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Fictional Problems at ‘Silicon Valley’ Get Real-Life Legal Advice, The Wall Street Journal

July 20, 2016

Pied Piper is getting some unsolicited advice from a few of Silicon Valley’s top legal minds.

The fictional startup portrayed in the HBO sitcom “Silicon Valley” faced a management coup, boardroom drama, layoffs and product-testing problems in its third season—all of which could have been mitigated with better legal planning, these experts said.

In one episode, Pied Piper’s engineers and executives clashed over whether to make their product—a revolutionary data-compression algorithm—available as a piece of hardware or a platform.

“I really wanted to jump in and be the lawyer, and make them think about all the things they didn’t think about,” said Jenn Wall, commercial counsel for X, the division of Google parent Alphabet Inc. that takes on moonshots such as self-driving cars. (Hooli, a tech giant rival in “Silicon Valley,” bears a striking resemblance to Google.)

“I would sit down with the founder and CEO and start asking questions,” she said. “Do you have terms of service? Are you exporting data? Are you importing anything?”

Ms. Wall was a participant in “Parody or Parable: A Legal Perspective on HBO’s Silicon Valley,” a panel hosted Tuesday evening by the law firm Morgan, Lewis & Bockius LLP in its Palo Alto, Calif., office.

The discussions were a sign of how seriously Silicon Valley takes “Silicon Valley” and its scrupulous skewering of tech culture. The show’s creator, Mike Judge, has gone to great lengths to create a realistic depiction of life inside a startup, hiring former Twitter Inc. Chief Executive Dick Costolo as a consultant on the script.

“Most of the show is built around a company doing things wrong,” said Tom Kellerman, aMorgan Lewis partner who works with tech startups. While the panel covered the show’s first two seasons, the third season that ended last month provided much grist for debate since Pied Piper finally became “a company with a product,” he said.

Though the discussion focused on the fictional Pied Piper, lawyers in the audience also brought up the truth-is-stranger-than-fiction problems faced by two nearby startups: Theranos Inc. and Tesla Motors Inc. At one point in the third season, Theranos’s troubles end up in a punchline. (In an earlier season, Tesla chief Elon Musk has a cameo.)

The panelists gave “Silicon Valley” credit for getting many things right. Daniel Ahn, managing partner at venture-capital firm Envision Ventures, expounded on the risks in replacing a startup’s founder with an outside CEO.

“There’s a 50-50 chance the organism will reject the new CEO,” he warned, something which—spoiler alert—came to pass at Pied Piper, when the founding team was repelled by the new chief’s approach.

Chris Banks, a Morgan Lewis partner leading the panel, said companies that misrepresent their growth—like Pied Piper did by padding its weak daily active users numbers—could be charged with fraud.

To the panel, it was clear Pied Piper’s growth in the third season warranted legal help, yet the show’s main characters remain engineers and investors. “I definitely think the show should have more lawyers,” said Lucy Wang, a Morgan Lewis associate.

By Christina Passariello, The Wall Street Journal