Deals: Bringing Corporate Transactions into the Law School Classroom

Tuesday, January 1st, 2002 at 12:00 am by Victor Fleischer
Victor Fleischer, Deals: Bringing Corporate Transactions into the Law School Classroom, 2002 Colum. Bus. L. Rev. 475

Law students are introduced to corporate transactions in much the same way Daniel LaRusso learns karate in The Karate Kid. The Karate Kid, you may recall, is a heartwarming movie about courage and discipline. Sixteen-year-old Daniel LaRusso (played by Ralph Macchio) and his mother move to California, where Daniel has trouble adjusting to life at a new school and repeatedly gets beaten up by the jocks. Daniel then befriends Mr. Miyagi (Pat Morita) and studies karate under Miyagi’s guidance. Miyagi teaches Daniel that the best way to fight is to control and channel his energy. Daniel overcomes his childish fear and anger with trained discipline and self-confidence. He ultimately faces down the jocks in a city-wide karate tournament, fights bravely, and wins the tournament.

Daniel’s relationship with Miyagi is the charm of the movie. When Daniel first shows up at Miyagi’s house, he is put to work performing a series of household chores – painting the fence, waxing the cars in the driveway, sanding the floor, and so on. Unbeknownst to Daniel, Miyagi assigns these chores to train Daniel’s muscle memory to perform basic karate moves. (‘Wax on, wax off . . . .‘) Just at the point when Daniel is ready to quit, Miyagi throws a punch; Daniel unconsciously parries the blow using the new skills he didn’t even realize he had learned. It’s the turning point in the movie, where Daniel learns to trust both his teacher and the value of the repetitive and grueling work.

The Karate Kid highlights the value of discipline and purity. Daniel learns karate piece-by-piece, with the focus always on the pure form of the ancient art. Miyagi shields Daniel from the sloppiness of actual fighting or even sparring against a live opponent. Not until the final scenes of the movie, where Daniel faces his enemies in the tournament, does he actually test his skills in combat.

Miyagi’s focus on the pure form is great for the movies, but I wonder if it might be a bit risky in real life. The Karate Kid method removes the untidiness of a live opponent from the picture. How will Daniel hold up when he notices the bitter taste of adrenaline in his mouth as he enters the ring for the first time? It’s a mystery until the end of the movie. As a moviegoer, I can accept as a matter of faith that Daniel will be able to translate his skills from the classroom into combat as a simple matter of discipline and courage. As an educator, I wouldn’t be so sure. It seems foolish to expect a young karate student to go out and compete in a tournament without first bloodying his nose in the practice ring. It cuts against everything we know about how people learn and improve new skills.

The Karate Kid method is the conventional method for training law students to become lawyers. Law school is supposed to teach you to think like a lawyer. It actually teaches you to think like a law professor. Law professors usually teach what they know best: how to identify issues, absorb doctrine, parse the holdings of cases, argue intelligently about policy, and do a close reading of statutory language. Most graduates can then easily translate these skills into what we traditionally think of as the tasks of a lawyer: writing a bench memo, crafting an appellate brief, or researching a complicated statute.

So far so good. The problem is that in modern practice, and especially in a corporate transactional practice, a lawyer’s daily tasks demand an additional set of skills. Thinking like a law professor will not help you identify, evaluate and manage business risks, structure agreements, negotiate terms, and draft and re-draft the documentation for complex financial transactions. Smart, hard-working law students may happen to become great transactional lawyers. But their professional success is only an indirect product of their law school training. Indeed, a majority of law students graduate without having once analyzed a prospectus, negotiated a term sheet, drafted a complex agreement, or, for that matter, even once having read a commercial contract from beginning to end. This may help explain why so many junior associates feel battered and bruised after they begin working at an actual law firm.

I don’t mean to be overly negative about the state of affairs in legal education. Talented teachers make up for much of the deficit in hands-on training. Law schools are full of Mr. Miyagis – masters of the Socratic method who teach students how to think in a focused, sharp, and disciplined manner about complex problems. Bright law students graduate with sharp minds and a honed ability to learn more, and many do succeed quickly by learning on the job. But I do think law students should get a few chances to develop and practice transactional skills before graduation.

This Essay is addressed primarily to law professors, deans, and the legal education community, but I hope it also might be useful to students, practitioners, alumni, and others with a stake in how we are preparing the next generation of business lawyers in the United States. The Essay will offer some reasons why law schools rely so much on the Karate Kid method and will discuss how the Deals Program – developed by Columbia Law School Professors Ronald Gilson, Victor Goldberg, and David Schizer – brings corporate transactions into the classroom.

Author Information

Inaugural Research Fellow in Transactional Studies and Lecturer-in-Law, Columbia Law School