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May 20, 2011

Working with Foreign Counsel: Pitfalls and Successes

How does a U.S. lawyer select an on-the-ground foreign counsel when contemplating an international transaction?  Are the expectations for electronic billing and conflicts check similar in developing nations and Europe, as they are in the United States?  What are some cultural and language issues about which to be cognizant?

These topics were covered during “Selecting, Retaining and Working with Foreign Counsel: Pitfalls and Successes,” a Section of International Law Spring Meeting panel.

How does one go about selecting a foreign counsel? Panelist Gabrielle Buckley, shareholder in the Corporate Practice Area of VedderPrice, suggested speaking with one’s law partners; looking back to law schoolmates; perusing directories; and retrieving information from articles read or conferences attended on the subject matter.

Representatives from Argentinean, Netherland and Japanese legal practice talked about the expectation of disclosing industry competitors when discussing the conflict issue. Tom Schutte, with De Brauw Blackstone Westbroek, New York, but speaking about practice in the Netherlands, said that the representation of a competitor within an industry would likely be disclosed to the potential partnering firm if there were a limited number of players within the industry.

Yasuhide Watanabe, with Nagashima, Ohno & Tsunematsu, speaking to the Japanese legal climate, noted that there are a very limited number of major law firms in Japan, so the issue of conflicts has to be addressed each day. Watanabe said that the fact that his firm represented a competitor in general would be disclosed, but not the specific competitor’s name.

When asked about usual billing practices, Watanabe said that much of Japanese legal services are billed hourly. Hernan Slemenson, with Marval O’Farrell & Mairal, Buenos Aires, said that Argentine firms often bill hourly, but firms are flexible enough to have a blended system of billing, and alternative fee arrangements such as flat fee or success billing are used.

In-house counsel may face challenges with the business people in their company in that the latter may look at the lowest bids and not fully take into consideration who would be working on the client matter — associates or partners.

Expectations on communications also vary from nation to nation. Even when there are no language barriers, cultural barriers may exist as to tone of e-mails.  Response time, too, may center on different expectations: managing expectations, communicating and interim responses all help. Significant time zone differences may be used to one’s advantage with international firms working so that the American client has information and work product in his or her inbox in the morning. Alternatively, some lawyers abroad will simply adjust their work hours to suit American clients.

Carol Mates, Washington, D.C., also served as panelist. James Silkenat, Sullivan & Worcester LLP, New York, introduced the panel program.

Learn More About:  International Law