|Chapter 2 of Special Circumstances. ©2001 Sheldon M. Siegel, Inc.|
"WE MAY HAVE A LITTLE PROBLEM WITH THE CLOSING"
"People think being Administrative Partner is a boring, thankless job. I disagree. The Administrative Partner is the glue that holds the firm together as an institution."
--- Simpson & Gates Administrative Partner Charles
A few minutes later, I am sitting in a sterile conference room on the forty-fifth floor, where my partner, Charles Stern, has called a meeting of our associates. For the last ten years, Charles has held the boring, thankless job of serving as our Administrative Partner, a position for which he is uniquely suited. A terminally morose tax attorney, his unnaturally pasty complexion, pronounced widow’s peak and emaciated physique make him look considerably older than fifty-five. He views the Internal Revenue Code as akin to the Bible. He always refers to it as "The Good Book." Likewise, he calls the 1986 Tax Act the "Satanic Verses," because it took away many of his favorite tax avoidance schemes. At S&G, we call what he does "creative tax planning." Out there in the real world, most people would say he helps his clients engage in varying degrees of tax fraud.
In addition to his modest tax practice, he devotes most of his time to serving on virtually every firm committee, thereby bringing order to the chaos that would ensue without his steady hand. He has also appointed himself as the financial conscience of the firm, and reviews each and every expense report and check request before any of our hard-earned cash goes out the door. He handles personnel matters and insists on being present when anyone is fired. He seems to take particular pleasure in this aspect of his job. He’s known as the "grim reaper."
Except for light reading of the Daily Tax Report, the only joy in his life seems to be the production of an endless stream of memos on every imaginable administrative subject, and some that are unimaginable. My life would be a hollow, empty shell without at least one missive every day about procedures, time sheets and expense reimbursements.
He insists that everyone call him Charles. Not Charlie. Not Chuck. Charles. An unseemly annual hazing ritual takes place when Bob Holmes sends an unsuspecting new associate to visit "Charlie." Last year, I had to intervene to prevent Stern from firing an associate on her third day.
A couple of years ago, in a meeting with the associates, my mouth shifted into gear while my brain was still idling, and I sarcastically dubbed him "Chuckles." Naturally, everyone now refers to him by that name.
I have been invited to the meeting because I have served as the liaison partner for five years and Chuckles wants to make a presentation to the associates. As liaison partner, I have had the joyous task of addressing the concerns of our associates. It’s the second most thankless job at the firm, behind Administrative Partner. The title of liaison partner goes to the most junior partner who doesn’t have the practice or the balls to say no. If there’s a shoe with dog shit on it, I seem to be wearing it.
Everybody hates the liaison partner. With good reason, I might add. The associates hate me because they think I’m a toady for the partners. They’re right. The partners hate me because starting salaries are more than a hundred thousand dollars. Nice piece of change for a kid right out of law school. In fairness to yours truly, our salaries are the same as every other big firm in the city. The managing partners of the big firms get together every year to decide how much money the new attorneys will make. In other industries, this would be called price-fixing. It’s not fair to blame me because the managing partners have had a collective brain cramp for the last ten years and decided to grossly overpay baby lawyers. Then again, nobody said life is supposed to be fair.
Our offices are hooked up by conference telephone call, so this meeting is a bad sign. Good news is communicated by closed-circuit television. The lack of refreshments is even more ominous. We’re incapable of holding a meeting without an assortment of sodas, bottled water, cheese, crackers and fruit. On extraordinarily festive occasions, we get cookies.
Of the fifty associates, only five are women and just one is black. Although Chuckles doesn’t know it, the black associate has accepted a job at another firm, and will give notice after he gets his bonus tomorrow. The seating is always the same. Chuckles sits at one end of the table and everybody else (including me) sits as far away from him as possible. He looks somewhat sad and lonely at the other end of the table. He clears his throat. Joel slides into the seat to my immediate right.
"May I have your attention, please?" Chuckles says. He’s wearing his gray Men’s Wearhouse suit and his blue polka-dot tie has a stranglehold around his neck. The room becomes silent. He glances uncomfortably over the top of his reading glasses. He looks my way and his thin lips contort to form the pained expression that suggests he’s trying to smile. I fear he’ll cackle at me. He takes off his reading glasses with uncharacteristic animation and says, "Before we start, I want to thank Mike Daley for his hard work on associate issues."
Relief, followed by acute embarrassment. "As you know," he continues, "Mike’s last day is tomorrow. On behalf of everybody in this room, I want to wish Mike the very best."
My face is red and my neck is burning. I nod politely and smile as the associates dutifully pat their hands together in quiet applause.
He puts his reading glasses back on. His eyes never leave his legal pad. "The partners asked me to update you on certain issues considered by the Executive Committee. After discussion with our consultant, we have made some important decisions. I want to assure you we have reviewed these issues very carefully and acted fairly and in the best interests of the firm as an institution."
I just love it when he refers to the firm as an institution. I can’t help myself and I grin. I’ve placed a legal pad between Joel and me. I jot a note that says, "HOLD ON TO YOUR WALLET."
Stern’s eyes are still glued to his notes. "Effective immediately," he drones, "associates will be considered for election to the partnership after eight and a half years at the firm, instead of seven years, as is current policy." He looks up for a fraction of a second to see if an insurrection is brewing.
Joel writes "BULLSHIT" on the pad and interrupts him. "Excuse me, Charles," he says. "May we assume that those of us who are up for partner this year will be grandfathered in under the old rules, and that we will be considered this year?"
Chuckles closes the small lizard-like slits he uses for eyes. He takes off his glasses and furrows his brow. "Joel," he says slowly, "did Bob talk to you? "
Long pause. He twirls the glasses. The telltale "oh shit" expression. "Joel," he implores, "let’s talk about this after the meeting." It’s fun to watch Chuckles tap-dance.
Joel’s eyes light up. He barks in his best lawyerly "don’t-fuck-with-me" voice, "I think we should talk about this right now. Am I up for partner or not?"
Chuckles sighs. "You’re not. And Bob was supposed to talk to you about it."
Chuckles usually doesn’t have to face the music from the associates. Joel isn’t backing off. "Well, he didn’t," he snaps. "This stinks. We will talk after the meeting. Before we do, maybe you should explain why the associates shouldn’t have their resumes out on the street tomorrow morning."
We’ve always had great finesse with these touchy-feely human relations issues.
On go the glasses. Chuckles finds his place and continues reading. "In addition, the firm will not be in a position to pay associate bonuses this year."
There’s an audible gasp. He looks up at dumbfounded faces. The more senior associates are expecting bonuses in excess of thirty thousand dollars. He’s astute enough to realize he’s in trouble. He makes the correct move and returns to the script. "I want to assure you these decisions were made after careful deliberation and represent the unanimous view of the Executive Committee as to what is fair and what constitutes the best interests of the firm as an institution."
At times like this, I’ve tried to diffuse the tension with a wisecrack. Tonight, I figure it’s time for Chuckles to start getting used to working without a net. I write another note to Joel that says, "NOW, THE EXPLANATION."
"By way of explanation," Chuckles says, "the partners wanted me to make it clear that these decisions were not made for economic reasons. The financial health of the firm is excellent."
Bad move. If we’re doing so great, it means the partners have decided to keep more money for themselves. I don’t necessarily have a problem with this because it means my last draw check will be a little bigger. On the other hand, if we aren’t doing great, he’s lying. Either way, the associates are getting screwed. And they know it.
"With respect to the partnership track," he says, "we have decided it would be beneficial to give each associate additional time to work with as many partners as possible."
Right. It’s not like we’re just pulling up the ladder.
"With respect to bonuses," he continues, "we have expended substantial sums to upgrade our computers, a decision made in response to concerns expressed by our younger attorneys. We believe it is in the firm’s long-term financial interests to pay for our new equipment as soon as possible. We realize this may not be the most popular decision, but we believe the computer enhancement is in the best interests of the firm as an institution."
Especially if the associates pay for it.
The associates turn toward Joel, who has been their spokesman for the last few years. He takes the cue. He writes a note that says, "WATCH THIS." He stands, looks at Chuckles and says, "You realize, Charles, that what you just said is complete and utter bullshit?" Without waiting for a response, he pushes his chair back and calmly walks out of the room.
Chuckles looks over the top of his reading glasses. Sensing the mood is not good, he asks for questions. He pauses for at least a full second before he gathers his notes and practically sprints from the room. The meeting lasted less than five minutes.
When I return to my office a few minutes later, the gruff voice of Arthur Patton, our Managing Partner and chairman of the three-man star chamber we call our Executive Committee, or X-Com, summons me from my voicemail. As usual, he never wastes a word. "Michael, Arthur Patton. Come to the executive conference room ASAP." It would never occur to him that I may not be available.
I walk downstairs to our "executive" conference room, which is located on the north wall of the forty-sixth floor in an office that once belonged to Skipper’s father. When he died, a catfight broke out. Skipper laid claim to the office by birthright. Bob Holmes said he was entitled to it because he had the biggest book of business. Arthur Patton said he should get it just because he’s Patton. After three weeks of backbiting, Chuckles Stern implemented what is now known as "The Great Compromise," and the office was converted into a conference room. My suggestion of a "one-potato, two potato" marathon was dismissed.
The room has a marble conference table, ten black leather chairs and a view of the Golden Gate Bridge. Portraits of our founding partners hang on the west wall and portraits of our current X-Com—Patton, Chuckles and Holmes—hang on the east wall. Patton and Chuckles look unhappy as they sit beneath the smiling pictures of themselves. Mercifully, Holmes is nowhere to be found. The usual assortment of cheese and fruit are on a silver platter.
On December thirtieth of each year, X-Com meets to give themselves a collective pat on the back and to determine "The Estimate," which is their best guess of firm profits for the year. More importantly, they allocate each partner’s percentage interest in the profits of the firm, or "points," for the upcoming year. The Estimate will be announced with great ceremony at a partners’ meeting at eight o’clock tomorrow morning. I’ve always thought we could streamline the process by putting a tote board like the one they have on the Jerry Lewis telethon in our reception area. This suggestion has not been well-received over the years. At the meeting, each partner will receive a check and a memo indicating the partner’s points. Theoretically, everybody will begin the new year in a good mood. Unless you’re like me, and your points have been reduced in each of the last four years.
I’m not sure why I’ve been summoned on the night of all nights. I’m pretty sure they can’t fire me again. I take a seat beneath the portraits of Leland Simpson and Skipper’s dad. They grimace at me. I feel like I’m surrounded. Patton glares at me and growls, "I wanted to discuss your departure."
Patton’s huge bald head, Nixon-like jowls and Brezhnev-like eyebrows overwhelm the rest of his tiny face. His red suspenders strain to hold his ample gut. At sixty-two, his gravel baritone is commanding, but its forcefulness has been tempered by forty years of cigars and single malt scotch. At times, he’s capable of playing the role of the avuncular grandfather. Last year, he was Santa at our Christmas party. The next day, he fired his secretary because there was one typo in an eighty-page brief. That’s part of his charm. On any given day, you never know if you’ll get the puppy or the pit bull.
In law firm speak, he handles complex civil litigation. Of course, I’ve never met a lawyer who admits he handles litigation that’s anything less than "complex." In reality, he represents defense contractors who get sued when their bombers don’t fly. To Art, every case is a holy war of attrition. He showers the other side with paper. Fortunately, his clients have the resources to wear down their opponents. He responds to every letter with his own version that rearranges the facts in his favor. He follows up every phone call with a letter that bears only passing resemblance to the matters that were discussed. Around the firm, he’s known as the "smiling assassin." He’s one mean son of a bitch.
He stares over my right shoulder. He begins with the grandfatherly tone. "I know we have had our disagreements, but I would like to think we can work things out and remain friends."
As if. I look right through him and remain silent. Let him talk. Don’t react.
His condescending smirk makes its first appearance. "Here is our proposal. If anyone asks, we will portray your departure as voluntary. We will say you left to pursue a different direction. You will agree not to say anything bad about us. We will return your capital contribution tomorrow." Upon election to the partnership, every partner must make a capital contribution to the firm. The amount depends on the number of points you have. Baby partners like me contribute seventy-five thousand dollars. The power partners like Patton have ponied up about a quarter of a million bucks.
"That’s it. Except for one thing. As a matter of good practice, we want you to sign a full release of the firm. We ask all departing partners. Just housekeeping."
He nods. "That’s it."
Keep the tone measured. "Let me see if I have this straight. I won’t piss on you, and you won’t piss on me. That’s fair. And that’s the way it will work because we’re smart enough not to say shitty things about each other. San Francisco is a small town. And you will pay me back my capital."
"Good. Because our partnership agreement says you have to pay me back whether or not I agree to say nice things about you and even if I don’t sign your release. I have no intention of suing you, but if I change my mind, I don’t want you waving a release in my face."
Gotcha. If I was in his shoes, I’d ask for the release. If he was in mine, he’d say no. I’m glad Joel showed me the section in our partnership agreement that says they have to return my capital.
He shifts to the half grin. "We figured you might say that," he says. "We are prepared to make a one-time offer of twenty thousand dollars for your cooperation. Take it or leave it." Visions of paying off my Visa bill and a year of rent dance in my head. "Not enough," I say. "Make it a hundred and we may have something to talk about."
Chuckles shakes his head. "Too much, Mike. No can do."
Patton trots out his "mad dog" persona for a preemptory strike, if only for effect. His act loses some of its impact when you’ve seen it as many times as I have. "Look," he says, "if it had been up to me, I would have thrown your sorry ass out of here at least two years ago."
For an instant, I think Leland Simpson’s picture is going to spring to life. "Yeah," he’d say, "I would have thrown your sorry ass out of here at least three years ago."
Patton isn’t finished. His bald dome turns red. "Use your head for once and take the fucking money," he bellows. I’m told he can actually make his head explode.
I place my fingertips together in my best Mother Teresa imitation. "Arthur," I say slowly, "if you’re going to lose your temper, you’re going to have to go to your office and take a time-out." I’ve been waiting five years to say that to him. I stand and walk toward the door, where I turn and face them. "Gentlemen, I’ll see you in the morning. I wouldn’t want to miss the reading of The Estimate."
When I arrive at the office at seven the next morning, I have voicemail messages from five associates who are furious about the decision on bonuses. Three ask me to be a reference. As always, the first person I see is Anna Sharansky, a Soviet refugee who begins every day by brewing enough Peet's coffee to fill the sixty coffee pots placed around the firm. S&G spends over a hundred thousand dollars a year on coffee. We exchange pleasantries. She never complains. I’ll miss her.
At seven-forty-five, I walk to a sparsely-furnished conference room on the forty-sixth floor to get a seat for the reading of The Estimate. The ceremony usually takes place in the PCR. We have moved downstairs because Bob Holmes won’t move the closing documents for Russo’s deal. It smells like a french pastry shop. Croissants, muffins, scones and fruit are lined up in neat rows on silver platters. Anna has filled the coffee pots and set out the bone china bearing the S&G logo. In the center of the table sit ninety envelopes, each with a partner’s name on it. They look like seating assignments at a wedding.
By seven-fifty-five, the room is full. I pour myself a cup of coffee and take a croissant with the sterling silver tongs. The blue sky frames the Golden Gate Bridge. Several partners wish me well. Let the exercises begin.
Patton always wears his tuxedo to the reading of The Estimate. He seems to think this lends a festive mood to the occasion. I think he looks like a maitre d’. At precisely eight o’clock, he makes his grand entrance, his face glowing. For Patton, this is what it’s all about. For fifteen minutes a year, we look like everything our recruiting brochure says we are: a big, collegial family of highly trained professionals who admire, respect and trust each other. He beams from the head of the table. We clap politely. "Thank you for coming at this early hour," he says. "I know how hard it is for some of you to get here when you’ve been out partying all night." Forced laughter. "I want to get Bob Holmes down here to report on Vince Russo’s deal. We will start in just a couple of minutes."
He asks Chuckles to find Bob. Chuckles seems pleased he won’t have a speaking role today, and he darts out. The sound of clinking china resumes. Several partners take calls on their cellular phones. I focus on the envelope in the middle of the table that bears my name.
Ten minutes pass. Chuckles and Joel appear outside the glass door. Chuckles looks more gaunt than usual. Joel looks distraught. Chuckles opens the door and says in a barely audible voice, "Art, can I see you outside for a minute?"
The room goes silent. Patton motions Chuckles in. Chuckles tries to convince him to step outside. After a moment’s hesitation, Chuckles comes in and whispers into Patton’s ear. Patton’s eyes get larger. I hear him mutter, "Jesus."
Patton faces nobody in particular, strokes his jowls, and says, "It is my unhappy responsibility to make a sad announcement. Bob Holmes and Diana Kennedy were found dead in Bob’s office a few minutes ago. I have no other information. The police have been called."
We sit in stunned silence.
"Obviously," he continues, "we may have a little problem with the closing of the Russo deal. Any discussion of the firm’s results for this year would be premature and out of place. I will provide further information later today. Meeting adjourned."
After a moment, I hear Patton whisper to Chuckles, "He couldn’t have fucking killed himself. We’re completely fucked. He had a fiduciary duty to us to close the deal."
Leave it to Arthur Patton to try to explain a man’s death by citing a legal doctrine.
As always, Chuckles is more sanguine. He says to Patton, "I suspect Bob wasn’t thinking about his fiduciary duties last night."
Without another word, we file out, pausing only briefly to pick up our envelopes.