China negotiatingI have recently been communicating via email with a good friend of mine who has lived in Shanghai for around 20 years. He had written me about our recent series on negotiating with Chinese companies. In particular, we talked about when we push back against the Chinese companies, they are completely unprepared and assume a deer in headlights look. He then emailed me the following regarding the health care his pregnant wife has been receiving. I thought it interesting and relevant to our readers and so I secured his permission to run it here, after stripping it of all identifiers.



Speaking of China and deer in headlights get this:

My wife receives prenatal care at a privately run maternity hospital in China. Since we have no insurance we paid 20,000RMB (3,500USD) for the prenatal package in cash. It’s been ok, getting this means she doesn’t have to take a number and wait for the 100 people ahead of her to go first as in many local hospitals. They did “fear monger” her into a useless test (because we have a pet cat) for an extra 500RMB (which I forewarned her about but she fell for it anyway). no big deal.

EVERY time since our second check up though the first thing out of the nurse’s mouths is: “have you paid for your birth package?” And it’s from 3-4 nurses each time. This has gotten annoying. Acting as a collection agency shouldn’t really fall to the “care giver”. Many people opt to have prenatal here and then go to the USA for the birth, I understand it’s a business but let’s have a little bit of professional decorum shall we?

For a basic natural childbirth package it’s 30,000RMB. But come to find out, they outsource it down the road to a local hospital. We were shown the fancy private room they rent out but if you read between the lines it’s easy to see the private hospital flips the local hospital 5,000RMB and pockets the rest. To have our “doctor” (who’s not impressive in any way) it’s a cool 45,000RMB. This doctor asks my wife’s age every visit. She’s 34 and since over 35 is considered high risk pregnancy in China and therefore more expensive, I almost get the sense he is asking each time to try to make more.

They have a shiny new center that is their showcase hospital, one nurse says that’s where we are to go and the next one contradicts her. No one is on the same page. When we pressed the customer service manager on which hospital we should go to when labor begins her answer was “you should call us to let you know what hospital to go to,” with a vague explanation about room availability as the logic behind her answer. How can you book a room for giving birth? it’s not a sure thing when the baby will come.

At our most recent ultrasound, the nurse, as always, led with “have you paid for the delivery package yet?” . She even came into the ultrasound room and was literally trying to force the document into my wife’s hands  while her dress was up, legs in stirrups and belly exposed. I had visions of her signing the document on her bare belly. My wife told her we hadn’t decided (largely because of all the nurses’ greedy behavior). The nurse then turned to me and said “your wife needs to sign this.” I waved her off and said in English we haven’t decided. The room was filled with tension caused by this nurse’s aggressive behavior. She then told my wife we HAD to pay today. We paid for 40 weeks and the customer service rep told us on an earlier visit it wasn’t a problem to wait.

My wife started to worry and I argued with her a bit outside the office (we never argue). I had a sit down with the customer service manager and told her that each time we came, the nurses’ unprofessionalism has caused us to check another local hospital recommended by an acquaintance with an “in” there.

70% of birth’s in China are C-sections largely because the doctors don’t want to wait for the birth. The whole point is we are trying to avoid a C-section (my wife has had not one problem with her pregnancy). This high pressure for the money makes me feel that we are being set up for a money grab. If it’s a C-section, the cost doubles, even to have an epidural or induce labor would tack on an additional 13,500RMB and when the pressure is on, I’m sure many couples agree out of fear. The nursing staff’s behavior is akin to a boxer telegraphing his next punch, and I’ve ducked many here.

I then pressed the manager about the percentage of people who paid for a 30,000RMB natural childbirth package and then actually had a natural birth. The deer was in the headlights my friend and I put the high beams on. She said 60%, so that’s about 50/50. We were previously told that the percentage of people who paid 45,000RMB that had a natural birth was 85%.

I told her we would check the local hospital to see (it will be a third of the price) how we felt and I asked if we still wanted to use our current hospital would that be ok. Answer: Yes, of course, and a big apology for the nurses repeatedly trying to strong arm us.

Typical China experience, the more you pay the more legal/better it is.

China Lawyers NNN Agreements

North Korea as a guide to doing business in China. It’s a long story, but let me explain.

The other day I got a call from an old client who used to do business with North Korea. Yes North Korea. Many years ago, this fishing company had explored doing a deal with North Korea, during a rare quasi-thaw in U.S. North Korean relations. At that time, we had reached out to Michael Hay, who I have known since his days in South Korea, and who is — as far as I know anyway — THE lawyer to use on any North Korea matter. If there is any other such lawyer, please let us all know in the comments below!

Anyway, this phone call spurred me to Google search Michael and his law firm to see what was up, and really just to see if he was still doing North Korea work in this time of what nobody would call a thaw in US-North Korea relations. Note though that I fully recognize that there are plenty of other countries that do business with North Korea. Well there it is, Micheal’s firm, Hay, Kalb & Associates, all with a website that looks circa 1983 or North Korea, circa 2015.

On the right side of Michael’s law firm’s website, is a scrolling list of “Tips, Myths, and Facts” about doing business in North Korea, which I copied and will discuss below. I did this because so much of the information there applies to doing business in China (really just about every emerging market nation) as well. So without further ado, I list out below the Tips, Myths and Facts from Hay, Kalb and then I discuss their applicability to China in italics.

Starting with the tips:

Tip #1: There is no such thing, person or entity as an ‘expert’ on North Korea, no matter how prestigious their background. 100% true of China as well. See China Experts. Really? 

Tip #2: If you meet someone who calls themselves a North Korea expert …. run – fast. See my comment to Tip #1 above.

Tip #3: The best you can get is those with “experience” – sometimes a great deal – but usually not. There are a lot of people with a lot of China experience. But the good ones virtually always have one area of expertise, be it Chinese business law for foreigners, logistics, marketing, manufacturing, etc. See Your Chinese-American VP Don’t Know Diddley ‘Bout China Law And I Have Friggin Had It.

Tip #4: Identifying — before you go into the DPRK — the correct DPRK entity with which to deal is critical to the success of your visit. It is a fundamental aspect of the preparation required on both sides for your visit. Failure to do so may produce, unintentionally, a ‘mismatch’ and result in you and your company never actually getting the level, quality and depth of introductions to which you otherwise would have had access. This is true of China as well, but finding legitimate companies with which to deal in China is no doubt considerably easier and less government focused than in North Korea. See China Business Basics, where we talk about the undeniable benefits of choosing your Chinese “partner” wisely and Basic China Due Diligence. Is This Chinese Company Legitimate?

Tip #5: The nurturing of mutual trust with the DPRK is a sometimes painstaking, frequently immensely enjoyable, experience, which takes time. The loss of trust, however, can occur with spectacular rapidity. Discretion is the key, both in your preparations for entry and once you are there. Avoid fanfare. The same generally holds true for China and for pretty much every country. See How To Keep Your China Manufacturer Motivated And Why That Matters

Now for the myths:

Myth #1:There are no traffic lights or traffic jams in the DPRK. There are plenty of traffic lights and even more traffic jams in China. 

Myth #2: All those huge high-rise buildings you see on documentaries are ‘uninhabited’, and empty shells, put up for show. Total myth. There are plenty of huge high-rise buildings in China that are uninhabited or are empty shells, but they were not put up for show; they were mostly put up either to generate jobs or profits. 

Myth #3: Americans cannot under any circumstances whatsoever travel to the DPR. Americans can freely travel to China. See China 72 Hour Visa Rules for a fast, easy and cheap way to get into and out of China without having to get a visa in advance.  

Myth #4: A foreign company cannot win in the courts or arbitral tribunals of the DPRK in a business dispute with a DPRK entity. Myth. Hays, Kalb & Associates speaks from direct experience. All true for China as well. See Arbitration in China. Different, Yes; Biased, Probably Not. See also Litigating in China and the four part series of China litigation posts mentioned there. 

And lastly, the facts:

Fact #1: Pyongyang is perhaps the safest capital city in the world, in terms of crime, for both adults and children, locals and foreigners. Beijing is generally quite safe as well.  

Fact #2: Air Koryo is the national carrier. It offers business and economy class. A common route, for several reasons, is the Beijing–Pyongyang route, with the flight time around 1 hour and 40 minutes. China has plenty of airlines that offer both business and economy class. Flights in China are, however, often delayed. See China’s Horrible Flight Delays. Makes Doing Business In China Even Tougher.

Fact #3: The DPRK has a surprisingly sophisticated framework of foreign investment and related legislation in place, with dozens of laws and regulations covering numerous aspects of foreign business activity, including a revised dispute resolution law. Same for China. Heck if it didn’t our China lawyers would have little to nothing to do. Just as a for instance, check out this recent long-form post on China NNN Agreements, where we lay out how we write our NNN Agreements to make them work for China’s complicated business and legal realities.  

Thanks Michael.


Since we took down our blogroll last year, I feel it is more incumbent upon us than ever to highlight other blogs and other sites and other writings we see as being helpful to our readers. Towards that end I emphatically recommend the US-China Trade War Blog.

Though nominally written by a BigLaw firm, this blog is really is the brainchild and the baby of William Perry (a partner at Dorsey), a leading trade law and customs lawyer. Bill has the nearly unique distinction of having been both an attorney with the Office of General Counsel, U.S. International Trade Commission (“ITC”) and with the Office of Chief Counsel and Office of Antidumping Investigations, U.S. Department of Commerce. I am not aware of a single other attorney in private practice who has been an attorney with both of these key international trade agencies and this dual background/knowledge infuses his practice. Full Disclosure: Bill is based in Seattle and I know and greatly respect him and he is my firm’s go-to lawyer for trade and customs matters.

Anyway, about Bill’s blog, which describes itself as follows:

This blog is the outgrowth of a newsletter that I have created to monitor US trade and other litigation against US and Chinese companies. I am an international trade lawyer. Before representing US and Chinese companies in international trade cases for more than 20 years, I used to work at the US International Trade Commission (“ITC”) and Commerce Department on various trade cases in Washington DC.

Based on my experience, I can categorically state that there is now an ongoing trade war between the United States and China. This Trade War became evident in the recent Solar Cells antidumping and countervailing cases against China, which target approximately $4 billion in US imports of solar cells from China. In retaliation for this trade case, the Chinese government has initiated a countervailing duty and antidumping case against $2 billion of US exports of polysilicon, which go into the solar cells being imported from China.

Upon investigation, this trade war has now expanded into a number of other litigation areas against Chinese companies, including intellectual property/section 337 cases, false claims act/customs fraud, antitrust, securities and products liability litigation.

The best kept secret, however, is that the real targets of these US cases are not Chinese companies, but US companies that import products into the United States. US importers are the companies liable for antidumping and countervailing duties in cases against China. US import companies are also liable in intellectual property/337 cases, False Claims Act/Customs Fraud and Products Liability cases. The primary target of this trade war is the US companies involved in trade with China, not the Chinese companies. This is truly a brave new world.

As you can tell just from the above, Bill does not pull punches and his blog doesn’t either. The blog focuses on the various trade disputes swirling between the United States and China, with a dollop of ominous warnings about how China-US trade disputes just keep on escalating to the detriment of both countries. I had lunch with Bill not that long ago and he was even more ominous in person, pointing out how anti-trade rhetoric in the U.S. presidential election scares other countries around the world and could foretell a new period of beggar thy neighbor policies that will further escalate trade tensions between the United States and China. Bill’s big issue is how US companies that import products are getting hit with massive fines for having imported products from that are subsequently determined to warrant anti-dumping duties. Bill is the person who taught me that the United States is the only country in the world that applies such sanctions against importers retroactively. Did you know that you as a US company can import a product from China and then years later be hit with a massive fine for having imported that product? Based on the phone calls we get from companies to which this has happened, my strong sense is that too few U.S. companies are aware of this.

If you import anything into the United States or you are contemplating doing so (especially if your imports come from China), I recommend you add the US-China Trade War Blog to your reading list. If you are merely interested in international trade, I make the same recommendation. I warn you in advance though that it is not for the faint of heart or of intellect.

On being a China lawyer and on doing business in China
On being a China lawyer and on doing business in China

I was interviewed last year by Jason Aquino of Scouts Consulting as part of an ongoing interview series on strategy and innovation in business, sports, and national security. Jason will be releasing this series of interviews in the future, but in the meantime he is allowing me to publish mine here, mostly after I begged him to be able to do so because I liked it so much.

The first part of my interview dealt mostly with the legal industry and the second part dealt mostly with being a China lawyer. I flipped the two around and provided the China portion the day before yesterday and the legal industry portion today.


Dan Harris is the founder of Harris Moure, an international law firm with offices in Seattle, Portland, and Beijing. He represents and seeks to protect companies doing business in China and other emerging economies in Asia. His work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, overseeing dozens of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

Dan and colleague Steve Dickinson co-author the China Law Blog, which discusses the practical aspects of Chinese law and how it impacts foreign companies doing business there. China Law Blog has been a mainstay of ABA Journal’s Blawg top 100 law blogs, and in 2013 was named to the Blawg 100 Hall of Fame. It is an indispensable resource for lawyers and companies seeking to do business in or around China. Dan’s perspectives on international legal issues have appeared in such publications and media outlets as The Wall Street Journal, Forbes, Fortune, Business Week, The Economist, The New York Times, The Washington Post, CNBC, and BBC News.  

Last April Dan was a keynote speaker at the Oregon Law Review Symposium on Disruptive Innovation in Law and Technology, where he discussed how lawyers could better position themselves in the evolving legal marketplace. He talked about the aversion many lawyers have to marketing, as well as the need for lawyers to become more business-minded, which legal training traditionally hasn’t encouraged. You can find Dan’s paper from the symposium here (p. 881).


What are some of the barriers to innovation in the legal industry that you see today? 

One of the common barriers is that most lawyers charge by the hour, which takes away incentives to innovate and become more efficient. Another barrier is the fact that so many law firms are run by 60-year olds.

Not that I have anything against 60-year-olds, but innovation oftentimes comes from people who look at industries in a new way. And young lawyers generally do not have much power in the legal industry.

But don’t law schools recruit students from a diversity of backgrounds? Doesn’t that help bring in new ways of looking at the profession?

That’s actually another problem with the legal industry. You can have a diversity of backgrounds, but law school pounds that out of its students, training all of its students to be incredibly conservative and risk averse.

And it makes sense: a lawyer’s job is to point out risks and help ameliorate them. But what that also creates is a personality that is afraid. Too many lawyers are naysayers.

I can give any business starting out 20 reasons why it is going to fail. But the trick to what I see as the good lawyers’s job is not discourage the client by doing nothing but pointing out the risks, but to help the client surmount potential problems. So many lawyers come up with the 20 reasons for themselves (or for their firm) and view them as reasons not to push forward, not to take risks, not to innovate, not to risk failure.

Is it fair to say that clients moving legal work in-house is a big problem facing law firms today?

There are a lot of reasons why so many law firms are struggling today. That is just one of them. Another is that they’re not really in sync with their clients. Their clients are focusing on business issues. Too many lawyers don’t think the same way as their clients, and that frustrates clients.

You would be shocked (or maybe you wouldn’t) at how many times companies choose our firm over two or three others simply because we were the only one willing to quote them a fixed fee rate on a project. These companies tell me that the other firms insisted that they had no way to know what the project would cost. If a law firm drafts a China manufacturing contract 3-5 times a month (as mine does), how can it not know how long it will take? In the early days when my firm was offering flat fees, some of the lawyers in my firm would try to make the same excuse for being unwilling to come up with a flat fee amount. My response to them was to “get over it and start thinking of yourself as a plumber and now imagine how pissed off you would be if your plumber told you he or she had “no idea” how long a relatively simple project was going to take.

And here’s the thing: take something like writing a manufacturing contract. Ninety percent of those that we take on come within a two to three hour range of each other, with maybe ten percent taking a bit more or less time. It is not as though one will take five hours and another will take twenty hours. And why can’t a law firm doing 50+ China manufacturing contracts a year take on the risk that it might be underpaid just a bit on a few of them? There are two answers to this. The law firm is actually not very experienced with such contracts or it is way too risk-averse.

Then there is the reputation lawyers have for being deal killers. The old saying among businesses is that lawyers always say no. There’s some validity to that. Lawyers must change in the same ways their clients are changing.

I’ve become obsessed with certain companies to see how we can apply what they’re doing to our law firm. For example, I’m fascinated with how a company like Uber has disrupted the transportation industry. What can my firm do on the legal side to disrupt? Our willingness to do so much work on a flat fee basis is somewhat disruptive in that I have actually had lawyers complain to me about our doing that.

In your article for the Oregon Law Review, you talk about the aversion lawyers have to marketing. Why do you think that aversion exists?

One thing that propels lawyers is this idea that the world is a meritocracy. The typical lawyer goes to high school, works hard, does well; goes to undergrad, works hard, does well; and goes to law school, fights to be in the top 10% of the class. Your first job is determined in large part by how you did in law school. Lawyers’ formative lives are based on reaching an attainable, pretty much numerical goal and then being rewarded for it.

Then they get in the real world, and all of a sudden the clients don’t care that they graduated from law school magna cum laude. They care about what you can do for their companies. Lawyers get thrown for a loop by that.

Lawyers don’t like the idea of having to compete. They had to compete in law school, but it was for a very clear goal. Now all of a sudden, they have to meet with 10 people in the hopes of getting two clients, and the carrot at the end is just not as clear cut.

And again, there’s the whole idea of uncertainty and risk. Lawyers will often talk about how this doesn’t work or that doesn’t work, and they do it with marketing, too. So many are unwilling even to try because they cannot get past the idea of failing.

When we first started marketing via our website and our blog, almost all lawyers would say, “I’ve heard you can never get a good clients off the internet.” They would state it like it was a fact, even though they had no evidence to support it.

Lawyers don’t like experimentation, the idea of “let’s try this and see if it works.” That’s too risky. And marketing is that: sometimes you think something’s going to work and it doesn’t, sometimes you think it’s not going to work and it does. The uncertainty kills lawyers.

Looking to the future, what kinds of firms are going to survive?

The first-tier big firms are absolutely necessary and will continue to thrive, as will some regional firms. But then there are the second-tier big firms that don’t have a niche, that aren’t as good as the Skadden Arpses, the Kirkland & Ellises, and the Latham & Watkinses of the world. These second-tier big firms are slowly getting edged out by both big and small firms.

Whenever our firm competes with a second-tier big firm for a matter, I love it because we offer so many advantages over them and yet they charge so much more than us.

The typical client that comes to us is not going to Skadden, Arps. You go to Skadden, Arps for the really big international deals, the really big international litigation. We get smaller international deals and smaller international litigation. Oftentimes we’ll compete for that work with a 250-lawyer law firm not nearly as well focused as us and yet it has a much higher cost structure. They might put five lawyers on a matter on which we would put two lawyers, or three lawyers on a matter on which we would put one lawyer and a paralegal or an international business specialist.

These second-tier big firms like to think of themselves as a Skadden Arps and they are trying to emulate Skadden. But they’re not Skadden.

Have you noticed differences in how the Millennial generation of lawyers thinks and works compared to its predecessors?

Absolutely. The Millennials are more in tune with business. They’re more comfortable with technology, they’re more comfortable operating anywhere, and they’re more comfortable appearing more “normal” and less lawyer-like, not using lawyer-type words. I think they understand better what clients want. Too many older lawyers feel compelled to tell potential clients everything about their own backgrounds and the work that they’ve done, rather than listen to the client and respond directly to that.

There are Millennials who have formed their own law firms, and they use newer technology. Within my firm, I oftentimes have to fight the older lawyers (of which I am one) on certain things. For instance, we set up Yammer – which is really nothing more than an internal Facebook – and some of our lawyers complained. They were worried about security, saying we shouldn’t be discussing firm matters “in the open.” But the security on Yammer is the same as for our emails. Both Yammer and our email are on Microsoft Office 365, and so both are equally unlikely to be compromised.

Then there are various groups in the firm that really use Yammer. One is our Regulated Substances Group, which Hilary Bricken has headed since she was 28 years old. There will be five to ten discussions every day on that group’s Yammer page. Someone will say, “Hey, I read this article about what they’re doing in Oregon. Does this make sense to you?” Or “You know, I just saw that in California, they’re going to do this. Maybe we should be doing that.” Then five or six people will respond to it.

In other groups, somebody will send an email saying, “I’m going to this event, does anyone know anyone who will be there?” They will carbon-copy eight people, including me, and then my inbox will get slammed with twenty emails from three people discussing some person I don’t know who might be at some event I won’t be attending. I don’t care, yet I’ve got twenty emails on it. I am constantly pushing people to stay out of my inbox. Put it on Yammer. Older lawyers often have trouble with that.

Have you seen Millennials struggle with certain imperatives of the profession, like having to actually call people on the phone instead of emailing or texting?

Yes, but I don’t view that as a negative.

One of the things I always talk about in terms of marketing is that anybody can be a good marketer. I used to help coach my daughter’s high school basketball team in the offseason. They had a player who was 6’4” and heading to the University of Washington with a full ride. She was a terrific player, and was going to get 12 rebounds a game. But for us to win, every single starter needed to get four or five rebounds. We couldn’t just rely on her. It’s the same with marketing; everyone needs to contribute in their own way.

There’s this idea among lawyers and probably others that the best marketer is the car salesman or the quarterback type . The reality is that’s just not true. There are many different types of potential clients out there. Millennials can be extremely effective with other Millennials. They can be extremely effective by being who they are, and dealing with people like them. That means texting and emailing instead of calling.

Millennials tend to be very morally centered. They really dislike working on matters when they don’t like the client, and there have been times when they have refused to do so and so we sent the client walking. There’s something to be said for that. They really like working on matters when they believe in the client. We typically discount our fees for not-for-profits. They like that.

This idea that Millennials are lazy, I don’t buy that. I’ve not seen that. They want freedom, and we give it to them. We’re a law firm that doesn’t care when or where our people do their work. We just care about the quality and the timeliness of the work. Our attitude on this jibes with what they are seeking and in that way we are a good fit.

One thing I’ve noticed – and I don’t think this is necessarily peculiar to Millennials, but a factor of being a new lawyer – is that I’m more confident in them than they are in themselves. They’ll look at their workload and see that in three weeks, five things might happen, so they’re reluctant to take on anything new. I see it as my job to convince them to go ahead and take on something new. Of those five things, probably only two or three are actually going to happen. I encourage them to take on a little more risk.

How has technology affected the way you practice law?

I generally dislike most legal technology because it’s lousy. But there is a lot more VC money starting to go into it, so I’m hopeful.

We use a program called Clio. It’s a cloud-based software program geared to law firms, and way better than anything was five years ago. There’s another one called RocketMatter. RocketMatter and Clio very much compete. Both are dubbed “comprehensive legal software.” I would describe them as pretty good – the competition is definitely helping – but every once in a while, we come up with something that’s not that unusual that is just not possible to do in the software.

When it comes to software for our firm, the best software we use is non-legal. One program I always rave about is called DocuSign. It’s very simple, and it just works. I think all programs should be like it. We love it because we can get off the phone and send clients a fee agreement in five minutes. The client doesn’t have to print it out, sign it, scan it, and email it back, which is the way most law firms operate. Everybody in the firm has a record of what’s going on with the fee agreement because it’ll show when it went out and when it was signed, and it’ll stay up in the cloud. It’s really a good program, and there are very few of those that work well for law firms. The proof is that all of our lawyers use it. Here’s a contrast. Our firm is a member of an international legal and accounting association based in Spain. When we joined this association last year we had to sign a document and then overnight the original to Spain. The association would not even accept a pdf!

There’s another software program we love called LawPay. One of the problems law firms have with alternative payments (forms other than check) is that when money goes into a trust account, it cannot touch the hands of a third person. So law firms cannot use PayPal or credit cards for trust account payments. If you have a big case and you’re charging by the hour or by the month, or if you want an advance fee payment, you have to use something like LawPay. LawPay may be the only company that does this and somehow it’s set up so that it complies with the bar rules.

Now we can get off the phone with people – it happens two or three times a month – they’ll sign the fee agreement, and we’ll be paid within 10 minutes. It’s just amazing. This is unbelievably efficient for everyone involved and our clients will often compliment us on it and I have no doubt it makes them feel even better about having chosen my firm for their legal work.

What would you like technology to do for you that it presently can’t?

We’re an all-Mac law firm, and as far as I know there is no good document generation software for Mac that’s dual language. We do five or six manufacturing agreements a month with Chinese manufacturers. These agreements are fairly complicated agreements and vary with each client, each product, and each manufacturer.

A manufacturing agreement for having your candy made in China is going to be very different from a manufacturing agreement to have golf carts made in China – the time periods, the standards, etc. But there are always going to be similarities. What I would like is a document system that would allow us to easily pull and re-use provisions in both the English (or the Spanish or the German or the Japanese) and the Chinese. For instance, if we know that there is going to be a 1% penalty for every day beyond a week that the product delivery is delayed, it would be nice to be able to review our ten best delivery delay provisions and just click the one that best fits, in both languages.

Like in a dropdown menu in the software? So you don’t have to copy-paste from past agreements? 

Exactly. That’s not out there yet. We charge a flat fee for these manufacturing agreements, so any inefficiency is on us. If we could save even 30 minutes on each one, that’s real money. We would be willing to pay a lot for a Mac program that could do that in both our client’s first language and in Chinese.

Have you ever applied an idea from another field to help you do your job better?

All the time. Henry Ford. I want everybody to have the exact same computer in our firm, we buy our desks from the same company, and everybody has the same chairs. I want the small things to be systematized, so that we are freed up to deal with the bigger things. If somebody has a problem with his or her computer, I don’t want a staff person to have to spend three hours researching the best computer to buy. He or she can just replace it right away with a MacBook Air. It takes three minutes. The same is true if we need a new chair or a new desk.

We have loyalty with our vendors because it allows for smoothness. Could we maybe get a better deal somewhere else? Yes, but then we are taking a risk that it will be a disaster and five hours will be wasted. I borrowed that from Henry Ford. I want our firm on the low-level things to be an assembly line, to be routinized.


The future wil be confusing and we will be a part of it
The future will be confusing and we will be a part of it

In just the last week, I have received around ten emails and a comment or two on the blog bemoaning the death of our China Law Blog. The below are two of the favorable ones:

I have heard about the end of China Law Blog. But I am not alone in saying that this was one of the premier blogs on China for many years. I am sorry to hear of its passing. Have you thought about taking some of the pertinent issues and repackaging them into a book? Or has that been done to death? In your case, you would have a lot of material that might work in a book format.

It has been a great pleasure to follow your China law blog. I understand that all good things have to come to an end but I will miss it. I read your blog every chance I got and I want to thank you for all that you did.

This one is far less favorable, and I think I know from whence it comes:

Your shutting down your stupid blog so close to your tenth year just confirms what so many of us knew all along. You are a fraud and nobody has read your blog for many years. We are laughing at you now, you f—-king loser.

But guess what. We have no plans to end our blogging.

A few weeks ago, I wrote of how we would be pulling the switch on our blogroll (our list of the recommended blogs) and then about a week ago we did. But pulling the plug on our own plug? No way, no how. And why should we? Our readership remains as high ever (probably higher) and our social media engagement with our readers (via Facebook and Twitter and LinkedIn) has really just begun. But I think those posts caused the rumors to spread. They are just so false.

So to those who worry about our shutting down, worry not. And to those (one person actually) who thought you were dancing on our grave, you were not. So there.

We fully expect to be here for another ten years, like us or not.

When we first starting writing this blog nearly ten years ago, we often heard from people surprised by our having an international law firm based in Seattle. Why Seattle, we were often asked. Back then I would patiently (well patiently for me anyway) explain how Washington State is more dependent on and probably more open to international trade than any other state. Boeing, Microsoft, Starbucks, Expedia, Expeditors International, Weyerhaeuser, Paccar…. the list of trade dependent companies here goes on and on.

Chou En-Lai and Warren Magnuson sharing a joke
Chou En-Lai and Warren Magnuson sharing a joke

And then I would explain how so many of the small and medium sized companies our firm mostly represents are also international. Software companies, fishing companies, education companies, timber companies….that list goes on and on as well.

Only over time though have I come to realize how unique Washington is when it comes to its internationalism. I saw it as a huge baseball fan when it looked like a group of Japanese businesspeople from Nintendo were going to buy the team. Friends would call to ask how up in arms Seattle was about its team being sold to foreigners. I would have to tell them that absolutely nobody, including the local media, had raised that as an issue; that we were all just focused on keeping the team in town. They would say things like, “well it would be very different here in Chicago/Cincinnati/Milwaukee/St. Louis, I’m telling you that.” And then there are the clients from various parts of the country who tell me of how they have been berated even for doing business with China or Vietnam, by people who ask them if they do not realize that they are “the enemy.” And now we get Donald Trump….

Now I am not going to say that this sort of thing does not happen in Washington, because it absolutely does. And it happens in Seattle too. But I think it happens in Seattle probably (and I have to say probably because there is no way to know) less than just about everywhere else. And that is due not just to its location and to its being a key Pacific port, but also to its history (which I realize is based on its location and to its being a key Pacific port).

Henry "Scoop" Jackson. A great senator.
Henry “Scoop” Jackson. A great senator.

I thought of the Washington State Asia connection the other day when a reader brought my attention to a new website set up to highlight that. The website is called WA China Watch Digest, and it was created as a labor of love by Wen Liu (刘雯), who has also written a couple of books on the Washington-China connections: My First Impression of China: Washingtonians’ First Trips to the Middle Kingdom and Connecting Washington and China: The Story of The Washington State China Relations Council.

My favorite part of her new website is the page detailing Washington State’s history with China since 1973. Thanks to Senators Henry M. Jackson and Warren Magnuson, Washington State has always punched above its weight when it comes to foreign policy, including China. I also greatly enjoyed the page on China-related Washington luminaries, especially since it contains my ugly mug.

I recommend you check out Ms. Liu’s site.


The International Court of Justice at the Hague.
The International Court of Justice at the Hague.

This is our 3,645th blog post and, at least as far as I know, I have never pretty much just re-run a previous blog post, wholesale, without any changes. Sure we have “cribbed” from previous posts, but the subsequent posts are more updates or refinements than a mere copying. But today, I freely admit that the below is just a word-for-word re-hashing of a previous post, with an explanation as to why.

This last week — for some unknown reason — I got more than the usual number of emails from law (and even undergraduate students) asking me what it will take for them to become an international lawyer or a China lawyer. I was out of the country for much of July and my quick responses to their emails was to write me again when I return. Anyway, what I have realized in trying to respond to these sorts of emails is that I do not have any particularly brilliant insights to offer anyone and if I did, I long ago spewed out all of it in posts on here. So my usual answer is to tell these students to search “so you want to be an international lawyer” on this blog. But more often now they are responding by saying that they have already done that but they were thinking that I might have something new to add — mostly because those blog posts are getting so long in the tooth.

So this morning I was going to write a brand new blog post on what it takes to become an international lawyer/China lawyer. And the first thing I did as research was to search out my prior posts. The first post I came across was the one below, and that led me to realize that I certainly had nothing more to say about the attributes that one should develop to become a top lawyer — international or otherwise. I then briefly skimmed my prior posts and realized anew that it’s all already one here. Not saying (at all) that I have all of the answers, because I fully realize that I most certainly do not. But I am saying that I have nothing more in my head to help on this.

Except one thing, somewhat related. Earlier this year, I spoke at a Legal Innovation Symposium at the University of Oregon Law School, and as a part of that, I also wrote an article for the University of Oregon Law Journal, entitled, Finding Your Legal Niche. This article seeks to explain how and why lawyers should find their legal niche, and what they should do to exploit that niche once they do so. I guess it should be considered a later in life add-on to what has previously been written on here.

And so with that, I simply re-post the last post I did on the whole international law career thing, which post includes links to the prior posts. If anyone has any additional tips for international lawyer wannabes or for international lawyers in training, please, please, please add them as comments below.

I have imaginatively titled this post “So You Want To Be An International/China Lawyer, Part VI.”

I wrote this post in April of last year and while going through draft posts just realized that I failed to post it back then, and so I’ve updated it and I am posting it now. That post is So You Want To Be An International/China Lawyer, Part V. Know The Fromm Six.

I get at least twenty emails every week from law students/young lawyers expressing interest in becoming an international lawyer (or a China lawyer) and asking essentially what courses they should take to achieve that goal. My response is always something like the following:

First, do what it takes to become an excellent lawyer, then focus on the international side. In the meantime though, get fluent in a language that matters to you and make yourself international by traveling and by reading.

In other words, get educated, get smart, and get international. Not terribly helpful, I know, but true.

Last April I read an article that really resonated for me. The article was written by William Henderson, a professor at the Indiana University Maurer School of Law and one of the most knowledgeable people alive on the legal profession. The article is entitled, The Fromm Six, and it sets out a “competency model for law students called the Fromm Six.

The article starts out with the following background:

One of the greatest people in legal education that you have never heard of is a man named Leonard Fromm. Fromm served as Dean of Students at Indiana University Maurer School of Law from 1982 to 2012. On February 2, 2013, Dean Fromm passed away after a relatively short battle with cancer.

I want to discuss an innovation that Dean Fromm contributed to legal education — a contribution that, I predict, will only grow over time. This innovation is a competency model for law students called the Fromm Six. But first, let me supply the essential background.

After several years in counseling and adult education, Dean Fromm joined the law school in 1982 to preside over matters of student affairs. Over the course of three decades he quietly became the heart and soul of the Maurer School of Law. Dean Fromm was typically the first person that new students met during orientation — the law school administrator who completed character and fitness applications for state bar authorities and the voice that called out their names at commencement (with an amazing, booming tenor). During the three years in between, Dean Fromm counseled students through virtually every human problem imaginable. His most difficult work was done in his office with his door closed and all his electronic devices turned off. It was private work that was not likely to produce much fanfare.

* * * *

One of the cumulative benefits of Dean Fromm’s job was the ability to track the full arc of lawyers’ careers, from the tentative awkwardness of the 1L year, to involvement in the school’s extracurricular events and social scene, to coping strategies for students not at the top of their class, and the myriad, unexpected turns in our graduates’ professional careers. During his tenure he interacted with nearly 6,000 students and stayed in contact with a staggering number of them after graduation. Invariably, he saw the connection between law school and a student’s subsequent success and happiness later in life (noting, in his wise way, that professional success and happiness are not necessarily the same thing).

In 2008, I started collaborating with Len on a project to construct a law school competency model. Our first iteration was a list of 23 success factors which we constructed with the help of industrial & organizational (IO) psychologists. Although valid as a matter of social science, the list was too long and complex to gain traction with students. In 2010, the faculty who taught Indiana Law’s 1L Legal Professions class got together and reduced the list of competencies to 15. Once again, we found it was too long and complex to execute in the classroom.

During the summer of 2011, as we were debriefing the challenges of another year in our competency-based 1L Legal Professions course, Dean Fromm said, “I have an idea.” A short time later, he circulated a list of six competencies that were appropriate to 1Ls and foundational to their future growth as professionals. Finally (or At last), we now had a working tool! Moreover, none of the professors teaching the Legal Professions course, including me, wanted to revise a single word — a veritable miracle in legal academia.

And thus the Fromm Six was born. This is that six:

Self-Awareness. Having a highly developed sense of self. Being self-aware means knowing your values, goals, likes, dislikes, needs, drives, strengths and weaknesses, and their effect on your behavior. Possessing this competence means knowing accurately which emotions you are feeling and how to manage them toward effective performance and a healthy balance in your life. If self-aware, you also will have a sense of perspective about yourself, seeking and learning from feedback and constructive criticism from others.

Active listening. The ability to fully comprehend information presented by others through careful monitoring of words spoken, voice inflections, para-linguistic statements, and non-verbal cues. Although that seems obvious, the number of lawyers and law students who are poor listeners suggests the need for better development of this skill. It requires intense concentration and discipline. Smart technology devices have developed a very quick mode of “listening” to others. Preoccupation with those devices makes it very challenging to give proper weight and attention to face-to-face interactions. Exhibiting weak listening skills with your colleagues/classmates/clients might also mean that they will not get to the point of telling you what they really want to say. Thus, you miss the whole import of what the message was to be.

Questioning. The art and skill of knowing when and how to ask for information. Questions can be of various types, each type having different goals. Inquiries can be broad or narrow, non-leading to leading. They can follow a direct funnel or an inverted funnel approach. A questioner can probe to follow up primary questions and to remedy inadequate responses. Probes can range from encouraging more discussion, to asking for elaboration on a point, to even being silent. Developing this skill also requires controlling one’s own need to talk and control the conversation.

Empathy. Sensing and perceiving what others are feeling, being able to see their perspective, and cultivating a rapport and connection. To do the latter effectively, you must communicate that understanding back to the other person by articulating accurately their feelings. They then will know that you have listened accurately, that you understand, and that you care. Basic trust and respect can then ensue.

Communicating/Presenting. The ability to assertively present compelling arguments respectfully and sell one’s ideas to others. It also means knowing how to speak clearly and with a style that promotes accurate and complete listening. As a professional, communicating means persuading and influencing effectively in a situation without damaging the potential relationship. Being able to express strong feelings and emotions appropriately in a manner that does not derail the communication is also important.

Resilience. The ability to deal with difficult situations calmly and cope effectively with stress; to be capable of bouncing back from or adjusting to challenges and change; to be able to learn from your failures, rejections, feedback and criticism, as well as disappointments beyond your control. Being resilient and stress hardy also implies an optimistic and positive outlook, one that enables you to absorb the impact of the event, recover within a reasonable amount of time, and to incorporate relevant lessons from the event.

I knew Len Fromm, which is to mean I thought the world of him. And for that reason, I did not want to write this post back in April as I was worried that my sadness at Dean Fromm’s death was clouding my judgment and forcing me to go gaga over his six.

But in re-reading it I realize how great the list really is and how much it deserves further dissemination for reasons that have nothing to do with memorializing a truly decent man.

Dean Fromm’s list just works. Law students and young lawyers, go talk to older lawyers you respect and I am confident you will find that they would agree. And the list works for what it takes to succeed as an international lawyer as well, which should be no surprise, since international lawyering is really no different than any other kind of lawyering. If you want to succeed as a lawyer, work on the six. I particularly love the line about silence, as it took me years to realize how valuable silence can be in getting people to reveal things, even things they never intended to reveal.

The scary thing about the Fromm Six is that we lawyers tend not to be very good at many of the things on the list. Lawyers are trained (maybe even over-trained) to be rational, logical and unemotional and to focus on merit. But life, and thus lawyering, is not always so simple. Dean Fromm’s list thus tilts much more towards EQ than towards IQ, and rightfully so.

For more on what it takes to become a China lawyer/international lawyer, check out the following:

So You Want To Be An International (China Lawyer), Part IV. Do You Really? (2013)
So You Want To Be An International/China Lawyer? Part III (2008)
So You Want To Practice International Law/China Law? Part II (2007)
So You Want To Practice International (China) Law? (2006)

I am still gaga over Dean Fromm’s list and I am going to make it a part of my future email responses. What do you think?


Again, all you lawyers, please comment to add more or to tweak or to reinforce or to criticize. 

Picture from City Weekend.
Picture from City Weekend.

Way back in 2010, we did a post comparing Beijing and Shanghai. That post took the rivalry pretty seriously:

The Beijing-Shanghai rivalry fascinates me. Not because it is so unusual, but because it is so pronounced and because it matters.

Beijing is the seat of government, yet it is also China’s art, media and tech city. Shanghai is the city of business and finance, yet it is both historically, and today, generally the most open to foreigners. Food-wise, most would give Beijing the nod, but I love Shanghai food and consider it a very sophisticated, subtle, and underrated cuisine. One of the biggest differences between Beijing and Shanghai is language. “Shanghai people” have their own dialect that is pretty much incomprehensible to outsiders and they do seem to love using it for that very reason. Shanghai is considered snobbier.

The Los Angeles Times has a fun and interesting story on this long-time rivalry. The article is entitled, A tale of China’s two great cities: The rivalry between Beijing, the national capital, and Shanghai, the financial capital, has been going on for decades. The dynamic is a powerful undercurrent in Chinese politics and culture. It deems Shanghai more fashionable, more for women and more cosmopolitan than Beijing. But Beijing holds the power. These paragraphs sum up the stereotypes I must often hear from the Chinese themselves:

Shanghai men are reputed to be vicious in business — hence the term shanghaied — but wimps at home. “At home, they do the dishes, take out the trash and give their wife/mistress a neck rub after the hard day she put in shopping,” wrote one blogger on a site called China Forum.

To the Shanghainese, the Beijingers — and all northerners, for that matter — are peasants.

“They smell like garlic,” said restaurateur Xu, voicing a popular refrain. “We Shanghai people keep ourselves and our homes very clean. We are more refined. We drink coffee. They only drink tea.”

In the legal arena, Shanghai stands somewhat alone in that Shanghai lawyers generally do not play well outside Shanghai, and vice-versa. This is less true of Beijing.

Back then, it seemed that anyone who was anyone was either in one or the other city or at least contemplating moving to one or the other. That was right at the height of when so many foreign companies believed that they had to “get into China” or at the bare minimum, “start doing business with China,” even if they knew little to nothing about how to navigate China.

I thought back to this old post today when I reading an article from the Nanfang on how expats like living in Shanghai best. The article, Despite Shallow Reputation, Expats Love Shanghai More Than Beijing, has this to say about Shanghai:

Yes it’s shallow, the expats don’t speak Chinese, and it’s not the “real China”, but expats in a new poll say it’s the best place in the country to live.

Nearly nine out of every 10 expats already there say they like the city, which is the highest satisfaction rating pollsters found. Eighty-six percent of the 237 expats interviewed said they liked the city, with 46 percent saying they’d even like to settle down there.

So what makes Shanghai so special? Expats say job availability and the “diverse cultural environment” are the main attractions. On the other hand, the respondents said traffic congestion and bad-mannered locals were the things they had problems with.

So which do you prefer to visit? Which is better for business? For Tech? For Media? What about the people makes them different? For whatever? Most importantly, where would you rather live and why? Someone who lives in Shanghai and frequently travels to Beijing told me the other day that “way more” expats are leaving Beijing than are leaving Shanghai. Is that true?

More than four years ago, we did a post, entitled, China: Do Just One Thing. Trademarks. In that post, we emphasized the absolutely critical importance of registering your trademarks in China, not later but now:

From time to time I get calls from start-up companies about to embark on manufacturing in China. They are calling to ask what they need to do “to protect themselves.”

I tell them about NNN Agreements and important those are to help prevent potential manufacturers from replicating their product. And I tell them about how important it is that they have an OEM Agreement to define and “regulate” their relationship with their Chinese manufacturer.

Then I tell them how if they do nothing else, they should immediately register their trademarks in China. This one usually surprises them and they often think I have misunderstood what they are planning for China. They at first do not understand why I am emphasizing the need for their filing a trademark in China when they have no plans to sell their product in China. I then explain the following to them:

China is a first to file country, which means that, with very few exceptions, whoever files for a particular trademark in a particular category gets it. So if the name of your company is XYZ and you make shoes and you have been manufacturing your shoes in China for the last three years and someone registers the XYZ trademark for shoes, that other company gets the trademark. And then, armed with the trademark, that company has every right to stop your XYZ shoes from leaving China because they violate its trademark.

Then they understand.

A Quartz Magazine (a great magazine put out by The Atlantic) article from earlier today does a great job nailing this point home. The article is entitled, In China, Michael Jordan does not hold the rights to his own name, and it illustrates the importance of you (and Michael Jordan) registering any and all trademarks in China (right now) important to you now or that may be important to you later. Because — as our China lawyers are always telling our clients — if you don’t do it, someone else will.

Please do read the Quartz Magazine article because the key to it is all that Michael Jordan has done and will continue to do in an effort to get back various trademarks important to him. To summarize, Jordan has already lost at least two Chinese court lawsuits against Qiaodan Sports, a now large Chinese company alleged by Jordan to be using 78 of his trademarks, including Qiadon, his name as commonly used in Chinese, and at least one of his images, as per the below.

Photo of a Qiadon store from the Quartz Magazine article.
Photo of a Qiadon store from the Quartz Magazine article.

The article makes clear that Jordan is not done suing Qiadon and that he plans on taking his case next to China’s Supreme People’s Court. Some of you who read the Quartz article will no doubt be outraged about Qiadon’s actions and believe the Chinese court rulings against Jordan have been wrong. Others may read it and think that the Chinese court has properly followed China’s trademark laws as written. I read it and recognize that unless I were to spend tens of hours reviewing the court transcripts and more, I would not have a good sense of who between Jordan and Qiadon is legally correct/entitled and I am not going to do that.

Because in the end the way I see it is that this article is just yet another example of how easy the calculation should be for any company doing business in China or contemplating doing business in China. Are you better off spending thousands of dollars now protecting your brand(s) and your trade-names in China by registering them in China, or are you better off spending hundreds of thousands of dollars (maybe even millions of dollars) later in litigating against those who are using your brand(s) and/or your trade-names in China?

Michael Jordan may eventually prevail on some or even all of his trademark infringement claims against Qiadon in China, or he may not. But either way, he will have paid a big price to get there, both out of pocket for the litigation and in the harm his brand has incurred in China from Qiadon as a competitor. Those costs dwarf what it would have cost Jordan to have filed for trademarks in China early on.

Our Linkedin China Law Blog Group: It's All Good
Our Linkedin China Law Blog Group: It’s All Good

A couple years ago, we started a China Law Blog Group on Linkedin to create a spam-free forum for China networking, information and discussion. This week we surpassed 10,000 members and the number and quality of our discussions continues to increase as well.

We have had some absolutely terrific discussions, both based on the numbers (discussions sometimes get 100-200 comments) and on their substance. Our discussions range from practical (such as, “what should I do to have a good relationship with my China manufacturer” or “how do I open a China bank account” or “what are the best practices for a China Joint Venture”) to “deep think” (such as, “will China ever respect IP” or “when will we know that China is taking innovation seriously”).

The group’s diversity is one of its greatest strengths. We have a large contingent of members within China and without. Some members are China lawyers, but the overwhelming majority are not. We have senior personnel (both China attorneys and executives) from both large and small companies and a whole host of junior personnel as well. We have students and we have professors. We have Chinese citizens, Americans, and Europeans. These mixes help elevate the discussions.

I am, however, proudest of how we have prevented even a scintilla of spam from landing on our site. We have become so proficient at this, in fact, that we now commonly go weeks and sometimes months without anyone trying to land a spam-bomb in one of our discussions.

If you want to learn more about doing business in China or with China, if you want to discuss China law or business, or if you want to network with others doing China law or business, I suggest you check out our China Law Blog Group on Linkedin and join up. The more people in our group, the better the discussions.

We will see you there. Click here and join us.