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The ethical line between RFPs that exploit good ideas and those that respect the proposers’ intellectual capital

An article on requests for proposal in the ACC Docket, June 2011 at 74, claims that “More and more companies are using requests for proposal (RFPs) to get a glimpse of what tailored ‘solutions’ outside counsel may offer and on what basis.”

To glimpse tailored solutions may be legitimate and innocent: ask law firms to describe how they would handle a matter or cluster of matters. Or it could be exploitative and guilty: deliberately luring in work product, strategies, tactics and legal analysis without offering a reasonable chance of being retained or protection for the hard-earned experience, valuable time, and useful work product they invest (See my post of Oct. 1, 2005: the ethics of using good ideas in RFP responses.).

One particular question posed by a law department in an RFP puts law firms in a bind: “How would you handle this matter?” It may be the most important question to ask of a law department, but should a firm spill its innermost secrets and legal analysis? Will those thoughts devolve to another firm’s benefit? Consultants face a similar quandary: do you roll out your best thoughts, methods and experience, even with examples and case studies, and risk leaks of all that intellectual capital to a competitor? Or do you withhold and thereby perhaps lose the competition?

Some could say, “That’s tough.” Or, a law firm could placate itself by saying that no matter what it discloses in the response to an RFP or the oral discussion that may follow, actual performance brings in so many other factors that disclosures fade away. I feel that no law department should knowingly engage in a pretend RFP process. Worse, they should not siphon off good ideas that benefit other law firms without some recompense to the originator.