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All content by Kyle E. Mitchell, who is not your lawyer.

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Copy-and-Paste Goes to Russialawyering by rote in the crazy 1990s

I’ve been really enjoying my grad-school colleague Rebecca Johnson’s Post-Soviet States Interviews for the Strauss Center. One interviewee in particular, attorney Robert Langer, really confirms what too many of us already know about lawyers: the copy-and-paste law machine simply plods ahead until it hits something it cannot rumble over.

On a deal in the 1990s, the early days of the Russian Federation, shortly after the fall of the Soviet Union:

I remember doing one legal opinion with another law firm where they were representing, obviously, the other side. I asked them to send me their form of legal opinion so I could take a look at it and give them comments, which is always done. I’m not going to name the law firm, although I don’t think they exist anymore. But the legal opinion that they sent said, essentially—it didn’t say quite this way—they said everything is fine. And then the last paragraph was an assumption, which is fine to have assumptions, but they said, “We assume”—and I’ll never forget the words—“we assume that Russian law will continue to be correctly interpreted.” That’s an absolute quote.

And on another deal:

And they said, “We have to have this legal opinion in order to go forward with the transaction.” And I said, “I understand that, but I think you’re being a little too aggressive under Russian law here.” And I remember the lawyer on the other side getting very upset with me—this was over the course of a couple of days—and saying, “You have to give this legal opinion because we have to do this transaction, and we can’t do the transaction unless you give the legal opinion.” And I said, “If you’re so sure that this is permitted under Russian law, why don’t you give the legal opinion?” And he says, “Our firm won’t give a Russian legal opinion.” I said, “Then don’t tell me what I have to say. I am telling you what Russian law permits, where it’s vague, and where I can give an opinion.”

And this was the issue. What people were doing is, they were trying to take transactions that we would do—let’s call it in the West; I don’t like that term—but outside Russia, and then just mark up those documents, use them for Russia, and then try to get somebody to say this works under Russian law. But Russian law wasn’t there yet. In some ways it’s not always there today.

I’m sure most American deals lawyers have seen all these tendencies in play on plenty of domestic transactions. The stories are good for chuckles over drinks.

In the context of the Russia of the nineties—a country that only just got corporate law—the bonkers factor triples. Russia had only just got a corporate law. Property, plant, and equipment in private hands was a new and exciting phenomenon. Filling out the blanks in an old US deal form was like plucking a McMansion off its foundation and dropping it on bare, ungraded Russian earth.

And yet, deals got done.

Your thoughts and feedback are always welcome by e-mail.

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