When Friends Become Foes: Collaboration as a Catalyst for Conflict

Abstract

Social embeddedness research has suggested that a history of collaboration between rivals should facilitate cooperation and prevent conflict. In contrast, the present study explores how a history of collaboration between people who subsequently become rivals can exacerbate conflict rather than facilitate future collaboration when salient others may expect them to be antagonistic. We develop this argument for a general set of relationships in which agents who previously collaborated become rivals while representing contesting principals. These agents may be perceived by the principals they represent as having compromised loyalties. This is especially likely when the principals whom the agents represent compete intensely or have previously been in conflict. To mitigate principals’ loyalty concerns, agents engage in compensatory behaviors meant to demonstrate social and psychological distance from former collaborators and now-rivals. Paradoxically, these behaviors transform a history of collaboration into a catalyst for conflict. Our empirical analyses are based on the professional histories of more than 20,000 external legal counsel representing corporate clients in intellectual property lawsuits filed from 2000 to 2015. Results reveal that lawyers engage in uncooperative behaviors in court to distance themselves from opposing lawyers who are former collaborators. These dynamics are associated with longer, more contentious litigation and lost economic value for clients, as evidenced by an analysis of companies’ abnormal stock market returns upon the termination of a lawsuit. Our research thus sheds lights on a mechanism by which past collaboration can undermine future collaboration and carries potential implications for research on social structures and for work on the interplay of structure and evaluative dynamics.