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Tech Legal Leaders Veer From Morgan Stanley Return-to-Work Order

July 23, 2021, 10:01 AM

The top lawyers at Adobe Inc., Dell Inc., and Qualcomm Inc. said they don’t mind where their outside lawyers work, days after Morgan Stanley’s chief legal officer told law firms to get back to the office if they value the Wall Street giant’s business.

“I feel no need to dictate to my outside law firms how they should manage through these difficult times,” said longtime Qualcomm general counsel Donald Rosenberg.

The memo from Eric Grossman, Morgan Stanley’s legal chief since 2012, put law firm leaders in a bind as they seek to refine remote work policies that please both their employees and corporate clients also facing their own return to work issues.

Bloomberg Law contacted more than a dozen other large technology companies to see if they would follow Morgan Stanley’s lead in telling outside lawyers to go back to the office.

Amazon.com Inc., whose general counsel is David Zapolsky, and Facebook Inc. and its general counsel Jennifer Newstead, declined to discuss the matter. Other companies like Google parent Alphabet Inc. and Microsoft Corp., which recently reorganized its legal group structure, didn’t respond to requests for comment.

Steve Gilmore, a spokesman for Dell Inc. and its general counsel Richard Rothberg, said the Round Rock, Texas-based computer giant’s return to work approach is based on prioritizing the health and safety of its employees.

“We are not requesting or requiring our law firms to bring their lawyers back to the office,” Gilmore said. “Our approach remains conservative and accounts for local government regulations, work councils and science, as well as our own data and risk model to determine safety and readiness to reopen sites.”

Craig Corica, a spokesman for Adobe Inc. and its general counsel Dana Rao, said the San Jose, Calif.-based software company is permanently shifting to a hybrid working model focused on flexibility. Rao said in a statement that Adobe’s in-house lawyers will follow the company’s guidelines and be in office 50% of the time.

“We think there is value in being in the office, and we have all learned there are many things you can do as or more effectively from your home office,” said Rao, a longtime Microsoft lawyer who became Adobe’s legal chief in 2018.

‘Imposing Culture’

Grossman’s memo, sent via email shortly before midnight July 15 and subsequently obtained by Bloomberg Law, said the legal profession is founded on an apprenticeship model that’s “been critical to the development of young lawyers.”

Those lawyers deliver the best results when they’re in the office together, said Grossman, adding that the bonds forged by such a culture will “dissipate over time, as relationships are not sustained” in a remote environment.

Grossman’s memo drew the public support of Greenberg Traurig, a firm that represents Morgan Stanley.

Robert Chesnut, a former general counsel and chief ethics officer at Airbnb Inc., said he understood Grossman’s desire for office camaraderie and tutelage but was “baffled” by the legal chief’s insistence that his outside counsel do the same.

“I don’t question Morgan Stanley’s decision to bring everyone back to the office, there are a lot of benefits to working together, and trust that they are doing what they think is right for their company and culture,” Chesnut said. “But I do question their decision to try and impose that culture on their legal partners.”

Chesnut, a former federal prosecutor who also spent a decade at eBay Inc. and was legal chief for technology company Chegg Inc., said he often never knew where his outside counsel were working from and didn’t care.

“What should matter is whether the outside counsel is available, responsive, and has the tools to do their job—and of course the quality of the work,” Chesnut said.

That sentiment was echoed by Rao and Rosenberg.

“While we haven’t yet had discussions with our outside counsel about their work arrangements, the quality of their work is more important to us than where they do their work,” Rao said. “Our outside law firms are our partners, and we trust them to figure out the model that works best for them and us.”

For Rosenberg, the past year has been a testament to the Qualcomm engineers that designed the communications technology that makes remote work possible, as well as the in-house and outside lawyers who helped the company get a big antitrust victory.

“Qualcomm has done quite well in obtaining the legal representation we have required, even in the virtual world to which we’ve all had to adapt,” Rosenberg said. “That’s a tribute to my in-house legal team and the excellent coverage we’ve had from the outside counsel we rely on.”

‘A Warning’

Grossman, a former Big Law partner himself, said he’s “rarely one to quibble about, take issue with, or even comment on how you manage your firms.”

The purpose of the message, Grossman wrote, was “motivated out of grave concern that our profession cannot long endure a remote work model.” Grossman said he wanted to “sound a warning in light of what I have generally observed about the lack of urgency to return lawyers to the office, and the various statements and policies I have seen about the ability of your lawyers (both partners and associates) to work a significant, and in some cases a majority, of their time remotely.”

The message missed the mark with some legal industry observers, who criticized it as being a difficult to enforce mandate that ignored the realities of the modern workplace. Some law firms whose business isn’t focused on the financial services industry have already sounded a different tone.

Cooley, a large U.S. law firm with its roots in Silicon Valley, said this week it won’t require its lawyers to return to the office this year. Husch Blackwell, a large firm based in the Midwest, told Bloomberg Law that its virtual office “The Link” has nearly doubled in size within the past year.

Morgan Stanley and Grossman have declined to publicly discuss the memo. It came amid a broader debate about return to work policies and work-life balance on Wall Street as the big banks pushed to bring their own employees back into the office after over a year of mostly remote work due to the coronavirus pandemic.

Grossman said he will no longer accommodate “Zoom participation in critical meetings” and told outside counsel that he strongly believes that “firms that return to the office will have a significant performance advantage over those that do not, and we will see that advantage reflected in their client service and the ability to deliver successful outcomes for Morgan Stanley.”

Wells Fargo & Co. and Coinbase Global Inc., both of which hired new legal chiefs last year in Ellen Patterson and Paul Grewal, respectively, told Bloomberg Law they have no concerns about where their outside counsel work.

Marco Santori, a former Cooley partner hired last year as chief legal officer for Payward Inc., owner of cryptocurrency exchange Kraken, called Morgan Stanley’s return to work memo “shocking to hear” and said it led him to wonder whether Grossman’s missive was spurred by a bad experience with an outside firm.

Financial services giants like Morgan Stanley need to take an “activist client role” since there are a limited number of large firms equipped to handle their various needs, Santori said. A big bank can shift the amount of work it divides among a group of firms, but rarely fires one firm and replaces it with another, he said.

Lee Udelsman, head of the in-house practice group at legal recruiting and consulting firm Major, Lindsey & Africa, told Bloomberg Law the ramifications of Grossman’s memo will likely hinge on delta and other Covid-19 variants and whether more technology outfits embrace future remote work options.

“I think industries are doing it really on a case-by-case basis,” Udelsman said. “We’re going to have to see what the fall brings.”

To contact the reporters on this story: Brian Baxter in New York at bbaxter@bloomberglaw.com; Ruiqi Chen in Washington, D.C. at rchen@bloombergindustry.com

To contact the editor responsible for this story: Chris Opfer at copfer@bloomberglaw.com

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