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Cover Story: Lawyering Under Fire

by Kimberly Lindy

Fall 2002, Vol. 65, No. 3

A few weeks ago, I left my office at a Tel Aviv law firm for a bi-monthly seminar I attend on business management in Jerusalem. Driving with two classmates, both of whom work in Tel Aviv's high-tech sector, I stopped chatting long enough to take a call on my cellular phone from my daughter. She reminded me to be careful; there was a high alert that day for terrorist attacks in Jerusalem. Having recently returned from a year's studies at the Friends Select School in Philadelphia, she wasn't used to these reports and wanted to make sure I was taking them seriously. I reminded her that she is preparing to be drafted into the Israel Defense Forces this fall. Would she like me to call her in the army every time there is an alert? We laughed.

Five minutes later, I stopped at a red light in the residential French Hill section of Jerusalem. Suddenly a blast shook our car as if there had been an earthquake. It was followed by silence that was simply unearthly. And then the ambulance sirens started blaring. The radio announced that a suicide bomber had blown himself up near a bus stop. The location was one block north of where we had been. Seven people were killed that night. Altogether, twenty-six people were murdered within thirty-six hours-babies, grandmothers, teachers and students, Arabs and Jews. Scores more were injured, some maimed for life. I feel like I'm living in a game of Russian roulette and this time I was just lucky.

In the fifty-four years since Israel declared its independence it has fought six wars; suffered a prolonged period of severe austerity in the early 1950s and a critical recession in the mid-1960s; endured a period of inflation that reached 500 percent a year in the early 1980s; and now, for the first time in its history, it is coping with unemployment close to ten percent. Despite it all, this tiny country, which was created from the ashes of two barbarous world wars, was founded on the principles of democracy and Western economic values and has flourished beyond the world's expectations. Israel's population today ranks as the third most highly educated in the industrialized world. It has developed a solid infrastructure of banking, accounting and legal services to support its dynamic business environment. And today it is widely recognized with international acclaim for its prominence in the global high-tech industry, even earning the nickname of "Silicon Wadi."

The 1990s were years of hope and prosperity for Israel. With the election of Yitzhak Rabin as Prime Minister in 1992, Israel's government dedicated itself to investment and expansion in infrastructure and business, as well as in real initiatives toward regional peace. Geographically situated at the epicenter of three continents and having established diplomatic relations with more than 160 countries, Israel was ideally poised to assume its place at the crossroads of Middle East trade. That process now seems frozen in dead body parts, shattered dreams and fear.

The morning after the latest attack in Jerusalem, my law office was slightly more subdued than usual, though not by very much. People avoided talking about "the situation," the euphemism we use to refer to the terror. Most people attempted to work as normally as possible, using the office as a sanctuary and perfecting our skills of compartmentalization. But two minutes before the hour, radios are turned on throughout the office for the broadcast of the hourly news report. Lunch is ordered in more frequently than before. The steady stream of lunch deliveries is a common sight now. It's safer inside.

With ninety attorneys, our firm is the largest law office in Israel. With a number of other large firms, it handles most of the sophisticated international commercial transactions in the country. Like other international corporate law firms, we have been affected by the fall of the NASDAQ and the global markets. A predominance of technology companies in Israel have their centers of activity elsewhere. Consequently, until now, we have been affected more by the global economic climate then by Israel's political situation. Nevertheless, the current war-like situation is now seriously affecting the Israeli economy and that in turn reverberates through all sectors, including those of international professional service.

Some of our lawyers deal exclusively with clients from abroad. They travel more frequently now to meet those clients outside of Israel, whether at their clients' offices or in a less-convenient location in between because fewer people want to risk traveling here. The hi-tech bust in Israel prevented companies from going public, as they had planned.

Investors are nervous about the solidity of companies in Israel and about investigating new opportunities within Israel. After the U.S. State Department travel warnings, the Food and Drug Administration cancelled all visits of its teams to Israel. The warnings have been in effect for more than twenty months, causing the closure and/or relocation of companies and laboratories dependent upon FDA approval to market their products in the United States.

All of these changes have undoubtedly had an effect on the Israeli economy and therefore also on service professions. In the past few months the Israeli shekel exchange has taken a tailspin vis-à-vis the dollar and other foreign currencies. Uncertainty about interest and exchange rates increases anxiety within the business climate, exacerbating an already difficult situation. While law firms have traditionally charged their clients in dollar amounts, clients are beginning to challenge this practice and demand a fixed exchange rate for greater predictability. Clients are more conscious about their legal fees and are very careful about all incurred expenses. Companies are trying to cut their outside counsel fees by having their in-house lawyers take on more responsibility.

Yet, no law firms have closed their doors, according to Minna Felig, president of LawJobs, Ltd., which does placement and consulting for law firms and company legal departments in Israel. They welcome natural attrition, however, without hiring replacement lawyers. When they do hire, they seek lawyers with experience in more than one practice area. Since the hi-tech boutiques are not as busy, many are looking to merge with firms whose work is more diversified. As a reflection of these difficult times, there is a greater focus on litigation. The firms in the best shape are the ones, like ours, with a diverse portfolio of clients.

Despite a few kind words offered at the beginning of a telephone conversation, in general, foreign clients don't want to hear about our problems. They aren't interested in the fact that your wife's cousin was injured in the last terror attack and the whole family is at the hospital or helping them at home, leaving you to deal with your young kids. Work has to get done and we are expected to perform. That's just the way it is. It isn't easy and it isn't normal, but that is the paradox with which we are faced. As a nation, we are living in a state of uncertainty. We say goodbye to our children in the morning, hoping and praying that we will kiss them goodnight in the evening. And yet, as an international business community, it is "business as usual."

We read a lot about post-traumatic stress syndrome. What name would the mental health professionals give to an entire society that is living with the daily stress of life-and-death issues? "The situation" affects everyone. But we are still expected to perform as if nothing extraordinary is happening. It is the daily psychological uncertainty of what each day is going to bring on a national, business and personal level that is making life so very difficult during this period.

We have had a few first- and second-year associates called into the Reserve. We do all we can to make sure they are given extra batteries for their mobile phones and tell them to keep their heads down. Their files are handed over to other lawyers, and business continues as normal.

A few weeks ago, when Operation Defense Shield ended, a firm member walked in for an early morning meeting. He had just returned from a month with his Army Reserve unit after serving in the West Bank. Although he was wearing civilian clothes, he had a rifle slung over his back. He sauntered up the corridor with that unmistakable soldiers' swagger and a slightly crooked and exhausted smile that said, "I'm alive, glad to be here but don't mess with me." He walked into the conference room, put his gun under the table, looked around and said, "Let's get started. What have I missed?" I looked at him, smiled, said "glad to have you back" and started the meeting.