Category Archives: Legal process outsourcing

Deafening silence from BigLaw about legal outsourcing


By Melody A. Kramer, Esq.

Just this week the news has been circulating about the unsuccessful attempts of Fronterion LLC who bills itself as an “independent outsourcing advisory” to survey large US law firms about their use of legal outsourcing providers.  Why unsuccessful?  The ABA Journal reports that according to Fronterion, of the “nation’s top 50 law firms” (“top” obviously meaning “largest”) only one confirmed outsourcing of legal services “to some degree,” four firms denied using outsourcing, and 20 (40%) did not respond at all or “in a sufficiently definitive manner” to even be included.  Twenty-five other firms (83% of the responding firms) declined to answer the outsourcing questions.

“No comment.”  Is this really what the “nation’s top 50 law firms” have to say on the subject of outsourcing?  What’s to hide?  If the mode of outsourcing they are using benefits their clients, why not openly say “yes, we use strategic outsourcing to reduce overall costs for our clients” or something similar. 

Is there any connection between this deafening silence and some other interesting reports in the legal industry about these same 50 law firms?  Let me review some headlines that have caught my eye recently.  On May 12th the ABA Journal reported that Orrick Herrington & Sutcliffe was reconfiguring its business model and now keeping partner profits secret (Orrick Partner Profits Are Now Secret Under 21st Century Redesign, Firm CEO Says).  The same day it was reported that all but 7 of the top 50 firms (the same class of firms that remained mum about outsourcing practices) have partner profits of $1 million or more (What Downturn? $1M-Plus Partner Profits the Norm, Outpacing 25 Years of Inflation).  On April 29th the ABA Journal also reported a slight increase in partner profits in 2009 based in part on law firms “aggressively reduc[ing] expenses.” (Not-So-Bad News for BigLaw: Small Drop in Head Count, Small Boost in Partner Profits).  In March, the ABA Journal reported on results of a Zeugheuser Group legal consulting firm report and concluded that “equity partners at the nation’s top law firms didn’t have to take much of a financial hit last year,” again citing cost-cutting (Crunching the BigLaw Numbers: Equity Partner Profits Drop Less than 1%).

Not only BigLaw, but the ABA is still turning a blind eye to the full picture of legal outsourcing.  As previously reported here, the ABA Commission on Ethics 20/20 Legal Process Outsourcing (Domestic and International)’s Call for Comments entirely ignored domestic freelance attorneys and contract attorneys who work for legal employment agencies.  This prompted a comparison of freelance lawyers to “freedom fighters” and, as far as google searches have shown thus far, only one publicized response to the Call for Comments.

While BigLaw is standing mute, corporate counsel are becoming more vocal about using project attorneys to handle their workload.  As reported in The Legal Intelligencer, corporate law departments are “increasingly using project- or contract-based attorneys to help handle an increased workload on a shrunken budget.”  “The pool of contract attorneys right now is exceptional” says James LaRosa of JuriStaff in Philadelphia.  “What they are getting typically is an attorney with a lot more relevant experience and a lot more real life practice experience.”  The full article is worth a read.

What’s in a name? “Growing enthusiasm for contract lawyers” but minimal interest in “outsourcing”


By Melody A. Kramer, Esq.

A significant percentage of law firms with 50+ lawyers “expressed a growing enthusiasm for contract lawyers” according to a Weil Altman survey but still are cool towards “outsourcing.”  According to their 2010 Law Firms In Transition report, in 2009, 39% of law firms reported “using contract lawyers,” a number increased to 53% for 2010.  However, the same report cites “less than 10% of firms outsourced or offshored legal work” in 2009 or 2010.  Nowhere does the article explain what the survey respondents meant by “contract lawyers” or “outsourcing.”

“Outsourcing” refers to having non-employees perform functions for your business.  Thus, if a law firm seeks out “contract lawyers” via an employment agency or a self-employed freelance lawyer to perform work for them, they are “outsourcing” work. 

“Outsourcing” is not synonymous with “offshoring” in which persons outside of the country’s territorial borders are performing work for U.S. law firms.

This continued confusion about the nature of outsourcing, contract attorneys working for employment agencies, and freelance attorneys working for themselves still pervades the legal profession, hampering meaningful discussions and actions.  For additional explanation, see the response to a Call for Comments by the ABA on Outsourcing provided by the National Association of Freelance Legal Professionals and freelance attorney Lisa Solomon.

Independent U.S. Contract Lawyer Takes On Foreign LPO: Round 2


by Lisa Solomon, republished with permission from Legal Research & Writing Pro

Last fall, I wrote about the risks that lawyers take when they outsource work to foreign legal process outsourcing companies. The primary risk I focused on wasn’t the possibility that the foreign provider might violate confidentiality or conflict of interest rules: it was the risk that the LPO company would produce substandard work. My last post on this subject was prompted, in part, by the abysmally poor grammar used in a particular LPO company’s marketing piece. As I explained in comments to that post, I think the quality of a company’s marketing materials is a good predictor of the quality of its work product. Last Friday, another marketing piece, by another foreign LPO company, brought this issue to the forefront once again:

foreign LPO Legal Outsourcing Handbook

This tweet promoted The Legal Outsourcing Handbook from LegalEase Solutions. Ever curious, I downloaded the Handbook and started to read.I was immediately struck by the “quality” of the writing. From the first paragraph (and, as I was to find out) to the last, the Handbook is rife with grammatical and usage errors; a few typos are thrown in for good measure. These errors alone would be sufficient to disqualify LegalEase from consideration by any sole practitioner or small firm looking to outsource: the last thing that a busy solo or small firm lawyer wants to deal with when outsourcing substantive legal work is having to practically rewrite a brief to get it signature-ready. But more serious still are the Handbook’s substantive errors.

The Handbook describes ABA Formal Op. 08-451 (Lawyer’s Obligations When Outsourcing Legal and Nonlegal Support Services) as “the first opinion issued by the ABA regarding legal outsourcing.” However, while Op. 08-451 is the first ABA ethics opinion that discusses offshore legal outsourcing, it isn’t the ABA’s first opinion concerning outsourcing.

In fact, Op. 08-451 itself discusses the ABA’s two earlier opinions concerning outsourcing: Formal Op. 00-420 (Surcharge to Client for Use of a Contract Lawyer) and Formal Op. 88-356 (Temporary Lawyers [the ABA acknowledges in Op. 08-451 that engaging the services of a temporary lawyer is "a form of outsourcing"]). Although the ABA’s ethics opinions are not binding in any state, they are widely cited in relevant opinions issued by state ethics authorities and some influential local bar associations (such as the New York City Bar Association). One would expect an LPO company like LegalEase to have a better understanding of these opinions, upon which the very viability of its business model rests.

There’s more. As every 1L knows, if you’re going to cite a case or statute in a brief, it’s important to make sure that the case or statute is still good law. In its discussion of its conflict checking systems, LegalEase quotes N.Y. Code of Professional Responsibility DR 5-105(e) (actually, it mis-cites the section as “DR 5 – 105(E), New York Lawyers Code of Ethical Responsibility”). New York abandoned the Code in favor of a modified version of the Model Rules 13 months ago.

When I tweeted about my initial response to the Handbook a few days ago, Russell Smith, the Chairman and President of the self-described “high-end” LPO company SDD Global Solutions Pvt. Ltd. quickly came to the defense of the foreign LPO industry:

With friends like this, the foreign LPO industry hardly needs enemies, does it? After all, wouldn’t it be fair to assume that LegalEase—which uses onshore (i.e., U.S.-based) lawyers to “manage and oversee every project, while the offshore staff performs the bulk of the work”—is also a “high-end” LPO company?

If you’re intent on squeezing every last penny of profit out of the outsourcing equation, you may be willing to spend the time to re-write poorly-written briefs, or to submit lightly-edited versions of those same briefs to the courts, in the hope that the judges before whom you practice aren’t sticklers for good writing. But are you willing to re-do the research, too, or run the risk that the brief you submit overlooks significant cases or statutes. or cites bad law? At what point does the extra work you have to do, or the extra risk you have to take, as a result of sending legal work offshore outweigh the benefit you obtain by maximizing the spread between what you pay to outsource the work and what you bill your client for that work?

There’s no question that you’ll most likely make less profit if you work with a freelance lawyer who lives, is admitted to practice in, and works in the United States than if you hire a foreign LPO company. But there’s more to outsourcing than dollars and cents: foreign LPOs may offer a better price, but onshore freelance lawyers offer solos and small firms better value.

About Lisa Solomon 

Lisa Solomon was one of the first lawyers to recognize and take advantage of the technological advances that make outsourcing legal research and writing services practical and profitable for law firms of all sizes. Through Lisa Solomon, Esq. Legal Research & Writing (www.QuestionOfLaw.net), she assists attorneys with all their legal research and writing needs, including preparing and arguing appeals and drafting substantive motions and trial memoranda. Through Legal Research & Writing Pro (www.LegalResearchandWritingPro.com), she shows other lawyers how to start and run successful practices as freelance attorneys and teaches lawyers in all practice areas how to write more persuasive briefs.

Lawyers are not widgets


By Melody A. Kramer, Esq.

Legal process outsourcing is all the rage these days.  Law firms faced with increasing pressure from their clientele to stop charging outrageous fees are often turning to legal process outsourcing companies who farm out document review and other work to unidentified, but reportedly well-trained, minions across the globe.  Law firms who use LPO companies in an effort to make a cheaper widget so they can compete in the market for their services on price point are entirely missing the point.

 Any law firm that outsources legal work offshore has forgotten what it means to be a lawyer.

Lawyers are not widgets – “something unspecified whose name is either forgotten or not known” (wordnetweb.princeton.edu/perl/webwn) — and for that matter, neither are paralegals or other support staff.  Each legal professional comes with his or her own unique set of strengths and abilities.  A genius at contract negotiation may quake in her boots at the prospect of appearing in court.  A phenom in courtroom advocacy may have poor deposition skills.  A meticulous patent prosecution paralegal may be utterly lost in a fast-paced litigation practice. 

Legal advice and services should be personalized and unique, whether the client is an individual consumer or a Fortune 500 company.  Providing that specialized and individualized service should be the priority of law firms, not maximizing their markup on billable hour widgets. 

However, the concept of a lawyer being a counselor and advisor has for too long been replaced by the big business model law firm with more and more levels of minions cranking out billable hour widgets that make the partners of mega-law firms millionaires.  What portion of this business model assists the client?  None of it.  No client, not even huge corporations, need a thousand lawyers! 

Can outsourcing of any legal work be of benefit to either law firm or client then?  Absolutely, when both the prism of law firm structure and client selection of law firms is adjusted.  Focus on individual skills and abilities rather than looking for a one-size-fits-all firm or lawyer.  Do you need high quality legal research memos?  Develop a relationship with a local freelance attorney with excellent writing skills.  Do you need a highly organized paralegal to help you prepare for a trial?  Contract with a local freelance paralegal that has familiarity with the necessary office and document management systems and trial preparation experience to help you out. 

Lawyer or widget – which is it going to be?

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