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BMC Software GC Pat Tagtow and his senior counsel, Sarah Menendez, spent five years litigating and two weeks at trial claiming that competitor but sometimes business partner IBM made a “material misrepresentation” and acted in “bad faith” during contract negotiations when it agreed to not displace BMC’s products from AT&T’s mainframe systems but did so anyway. There were 52 depositions, 17 expert reports, hundreds of thousands of pages of documents produced as evidence and more than 950 court docket entries.
Tagtow “was the impetus” for BMC filing the lawsuit. He lobbied the company’s CEO, CFO, head of mainframe and head of sales to get them on board.
The result was a landmark $1.6 billion trial victory against IBM.
In this expanded Q&A with The Texas Lawbook, Tagtow reflects further on the “best day of [his] work life,” how the role of the general counsel has evolved during his career and what he considers his most important role as a GC.
To read Mark Curriden’s full-length profile of the BMC legal team in the IBM litigation, click here.
Texas Lawbook: You have been in-house counsel for 23 years. How has the role of the GC and in-house counsel changed during your career?
Pat Tagtow: It’s actually been 24 years as of Feb 15, having started at BMC in Feb 1999 (wow — I am old). Interesting question — in some respects, very little, and others have changed quite a bit. What has been consistent for 24 years is the role of the lawyer as guide, teacher and risk analyzer. The goal has always been and continues to be to become the trusted advisor that adds value and can successfully navigate difficult or uncomfortable situations (in-house counsel or GC). What has changed are the tools and the issues, which is part of what makes practicing law in-house constantly interesting, engaging and evolving. Over the years, new issues internally and externally — Covid challenges, remote working, public company challenges, geopolitical issues, workforce evolution issues, activist investors, private company dynamics, working with PE sponsors — have kept all of BMC’s lawyers busy.
Lawbook: Pretrial, what do you think was your most important success?
Tagtow: Discovery battles — I cannot express adequately how hard IBM tried to keep critical discovery out of our hands. Whether under questionable claims of privilege, shell game of production or battles about scope, we had more hearings on discovery than all other subjects combined (and won virtually all of them). It was through sheer tenacity, strategy and endurance that we were ultimately able to get the rightful discovery (often buried in mountains of irrelevant data) that uncovered the story of their fraud in this case.
Lawbook: What are the factors you consider when deciding about hiring outside counsel?
Tagtow: We go through a very thorough process when hiring outside counsel. We start with the people: individual experience and strengths, team make-up, diversity, overall support. Then we understand their process for case management, communication, scheduling. While people and process are important, the third area is key: partnership. On significant matters, BMC legal becomes part of the working team. We want to make sure the process will be collaborative, inclusive, communicative and transparent.
Lawbook: What has been your best day working at BMC?
Tagtow: Well, I got to say, reporting the judgment of this case to my CEO and board has to be the best work day of my life.
Lawbook: What does outside counsel need to know about you?
Tagtow: I am a straight shooter. I am usually easy to work with, but I do expect communication and transparency. If there is an error, just tell me about it. Counsel who have not, and we later find out, were not rehired, and some replaced midstream. I am part of the team — it is “we” not “you” or “I” on wins and losses and everything in-between. The most important things are trust and teamwork. The Bracewell team (and now also the White & Case team) and BMC were and are excellent partners on this case all the way through and continuing through appeal. I cannot stress enough how impressed I am with our external team.
Lawbook: What role does diversity play in your decision for hiring outside counsel?
Tagtow: It plays a significant role. I am a very firm believer that the best solutions and approaches come from a diversity of perspective. That diversity can come from professional experience, gender, race, age or other aspect of a person that may give them a view that differs from others.
Lawbook: What is the most important part of your role as a general counsel?
Tagtow: To find, foster and develop legal talent within the organization. My individual role and impact is dwarfed by the collective impact of the department as a whole. The development of a well-functioning legal department is my responsibility to my company, but creating an environment that fosters development, collaboration, teamwork and trust is my responsibility to my team. Any GC of a department of legal professionals is only as good as the team around him, and I am fortunate to have the best people I have ever worked with on my team.