In an earlier post I moaned on about the conduct of the company that produces AUSTRALIAN GOLD tanning lotion. Understandably brand owners want to have their cake an eat it too. That is, when a brand owner sells a product that has large profit margins- the brand owner will want to control the pricing structure of that product. But almost as surely as day follows night someone in the chain of distribution will break ranks and undermine the efforts of the brand owner to control the pricing of its products. Of course, consumers almost always benefit from this fact. And, as I tried to convey in the earlier post, often, no skirts are clean in these circumstances.

But my use of the world sleazeball to characterize the defendant was wrong. I was trying to make the point that even though we as consumers benefit, for the brand owner, any reseller who refuses to play the game is automatically sleazy. Not as a matter of fact but as a matter of status.

But wrong is wrong. And for that I apologize and ask for forgiveness.


Law 2.0, The Future of Law Firms and The End of Competition: Will Rearranging the Deck Chairs be Sufficient?

Just last week the largish( 350) law firm where I once worked chose a new CEO. Or more accurately, a new CEP (Chief Executive Partner). And, of course he was interviewed by the local press. His comments were truly startling. And here I paraphrase: In describing his role he boldly committed himself and the firm to the highest standards of client service. And to achieve these lofty client service goals he also committed himself and the firm to finding and retaining the best talent available.

Of course this ship is unsinkable. But there's a report from the bridge of some sort of iceberg ahead. And that iceberg is Enterprise 2.0 or Web 2.0 or Law 2.0.

What does superb client service mean in the world of Law 2.0? You pay me by the hour to answer certain questions for you. And if I am better than my competitors I get you your answers faster? How does this definition of service survive in a world where solving problems is an iterative process and the boundary between client and lawyer is fuzzy at best. Where sharing and collaboration are not a novelty - they are the accepted norm of business. If we are all connected then why do lawyer's get to be labelled as experts?

But wait there's more. In the brave new world of wikis and mashups not only will the lawyer's work product be redefined- the structure of the organization to produce that new work product must be radically altered. In his brilliant piece in the Financial Times, Lost or Hurt at Sea ? Phew! Victor Mallett drew a powerful distinction between the rules of mountain climbing and the rules of sailing.

Get hurt or injured on a mountain?

Its very likely that you will be left to fend for yourself as other mountain climbers pursue their quest for Everest. By contrast, there is a rich tradition in ocean sailboat racing that if a competitor is lost or injured others immediately put aside their individual desires to help their fellow sailor. Mallett describes a rescue during an around the world race where a sailor turned back into the face of a vicious ocean storm to save a competitor from certain death.

I think I can say without too much controversy that to survive in most law firms you darn well better be a mountain climber. Oh sure there may be an organizational chart and a formal genuflection to teams. But the informal rules of survival are written with words like self interest, watch your back, you help me and maybe I'll help you, zero sum game, high achiever, and rainmaker jerk.

How will law firms driven by static notions of expertise and a mountain climber notion of achievement fare in the new world order? I can't say for sure. But with the size of the icebergs ahead I suspect that being a mountain climber could mean being irrelevant.



All you sun worshippers pay attention. Bet you didn't know that your AUSTRALIAN GOLD tanning lotion ain't from down under- its from INDY!! And Australian Gold, Inc. is the latest company to have its business model undermined by the Internet. Eric Goldman has commented on this case at his blog site TECHNOLOGY & MARKETING. And Ron Coleman, author of the LIKELIHOOD OF CONFUSION blog site was the attorney for the defendant. He too has provided a link to the case.
In a nutshell: Australian Gold tries to control how its tanning products are sold. It sells its products only to authorized distributors who, under the terms of a distributorship agreement, may only resell the Australian Gold products to "authorized" tanning salons. The sleazeball defendant somehow got hold of genuine products and began selling AUSTRALIAN GOLD tanning lotion on the Internet at half price.

The case is of some interest because a court in the Second Circuit once again has concluded that buying keywords or placing terms in the metatags for one's website does NOT constitute trademark use.
But, it is the battle hardly mentioned in the case that is most interesting to me. Almost every case involving the sale of unauthorized but genuine goods is a case where a brand owner is asking the courts to become an enforcer for the brand owner- against the brand owner's own customers!!

In the most recent Australian Gold case the Court accepted without question that the defendant only got its product from rogue retailers. And the District Court, in denying the defendant's motion to dismiss a tortious interference with contract claim, seemed willing to consider such a claim as valid even though the defendant had no direct contact with distributors. So what you say?

Here's what. Only if Australian Gold and its distributors ignore reality can an Internet retailer get enough product to survive. Imagine that you are an Australian Gold distributor. And suddenly, one of your retailers starts ordering unnaturally large quantities of tanning lotion. What do you do? Do you aggressively seek out an explanation? Or do you happily accept the increase in business?
And the same logic applies to Australian Gold. If the Internet retailer is success full then SOMEBODY is ordering more tanning lotion from Australian Gold. So what does Australian Gold do? Dig deeply into the ordering patterns of its distributors to find anomalies? Or book the orders. That is, until retailer and distributors who are not part of the informal distribution channel start to complain.

Several years ago I worked for a famous American motorcycle company. At that time, the authorized dealers complained bitterly about unauthorized American dealers who bought bikes in Canada, brought them to the States, swapped out the speedometers for one's that read in miles per hour and sold the Canadian bikes at a handsome profit.
So I did a bit of digging. And it turned out that a few authorized dealers had been ordering hundreds of speedometers from the parts and accessories dept of the company. Did the exec responsible for parts and accessories raise an uproar and immediately stop filling suspicious orders for American speedometers?

I'll let you guess.