Guest Chapter 19

Name: Randy Klein

Current Position/Background: Principal at Goldberg Kohn, Ltd., a 90+-lawyer finance boutique based in Chicago. https://www.goldbergkohn.com/professionals-Randall-Klein.html.

I joined Goldberg Kohn in 1993 as a fourth-year associate, after a one-year bankruptcy law clerkship. Ten years after my clerkship, I recruited that judge to join Goldberg Kohn. I have been the Chair of the Bankruptcy and Creditors’ Rights Group for the past 15 years. In 2021, I named a co-chair who I have trained since recruiting him from law school 20 years ago. We have 10 lawyers in our Group, with 5 women and 2 diverse, including one former judge who is of counsel. All of the current principals (except me) started their careers at Goldberg Kohn.

Law School/Year. Northwestern University School of Law, 1990

Legal Practice Area: Bankruptcy. While in law school, I thought I might want to become a real estate developer, so I took a summer position at a smaller real estate boutique and focused on real estate classes. By the time I graduated, however, inactive construction cranes filled the Chicago skyline. Real estate transactions came to a screeching halt, as did my real estate legal career. Instead, I was left to work on busted real estate transactions (office buildings, apartment buildings, hotels, retail, mixed use), workout, chapter 11 cases, and liquidations. Simply because I took a couple bankruptcy classes, I became the resident bankruptcy attorney at my first firm (with no mentor). My second exposure to restructuring occurred within the firm itself. With no real estate work, my first firm struggled to keep the rainmakers (construction litigators) happy. They left, partners and associates were dismissed, and I was asked to stay on board as part of a “ground-floor opportunity.“ No thanks. I interviewed for a bankruptcy clerkship and landed several offers in Chicago before accepting my one-year gig with Judge Barliant.

Recommended Reading. Anything unrelated to the law that allows you to relax and escape would make a good reading list. For me, I like the Gray Man series by Mark Greaney and the Mitch Rapp books by Vince Flynn. Espionage, special agents, formidable foes, where the good guys always seem to win. I also enjoy reading “inside baseball“-type books about restructuring, debt trading, and bankruptcy. The most recent one of those is The Caesars Palace Coup: How a Billionaire Brawl Over the Famous Casino Exposed the Power and Greed of Wall Street by Max Frumes and Sujeet Indap. I know a lot of the lawyers and judges described in that book; and reading about the strategies of billionaire hedge funds pitted against one another is a useful guide to anyone interested in what I do for a living. Importantly, get a good book on legal writing. Brian Garner is a big name in that area, and teaches the craft for any young lawyer (litigator or transactional). If you find his stuff to be too preachy or textbook, pick up Nino and Me: An Intimate Portrait of Scalia's Last Years (Garner's memoir of his friendship and co-writing experiences with Justice Scalia).

Why I Went to Law School

With an undergraduate degree in liberal arts, a minor in finance, and no appetite whatsoever for accounting, I thought about either getting an MBA, becoming a real estate developer, or going to law school. I didn't come from a family of lawyers (no immediate relatives in the law), had no real idea of what it meant as a profession, but did surprisingly well on the LSAT. So I made the choice to go straight from undergrad to law school.

Frustrations After Law School—For Me and New Hires

For me, I wanted to practice real estate law and focus on real estate development. The real estate recession of 1989–1990 meant I needed to do something else.

I never forgot what it was like to know very little; and, once I started hiring law school graduates, I took an interest in their development. I trained a number of the bankruptcy associates and the ones who took a real interest in being trained were the most successful. No one wants to have to spoon-feed new lawyers; and, equally inefficient are young lawyers who try to do everything themselves without knowing what not to do. Find a mentor. Not every senior associate or partner is good at mentoring. Those who are will have a reputation for it. Find him or her and be willing to be taught. A related frustration are the new associates who don't dig in. Practicing law is hard. You need to ask questions, ask more questions, and then when you think you have it figured out, understand enough to know that you should ask more questions. Take the hard road. Challenge yourself, even on what may appear to be easy assignments. A young lawyer who used to work for me told me that my problem was that I didn't coddle him. I told him that his problem was that he needed to be coddled.

How Have I Used Core Concepts of Lawyering?

There are different ways to define success as a young lawyer in a law firm, but for me I wanted to develop client relationships and bring in business. I found out early on that many clients want to know their lawyers personally, for them to be genuine and forthright, and to work hard, be dedicated, and produce great work product. Clients only interested in giving instructions and wanting work done quickly, no questions asked, were of no use to me. So over the years I found clients with whom I meshed on a personal level. The single most important attribute of my most successful attorney–client relationships was sharing my thought process with the client.

Similarly, when a young partner asked me how I was able to develop so many clients at such an early stage in my career, I told him to find a target and dedicate himself to that client. Literally tell them that they are your most important opportunity and that you want to do whatever they need, whenever they need it, without charging them for every single phone call and email. Build the personal trust by understanding their business and letting them know that they can rely upon you. I suppose you can break down what I did, for myself and how I encouraged my colleagues, into the Core Concepts. They're all in there. It is truly a function of being a real person first and a lawyer second.

Biggest mistake(s) you made while in law school/classes you should have taken

My biggest is not fit for print. But I wish I took more practical classes that would translate into being a transactional lawyer. Most law schools, unfortunately in my opinion, are not vocational schools. You're told that you'll learn how to think like a lawyer. Maybe. Teaching me how to draft a contract would have helped a lot, too. I had no idea if I wanted to be a litigator or a deal guy. At one point, I wanted to be an antitrust lawyer. I did not figure out until later that bankruptcy (part litigation/part transactional) would be my specialty; therefore, I did not take advantage of more finance and restructuring courses.

Most useful classes in law school

I learned a lot from the Negotiations class, taught by a practicing lawyer (so it had immediate application to the real world). Also, I learned a variety of negotiation techniques. Most important, it taught me the power of leverage. During one role play module about the building of a mental health facility in a wealthy suburban neighborhood, I was given the role of the federal government. The materials stated that I should allow the parties to try to reach their own resolution but if they couldn't, and only to break an impasse, I could announce all federal funding for various resources for the neighborhood would be withdrawn. Instead, I walked into the session and immediately announced my position and then walked out. When I met the professor in the hallway, he was incredulous. He asked me why I didn't follow the instructions and I told him: I had the big club, so I decided to cut through all the b.s. and swing it. I aced the class. This class taught me how to understand all the parameters in a complex situation (asking questions) and to navigate my own course (giving advice), and to trust my judgment.

How I decided what to do after law school? Did I make a good choice?

As explained above, the options for a real estate lawyer and potential real estate developer were nil upon graduation in 1990. I realized I had a knack for complex, multi-party negotiations, research, persuasive writing, and creativity. All of these factors came together in the creditors’ rights field. During my clerkship, I had opportunities to research and write about the enforceability of liens on intangible income streams. Once back in private practice, I wrote articles on the subject, gave presentations, and had numerous opportunities to litigate related issues. Eventually, I built a reputation for creative solutions and a willingness to make arguments that pushed the envelope. Clients loved being educated about the process and the risks of various outcomes.

Biggest mistake you made at your first job

As a brand-new lawyer, I was tasked with working on a purchase of an apartment building (near Northwestern Law School). I learned about the archaic law of party walls and the weird world of title insurance, including how to read a survey. The buyer (our client) agreed to pay some of the purchase price over time. We were supposed to close on the first day of the month, with monthly payment dates in equal installments (part interest, part principal). But the closing was delayed. Instead of closing on the 1st, we closed on the 20th. I did not adjust the promissory note to make it “interest only” for 10 days, and start the amortization schedule with the first payment after the first full month post-closing. As a first-year lawyer, should I have known that? Probably not. I was supposed to have been supervised. And, incredibly, the lawyer for the seller refused to correct for the mistake, which he absolutely knew I had made before we closed. Ultimately, the business folks worked it out, but it did not stop the senior partner at my firm from making an example out of me at a full associate meeting. He thought it was a teaching moment. I was mortified. I learned the hard way to make sure I understood what I was doing and why; and, if I didn't, I should have been asking questions. I suppose in hindsight this incident had an impact on my decision to leave the firm to pursue my clerkship. It wasn't because I made the mistake. It was the way I was treated. After that, I aspired to be a better teacher and to encourage inexperienced lawyers to not stress out about what they don't know. Everyone begins with very little actual knowledge. You have to accumulate it; and senior lawyers need to be willing to teach, guide, and encourage. As I said, find your mentor. (And it goes both ways when you become a partner. Be a mentor. You'll be rewarded throughout your career.)

Best advice received or have given for new lawyers

Take seminars and read books about how to draft clearly and concisely. Edit, edit again, and edit a third time. But perhaps the best advice I've given over the years is this: Speed Kills. Do not make the mistake of stressing out and rushing your work product. Ask how long an assignment should take; ask for samples and precedent and then do the work thoughtfully and carefully. Of course, clients don't like to pay for excessive hours, so you have to learn to be efficient. Do not hurry. The worst thing is for a client to spot a mistake that was easily avoided. They want the work done efficiently and done right. Sometimes, rarely, a client will ask for a rough draft so they can provide input during the drafting process. That's OK. Embrace their participation and expect that there will be errors. The final product is yours. Always strive to do it right.

Worst advice received or given for new lawyers

Eager to receive reviews as a junior lawyer, I was told “no news is good news.” That's unacceptable laziness by the senior lawyers. Do not accept that sort of feedback. Ask for more. What else could you have done, or done differently, or should you be doing? If you have free time, think about organizations to join, articles to write, and clients to contact. The practice of law requires you to be thinking all the time about what else you should be doing. You should be sharpening your skills with feedback from your mentors and from senior associates. Eventually, you will develop enough to be able to ask clients the same sort of questions: How are you doing/what else could or should you be doing to help them? You may need to develop thick skin to absorb criticism. Constructive criticism, especially from clients, will strengthen your client relationships.

How to remain satisfied practicing law; what to do when you’re not

Find out what kind of practice area best suits your skill set. For some of my colleagues who are happy practicing finance, they love checklists. They are extremely organized and task-oriented. They can multi-task, and are most efficient when moving through an assembly line of documentation. That didn't work for me. I started out as a front-end transactional attorney. I was often bored and dissatisfied, wondering whether I was going to be stuck doing work I didn't enjoy. Luckily, my career started with disruption. I was forced to learn how to practice restructuring law, followed by my bankruptcy clerkship, and leading to my job at Goldberg Kohn. Bankruptcy and creditors’ rights rarely present the same matter. Every case is different. Different structures, clients, adversaries, businesses, third-party issues. It's more like playing chess. Infinite moves and outcomes. The most successful bankruptcy lawyers are those who are best at thinking on their feet (in court or in the boardroom), being persuasive advocates, and solving complex puzzles. But it is also an extremely stressful practice area. Understand that it is important to work hard, and to also decompress. Unplug. Turn off your phone (or at least don't look at it for a while). Try to find time for your hobbies. For me, that means golf. Unlike some folks who are better suited to be musicians, golf has been my best tool to develop long-lasting work relationships. You get their attention for six or more hours, have fun away from the office, and learn about them and their families. You may prefer going to concerts, or giving one.

What would I go back and tell myself as a third year?

What no one ever told me as a new lawyer, and I wish they had, was that it is OK not to know what you're doing. It's also OK to feel that there is always more than you should be learning. Remember that you are the sum of your experiences; and for the practice of law, you know what you have done. No one is any different than you. Find the subject matter that is most interesting to you. Try to master it. Get your hands on practical guidelines, checklists, and examples. And build your own annotated set of documents. Whether litigation or transactional, there are basic outlines that are now available. The practice of law has changed. Today, you have third-party resources like Practical Law, or Bloomberg, to provide you with the templates. Do your homework and your research. And keep building your own experiences. Eventually, you will be an expert in one or more areas. You will be able to attract clients because they trust you with their projects. Build your knowledge, build your clients, and then as soon as you are comfortable that you have achieved your initial goals, train someone junior to you. Then, start the process all over again.