Concho Minick is the former long-time President of Billy Bob’s Texas, the historic and world-famous entertainment venue in the Fort Worth Stockyards. He is credited with transformation of the institution into its viable modern form. In 2017 the owners of Billy Bob’s Texas began an internal legal battle that shattered long-standing friendships and families. The battles continue to this day. In this continuing series, Concho shares experiences and insights gained from running the world’s largest honky-tonk. Concho is now the CEO of Christie’s International Real Estate | ULTERRE which is a commercial and residential real estate brokerage focused on the Dallas Fort Worth area.
Lessons from the Honky-Tonk
By Concho Minick
The Introduction to this series, Part 1 and Part 2 can be found here: Pt. 1 and Intro and Pt. 2. These installments cover screening for good business partners and avoiding conflicts of interest through the lens of my honky-tonk experience. In this short article, the topics are advanced to provide thoughts on legal conflict and Pt. 4 will address the added layers of difficulty that are presented with friends and family in business.
Pt. 3 of 5: NAVIGATING LEGAL CAPITALISM
“My mother has $25 million in the bank, and she says she will spend all of it to see you get nothing.” –Billy Bob’s Texas partner regarding legal conflict.
Had I encountered this statement before receiving a battlefield education in lawsuits, I would have probably laughed it off as a playground schoolboy “my dad can beat up your dad” kind of thing. It seems like such an outlandish statement to make about how anyone would approach the justice system and framework of laws here in Texas. But now that I have completed what feels like a legal combat tour of duty and signed up for another, statements like that do not surprise me anymore. They do however highlight the disfunction of our legal system.
So, what started the legal battles at Billy Bob’s anyway? Simply stated, greed and vanity drove a faction of partners to subvert the common interest of Billy Bob’s Texas to their own personal goals and gains. The behaviors ran unchecked in backroom meetings until they spilled over into a willingness to destroy the integrity of the business. Attempts at legitimate contract resolutions, professional management transitions, and financial transparency were forcefully ignored. Instead, an old west style takeover with armed security was invoked and a lawsuit was born.
When your back is against the wall like this, taking issues to a legal battleground can appear as a righteous move. I was carrying an ingrained belief that truth would win the day and that the legal system would deliver justice. And I felt well prepared. We had governance in place that rested on an LLC agreement requiring unanimity on all major business decisions. Surely the courts would see LLC contract law as high stakes for Texas business and our case would have sound footing, right? Additionally, I had an employment contract put together by highly competent attorneys, and I had established a record of tremendous business success including modernization of nonexistent or at best backward business practices which reduced the risk profile of the business and positioned it for expansive future progress. Finally, I had a few good partners that saw it all the same way.
I figured that in a courtroom, the bad guys would be forced to demonstrate facts that support their position and just like in the old westerns, the good guys will win. Unfortunately, that happens mostly in the movies. More than three years have passed now, and the legal conflict remains in the courts. I feel like I am only now taking a late seat at the banquet table of legal reality and that everyone knew about dinner time but me.
Let me share a few things I have learned so far that might help you if you find yourself headed toward events like this:
- Conflict Out the Best Lawyers. The lawyers you select will make a massive difference. Do your homework and be prepared to spend handsomely to get the best, experienced lawyers with a track record of home court advantage. You do not want them working for your competition. They can have enormous impact on the courtroom machine through their relationships, and it is best to catch the opposition flat-footed in this effort especially in a small town like Fort Worth.
- Lawsuits are the Wild West of PR. Lawsuits are like buying the most expensive form of advertising with little control over the message or the medium. Even if you are 100% in the right, count on a heavy dose of spending to counteract the public claim you are the bastard son of Bernie Madoff and Elizabeth Holmes. You have no control over what your opponents or the media will say. Nobody will be held accountable for what is said in the counterclaims or in the news, so prepare yourself (and your company) for maximum shock value.
- Embrace the Deposition. A friend of mine often said you have not matured in business until you’ve been deposed – he is so right. This is a game of manipulation and intimidation, so be prepared for it. [Pro Tip] – In a deposition, when an attorney hands you a document and asks you something about it, take a minute to read it even if it looks like your birth certificate. You will instantly find yourself the victim of the opposing counsel’s professionally trained frustration. Stand fast, you are right to carefully read everything. The goal is to trick you on camera. Think of a deposition like this – if someone spends $10,000 on attorneys to ask you questions about anything for 7 hours, do you think they can get one small video clip that makes you look foolish? They could probably do it in one hour. Welcome to the game.
- Truth Meters Not Installed Here. Do not count on sirens and lights to go off in the courtroom when someone lies on the stand or even says something vitally important to your case. Judges are human and unfortunately the technology for the gong to sound when someone commits perjury does not exist yet. You are going to be surprised at who is willing to take the risk. When you see this, do not let it distract you from the fundamentals of your case. Chasing every lie and exaggeration can get you unnecessarily off track.
- Add a Zero. Plan on spending 3x-10x what you initially plan on if you are determined to prove yourself right. This rarely happens efficiently in the courts and the ROI on such will make your CFO apoplectic. Set your course for a legal conclusion instead – one that will likely leave you feeling dissatisfied. Justice is a beautiful word but settling on imperfection can often be the most economic route. “The courts are no place for the common man,” says a good friend of mine, “It is a rich man’s game.” It is a simple but stunning truth.
To be clear this is not about paying off judges and jurors or bribing your way through anything. This is 100% about setting up a battle of attrition and scale that is a function of capital. Basically, it goes like this: create a giant black hole of time and expense for the one in your crosshairs by spending a lot of money that forces them to respond in kind – or – you win. Conversely, you can also cover your tracks by creating a giant black hole of time and expense for the person pursuing you. It works both ways! I am not advocating it. Just beware of these traps as hunter or the hunted.
“Litigation is the basic legal right which guarantees every corporation its decade in court.”
The reality of the legal system is a big letdown when you learn it. Seems like the “Santa Claus isn’t real” sort of thing that most people know but just do not want to tell their kids. It is hard to swallow because I have always revered the courts and my smart lawyer friends. In the past it all appeared so amazingly intellectual and genuinely about justice and how to build laws to help society. Plenty of good intent abounds for sure, but sadly the system has not quite developed for the average joe to pursue truth and justice. The forces of capitalism and greed are so incredibly strong – they have combined here to overpower right and wrong.
In one of my favorite books, The Dichotomy of Leadership, an idea comes forward about spending too much time on any extreme. The choices are infinite, but in the spirit of this article they are: 1. The virtue of law, and 2. The power of money. My best advice is to not spend too much time on either of these riverbanks. Remember this from David Porter (Microsoft) “Litigation is the basic legal right which guarantees every corporation its decade in court.” So find as comfortable of place you can between these two riverbanks and keep quickly paddling downstream toward better business ventures.