if you miscalculate and lose your best clients? Still, there comes a time when you have to increase your rates to stay profitable.

HOW TO RAISE FEES WITHOUT LOSING CLIENTS

Don’t Lose Your Shirt When Raising Your Fees by Frederick J. Esposito, Jr. Frederick J. Esposito, Jr. is Executive Director of Rivkin Radler. He has more than 20 years of law and accounting firm experience. He writes and speaks extensively on legal management topics, including billing, collections, financial and profitability models, risk management, human resource development, project management and alternative fee arrangements. Follow him @lawmgtguru. Previously published in Attorney at Work.

So, how do you implement a rate increase without driving away the client? It comes down to communication, metrics, timing and value. Here are some thoughts on how to go about it. 1. Get over the fear factor. Don’t let fear keep you from raising rates! Chances are, if you are making excuses to avoid a rate hike, those excuses are a cover for speculations based on fear. 2. Communicate the “whys.” When your firm has specific reasons for raising rates, tell your clients. Perhaps you froze rates during the recession out of consideration for your clients’ financial situations, or to keep their business. Maybe you wrote off a considerable amount of time each month resulting in even lower effective rates. No matter how big or small, letting clients know about these financial courtesies builds goodwill—and it can be a great client development tool. 3. Understand the metrics. Before deciding to increase your rates, know your firm’s economics. Do you know where your breakeven point is, profitwise? How much it costs to produce a billable hour, or a brief? Or your costs by timekeeper? Understanding the economics makes it much easier to determine the increase. Keep in mind that smaller increases — 3 to 5 percent per year—are generally better, and are met with less resistance when they are implemented consistently (i.e., the same time each year). When setting rates, it’s not just about what the firm “needs” to charge to break even, but also about what the firm “wants” to generate in fees. Review your costs, calculate your breakeven point, and determine a suitable rate. You might also consider the 80/20 scenario: Identify the 20 percent of your clients who generate the least profit and either raise their rates or terminate them. If this sounds harsh, keep in mind that you are in business to generate profit—you cannot afford to carry unprofitable clients just because you like them. 4. Timing is everything—no surprises! The worst thing you can do is fail to tell clients about your rate increase, instead letting them find out when they open their next invoice. Let your clients know in writing that you are increasing rates and provide sufficient notice, perhaps 60 days. Also, as a best practice, make sure your engagement letters include language indicating the firm will, upon notice, adjust rates periodically. This should alleviate some pushback. Some clients will resist and attempt to negotiate the proposed rate increases. That opens the door for discussions about the actual value of legal services provided … and brings us to No. 5. 5. Talk about the value being delivered. Will you lose some clients who aren’t willing to pay a higher rate? Maybe. But if you do, your firm needs to ask an important question: Why doesn’t the client perceive the full value of the services provided? Get past the fear factor and help clients understand the value your firm delivers. At every chance, seize the opportunity to educate them! n

Attorney Journal San Diego | Volume 139, 2015

The partners and staff would like to congratulate Rebecca Blain Morrison for her 2014 “TopYoung Attorney”award. This is the second time she has received this honor. Rebecca’s practice emphasizes complex business litigation, condemnation and business disputes. 2550 5th Avenue 11th Floor San Diego, CA 92103 Voice 619/236-9363 Fax 619/236-9653 Toll-free 800/577-2922 www.tbmlawyers.com

Over a billion dollars in verdicts and settlements © Copyright TBM 2014

COMMUNITY news nBrown Law Group has named Stacy Fode as Managing Partner. Ms. Fode focuses her practice on employment litigation and advisement and specializes in the representation of business clients in all aspects of employment law including wrongful termination, discrimination, sexual harassment, whistle blower, employment STACY FODE agreement disputes, and wage and hour matters, including class actions. Ms. Fode’s clients include employers in the energy, financial, entertainment, insurance, retail, technology, and telecommunications industries. In addition, Brown Law Group has named Brittney R. Dobbins as Associate. Ms. Dobbins focuses her practice on employment law and all BRITTNEY R. DOBBINS areas of business litigation. She has particular proficiency in the area of intellectual property, in the context of brand protection. While attending law school, Ms. Dobbins launched a United States Patent and Trademark Office Student Trademark Clinic, where she counseled individuals and startups on the development of United States trademark portfolios. nFish & Richardson has announced that Ryan O’Connor, based in the firm’s San Diego office, has been named a principal of the firm. Ryan O’Connor is a member of Fish’s Intellectual Property Litigation Group and represents plaintiffs and defendants in intellectual property litigation nationwide in a variety of technology areas, including life RYAN O’CONNOR sciences, medical devices, specialty chemicals, Internet advertising, and computer hardware/ software. He received his J.D. and LL.M. in intellectual property from the University of New Hampshire in 2007, and his B.S. in chemical engineering and B.A. in biochemistry from the University of Colorado in 2004.

Have a Press Release you would like to submit for our Community News? Email it to PR@AttorneyJournal.us

Attorney Journal San Diego | Volume 139, 2015

nHahn Loeser & Parks LLP announced today the addition of two new attorneys to its San Diego office. Dale C. Hunt, Ph.D., and Sheila R. Gibson have joined Hahn Loeser as partners and will continue to practice in intellectual property with an emphasis in life sciences and in biotechnology, respectively. Mr. Hunt and Ms. Gibson are joined DALE C. HUNT in their move by registered patent agent, Katherine M. Falkenhagen, Ph.D. Hahn Loeser has enjoyed tremendous local growth since opening its San Diego office in 2012. Since then, it has grown to nine lawyers, comprised of five litigators, two estate planners, and now two patent lawyers, plus a patent agent. Moreover, the firm plans to continue to grow in San Diego to realize its goal of becoming a full-service office for the needs of businesses, business owners and high net worth individuals. “Hahn Loeser has been providing sophisticated legal representation throughout all of its offices in the areas of litigation, estate planning, intellectual property and corporate matters,” said Michael J. Gleason, managing partner of Hahn Loeser’s San Diego office. “We are thrilled to be growing our office to reflect the same full-service capabilities right here in San Diego.” nCaldarelli Hejmanowski & Page LLP is pleased to announce that effective January 1, 2015 the firm has been renamed Caldarelli Hejmanowski Page & Leer LLP. The change reflects the addition of partner Jack Leer to the firm’s name, and the firm has launched a new website, www.chpllaw.com. “The decision to add Jack’s name to the firm demonstrates the value JACK LEER we place on Jack’s professional expertise and his integral role in the future of our business,” said Bill Caldarelli, one of the founding members of the firm. “Since joining our firm, Jack has expanded our practice areas, won several important trials for our clients, and helped to grow our business.” Leer joined Caldarelli Hejmanowski & Page in 2013 after spending 13 years at Seltzer Caplan McMahon Vitek, where he was a partner and a member of that firm’s executive committee. He represents clients in a broad range of business litigation, including real estate and construction disputes, partnership and corporate management matters, and intellectual property litigation. Among other industries, Leer has built a practice representing craft breweries in trademark and other commercial litigation. He currently serves as President of the San Diego Chapter of the Association of Business Trial Lawyers, and is listed in The Best Lawyers in America for Commercial Litigation.

COMMUNITY news nHoffman & Forde released a new, groundbreaking e-book to help real estate agents master the essentials of residential real estate. The e-book discusses the trends, challenges, and solutions to mastering the essentials of residential real estate. Specifically, it covers the deciding factors in achieving a successful real estate SCHUYLER HOFFMAN DANIEL FORDE transaction. Re-entering the residential loan market is difficult, especially in today’s economy. Hoffman and Forde describe the multiple challenges the market brings, and how to get through the uncertainties real estate professionals may face. nJoseph Potocki and Karen Holmes of the law firm of Balestreri Potocki & Holmes have been selected to the 2015 San Diego Super Lawyers list in the field of construction litigation. Potocki’s practice concentrates on litigation, transactional matters and construction contract JOSEPH POTOCKI KAREN HOLMES drafting and negotiation. His extensive litigation experience involves high-value disputes relating to a wide variety of issues in the real estate, business and construction arenas. His professional awards and honors include the Top 25 Attorneys in Construction and Real Estate Law, San Diego Daily Transcript, and Super Lawyers. Holmes is a successful litigator and trial attorney specializing in professional liability defense and civil litigation. She handles contract review and negotiation as well as the defense of construction delay, extras and defect claims on behalf of architects, engineers and contractors. Holmes has extensive trial experience and has served as Judge Pro Tem as well as arbitrator and mediator for the San Diego Superior Court. She is the recipient of many professional awards and honors including being named a San Diego Super Lawyer since 2007. nPajman Jassim of San Diego-based law firm Jassim & Associates has been chosen as a Super Lawyers Rising Star for 2015. The Super Lawyers rating service distinguishes lawyers from more than 70 practice areas who have been recognized by their peers for their professional achievements. The Rising Star candidates must be under 40 years old, or in practice for 10 years or fewer. “I’m honored to be distinguished as a 2015 Super Lawyers Rising Star,” Jassim said. “Super Lawyers is a valuable and highly recognized honor in our profession. To be named PAJMAN JASSIM along with other young and upcoming attorneys means my career is heading in the right direction.” The Super Lawyers research department used 12 indicators of peer recognition and professional achievement when considering Jassim for Super Lawyers.

Attorney Journal San Diego | Volume 139, 2015

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No Worries TAX ATTORNEYS THE

Ronson J. Shamoun and His Team of Highly Specialized Tax Attorneys at RJS LAW Work Tirelessly to Help Others Rebuild Their Lives and Better Their Hometown Community

ATTORNEY

OF THE MONTH

2015 2014

by jennifer hadley

“P

eople come to us when they are in a jam,” says Ronson “Ronnie” Shamoun, JD., LL.M., founder of RJS LAW-A Tax Law Firm, with offices in San Diego, Irvine, and Beverly Hills. “They have had a hiccup in their lives—divorce, a lawsuit, loss of income. Some event caused them to get behind with their taxes. They pay their rent, electricity, and employees’ wages, but get behind on sales taxes or payroll taxes. These aren’t hardened criminals,” he adds. But all the same, they desperately need Shamoun’s help. “The government agencies are aggressive. They will levy the money you have in your accounts, levy your accounts receivable, and can seize assets,” he explains. That’s precisely where the team of highly specialized tax attorneys at RJS LAW come in. “We solve tax problems with both the state and IRS, including civil and criminal cases. We are here to protect our clients. We get them compliant and help them save their businesses. It’s incredibly rewarding to prevent someone from losing their business and help them rebuild their lives,” he says.

Excellence in Entrepreneurialism

A native San Diegan, Shamoun says he’d wanted to be an attorney for as long as he can remember. “I grew up next door to a CPA/Tax Attorney and I knew it was a great career path,” he says. However, an entrepreneurial streak seems imbedded in Shamoun’s DNA. Growing up with a father who is a prominent businessman and commercial real estate investor in San Diego, long before Shamoun decided to dedicate his life to helping others, he became a business owner himself. From an early age he had worked at his family’s convenience store, and by 16

Attorney Journal San Diego | Volume 139, 2015

the time he had graduated law school, Shamoun was running his own businesses. “I opened a Subway franchise, and then another Subway. Next it was a coffee shop, a convenience store, and a laundry mat,” he recalls. “I was taught that if I work hard, I might make it. But if I didn’t work hard, I’d never make it. With those odds, I decided I might as well work hard. Fortunately, I had incredible parents who had faith in me, and their encouragement and support was unwavering.” Still, Shamoun never lost that desire to be an advocate for others. With a deep love for his hometown, Shamoun attended the University of San Diego for his undergraduate degree in Accountancy and stayed for both his graduate and postgraduate law degrees. He also confirmed what he had suspected as a child; that working in tax law was definitely his calling. “While I was in law school I took the Tax Litigation class with Richard Carpenter who became a mentor and close friend. I really liked tax litigation, and after the class, I was sold on becoming a tax attorney,” he says. The desire to become not only a tax attorney, but the founder of the largest boutique tax law firm in San Diego was further reinforced by an experience while interning at the Federal Income Tax Clinic at USD. “During my time at the Federal Income Tax Clinic with Richard Carpenter, I settled seven cases and remember vividly one case in particular that spanned about three years: an Innocent Spouse Claim for a low-income woman who was recently divorced. Her husband had been hiding his business activities and she, being a loving and supportive wife, signed all of the paperwork he asked her to without question. When their divorce was finalized, he ended up leaving her with an

ÂŠBauman Photographers

enormous tax bill that she would never be able to pay off. She came to the Legal Clinic distraught over how she could ever afford to pay the money back. I was able to persuade the IRS to abate the full liability. I will never forget how grateful she was when we told her that her liability was relieved.” That experience, along with much encouragement from his father to seek a postgraduate LL.M., solidified Shamoun’s goals for the future. “While I was in law school, my dad asked if there were any degrees after my JD that I could obtain. I told him about the LL.M. in Tax and how I could apply twelve of my units from my law school degree to the LL.M. degree, making it only one semester long. My dad encouraged me to get my LL.M. because it showed my commitment to expertise in my field, and because it was a short time commitment, I agreed. I didn’t want to be just a tax attorney, I wanted to be a tax expert. Now, I encourage all law school students who come to me for advice to get their LL.M. in Tax, regardless of the area of law they intend to practice. It’s an invaluable investment you make in yourself, applicable to many areas of law.” After working for a few years as an accountant while earning his two law degrees, Shamoun set his sights once again on a new business venture. This time, he had the vision of “creating the best tax law firm in the United States. I wanted the firm to be different, becoming a household name and international resource,” he says. In 2003, he opened the doors to his own 18

Attorney Journal San Diego | Volume 139, 2015

firm, and began the daunting task of marketing himself as an attorney in his own community. “I started out as a solo practitioner. I worked evenings and weekends at my convenience store and Subway in Ocean Beach, trying to spread the word about my new law firm to every customer who came in. I began to build relationships with them and they started to come to me with their tax problems. They knew they could trust me because they’d see me the next day when they came in to get their coffee or sandwich,” he says. It suffices to say Shamoun has come a long way from the days of face-to-face marketing with his convenience store customers, but he has seen the fruits of his labor materialize into the firm that he had always envisioned. With 9 attorneys (all of whom hold an LL.M. or are in the process of obtaining it, as it is a requirement to join his firm), Shamoun has built a practice that is lauded not only for helping its clients, but for its tireless dedication to helping better the San Diego community as a whole.

Building the Helping Brand

Shamoun’s practice today involves federal and state taxation with an emphasis in criminal tax defense, tax controversy, real estate, corporate law, and international tax. He has represented countless individual and businesses before the IRS, the California Franchise Tax Board, the California Employment Development Department, and the California State Board of Equalization.

©Bauman Photographers

Ronson J. Shamoun with the RJS LAW team. He credits much of the firm’s success and growth to the team he has assembled.

He’s also defended clients against criminal prosecutions by the federal government and the State of California. All told, he and his colleagues at RJS LAW have helped thousands of clients find solutions to their civil and criminal tax matters. “Our typical clients are business owners who have run into tax problems. Whether they are facing an audit, collections, penalty abatements, or complex tax planning, businesses always need our help, no matter the size,” he says. To that end, RJS LAW abides by a few guiding principles which Shamoun wholeheartedly believes are the reason for the firm’s incredible success and impeccable reputation with the courts, federal and state taxing agencies, and other attorneys. “We treat our clients with compassion, advocating for and caring about each one as if they were a part of our family,” he says. “We give each client personal attention, promising a 24-hour turnaround time on all phone calls and emails. We create genuine relationships with our clients, making them friends for life. Our strategy of putting compassion at the center of everything we do has proven to be innovative. Our clients come to us scared, looking for someone they can trust and turn to in their time of need.” To Shamoun that means that his firm must never say no to a client who needs help. “We are committed to offering reasonable rates. Not only are our rates competitive and affordable, but because of our experience, we are extremely efficient, allowing us to reduce the amount of time it takes to complete the matter,” he says. Continuing he adds, “We run our firm like a retail establishment. We want our clients to walk out of the office smiling, and if they aren’t we will do what we need to do in order to fix the problem. If that means discounting their bill, so be it. If that means taking on another aspect of their case pro bono, so be it. If that means providing free legal advice to them even after their matter is closed, so be it. We are happy to help in any way that we can.” As the result of this tireless advocacy and compassion, Shamoun is extraordinarily proud of the firm’s 100% customer service satisfaction rate. “We are proud of our customer satisfaction rate, and will always go above and beyond for our clients to keep this statistic,” he says. “We donated more than 3,500 pro bono hours in 2014, and our goal for 2015 is to donate 5,000 hours of pro bono work. The people we help in a pro bono capacity have become some of our biggest fans and best referral sources. They are in the community advocating our services for the rest of their lives,” Shamoun says with a smile. However, Shamoun’s determination to help others isn’t limited to those with tax problems. On the contrary, RJS LAW is equally determined to help the local community as a whole. Indeed, the individual attorneys at RJS LAW donate countless hours of their time and resources to charities and nonprofits close to their hearts. By way of example, Shamoun volunteers his time to the Grossmont Hospital Foundation, the Chaldean Middle-Eastern Social Services Clinic, the Saint Peter Chaldean Seminary Program, the Challenged Athletes Foundation, the Knights of Columbus, the University of San Diego School of

Law Board of Visitors, the National Academy of Television Arts and Sciences, and the United Services Organization, amongst others. Shamoun has also donated an annual scholarship, the $5,000 Ronson J. Shamoun RJS LAW Tax Scholarship, to the University of San Diego School of Law to be awarded to students who pursue an LL.M. in Taxation at Shamoun’s alma mater. His team of associates and attorneys are like-minded in their own service work. Attorneys at RJS LAW contribute their time and resources to organizations both inside and outside of the legal community including Young Tax Lawyers, Habitat for Humanity, the National Alliance on Mental Illness, Big Brothers Big Sisters, the Rwandan Orphans Project, Kiwanis, and I Love a Clean San Diego. Many of the attorneys at the firm are also professors at local universities. As a firm, RJS LAW also helps numerous indigent people throughout San Diego County get their lives back on track. “We never turn down someone who needs our help. When they come to us for help, we are there. Our job is to lend a helping hand no matter what. We always offer our clients a free one-hour consultation with an attorney, giving them all the tools to solve their problems themselves whenever possible or referring them to the USD Federal Income Tax Clinic when necessary,” Shamoun says.

Big Return on Investment in Goodwill

Shamoun is clear that his efforts to use his talent and expertise to help others, coupled with his investment in extending goodwill, have played an imperative role in his success. “We believe that it is because of our commitment to excellence, honesty, and hard work that we’ve built a sterling reputation with the courts, federal and state taxing agencies, and other attorneys. We have an endless list of happy client testimonials, and we take impeccable care of clients who have been referred to our firm by other attorneys or tax practitioners,” Shamoun says. Yet he is honest when he says that it was slow going when he first opened his firm. “For the first 3-4 years, revenues in the firm weren’t great,” he says candidly. “But we have always been very giving, and after a few years, the word spread. When you do good for others, whether it’s by taking on a pro bono case, offering a free consultation, or even telling clients how they can solve their tax issues without hiring us to help, those people tell others how you were able to help them, and that is how we have grown our firm. When you do good, good comes back to you,” he says simply. Good things have certainly come to pass for RJS LAW over the last decade. Beginning in 2009, the awards and accolades for Shamoun’s excellency in advocacy began to pour in. He was named a Top Young Attorney by the San Diego Daily Transcript in both 2009 and 2010. By 2013, he’d been named a Top Young Influential and Top Tax Attorney by the San Diego Daily Transcript, a Top Lawyer by San Diego Magazine, and one of the Top Lawyers in California by American Lawyer Media. RJS LAW was also named the Business of the Year by the San Diego East County Chamber of Commerce. To boot, the same year, and every year thereafter, Shamoun earned an AV Preeminent Attorney Journal San Diego | Volume 139, 2015

Contact: Ronson J. Shamoun RJS LAW-A Tax Firm www.RJSLawFirm.com RShamoun@irssolution.com 619-595-1655 San Diego | 303 A Street, Suite 400, San Diego, CA 92101 Beverly Hills | 8484 Wilshire Blvd., Suite 210, Beverly Hills, CA 90211 Irvine | 2 Park Plaza, Suite 1258, Irvine, CA 92614 20

Attorney Journal San Diego | Volume 139, 2015

©Bauman Photographers

EXPERIENCE

rating from Martindale Hubbell, the highest possible rating for professional ethics and excellence. By 2014, Shamoun’s firm had been named a Family Owned Business Finalist by the San Diego Business Journal, as one of San Diego Metro Magazine’s Most Admired Companies, and was a finalist in the Better Business Bureau’s Torch Award for Marketplace Ethics. He’d also been named a Top Lawyer by San Diego Magazine, was included amongst the Best of the Bar by the San Diego Business Journal, and earned the Client’s Choice award from Avvo in all of his practice areas: tax, business, trusts, and real estate. Similarly, he was one of San Diego Metro Magazine’s Mover to Watch and Best Attorney in 2014, as well as a 2014 San Diego Daily Transcript Top Tax Attorney. In 2015, he received the Top Lawyer title yet again from San Diego Magazine, and was a finalist in the 2015 San Diego Business Journal’s Most Admired CEO award. Shamoun has also become a frequent legal commentator for various media outlets including Fox 5 News, ABC Channel 10 News, KUSI News, and NBC 7 News in San Diego, and nationally on One America News Network. He is also an expert contributor to the San Diego Union Tribune, San Diego Daily Transcript, and the San Diego Business Journal. But beneath all of the awards and accolades for his expertise in tax advocacy, Shamoun remains a true San Diego family man, entrepreneur, and business owner who feels a deep sense of gratitude and obligation to pay forward his success. RJS LAW is truly a family affair: he serves as Chief Executive Officer; his wife, Melanie, is the Chief Financial Officer; his sister, Renae serves as Chief Marketing Officer; his father, Sabri, is a consultant; his niece, Larissa, is a staff accountant; his nephews, Devon and Dominick, and niece, Leandra, are summer interns; and his nephews, Dylan and Drake, are starting as interns later this year. “I come from a very close knit family and we are still that way today.” Every Friday his brother Robert and his wife Lisa, as well as his sister Renae and her husband Alan, come with their kids to his family home to spend time together. “Growing up, it was always my goal to make my mother and father, Mary and Sabri, proud of me. Now that I’m married and have kids, I have even more people to make proud; my wife, Melanie, and my daughters, Mariella and Audrianna, are my biggest inspiration and source of encouragement and I would not be where I am today without my family’s support. Everything I do is for my family, my firm, and my community.” n

» EDUCATION • Law School: University of San Diego School of Law • Other Graduate School: Masters of Laws in Taxation • College: University of San Diego, bachelor’s in accounting

» AWARDS • Client’s Choice in Tax, Business, Trusts, and Real Estate—Avvo 2014 • Martindale Hubbell AV Preeminent: Highest Excellence in Legal Ability and Ethical Practice—2013 • Torch Award Finalist—Better Business Bureau of San Diego, Imperial, and Orange Counties 2014 • Most Admired Companies—San Diego Metro Magazine 2014 • Best Attorney—San Diego Metro Magazine 2014 • Mover to Watch—San Diego Metro Magazine 2014 • Most Admired CEO Finalist—San Diego Business Journal 2015 • Best of the Bar—San Diego Business Journal 2014 • Family Owned Business Finalist—San Diego Business Journal 2014 • Top Lawyer—San Diego Magazine 2013-2015 • Top Lawyers in California—American Lawyer Media 2013 • Top Young Influential—San Diego Daily Transcript 2013 • Top Tax Attorney—San Diego Daily Transcript 2013 & 2014 • Top Young Attorney—San Diego Daily Transcript 2009 & 2010 • Voted San Diego’s Best Tax Law Firm by the readers of the Union Tribune—RJS LAW 2014 • State of California Senate Certificate of Recognition—RJS LAW 2014 • California Legislature Assembly Certificate of Recognition— RJS LAW 2014 • San Diego Regional Chamber of Commerce Certificate of Merit— RJS LAW 2014 • City of San Diego Certification of Recognition—RJS LAW 2014 • San Diego East County Chamber of Commerce Business of the Year— RJS LAW 2013 • Certificate of Special Congressional Recognition—RJS LAW 2013 • State of California Senate Certificate of Recognition—RJS LAW 2013 • California Legislature Assembly Certificate of Recognition— RJS LAW 2013 • San Diego County Board of Supervisors Certificate of Recognition— RJS LAW 2013

Areas of Expertise Business • Class Action Complex Litigation • Construction Employment/Wage and Hour Insurance Coverage/Bad Faith • Intellectual Property Legal Malpractice • Medical Malpractice Personal Injury • Probate Real Property • Wrongful Death

Past President: San Diego Chapter of ABOTA, San Diego County Bar Association Listed in The Best Lawyers In America, Super Lawyers and Top Attorneys 30 Years of Experience as a Mediator and Arbitrator 35 Years of Extensive Civil Litigation Experience Representing Plaintiffs and Defendants

Monty A. McIntyre, Esq. Mediator, Arbitrator & Referee ADR Services, Inc.

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Attorney Journal San Diego | Volume 139, 2015

he Managing Partner of one of our clients recently said to me, “The hardest thing in the world for most lawyers is to decline an opportunity for increased business, even when it’s because of a conflict or a question of ethics.”

SOMETIMES YOU HAVE TO SAY “NO”

There’s obviously no question about having to say “no” in those situations. But there are other opportunities for increased business when the wise decision for the firm or the individual lawyer would be to say “no.” Here are a few examples. LATERAL ENTRY OPPORTUNITY

by Robert Denney Bob Denney is President of Robert Denney Associates, Inc. He and the firm provide management, marketing and strategic planning counsel to law firms and privately held companies throughout the United States and parts of Canada. He has authored or co-authored seven books and has written many articles on these subjects. For information about Bob, the firm and their services, visit their website www.robertdenney.com.

A 40-lawyer litigation boutique was approached by a widely recognized and highly successful partner at a BigLaw firm about joining the firm as a lateral entry partner. He had a blue chip client list and a large book of business. He planned to bring his entire group with him, including two younger partners and two associates. He demanded a guaranteed compensation package that would have made him almost the highest paid partner in the firm. He also demanded that, not only his two partners but also the two associates, be brought in as equity partners. The firm very much wanted this lawyer, his clients and the revenues that would probably ensue. But, after reviewing the situation with us, the partners decided that, if they met all his demands, it would disrupt the firm. They said “No.” Six months later our client did bring in a lateral entry partner who also had a blue chip client list and a substantial book of business but did not require his compensation be guaranteed or that the two associates he brought with him be admitted as partners. The firm has continued to grow and also has further strengthened its already strong culture. By the way, the other lawyer and the rest of his group have remained with his firm.

CLIENT DEMAND One of the top three clients of a 200-lawyer firm demanded a number of additional “value added” services as part of a different fee arrangement or they would take all of that work to another firm. The arrangement they demanded would make this client unprofitable for the firm to serve. Despite the considerable revenue involved, our client said “No.” It did, however, offer to provide other additional services at no charge and also proposed a different AFA which would still be profitable for the firm. After some discussion and negotiation, the client agreed to the firm’s proposal. Shortly thereafter, in a surprising development, the client then announced it was terminating another firm and was giving that work to this firm—work, by the way, which was also profitable. 22

Attorney Journal San Diego | Volume 139, 2015

STRATEGIC DECISION In today’s highly competitive legal market, some firms accept work from current or potential clients even though they have limited experience or capability in an area. This is an unwise attempt to be “all things to all people,” or at least to all clients, instead of differentiating themselves by being recognized for their expertise in certain areas of practice or selected industries. What most firms should do is make the strategic decision to focus on and develop certain practice areas, types of clients or industries. Concurrent with this is to decide there are certain services they will not attempt to provide or certain clients they will not accept and, as a result of this strategic decision, decline opportunities for increased business in these instances. This does not mean firms should say to their clients at times, “We don’t want your additional work.” What they should say is, “We’re not the best choice for this work. Let us refer you to a firm that has the expertise you need in this area.” By handling the situation this way, the firm strengthens its relationship with its clients because it demonstrates that it places their interests ahead of its own desire for additional business. Despite the soundness of this decision, there will still be partners or managers in the firm who disagree. Some will say, “That’s all well and good but it’s just bringing another firm into the picture and running the risk of our eventually losing the client.” That misses the point. The realities are: 1. You can’t prevent a client from using other law firms or professional advisors and . . .

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2. You keep clients loyal to you by serving them superbly and earning their trust. Others in the firm will say, “That’s fine for established firms who have so much business they can afford to say ‘No.’ We can’t.” The reality in this case is that, if you decide you can’t afford to decline business until you’re established and overwhelmed with work, you’ll never be established and differentiated from your competition. This principle doesn’t just apply to law firms. It applies to every business and professional firm— including consulting firms such as ours. Yes, we practice what we preach! It’s not easy and it requires courage. But successful operations have learned that sometimes you have to say “No.” n

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Attorney Journal San Diego | Volume 139, 2015 7/12/13 23 5:04 PM

LAWYERS IN RELATIONSHIP

Building business, but are they connecting? by Kimberly Alford Rice

Some things appear to be so simple that we assume (dangerously) that everyone “gets it.” Bear with me a moment. For lawyers, it is imperative to consistently and persistently cultivate, nurture and strengthen their relationships with their universal network; with clients, to receive more work; with referral sources, to receive more referrals; with prospects, to develop new work; and so on. Then why is it that a significant number of lawyers either have no system—formal or otherwise— for getting and staying in touch with these people or do a dismal job of staying connected? WHAT DOES ‘GETTING AND STAYING IN TOUCH’ MEAN?

Again, a seemingly obvious question, but in my legal marketing practice of more than 20 years, I have yet to encounter more than a handful of lawyers who understand, as a practical matter, the fundamental principle of this phrase. Starting with the widely known statistic that it takes from 7-10 “touches” annually to stay “top-of-mind,” lawyers are well served to develop—often with the support of their legal secretary/ assistant/marketing or IT department—a consolidated contact list including clients; industry and professional contacts; referral sources; prospects; friends and family; school classmates—law school, college, high school, etc.; co-workers and former co-

Attorney Journal San Diego | Volume 139, 2015

workers; contacts from former clerkships; association contacts; community contacts; holiday card recipients; and so on. Though it may be an arduous administrative task to assemble all the business cards, old Rolodexes (yes, I’m showing my age), database printouts, etc., it is important to have all your contacts in one system. As I often relay to my clients, no list equals no connections, no communications with friends, peers, industry contacts and prospects, and, ultimately, no clients. Remember, we’re in the “relationship-building” business, and it becomes much more daunting to foster relationships if we don’t proactively get and stay in touch. While I could outline the precise steps lawyers need to take

in assembling, organizing, categorizing and systemizing their contacts, I’ll spare the reader the administrative details in this article except to point out that once the task of gathering and entering all your contacts into a central system—even Microsoft Outlook does a decent job of this—is complete, lawyers would be sorely remiss if they did not “categorize” their contact names.

WHAT DOES THIS MEAN?

For purposes of communicating regularly with your various constituents (clients, referral sources, prospects, etc.), no one communication message will be of interest to everyone on your contact list. That is to say, if you develop an e-newsletter or legal update on the importance of developing social media policies for the workplace and send it to your human resource clients, that topic may be of little interest to your charitable organization contacts unless they are involved in employment law issues. Basically, you want to tailor your message to an intended audience and there is no better way than to develop “categories” of contacts. When it comes to knowing how, when and how often to reach out, paramount on most attorneys’ minds is that they do not want to be perceived as “too pushy,” “aggressive” or otherwise annoying. Understandable. One principle I often convey to my clients is that most people are so involved in their own world, business, family, etc., you are not capturing 100 percent of their attention most of the time. In other words, to adequately “register” on your targets’ radar, there must be regular, consistent and persistent “touch points,” be they via e-mail, phone call, face-to-face contact (for which there is no substitute) and social media outlets, just to name a few.

CHECK MOTIVATIONS

To build and grow a healthy practice, it is imperative to develop a system of getting and staying in touch but doing so with the appropriate mindset. In short, “It’s not about you.” Lawyers often ask me: “What is it that I’m saying to all these people?” Lawyers sometimes say, “I don’t want to bother these folks,” and express other such sentiments. My response is usually a variation on the theme of reaching out with a helpful spirit and with true intentions of checking in on your contacts’ business, seeing how they are making out with a recent transition or starting a new position, or a company move, etc. The universal sowing of seeds of goodwill will certainly reap only good things. Or, said another way, employing Newton’s Laws of Motion, “For every action, there is an equal and opposite reaction.” The more “goodwill” you put out, the more it will come back to you … usually multifold.

TIME CONSIDERATIONS

Attorneys are very busy people, often logging their time in sixminute increments. Where do they “find” the time to get and stay in touch with everyone and have the oft-needed downtime? Just today, I explained to a junior partner client that, if addressed productively, his contacts will soon be in his personal network circle. Think about it: We all have certain people with whom we enjoy sharing time. What if those special people could be the same people in your categorized contact lists? How cool would that be? Kill two birds with, well, you know. For the successful senior attorneys among us, many of you have worked most of your professional careers to create this very scenario. But it didn’t happen overnight. It took years, in some cases, one contact at a time. This brings me to my next point.

LEVERAGE TECHNOLOGY

In our global Internet age, it has never been easier to “get and stay in contact” with a broad base of contacts via the technological tools available (e.g., LinkedIn, Facebook, Twitter, blogging). Not a technophile? No sweat; there are “people” who make a career of helping clients “connect.” One such job title is “certified social media specialist.”

NET-NET

In the growing competitive legal services arena, cultivating strong relationships is more important than ever before. As a successful lawyer and business owner, you must find a way to get and stay in touch with your desired audiences, targeted constituents and those folks who ultimately can help you grow a healthy practice. It is most easily done by: • Committing to making it happen. • Gaining buy-in from your support resources (internal and/or external) so everyone is on the same page. • Developing a viable and workable system for gathering, categorizing and maintaining contacts on an ongoing basis. • Scheduling dates/calendar regular communication with your contacts in addition to the other regular “touches.” • Repeat. n Kimberly Alford Rice is Principal of KLA Marketing Associates (www.klamarketing.net), a business development advisory firm focusing on legal services. As a law marketing authority, Kimberly helps law firms and lawyers develop practical business development and marketing strategies which lead directly to new clients and increased revenue. Additionally, Kimberly founded Women in the Law Rainmaker Forum to provide women lawyers guidance in professional and career management issues. She may be reached at 609.458.0415 or via email at kimberly@ klamarketing.net

Attorney Journal San Diego | Volume 139, 2015

PROTECTING

CLIENTS FROM UNNECESSARY

LIABILITY

When Using Social Media in Recruiting and Hiring byTodd R. Wulffson and Lindsay Ayers

TODAY,

virtually all companies use social media as a tool to attract, recruit and hire employees. Unfortunately, many organizations also are using social media in a way that can draw a potential lawsuit. As counsel for these companies, the key is to step in and make corrections in procedures and practices before suits are filed. Companies generally use social media in the hiring process when: 1. Advertising for and recruiting candidates 2. Screening applicants 3. Conducting a social media background check as part of the hiring process Hiring managers need to be aware that the potential liability and risk of being sued increases through each of these three stages.

SCRUTINIZE HOW SOCIAL MEDIA IS USED AS A RECRUITING TOOL Social media is an inexpensive way to reach many prospective candidates quickly, which is why it is an attractive recruiting tool for many companies. However, marketing positions via social media, through use of targeted ads for example, can lead to claims of racial, age, and religious discrimination, and investigations by the U.S. Equal Employment Opportunity Commission (EEOC). As counsel for companies using social media for recruiting, it is important to scrutinize recruiting practices closely. If the 26

Attorney Journal San Diego | Volume 139, 2015

company uses a targeted ad (offered by some social media sites), this may target anyone who has friended or “liked” the company’s site. If the company’s social media “audience” is comprised solely of teenage boys, the company may become a target for EEOC investigators and plaintiff’s counsel, who can claim that the directed ad was designed to exclude other groups. This can be particularly problematic if the company has a contract with the government, and needs to reach out to minorities, women, the disabled and veterans.

SCREENING APPLICANTS VIA SOCIAL MEDIA IS A DANGEROUS PRACTICE Using social media to screen applicants is a rapidly growing cause for companies to be sued. Counsel should advise clients that screening applicants by looking at their Facebook pages is inadvisable and could to get them sued because a Facebook page is likely not intended to be viewed by prospective employers. By reading someone’s posts, looking at his/her pictures, and doing some quick math on his/her graduation dates, it is fairly easy to ascertain a candidate’s age, race, national origin, sexual orientation and/or disability status. Managers should be trained that companies are not allowed to consider these things as a prospective employer. If these factors are assessed, companies face the risk of having to explain why this information was viewed before eliminating an applicant from the interview pool. Counsel also should inform clients that in addition to discrimination lawsuits, screening applicants via social media

may directly run afoul of the law. Both the federal Fair Credit Reporting Act (FCRA) and the California Investigative Consumer Reporting Agencies Act (ICRAA) have specific rules on notice that must be provided to a consumer (i.e. potential employee) before a consumer report can be obtained, and he/ she must be informed if negative information was a basis for an employment decision. In addition to the FCRA and ICRAA, there are a host of laws governing the use of credit checks and criminal records for hiring. In relation to a company’s social media screening uncovering protected information, without proper guidance from counsel, it is very easy for a company to make wrong moves and unwittingly violate a law when eliminating an applicant from the interview process. Counsel should suggest that employer clients consider the model provided by the rising trend of “ban-the-box” laws which prohibit (mostly public) employers from performing criminal background checks until after an offer is made. Since social media behavior, like someone’s criminal history, is more likely to be used as a basis to deny employment a good deal of time, money and potential liability can be saved with a policy of transparency. Companies should tell all applicants that they will be subject to a comprehensive background check, including social media, only after they are given an offer of employment. Most applicants who know they will not pass this hurdle will simply not apply, and then the company is only focusing resources on people who are otherwise qualified for the position.

USE OF SOCIAL MEDIA FOR BACKGROUND CHECKS IS A BALANCING ACT While companies can draw lawsuits for conducting background checks on potential employees, it is even more likely to draw lawsuits for failing to run background checks. When advising clients on background checks, the recommendation is to analyze and balance the costs and benefits of conducting a background check. The cost of the information needed should be measured against the cost (i.e. risk of litigation or bad public relations) if a lawsuit develops after hiring the wrong person. With respect to use of social media, it should never be the sole source of background check information. Counsel should be advising corporate clients that the first step, when determining how social media will play a part in background searches, is to decide what information is needed from the social networking sites. Is social media expertise a requirement of the job? Will the employee be high profile such that his or her public posts reflect on the company? Is there need for more than just résumé verification? The goal is to assure that the company’s actions were consistent, objective and job-related. In addition, companies should ensure upon signed authorizations from applicants that specifically mention a comprehensive social media check. Assuring that corporate clients keep record of all the background searches, and provide the applicant with negative information that may disqualify them

while allowing them the opportunity to rebut that information, will greatly reduce the chance for a lawsuit down the line.

TIPS TO ASSIST YOUR CLIENTS IN AVOIDING LIABILITY To assure compliance with Title VII, the Fair Employment and Housing Act (FEHA), current state laws and the like, it is important to assure your clients’ stated policies and handbooks are updated and being enforced properly in accordance with various laws. Hiring managers should be trained and told repeatedly that they cannot do any research into candidates beyond what HR provides. They should be advised that all notes and interview documents should be returned to HR and destroyed following interviews, so as to avoid unexpected production of these notes in litigation. One manager’s handwritten comments on a résumé can lead to evidence of the alleged discriminatory action in hiring decisions. Hiring managers need to be encouraged not to email comments, as email is eternal and can easily be taken out of context. Assure that you, as the company’s counsel, or HR, is doing all of the social media screening and checks, and that managers are not violating AB-1844 by asking applicants or employees for passwords or other access to their social media accounts. Finally, be aware that certain actions taken as an attorney when involved in the hiring and firing processes for a company can be discoverable. For example, if an attorney is the hiring manager, the notes taken by that attorney during the hiring process will likely not be privileged. n Todd R. Wulffson is partner at Carothers DiSante & Freudenberger LLP, a leading California employment, labor and immigration law firm providing litigation and counseling services to California employers. Wulffson has 25 years of experience counseling and defending businesses in labor and employment issues and has extensive experience representing employers across the entertainment, manufacturing, banking, hospitality, financial services and retail industries. Wulffson focuses on issues related to human resources, and the implementation of proactive measures to reduce risk and cost, including substantial experience in the evolving area of social media in the workplace. He is a frequent speaker, author and resource to employers nationwide on analyzing and implementing employee-related social media policies.To contact Wulffson, email him at twulffson@ cdflaborlaw.com or call (949) 622-1661. Lindsay Ayers is a trial attorney and partner at Carothers DiSante & Freudenberger with more than a decade of legal experience. She frequently litigates on behalf of California employers in state and federal courts on employment-related claims of wrongful termination, discrimination and harassment as well as claims of unfair competition, breach of contract and various business torts. Ayers is a sought-after speaker on labor and employment issues. To contact Ayers, email her at layers@cdflaborlaw.com or call (949) 622-1661. Attorney Journal San Diego | Volume 139, 2015

STRATEGIC PLANNING for Small Law Firms

by Roy S. Ginsburg

Pressed for time and averse to business jargon, solos and small law firms may be overlooking benefits of strategic planning that include more and better business over the long term.

If a small law firm is perfectly happy with its current status and future outlook, then it does not need a strategic plan. But really, how many firms can claim to be perfectly satisfied? Most small firms want more business and better business. To achieve this goal, these small firms need a strategic plan. If you don’t know where you are going, after all, any road will get you there. Following many roads in random directions is inefficient and ineffective. If you do know where you are going, you can follow a specific and direct path to success. When asked what their law firms should accomplish in the next few years, most small-firm leaders will say that they want to be more successful. They will say that they plan to do this by working harder and smarter. These vague aspirations, however commendable, do not constitute a plan. It is not surprising that many small law firms lack strategic plans. Their counterparts at larger law firms have staff to manage the firm, so that the lawyers can concentrate on clients. Solos

Attorney Journal San Diego | Volume 139, 2015

and small-firm lawyers must do it all themselves. As a result, strategic planning often takes a back seat to client matters.

WHAT IS STRATEGIC PLANNING? When attorneys hear the term “strategic planning,” their innate cynicism often takes over. They envision hours spent with a high-priced consultant who spouts arcane business jargon and then presents obvious recommendations. In other words, these attorneys envision a complete waste of their time and money. Put these preconceptions aside. Strategic planning is not all that complicated. It is simply a process that forces a law firm to pause briefly to carefully consider where the practice has been, where it is today, where you would like it to be in the future— and how you can make this happen. In other words, strategic planning is a process in which an organization defines its goals and then creates a plan to achieve these goals. The process forces busy lawyers, who are often scrambling to keep up with the day-to-day tasks of lawyering, to actually anticipate the future. Most plans cover one to three years.

A successful small law firm strategic plan should consider a firm’s unique culture and vision, emerging trends in the legal market that might provide opportunities, emerging threats in the market that might dictate a change of course, and any needed operational changes. Plus, a strategic plan can be simple. In fact, less is more. Law firms should not try to accomplish too much, too soon. If initial goals are too ambitious and not reached, firm members will likely get discouraged and resist future efforts. Success in achieving smaller, simpler goals can create the momentum and confidence needed to achieve more difficult goals down the road.

Regarding the marketplace:

WHY DO LAW FIRMS RESIST?

• Do we have the right leadership? Are there gaps?

Common obstacles to strategic planning include: • Lack of incentive. Strategic planning requires an investment in nonbillable hours, which are not rewarded by most law firm compensation systems. Many firms resist spending time on an activity that brings no reward. • Lack of consensus. Most law firms are democratic institutions that rely on consensus in order to get things done. Strategic planning may uncover difficult issues and spark differences of opinion. Many firms resist conflict and simply hope that a problem will go away. • Lack of leadership. Strong leadership is required when dealing with difficult issues. Often, when consensus is hard to achieve, a managing partner operating alone lacks the skills and political capital to effectively manage significant changes. • Lack of execution. Once created, even the best strategic plans must be implemented. This takes time and resources. Many firms find it easier to ignore a plan and concentrate on client matters. • Lack of accountability. Strategic plans often impose no adverse consequences for inaction. Even if they do, the firm may not enforce these consequences. When lawyers fail to follow through on a plan’s tactics, they must be held accountable.

• Who are our competitors? • What do they do better than we do? What do they do worse? • What is our reputation in the marketplace? How can it be improved? • How can we distinguish our firm from our competitors?

Regarding internal issues: • How would we describe our firm culture? • What are our core values? • Are we getting work out efficiently, effectively, and in a timely manner? Which improvements are needed? • Are our marketing efforts adequate, or should they be upgraded? • Do we have the right number of the right kind of employees? Are our training needs being met? • Are any of our lawyers close to retirement? What changes will this bring about? • Is the firm the right size or should it be smaller or larger? • Are professionals and staff compensated fairly and consistently with our culture? • Does our technology allow us to compete in today’s culture?

Regarding external issues and trends: • Will any practice areas be impacted by changes in the coming years in the regional economy, legislation and regulation, and/or political climate?

Regarding clients and services: • Who are our top clients and what kind of work do we do for them? • How will their needs change in the future?

STEP BY STEP PLANNING

• Which are our most profitable practice areas?

1. Assess status and gather facts. One popular and straightforward strategic planning tool that can be used by a small law firm is a SWOT analysis, in which lawyers identify the firm’s strengths, weaknesses, opportunities, and threats. Most firms will already know what these are, but have never carefully considered them all in one place. Do not get carried away. Identify only the most important elements in each category. To be more thorough, use these questions to trigger discussion.

• Should we reduce or eliminate some areas while growing or adding others, in order to meet client needs going forward? When assessing client needs, do not rely only on lawyer perception of these needs. Lawyer and client perceptions may not be in alignment. Solicit direct client feedback via confidential interviews (usually for larger clients) and client questionnaires (usually for smaller clients). This information can also be used to identify (and plan for) future opportunities or potential loss of business.

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2. Organize and rank. The above discussions will uncover a lot of information. You cannot possibly deal with all of this information at once. To keep the strategic planning process simple and focused, concentrate on perhaps three or four issues. If these issues are not immediately obvious, discuss one further question: What worries us most about the firm’s future? The answer to that question will inform your list. Some of these issues may be longstanding problems that have not yet reached crisis level, but have been neglected for too long. Thus, strategic planning not only forces small law firms to consider the future, it also motivates them to proactively tackle lingering problems that have been holding them back.

just the partners. On the other hand, associates and staff do not have an ownership stake in the firm and will be less immediately affected financially by any changes that are part of the strategic plan. Also, there may be certain issues that are better kept confidential. When it comes to inclusiveness, there are no hard-and-fast rules. In the opinion of many experts, expanded participation should be seriously considered for some parts of the process. Outside Consultants. A disciplined small law firm should be able to work through the strategic planning process on its own, but many find this process far easier when it is facilitated by an outside consultant. A skilled consultant can:

3. Create a plan. With the information gathered and priorities ranked, it is time to create an action plan. This document should be short and simple. It should address:

• Rein in uncooperative partners;

• What are the three or four realistic goals for this plan? Don’t be tempted to expand the list. Less is more. • How will we achieve these goals? What are the specific tactics (including “to-do” lists)? • Who is responsible for accomplishment of a tactic? • What are the final deadlines and interim deadlines? • How will the firm measure and reward results? • Will the firm offer disincentives to ensure accountability? 4. Just do it! The most difficult part of any small law firm strategic plan is execution. The best strategic plan will be wasted if it just sits on the lawyers’ desks gathering dust. To avoid this result, progress towards meeting plan goals must be monitored regularly. Constant monitoring is critical to hold people accountable, so everyone involved knows who is walking the talk and who is not. Results must be measured and communicated. It is also critical for making revisions. Perhaps some assumptions were incorrect or a tactic is not working as planned. Perhaps a lawyer has left the firm. A strategic plan is a flexible, living document—not etched in stone. Most often, monitoring is best accomplished by holding regularly scheduled meetings each month. These meetings can be short, allotting just enough time for each person to give an update. If changes need to be made to the plan, a little extra time can be added.

INCLUDING OTHERS Associates and Staff. There are pros and cons to including associate attorneys and law firm staff in the strategic planning process. On the plus side, they can provide a unique perspective on issues, providing a more accurate and well-rounded picture. Including associates and staff also sends a positive message that the firm is inclusive and values the opinions and contributions of everyone—not 30

Attorney Journal San Diego | Volume 139, 2015

• Keep the process moving along by avoiding side-tracks; • As an objective outsider, obtain more accurate perceptions about the firm from the partners; • Question long-held (but possibly outdated or incorrect) assumptions and beliefs that cannot be raised by partners due to firm politics; and • Provide an independent and objective voice to the process when individual lawyers are tempted to favor their own vested interests over the firm’s. Although all types of businesses engage in the strategic planning process, law firms offer some unusual challenges. It is usually best to retain a consultant who has worked with law firms and is attuned to their economics and business development practices. In addition, an experienced consultant will have a better understanding of the unique lawyer personality and what makes lawyers tick. For all of the reasons mentioned above, solo practitioners should also engage in the strategic planning process. On one hand, the process is simpler. On the other hand, it can be harder for a solo practitioner to stay on track without peer pressure to do so. Even solos can benefit from the discipline imposed by an outside consultant.

CONCLUSION Small law firms that want more business and better business cannot achieve these results simply by wishful thinking. They need a direct roadmap to get from where they are today to where they want to be tomorrow. They need to follow that route without getting side-tracked. They need a strategic plan. n Roy S. Ginsburg is an attorney coach and consultant who has helped numerous lawyers achieve practice development goals and career satisfaction. He is a frequent CLE speaker and consults with firms and individuals nationwide. For more information, visit www.planningforlawfirms.com. This article was first printed in Bench & Bar of Minnesota.

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