Thursday, February 22, 2018

Improve Your Writing in the Time it Takes to Read This

“It is perfectly okay to write garbage—as long as you edit brilliantly.” – C. J. Cherryh

Many people think that litigation involves a Perry-Mason cross examination or Jack Nicholson losing it on the stand.  We love courtroom dramas too but the truth is, if you can handle it, is that most commercial cases resolve after a judge decides a client’s case based on written submissions.  This means that in most cases we are professional writers, presenting our clients’ cases not in the courtroom but through written briefs.

Although legal writing can be technical, good writing is good writing.  The same techniques we use to persuade judges are techniques our clients and friends can use to persuade their team, their boss, their board and their clients.  Here are 5 simple tips that will improve your writing right now.

Outline Everything

We outline every brief before we put pen to paper.  In fact, we outline almost everything.  Letters, substantive emails, even this blog post gets outlined.  Your outline does not have to be long.  The outline for this post is scribbled on the back of a magazine. 

The outline does more than organize your writing, it organizes your thought process.  There have been a number of times when we were headed in one direction only to go another after playing with an outline for an hour.  Bad writing is often a result of fuzzy thinking.  If you skip your outline, it will take you twice as long to straighten yourself out.

The more detailed your outline the more detailed your thinking.  Try to make the subject headings in your outline as detailed as possible.  Use a declarative sentence if possible.  Even if you decide not to create separate sections in your piece, using headings in an outline will help to keep you on track.

Learn to Stop Worrying and Embrace the Ugly First Draft

Our best finished product usually starts with an ugly, near stream-of-consciousness, first draft.  Do not even consider rewriting sentences or correcting grammar this round.  We will sometimes simply close our eyes while typing out the first draft to avoid the temptation.  It also has the added benefit of not having to look at the scary empty white space on the page.  Some of us will dictate a first draft. 
The point is to let your ideas flow unimpeded.  Don’t worry about missing punctuation, words or even sentences.  Once you grind out that ugly first draft, put it down for the day without editing or refinement.

When you pick it up again is when writing starts to get more fun.  You can start filling the inevitable gaps, improving flow and adding pithy one liners where appropriate.  If you try to skip the ugly first draft, it never turns out as well.

Stop Using Passive Voice

We have all heard this before but it is true.  If you are not sure whether you are writing in the passive voice ask yourself, “who is the actor in this sentence?”  For example, “plaintiff’s motion should be dismissed.”  Who should be doing the dismissing?  You can’t tell from this sentence and so know it is in the passive voice.  The active voice doesn’t hide the actor – “the judge should dismiss plaintiff’s motion” – and it makes for better writing.  It sounds better and provides more information.

If you find yourself using the passive voice often, consider whether you have an issue with your writing or your thinking.  When we find ourselves using the passive voice, it is often because we do not fully understand our topic and are using the passive voice as a crutch.  Who is the actor in your sentence?  If you do not know, you may need to clean up your thinking.

Please, No Corporate Speak, Made Up Words or Weblish

Corporate speak, made up words and “weblish” continue to work their way into our lexicon.  They do not have a place in your writing.  If you use corporate speak, your reader may not understand you.  Using the word “solution” to describe a product (often software) is a good example.  “We sold the customer a solution that will help them extract more useful information from their database.”  Rather than use a not so subliminal marketing tool, just describe what you sold.  If you use made up words (“I would guestimate that…”), you risk looking like someone who does not have the command of the English language needed to express themselves.  If you use weblish, you sound like a computer (“I don’t have the bandwidth for that…”).

You can usually avoid these issues by asking yourself a few questions.  If I used this term with a family member who knows nothing about my business, would they understand me?  If I looked in a dictionary, would this word appear?  Was this word or term in existence in 1970? If the answer to any of those questions is “no”, then keep it off the page.  

Lose the Adverbs Unless They Really Change the Meaning of Sentence

We are habitual offenders of this rule and often slash “-ly” words from our first drafts.  Overuse of adverbs tends to make your writing wimpy and bloated.  Use them sparingly and only when they change the meaning of a sentence.

The first sentence of this section is a good example.  Removing the adverbs “habitual” and “often” does not change the meaning of the sentence and removing it makes for a stronger sentence: “We are offenders of this rule and slash ‘-ly’ words…”

You can also reduce the tendency to overuse adverbs by using more descriptive verbs.  Rather than saying “he shook my hand very firmly,” you could say “he crushed my hand.”  Using a stronger verb allows you to remove the adverb “firmly.”


Good writing takes time but little changes can have an immediate impact.  Try these the next time you have a scary blank page in front of you.

Thursday, January 11, 2018

When Forming a Business Entity, Equal Partnership Isn't All It's Cracked Up to Be

“The worst form of inequality is to try to make unequal things equal.” ~Aristotle
Aristotle got it right. Some things were not meant to be equal. One quarterback should call the play. One physician should determine the treatment. And one person should steer the ship. Sometimes egalitarianism leads to impasse, confusion and even disaster. Yet, every month enthusiastic clients ask for assistance in setting up new businesses.  The conversation goes something like this: “My partner and I have a great idea for a business!  We want to form a company! We want to split everything 50/50!” 

There is a certain appeal in a 50/50 ownership split.  An equal split means “we share the risks, we share the rewards and we’re in this together!”  Splitting equity equally suggests obvious analogies to a marriage and - like marriages - creates the expectation that the business arrangement is “until death do us part.” Dividing ownership interests equally also avoids awkward conversations about the value of each partner’s contribution and the compatibility of individual goals.

Unfortunately, as in marriages, some business ventures do not work out. Management styles may clash and the business may outgrow the talents of its founders. Partners may pursue divergent personal and professional goals. One partner may be in search of a “lifestyle” business - a business that is essentially a life time job - while the other may be a “serial entrepreneur” intent on starting-up and selling out. In the most extreme examples, a business owner may find his or herself partnering with an irrational or self-interested owner, who puts his own needs ahead of the demands of the business.

Any Decision is Better than None

When managerial control is evenly divided between owners, there generally must be unanimous agreement before the business can act.  In the case of strategic decisions such as entering a new market, hiring a high level executive, or borrowing money, the need for unanimity may result in stalemate. Disagreements over strategic decisions may well reflect good faith differences of opinion in how the business should operate. At worst, however, a disgruntled fifty percent owner can use the veto power to exact concessions from a co-owner that have little to do with business strategy. An owner who is piqued at a partner can refuse to pay employee wages, vendors or company debts unless the other owner accedes to his or her demands.  An owner with signing authority at a bank can abscond or move money out of the other partner’s reach. Feuding owners that give conflicting directives to employees makes for a particularly toxic work environment. Employees may be forced to “choose sides” or decide to look for new jobs.

Once the internal dissension becomes public, third parties may decide to take a defensive posture to avoid being “caught in the middle.” Banks, payroll companies and other vendors may refuse to act without the authorization of both owners. The process can be cumbersome, frustrating and damaging to the business. Customers may be reluctant to make further commitments to an entity whose days seem numbered. Over time, the inability to reach any decision might be more damaging than implementing the “wrong” decision.

But Our Operating Agreement Says That…

There are a variety of devices that can be included in operating agreements and other organizational documents to help reduce the perils of 50/50 ownership. While such provisions offer some relief, they are not a panacea.

Many operating agreements contain “shoot out” provisions. Such provisions allow an owner to offer to purchase the other partner’s interests at a formula price or at a price determined by the offeror.  In the event the offer is rejected, the situation is reversed: the other partner is required to purchase the offering partner’s interests for the same amount.  While such provisions may offer an opportunity for “uncoupling” incompatible partners, there may be practical limits to their efficacy. A purchasing owner must have the financial resources to complete the buyout.  Privately-held businesses may be difficult to value and may not be able to attract third-party financing. Borrowing to fund the buy-out may also weaken the company’s financial posture and potentially trigger defaults with existing bank loans.

Even if an owner is successful in selling his fifty percent interest to the other owner, there may still be continuing obligations to the business. The sale of his or her interest will not extinguish an owner’s obligations under a personal guarantee. Third party creditors may have no incentive to release a departing owner from his guarantee obligations to the business.

When amicable negotiation fails to resolve 50/50 disputes, the parties frequently litigate. Unfortunately many county courts are unfamiliar with shareholder disputes. Some courts deal with fewer than a dozen commercial cases each year.  As a result, the tendency of the court is to act slowly and cautiously, which can prolong the often daily combat between owners and frustrate normal business operations.

The Takeaway

When considering a 50/50 split, understand that a dispute between the owners can have a crippling effect on the business that cannot be wholly mitigated by dispute resolution techniques.  While there are many ways of starting the discussion about equity distribution, one approach is to identify and weight key attributes necessary for business success and then evaluate each partner against such attributes. While such percentage weightings are not necessarily dispositive of equity ownership, they offer an objective approach to discussing roles and responsibilities. Such an exercise may also highlight talent “gaps” which must be filled for the venture to be successful. Allocating a percentage of ownership for future managers and deciding how that will affect the existing owners may make recruiting of high level talent easier and more efficient.

Frank, honest conversations at the beginning of a venture can build trust and lay the foundation for effective collaboration. Recognizing differences in talents, resources, management styles and commitment can lead to proportionate - and appropriate - equity distribution. In a business venture, the greatest inequality really is the effort to make unequal things equal.