The Washington Post reports today about the outsourcing of legal services to attorneys in India. This can’t be unexpected news; costs are much lower in India. And since much of the work product can be delivered instantly, via email, the industry seems reasonably well-suited to international outsourcing.
According to Russell Smith, whose legal outsourcing firm SDD Global Solutions apparently does some amount of Hollywood legal work, “my people in India can do everything from here, except sign the opinion letter and appear in an American court.” Apparently the most fertile site of outsourcing – no shock – is the vast world of discovery and document review. Why have fifty contract attorneys in a some high priced New York (or even Newark) office tower look for hot docs when attorneys in Hyderabad can do the same thing for less than half the price?
Attorneys are creatures of the guild, and many will probably respond: what about unauthorized practice issues? I am certain that some state bars will make efforts to prohibit this outsourcing. Still, it may be hard. In many law offices, paralegals do these sorts of tasks – everything from discovery to basic drafting. That’s kosher because a lawyer supervises, and signs off on, the projects – as he or she does with outsourced work. Any bar regulation clamping down on international outsourcing might therefore have signficant collateral effects on existing practice structures. While large firm lawyers are the most likely victims of international outsourcing, the state bar rank and file – lawyers in small and midsize firms – may have less of a stake in this battle and might be more protective of their own cost-control schemes. (In small firms, an experienced secretary often “practices” law.)
Will anything stop this practice? I suspect that if there is a brake, it will be the market. I imagine that first-rate quality control will require having supervising lawyers physically present at these international sites. That is a cost – and not necessarily a simple problem if you’re Cravath and want a Cravath-quality lawyer on site. Then there is the reputational risk. Big firm billing rates can only be supported by a guarantee of exceptional quality. When I was clerking, I always had the sense that top firms were billing thousands of dollars to insure perfect footnotes (that virtually never changed the outcome of a case.) The only reason for a client to pay this money is to create a near perfect assurance that it has obtained the best possible outcome in a matter. But it’s very hard to figure out if you’ve actually received this level of service. Consequently, firms need to find signals to convince clients of their quality. These signals range from office location to the hiring of Harvard Law graduates. The mere act of international outsourcing may undermine client confidence.
At the end of the day, however, it seems clear that there is a market for these services. In-house counsel will identify those matters that justify fully-domestic work and demand outsourcing of other projects. In some cases, in-house counsel may retain firms in places like India to research and write to the her strategic preferences, and ultimately sign the papers herself. If SDD Global Solutions can deliver high quality technical services, there are bound to be some clients who’d rather keep their money than deliver it to BigLaw.
Photo: the High Court of Hyderabad.
Hi.
Thank you for this posting. This is a very sensitive issue for me. I have zero problem with outsourcing. I have a huge problem with people practicing law without a license. These actions have completely cheapened the licenses that we have worked so hard for, and I am appalled that the state and national bar organzitions have not intrervened.
I mentioned your blog in one of my entries at GabesGuide.com, under laze sunday links.
Take care
How long will it be before we see a mass of arbitration clauses that mandate resolution of claims in Hyderabad?
How long will it be before we see a mass of arbitration clauses that mandate resolution of claims in Hyderabad?
I agree with Gabe on the unauthorized practice issue. The WP article implies that all or most of the people in India doing the work are graduates of Indian law schools. As a US law graduate, I can't practice Indian law and turn out good work product if the only expertise I have is a few hours of some firm-sponsored training. Nevermind that the work being done is just doc review or "paralegal" type work. A lawyer is a lawyer. If the law firms and outsourcing firms are going to classify these workers as lawyers, then they need to fulfill the bar requirements to be lawyers of the jurisdiction of the law that they're practicing (and frankly I think any US bar admission will do).
As for the collateral consequences on small firms if bar groups move to curtail outsourcing, I think restrictions can be narrowly tailored by geography instead of task. Simply restrict "outsourcing" to overseas offices of the same firm, and exclude the pure doc review outsourcing vendors. Right now, India's Bar Council prohibits the establishment of local offices of foreign law firms, which is why you don't have a Cravath office in Mumbai. But if a US firm with an office in London or Shanghai wants to farm US work to US lawyers out there, that's fine – it's up to the firm to determine whether there are any savings in doing this.
Finally, on the general topic of offshoring, I don't think it's a sustainable practice for India in the long run. Many of the once-touted call centers have moved back to the US or have moved on to even cheaper pastures in Egypt or the Philippines. More to the point though, is the fact that offshoring of work like call centers or rote doc review amounts to 21st century mercantilism and the death of real innovation. How can Indian lawyers develop Indian jurisprudence when the outsourcing firm they work for is only interested in squeezing out more productivity from them for some US client? Indian universities certainly churn out plenty of well-educated graduates. Yes the money they make is great, but what is socially innovative about having these people spend their days reading Hollywood contracts or answering calls from Mrs. Jane Doe in Peoria?
LPO Training Program & LPO Job Opportunities from Lawwave
Dear Friends,
Here is a great opportunity for law graduates and working lawyers to put their legal career on fast track!
Lawwave, a leading brand in legal outsourcing based in New York with its back office operation in Chennai, India is conducting an LPO Training Program for law graduates and working lawyers.
This program is meant to create excellent career opportunities for law graduates and working lawyers in LPOs and legal departments of MNCs.
The course content focuses on international legal practice and provides exclusive training and coverage on all the crucial areas of practice that are highly relevant to carve a niche in the legal industry.
The program offers exclusive career-counseling, resume-building and interviewing sessions for the candidates.
Lawwave provides placement assistance to candidates and their resumes are referred to LPOs and corporate.
The main highlight of the program is Complimentary Internship which offers the candidates with live LPO assignments to work on. It greatly helps the candidates in developing a keen practical insight about the functioning of the LPOs and corporate before joining the industry.
The candidates are assured of an advanced skill set and a growth-oriented career path after successfully completing the Lawwave LPO Training Program.
For further details about the program, please visit the URL http://lawwave.com/lpotraining_program.htm
Lawwave Corporate & LPO Training Program is scheduled to commence in the month of September 2008 in Chennai (at Lawwave Training Center) and Delhi (at India Law Institute Opp. SC Chambers)
Hope you find this interesting and see this as a great opportunity to explore and learn more…I would be glad to invite and reply to your comments and questions. Thanks!
LPO Training Program & LPO Job Opportunities from Lawwave
Dear Friends,
Here is a great opportunity for law graduates and working lawyers to put their legal career on fast track!
Lawwave, a leading brand in legal outsourcing based in New York with its back office operation in Chennai, India is conducting an LPO Training Program for law graduates and working lawyers.
This program is meant to create excellent career opportunities for law graduates and working lawyers in LPOs and legal departments of MNCs.
The course content focuses on international legal practice and provides exclusive training and coverage on all the crucial areas of practice that are highly relevant to carve a niche in the legal industry.
The program offers exclusive career-counseling, resume-building and interviewing sessions for the candidates.
Lawwave provides placement assistance to candidates and their resumes are referred to LPOs and corporate.
The main highlight of the program is Complimentary Internship which offers the candidates with live LPO assignments to work on. It greatly helps the candidates in developing a keen practical insight about the functioning of the LPOs and corporate before joining the industry.
The candidates are assured of an advanced skill set and a growth-oriented career path after successfully completing the Lawwave LPO Training Program.
For further details about the program, please visit the URL http://lawwave.com/lpotraining_program.htm
Lawwave Corporate & LPO Training Program is scheduled to commence in the month of September 2008 in Chennai (at Lawwave Training Center) and Delhi (at India Law Institute Opp. SC Chambers)
Hope you find this interesting and see this as a great opportunity to explore and learn more…I would be glad to invite and reply to your comments and questions. Thanks!
The BPOs in India face an enormous challenge in reducing attrition rate and this being a nascent industry needs to draw parallels.Before we proceed its important to understand the underlying reasons for high attrition rates, which are pretty steep and are around 40-50%. Currently it is about 35% in non-voice and 45% in voice call centers. About 80% of them look for better careers within the same industry.
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