Late last week, multiple media sources revealed that Bloomberg news reporters had accessed information about customer usage of the Bloomberg financial terminal. The New York Times covers it this morning here; earlier reporting is summarized by Buzzfeed here.

One of the first Bloomberg customers to complain was Goldman Sachs; one assumes that this would get some attention from management at Bloomberg given their corporate use of the terminal.

Apparently a Bloomberg reporter contacted Goldman about the employment status of an employee, because the reporter noted that this employee hadn’t logged on to their terminal for some time.

Last Friday, Bloomberg CEO Daniel Doctoroff posted a first draft of an apology on the corporate blog:

A Bloomberg client recently raised a concern that Bloomberg News reporters had access to limited customer relationship management data through their use of the Bloomberg Terminal. Although we have long made limited customer relationship data available to our journalists, we realize this was a mistake.

Mistake? At least one important customer apparently saw it as something more.

Then early this morning, the editor-in-chief of Bloomberg News, Matthew Winkler, published a slightly longer explanation, which included this:

The recent complaints go to practices that are almost as old as Bloomberg News. Since the 1990s, some reporters have used the terminal to obtain, as the Washington Post reported, “mundane” facts such as log-on information. There was good reason for this, as our reporters used to go to clients in the early days of the company and ask them what topics they wanted to see covered.

Mundane? What was possibly mundane in the 1990s is apparently different now.

Bloomberg News is really an awesome operation. Their iPhone app, with its integrated video and audio content, is way beyond what others offer right now in terms of global coverage and quality.

In-house counsel can watch this story to see what Bloomberg’s crisis management playbook says, and watch in play out in real time.

There may be more twists and turns to this story. One question some law firms and corporate legal departments may have is this: Did reporter access to selected customer use information extend to the Bloomberg Law product?

We are in the early stages of the digital era as far as privacy and appropriate data use are concerned. This is a really hard issue for lawyers since it has a technological nexus and is difficult to research and understand, let alone monitor in real time.

A common tactic in compliance training is to suggest front-line personnel imagine “reading about the company doing X on the front page of the New York Times” before doing it.

I guess that is no longer a hypothetical scenario for Bloomberg.

(Updated 2:05 pm EDT on 13 May 2013).

So law firm goes into damage control mode, declines to comment to press, and sends memo to staff. Press gets memo:

Wait a minute. Isn’t the point of discovery to find documents and use them to your advantage?

The DLA Piper “That’s Team DLA” lawsuit been covered by Inside Counsel, Thomson Reuters, and even the Op-Ed page of the New York Times. The Op-Ed tries to link this dust-up to the entire billable hour regime.

Wow.

Years ago I asked a very savvy partner at a prosperous law firm whether he had ever sued a client over an unpaid bill. The response was something like this:

No. I can’t say I never would. But it would have to be a large bill, a great result, and a clear winner. And of course a client that I didn’t care about losing.

The intransigent client’s unpaid bill from DLA Piper was reportedly $675,000. To put this in perspective, DLA Piper revenues for 2012 were $2.44 billion (source). I think that works out to about 0.027%.

Some in-house lawyers have put this entire matter in perspective, seeing it as larger than any one firm with a dispute with a single client.

A final explanation in the “not-to-be-commented-upon” internal DLA Piper memo was that the emails were nothing more than:

“…an unfortunate attempt at humor by three former lawyers of the firm.”

Many April Fool “jokes” are unfortunate attempts at humor.

I have to believe many partners at DLA Piper think that the press generated by this collection lawsuit has not been funny. In the least.

As a life-long resident of the greater Detroit area, I agree that all those designations may be true. But they don’t tell the full story. I don’t see Detroit just as a current laggard. I also see Detroit as a potential leader. And lawyers are on the case.

The quick-rinse bankruptcies of GM and Chrysler were seen at the time as a virtual death knell for the US auto industry. Flash forward a few years, and GM and Chrysler are wildly profitable. Some of the high-end European automakers are starting to see what real worldwide competition is like while facing a horrible economic state and the mess that is the European Union (as a financial system).

Lawyers made the automaker bankruptcies happen. And one lawyer, involved in that, may be part of something more.

Detroit as a city had a lawyer as mayor (Dennis Archer, a former Michigan Supreme Court Justice) some years ago; he basically saw what was on the horizon (and the reality of an intransigent City Council) and took his formidable talents to the private sector. His successor, Kwame Kilpatrick, was a lawyer, until he resigned in disgrace and lost his ticket a few years ago. Yesterday we learned that a federal jury considered Mr. Kilpatrick a criminal, and their verdicts in the morning resulted in Mr. Kilpatrick to being remanded to the custody of federal marshals in the afternoon to await sentencing. It was a big win for US Attorney Barbara McQuade and her team (lawyers all, with AUSAs Mark Chutkow and Michael Bullotta on point).

But into the void of failed leadership rides someone new. That would be Michigan Governor Rick Snyder. He is–wait for it–also a lawyer (University of Michigan JD/MDA). He spent years in the private sector before running for governor. He is just about the least political politician you will ever meet. Under Michigan law, cities failing economically are reviewed by the state, and an Emergency Financial Manager (EFM) can be appointed. A hearing on such a financial emergency for Detroit will be held in Lansing today. All signs point to clear distress in Detroit; although, incredibly, some on the City Council disagree.

So who would Governor Snyder appoint as the Detroit EFM? Well, someone brave for starters. Press reports this morning mention one Kevyn Orr, a partner at Jones Day. Mr. Orr and his firm represented Chrysler in the bankruptcy mentioned above. I hope, if asked, Mr. Orr or someone of his pedigree accepts the challenge.

I have a hunch I’m not alone in thinking that there would be no more challenging public position in America than the Detroit EFM.

And the “Detroit as Leader” part? I see the challenges facing Detroit (financially and otherwise) to be present in many large urban centers and states around the country. Maybe not as urgent, maybe not in the same magnitude. Detroit is a sort of “leading indicator.” And if the Detroit EFM recommends to Governor Snyder that a Chapter 9 is required, it will be one for the record books (and the legal treatises).

Business Blogging 101 says you don’t stray into politics. That’s not really the focus here today. In much of what ails Detroit, there are serious legal challenges involved in fixing the results of 50 years of mostly failed leadership (and complex demographic trends).

Thankfully, there are some lawyers with courage who are willing to take the case.

(Downtown Detroit from Belle Isle; not today, maybe someday. Source)

We often know what really happened, but accept the duty to read between the lines like rookie CIA analysts deciphering Pravda editorials during the Cold War.

So when Groupon CEO Andrew Mason departed today, he did so with an amazing memo to staff. Here is the opening paragraph to the “People of Groupon,” via press reports:

After four and a half intense and wonderful years as CEO of Groupon, I’ve decided that I’d like to spend more time with my family. Just kidding – I was fired today. If you’re wondering why… you haven’t been paying attention. From controversial metrics in our S1 to our material weakness to two quarters of missing our own expectations and a stock price that’s hovering around one quarter of our listing price, the events of the last year and a half speak for themselves. As CEO, I am accountable.

I don’t expect to ever see a memo like this again. And that’s too bad.

CNN is reporting a severance package valued at $378.36 (this is corrected thanks to reader Jonathan’s comment, below). Looks like honesty in severance as well.

The fact that you have a conference that goes for nearly three full days is a testament to (a) its staying power, and (b) that a lot of people want to go to New York on an expense account.

Many of the prime movers in the legal technology space use the conference as an opportunity to release new products and initiatives (Thomson Reuters is an example). When you peruse the conference agenda and the exhibitors list, you see that it’s really a who’s who of legal technology.

And you also have companies active just outside the exhibit hall, as we know that there’s often more interesting and open conversations there about what’s going on out in the field.

But just as BigLaw is facing challenges from competition, so is BigTech (legal and otherwise). And that’s not just me speculating. There’s a recent interview and an imminent product launch that serve to remind everyone that no company is immune from the forces of change.

First, the interview. It’s here, and features Marc Andreessen, current uber-VC, and founder of Netscape (the first mainstream web browser). Mr. Andreessen gets why consumers are driving the pace of change in technology (hardware and software) and how this is affecting the enterprise. What used to be trickle-down (enterprise to consumer) is now moving the other way, from the consumer “grassroots”:

And the reason is because – the reason fundamentally is because now that you have got these things, you have — now that you have a computer in everybody’s hand, all of a sudden all these barriers — it used to be these barriers to market entry were so big, it used to be there just weren’t that many early adopters in the world. To bring out a new technology for consumers first, you just had a very long road to go down to try to find people who actually would pay money for something.

And now all of a sudden you have got this global market of all these early adopters that have smartphones connected to the Internet, and they can just pick up their things and run with them.

And of course consumers can make buying decisions much more quickly than businesses can, because for the consumer, they either like it or they don’t, whereas businesses have to go through these long and involved processes.

That last part will resonate with anyone trying to sell technology into the legal enterprise (law firms or legal departments). To call the sales cycle long is to make a glacier seem like a racetrack.

The interview is extensive, but it is a rare privilege to peer inside the active mind of a technology first-mover. Mr. Andreessen notes that the fascination with consumer markets over the enterprise is cyclical, and that, today, all business is hard:

There are no easy businesses in the world other than maybe Google, but other than that, there is no easy business anywhere in the world. So what happens is Wall Street gets enamored by the businesses that look like they are easy, until it turns out that they are not, and then Wall Street gets disillusioned and freaked out, and then rotates into the businesses that they think are going to be easy, and then they get endless disappointment. It’s like a seventh or eighth marriage at some point.

At some point the problem isn’t with your seventh wife. At some point the problem is with you.

I think we would all agree that the law business today isn’t easy. (I’ll leave the marriage part to TMZ).

And now a brief look at Exhibit B. To see another example of how business isn’t easy and how consumers play a big hand in it, we need only to look just down the street from LegalTech. To something that’s starting literally as I hit “publish” on this.

Today Research in Motion will announce its new BlackBerry 10 (handsets and operating system). If you show me a lawyer who never used a BlackBerry, I’ll show you someone who still has his first Etch-a-Sketch. In fact, I’d wager that at LegalTech there still are a number of BlackBerry users in attendance, hoping against hope that the new versions (including one with a keyboard!) are good enough to stave off the tractor-beam pull of Apple’s iPhone.

But BlackBerry hasn’t released a new handset in 18 months, which is like a decade in tech:

RIM’s market share has eroded substantially since it last released a new phone in August 2011. Apple and Android accounted for an estimated 87.1% of global smartphone shipments in 2012, up from about 68.1% in 2011, according to research firm IDC. RIM’s share, meanwhile, fell to 4.7% last year from 10.3% in 2011, according to IDC.

[Source]

For the longest time, BlackBerry relied on its dominance in the enterprise market and would dismiss “consumer” products as not fit for corporate use, not secure, and not whatever else they could throw up against the wall.

For the sake of competition, I hope the BlackBerry 10 lives up to the pre-launch hype. One lesson for people involved in legal technology is this: if a powerful company (RIM) and a pervasive product/software combo (BlackBerry) can stumble mightily, then there is hope for all of us who want to compete, and trepidation for those of us facing competition.

[Quick update @ 10:45 am EST: the company's now "Blackberry" so long RIM; and here's the two new handsets]:

For now, back to the exhibit hall! There are bags and pens and notepads for everyone!!