NCBJ 2021: Diversity & Inclusion in the Bankruptcy Profession

10/10/21

One of NCBJ's plenary sessions explored Diversity & Inclusion in the Bankruptcy Profession. The panelists included the Hon. Bernice Donald (6th Cir.), Jimmie McMillian, the Chief Diversity Officer and Senior Corporate Counsel for IndyCar, Michael Bernstein of Arnold & Porter Kaye Scholer, LLP and Prof. Angela Banks from Sandra Day O'Connor School of Law. Judge Donald has a unique history in that she is one of the few judges to begin their career on the State bench, then move to the Bankruptcy bench followed by service on the District Court and the Court of Appeals.  

The program explored ways to create a more welcoming environment through three hypotheticals involving a law firm, a court scenario and a law school hypo.

Law Firm

Under the hypothetical, sections in a law firm were asked if they needed any new associates. New  associates could apply for the section of their choice. There were two candidates for one position in the trial and litigation section. One was an Orthodox woman with four children who could not work Fridays or Jewish holidays. The other candidate uses a wheelchair. The head of the section said that both candidates would be better off in a practice other than trial and litigation.  His rationale was that in litigation, you have to work Fridays and Saturdays and that a lawyer in a wheelchair would have trouble coping with the travel necessary for trial work. He also expressed that he had never seen a lawyer in a wheel chair try a case and didn't know how a jury would react. The firm's chief diversity officer disagrees. How should the firm address the conflict?

Mr. McMillian suggested that the chief diversity officer should approach the head of trial section along with another partner with a good book of business. The Diversity Officer would need to be prepared to tell the head of the trial section that discriminating on basis of religion and disability was illegal,  immoral and unethical. Prejudging an associate based on what you think they can do does not fit with the culture of firm. If the associates would like to try litigation, the firm would give them the chance to try. He said that as Chief Diversity Officer (or presumably another partner with management authority), you have to have the courage to stand up to people and run the risk that you will lose your own job. If you don't stand up to biased behavior, then the culture of the firm allows it. He also recommended that the head of the litigation section go through diversity training.

Judge Donald added that these issues happen all too often and sometimes a firm has to deliver a message to a client if the client wants the firm to discriminate.

Mr. McMillian gave an example of when he was in private practice and there was to be a jury trial in  Southern Indiana. The client asked, how do you think a jury will react to a person like Jimmie? The  partner responded that we're mostly white and we love Jimmie and that  he would rather have Jimmie try the case than him. Mr. McMillian said that it was an important moment because the partner backed him. 

Mr. McMillian added that it was important for the person holding the position of chief diversity officer have respect. He was asked to be chief diversity officer in a firm at a time when he was a non-capital partner and turned it down. He said that you need someone with enough power and influence within the organization, someone with enough boldness to be willing to get fired if you say what you need to say.  

Judicial Scenario 

In the second hypothetical, a judge sits in a racially and ethnically diverse city. Firms in the area have had some success in recruiting diverse lawyers but they rarely show up in court  and when they do, they never speak.  Should the judge intercede to create more opportunities for diverse lawyers? Does the fact that the judge is ethnically and racially diverse matter? 

Judge Donald said that judges have an obligation to improve the administration of justice. However, she asked, "Do I have an obligation to interfere in lawsuit you are presenting? I would not intercede in your case. I might call a conference after the case. Some judges will be more aggressive. What I would say is implement rules to address the issue on the front end." Frequently firms will send a junior person to the Rule 16 conference. The court can adopt a rule that whoever comes to the pretrial conference must be a person who will have an active role in the case. They don't have to be a lead but questioning a witness or arguing a motion can be a way to get valuable experience. 

Bringing in a minority attorney who is not given a real role in the trial can backfire. A TV station was sued by reporter. The firm defending the station brought in a minority partner. All she did was sit at the table. The jury ruled in favor of the plaintiff. The station manager felt like it was punished for bringing in a minority for show when there was no currency. 

Judge Donald said, I get the message out through training and speaking. When you go into the courtroom you know your case better than I will ever know it. At that point I won't get involved.

Mr. McMillian asked the audience to repeat three statements:  How's Jimmie doing? I like Jimmie. I hope you guys are taking care of him. He said these are the most powerful tools to help young minority associates. "You can not imagine how much power comes from saying that if you are judge, client or a  person in the community." He encouraged using those three phrases with anyone that you are a mentor or an advocate. 

Judge Donald spoke about hiring by other judges.  She said that some judges say they want to hire diverse clerks but haven't gotten many applications and that those they did receive didn't meet the  traditional criteria. Her question was, do you just take the applications you get? I get so many people who are diverse applying. People who have worked for me are always screening and sending me names. People who tell me they don't get diverse applications have a history of not hiring law clerks of color. One time another judge asked if she was done hiring because he had come across a minority applicant who graduated from Harvard. Her thought was if he's that good, why didn't you hire him? 

Mr. McMillian said that he applied for clerkships to judges of color because people don't want to be somewhere they don't feel they are welcome. He said we need to work on the inclusion part of diversity. He said to tell mentees go and apply for positions you don't think you will get. You can't live in fear of that. 

Judge Donald warned about implicit bias. If you surround yourself with people like you you will be blind to  noticing people who aren't like you. Martin Luther King, Jr. said that the arc of justice bends toward justice, but she added that it only bends if people bend it. The qualify of justice will be imperfect. It's all filtered through the lens of learned experience and that you need to have diverse clerks with diverse learned experience.

Law School Example

At a law school, employers come to interview student. The law firms prescreen resumes and decide who to interview. The school notices that African American students don't seem to have gotten as many interviews as white students. Those resumes that suggest students race seem to get even fewer interviews. The Black Law Students Association asks to eliminate the prescreening. Employers object, saying they are prescreening for high GPAs and journal service. 

Prof. Barnes said that hiring criteria, such as class rank, GPA, journal service are shiny baubles. Studies have looked at the correlation between various factors and success, what she called money ball for law firms. She said most of it doesn't matter and doesn't correlate with success. GPA and writing a note that gets published are best the indicators of future success. Other factors not so much. Non-traditional factors that are likely to predict success include military background and blue color work experience. These demonstrate tenacity and work ethic.  It's not where you went to law school that will determine your success. Some time ago law professors began empirical studies as to which factors predicted success. When this was shown to law firms, they said we can't present this to the partners because it says everything you think about recruiting is not going to help you get the best associates. Now firms have become more comfortable with data.

Mr. McMillian said that if you are on a recruiting committee. you have to pick 20 or 25 resumes to talk do. Grades provide the easiest cutoff point as opposed to intangibles. If your culture is grades and you drink the Kool-aid of grades and you consider someone else, you are bringing them into a bad situation. When they make a mistake, they receive greater criticism. When that happens, the firm is likely to decide that they are not not going to do that anymore and they will bring in people who fit the culture of the firm. However, he said, I have seen many people with 3.9s and 3.7s who crashed in the work setting. In other words, grades are considered to be of paramount importance but that may be due to confirmation bias.

Implicit Bias and Personal Stories

Prof. Barnes stressed the importance of a shared understanding of work culture. If appreciation for inclusion is not appreciated by the firm as a whole it won't be appreciated. If a firm is going to try a different approach, there must be leadership that will support nontraditional candidates so that when someone makes typical mistake for ,a second year associate they have someone to speak up for them. 

Judge Donald discussed a study on implicit bias. Law firm recruiters were shown a memo with various errors. Sometimes the memo writer had an Afrocentric name. Others had a Eurocentric name. When the memo was given to recruiters, partners found more errors in memos with Afrocentric names regardless of their own race and the comments were more critical. Having a European sounding name was worth an additional 0.7 points on a 5.0 point scale when the memos were identical.

Judge Donald and Mr. McMillian both gave examples from their own lives. 

Judge Donald had never worked in law firm while she was going to school. She had worked in the telecommunications industry. When she applied to work at the legal department of the company where she had been working, she was told she would never get a job in the law department because she went to an evening law school and they only hired Ivory League grads. Later, a friend of hers was terminated from the same firm and asked Judge Donald to represent her. She said the suit was an intense battle and she realized that even though she didn't have the pedigree of an Ivy League education that she had the skills. She said that just because a person doesn't check all boxes, it doesn't mean they don't bring quality and to be prepared to look at the whole person.

Mr. McMillian said that law firms and the corporate world today are going through a post-George Floyd guilt phase. He said firms would have to be patient enough to stick with inclusion for the time it will take to fix it. He said this is a long hard struggle. 

He rhetorically asked how diversity is used? Will firms ask, "Will it make me money? Come back with some clients and then we'll really support your diversity efforts." He said,  "I wonder if black people and brown people are ready. You want us to perform at highest level and there have been years of neglect. There's a reason that doesn't happen and it's not because we're lazy or dumb." He said that he was raised on the South side of Chicago. When he was 15, he was walking down the street and someone blew his best friend's head off. When he was enrolled at Michigan State, his father tried to shoot him in the dormitory and eventually shot mother. He flunked out out of college. He went to work at Best Buy as a security guard and later installed tires at Firestone. He paid for his student loans and got back in college. He said "my path is similar to other people's path. I was blessed to have people who would give me a chance. My GPA was 2.4 because I had to deal with hood (stuff)." He said that employers need to be willing to see beyond the surface. He said that there might be a candidate who was smart and hardworking but you just threw their resume away because they didn't check certain boxes. 

Judge Donald concluded by saying, all of you lawyers have power and should be committed in some degree to social engineering. 

 A Personal Note

It is not uncommon for people who look like me to respond to calls for diversity and inclusion to say what about me? What about my struggles? I have thought about that in the context of this panel. I was the first person in my family to attend law school. A combination of naivete and poor choices ensured that I never had a big firm clerkship or a job offer from a big firm. My starting salary after graduating Order of the Coif was less than half what the associates in the big firms were making in 1986. I actually got turned down for a job because my grades were too high.

Should I complain and say what about about all the unfairness in my life? The answer, informed by a lifetime of experience, is no (and I'm not just saying this to try to appear woke, whatever that means).  

First, the roadblocks I encountered were of my own making. I could have studied how to interview for a job but just assumed that I already knew. I could have tried out for law review but didn't think it was as important as working as many hours as I could to pay for law school.  I could have applied for a judicial clerkship but it just never occurred to me. In short, I was just glad to attend law school and didn't know that there was a path to the top that involved more than just working hard. However, no one ever counted me out because of who I was. No one ever said we've never hired a white graduate from the UT School of Law before. No one ever doubted that a married man could handle the stresses of working in a law firm. 

Second, I didn't do that badly. By the time I was in my late 20s I was making about as much as my dad who had two professional degrees in engineering. I'm now a shareholder and director in a firm I like. I have never made a million dollars and I didn't have a vacation home to move to when Covid hit. (By the way, several speakers in this conference did talk about people moving out of the city to their vacation homes. I think they don't realize how far outside the norm their experiences are).  

Third, at critical stages in my career, there were people who supported me even if my life path took a few detours along the way. Like I said earlier, no one ever counted me out because of who I was. I didn't need to benefit from diversity and inclusion because I was already in the mainstream. As a result, I had a mentor who taught me the ropes of bankruptcy and left me his practice when he retired at the age of 42. I had a friend who invited me into her law firm when my career had stalled out. I don't need to be jealous that someone out there might be getting a hand up because I got a hand up by default, just by being part of the mainstream. As the Rolling Stones said, "You can't always get what you want, but sometimes you just might find, you get what you need." I have always gotten what I needed. Diversity and inclusion or the related term belonging and inclusion is just about making sure that someone else gets what they need and I am good with that. 

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