Lawyering, Business Judgment, and Ethics

Dissecting the Two-Handed Lawyer:  Thinking Versus Action in Business Lawyering, 10 Berkeley Bus. L. J. 231 (2013).

Business clients sometimes refer derogatorily to their 'two-handed' lawyers, implicitly distinguishing between the thinking that leads up to a decision and the decision itself. A 'two-handed lawyer' is one who can analyze a problem on one hand and on the other hand, but tosses the actual decision back to the client. The observation invokes something fundamental about objective information, subjective judgment making, and the commitment to action. 'Thinking like a lawyer' is a prototype of the rationally analytical mindset residing at one end of the mental continuum, and the entrepreneur’s impatience with allocating the risk of failure is a prototype of the commitment to action residing at the opposite end. If leaping is the metaphor for the business decision, then the systematic and dispassionate 'two-handed' assimilation of data through rational analysis – the lawyer’s stock in trade – plays a crucial role. The leaper uses that analysis to assess distances and capabilities. But the decision to leap is something quite different. The leaper’s subjective experience of the “aha” moment of a business decision (or any decision, even when made by lawyers) defies scientific reduction. It is really only accessible through the subjective lived experience of the decision-maker. Deciding is more like action than thought. 

In his iconic The Reflective Practitioner, the late Donald Schön criticized a mode of thinking he called Technical Rationality. Prototypical legal analysis is an exemplar of Schön’s Technical Rationality, applied methodically and systematically as a means of helping others to understand their circumstances and to optimize their positions in light of risk and uncertainty. Prototypical entrepreneurs and investors, however, are obliged to decide and to act. The mental process that leads to action is deeply subjective, personal, intuitive, and often ad hoc. Understanding that in difficult cases it is possible to offer as many reasons for as against the proposed action, the most effective business lawyers do not merely analyze and offer 'two-handed' alternatives. Instead, they put themselves in the position of the decider and understand what it means to take the leap of a business decision. This article is a reflection on the reasons for lawyerly 'two-handedness' and some preliminary thoughts on overcoming it. The affective toolkit for getting beyond rational analysis to action includes attributes such as epistemic humility, epistemic courage, self-awareness, and the willingness to accept responsibility for the consequences of one’s decisions. The practical toolkit will follow in another essay.

The Venn Diagram of Business Lawyering Judgments, 46 Seton Hall L. Rev. 1 (2011)

This article addresses that attribute variously called good, sound, seasoned, or mature judgment. How do we in the academy describe this almost ineffable quality, much less teach it? To be clear, this is not the usual legal or philosophical task of sitting in retrospective judgment, as in the attribution of fault or blame, but instead the process of prospective decision-making. The question is who is capable of making mixed law and business judgments. We can model these as the overlap between pure business judgments and pure legal judgments in the circles of a Venn diagram. The practical implication is that businesspeople are not generally competent to make the legal judgment, but not inclined merely to trust the mixed decision to lawyers. Lawyers, on the other hand, are usually successors to a particular conceptual method of organizing the world, and members of a closed discipline; they are usually not business people. My thesis is that the very nature of a judgment, however, requires that it occur privately in a single conscious mind, no matter how the judgment is ultimately influenced, communicated, shared, or adopted by others. The implication for lawyering and legal education is that some of the old canards about leaving business judgment to the business people must fall away.

There are three sub-themes. First, there is no "collective judgment." Practical judgment does not occur in some communitarian ether, but in a mind. The closest we have come to a science of judgment is the exploration of consciousness and cognition, both of which remain tough nuts. There is still no scientific explanation of consciousness; it is subject to what Thomas Nagel referred to as the "explanatory gap." It is fair to say that if there is anything to the idea that consciousness is irreducible, judgment must also be. Indeed, an inquiry into prospective judgment overlaps traditional questions whether anything actually constrains a judge's retrospective decisions. It seems intuitively correct, when we think about judgment not within the adjudication context but as a relatively mundane and prospective exercise, that our judgments are neither pre-ordained by some kind of formula nor wholly random. We need to assess rule following in the non-adjudication context, and for that I turn to work in cognitive science and the law.

Second, the judgment in the overlap is interdisciplinary. Business judgment depends far more on the argument from merit, versus legal judgment, which depends far more on the argument from authority, and a particular kind of authority at that. What, then, does it means to be an expert in the overlap of the diagram? We need to define a new professional discipline: the field of metadisciplinarity. Being a metadisciplinarian takes us to a higher order skill: it means being expert in the making of interdisciplinary judgments. My experience was that successful business people and business lawyers frequently made judgments in which they weighed and selected among the views of experts in different disciplines, even those they were not expert in any of them.

Third, metadisciplinarity recruits such basic cognitive abilities that the task of learning it is never going to be easy. It requires that its practitioners understand that human beings are "meaning-making machines," employing what the cognitive scientists call "cognitive integration" or "blending" (of which metaphor is a prime component). Metadisciplinary lawyers will not merely understand the fact of cognitive blending, but also approach it empathetically

Models and Games:  The Difference Between Explanation and Understanding for Lawyers and Ethicists, 56 Clev. St. L. Rev. 613 (2008)

There is value for lawyers in thinking about constructs of rules as games, on one hand, or models, on the other. Games are real in a way models are not. Games have thingness - an independent reality - and they can be played. Models have aboutness - they map onto something else that is real for the sake of simplification and explanation. But models and games are not dichotomous as the preceding claim makes them out to be. Sometimes models look just like games, and sometimes games can serve as models. Because models look like games, we may come to believe they are real - that the models have thingness rather than aboutness. People are prone to think some of the models they deal in all the time are real, like games, and perhaps even more real than the reality the models are supposed to represent. When that happens unreflectively in business, ethical and legal problems can ensue. 

There is also a relationship between games and models as a way of thinking, and the position of the thinker as modeler, game creator, or game player. To engage in any of those acts is to use the legally trained mind to make sense of what is going on, and to act on it. But there are different ways of making sense, either by explaining or understanding, and it is not common in legal education to undertake the exercise of thinking about thinking, or theorizing about theory. I explore the consequence of confusing games and models in two contexts, financial accounting and contract interpretation, and consider the possibility of co-optation from models into games and vice versa. I conclude that practicing lawyers (or law professors) need to think about thinking itself or face the possibility of being misled by precisely the same context facing their clients. In short, lawyers need to be pragmatic ontologists.

Law as Rationalization: Getting Beyond Reason to Business Ethics, 37 U. Tol. L. Rev. 959 (2006)

Embedded in the way we use the law is the tendency of human reason to justification; in the words of one philosopher, a thirst for rationality [that] is a major source of lies. I contend that this tendency is exacerbated by the conflation of what is knowable as a matter of science, and that which we might believe is normative. I rely on Kant's critique of theoretical and practical reason to assess claims to objectivity in social science approaches to law, and to suggest it is not surprising that the operation of theoretical and practical reason would tend to the conflation of the descriptive and the normative. When we understand the illusions of which reason is capable, we may be more circumspect about claims of objective knowledge and more willing to challenge assertions of a single right answer on normative issues (the modus operandi of most legal argumentation). 

Nevertheless, we have a sense that there are objective standards of right and wrong, bespeaking right answers, if not single right answers, on difficult issues, and these are the basis for ethics, if not law. How does one bring broad universalisms down to practical application, and have the confidence one's judgments are right, and not someone else's view of dogmatism? I discuss the mystery that lies behind the process of judgment, and conclude that the best check against the illusions of reason is our ability to have a relation with, and understand the viewpoints of, others. In particular, I consider Buber's concept of dialogue, and how it might affect common types of ethical decisions in business.

© Jeffrey Lipshaw 2013