Thomson Reuters Embraces Legal Process Outsourcing

Thomson Reuters announced last Thursday that they'd aquired a leading legal outsourcing company, Pangea3, in a move that according to the compnay:

"Gives Thomson Reuters a leadership position in the fast-growing legal process outsourcing market."

Reuters' press release notes that:

• Peter Warwick, president and chief executive officer of Thomson Reuters Legal, said legal process outsourcing will be key to helping law firms and corporate legal departments be more responsive and cost-effective.

• The acquisition is true to their mission to help the legal system perform better, every day, worldwide; we will now bring to the legal marketplace a responsive, high-quality, transformative resource for a broad range of legal support work.

• This is particularly important as law firms and general counsel adjust to the realities of the 'new normal,' where efficiency, quality and responsiveness are paramount," he noted.

• The LPO marketplace is growing at more than 20 percent annually and projected to exceed U.S. $1 billion this year.

The ABA Journal reported that:

"Thomson Reuters already has about 8,400 employees in India, but this would apparently be the first time the company would be providing legal services themselves, rather than just legal information and consulting services to law firms and other legal providers. The move into providing legal services – and, at least in a small way, competing with its own legal information clients – comes at an interesting time, as the United Kingdom readies to allow companies to invest in law firms next year."

It is definitely an interesting development, but one that is clearly consistent with the Reuters' strategy "to develop world-class information, software and workflow solutions for legal professionals around the world."

Because legal process outsourcing fits squarely under the heading of "Workflow Solutions."

The Survey of Small Firm Economics

Last week we looked at the survey of the 250 largest U.S. firms, and this week we'll look at The Survey of Law Firm Economics, a joint project of ALM Legal Intelligence and The National Law Journal, for which the majority of respondents were firms with fewer than 150 attorneys.

Consistent with the largest firms, the small and mid-size firms also saw an historically unprecedented double dip.

According to law.com:

In 2008, revenue per lawyer declined by the largest percentage in 25 years — nearly 5%. In 2009, the figure dropped again, this time by less than 1%. Although the decrease was slight, a two-year drop in revenue-per-lawyer figures is unprecedented for firms taking this survey.

And yet, according to the report, small and mid-size firms actually increased profitability by:

• Aggressive cost cutting.

• Expense per attorney dropped by 5% in 2009, the largest ever decrease in expense-per-lawyer.

• Expense-per-lawyer also dropped in 2008, making it the first consecutive year drop in that category since numbers have been tracked.

• Net income was also up by 2.7%.

• However, actual realization rates dropped 2%, and partners wrote off 7% more of their time than in 2008.

• Billable hours also dropped for both partners and associates.

So, if billable hours were down and clients were paying less of their bills, was aggressive cost cutting the sole component of the rise in net income?

No. According to the report, small and mid-size firms also compensated by raising rates.

Hourly rates for the average equity partner are now at an all-time high among surveyed firms.

Which means we seem to have a disconnect. Because most observers feel the balance of power has shifted to the client side. And, as we've discussed, the current ACC Value Challenge expects firms to drop costs by 25% next year.

It would appear that expectations on one or both sides of the equation will have to change.

Results from the NLJ 250

The National Law Journal's annual survey of the 250 largest U.S.-based law firms by headcount is out, and the numbers are starting to crystallize our collective perceptions from the last two years.

The largest U.S. law firms trimmed another 1,400, making this the second consecutive year of cuts and the largest two-year decrease in headcount in the ranking's 33 year history.

Over the last two years, the NLJ 250 have shed more than 5% of their attorneys. The only other consecutive two-year decrease was 1992-93, which saw cuts totaling less than 2%. So, we're clearly in uncharted territory here.

Digging a little deeper into the numbers we see:

• More than half of the 250 saw decreases, while more than 2/3 of the top 50 saw declines.

• Some firms even saw double-digit percentage cuts.

• Associates, again, took the biggest hit, accounting for the majority of the decreased headcount.

• Where headcount did rise in 2010 was in the "other category", which includes non-associate attorneys, contract lawyers, and temporary attorneys.

According to Altman Weil consultant Ward Bower, "There are fewer lawyers producing more work and more revenue." Which means "there's been a reset."

"Law firms are unlikely to hire hordes of associates as they had before the 2007 recession any time soon, if ever."

And this seems to be another indicator that what used to be considered associate-level work is now being accomplished via new, emerging channels.

Collecting Law Firm Data

Last week we discussed the ACC Value Challenge's latest initiative to reduce law firm spending by 25% in 2011.

One obvious question was what tactics will Law Firms ultimately embrace to tackle such a hefty directive?

Corporate Counsel reported last week on one interesting new tool that may factor into the mix.

ACC's longtime general counsel Susan Hackett announced the organization's new initiative to ask law departments to post their internal data -- anonymously -- on an ACC site so all firms can compare how their departments are performing.

The vast majority of law firms track internal data like:

• Outside Legal Expenses

• Actual Performance Compared to Amount Budgeted

• Department Spending as a Percentage of Revenue

But this data is of limited value if it can't be measured against other firms, and that's what the ACC's new database seeks to correct. According to General Counsel:

"Only 24 percent of the survey's respondents said they have the tools or capacity to benchmark their legal departments against others. And that inability to compare, Hackett said, is preventing them from making more effective use of the numbers."

Hackett said they hope to have something up and running, "even if not fully 'populated,'" by mid-2011.

The New Normal

The ABA Journal is hosting The New Normal, an ongoing discussion between Paul Lippe, the CEO of Legal OnRamp, and Patrick Lamb, founding member of Valorem Law Group, about the changes occurring in the delivery of legal services.

The phrase "New Normal" describes how technology and global competition are creating a new normal of relentless change, and this past discussion focused on the next wave of value demands from GCs.

According to the article, from GCs perspective, they are now coming from a place where "most things we buy are getting cheaper while law is getting more expensive."

Which leads GCs to question how can law firms can "say you’re putting our interests first when you don’t realize global competition could put us out of business if I don’t manage every aspect of my operations more efficiently?”

We've discussed the ACC Value Challenge before on this blog, but now according to its chairman, Mike Roster, “25% in cost savings for 2011 is the new target."

Roster continues, "I've spoken to many top GCs and this is what they're planning to get to next year, and it's achievable. And by trying to get there, they’ll actually do a better job.”

The New Normal wondered if a goal of a 25% cost reduction would be a "catastrophe or an opportunity", and they postulated that in their experience "seeking modest, incremental improvements usually changes little; seeking dramatic improvements (which requires simultaneously redefining objectives, resources and constraints) often – but of course not always – leads to breakthroughs."

25% cost reductions in 2011 is no doubt an aggressive goal. It will be interesting to see how adamant GCs remain, and what tactics law firms ultimately embrace to tackle such a hefty directive.

Trends Gaining Traction in Bureau of Labor Statistics Report

The ABA Journal last week highlighted the recent U.S. Bureau of Labor Statistics Report that contained good news for paralegals.

But if you really look at the actual BLS Report, it is striking how the trends that have emerged over the last two years are now shaping projections for the legal job market.

According to the report:

• "Corporations in particular are expected to increase their in-house legal departments to cut costs. The wide range of tasks paralegals can perform has helped to increase their employment in small and medium-size establishments of all types."

There has been debate whether cost cutting is a trend during challenging economic times or whether it is the new reality, and this report seems to assume the latter.

• "Demand for paralegals also is expected to grow as an expanding population increasingly requires legal services, especially in areas such as intellectual property, healthcare, international law, elder issues, criminal law, and environmental law. The growth of prepaid legal plans also should contribute to the demand for legal services."

There has been no shortage of talk about alternative billing models, but it is noteworthy to see one gaining enough traction to factor into government labor projections.

• "Employment of paralegals and legal assistants is projected to grow 28 percent between 2008 and 2018, much faster than the average for all occupations. Employers are trying to reduce costs and increase the availability and efficiency of legal services by hiring paralegals to perform tasks once done by lawyers."

At the core of legal service outsourcing is the idea that some rudimentary, associate-level legal work can be effectively executed by lower cost regional or international lawyers. But this government report takes that idea one step further, implying that some functions can be delegated to non-lawyers, which is something clients may want to watch warily.

Challenges of Constant Connectivity and Instant Communication

A couple articles this week highlighted the challenges and considerations arising from our current state of constant connectivity and instant communication.

We've all hit 'send' on an email, only to feel that wave of doubt. Should I have sent it? Could it be misinterpreted?

If that concern with an overly hasty missive exists with email -- which at least forces us to slow down a little and compose a thoughtful (hopefully) message -- the potential for rushed and ill-considered communication exponentially increases with text messaging, which is by nature immediate and fragmented.

Other potential pitfalls of instant communication for lawyers were assessed by Samantha Southall at Law Technology News, including texts from new/potential clients, inflammatory texts from opposing counsel, texts that contain derogatory comments about colleagues or judges, and inquiries from reporters.

One of Southall's observations turns out to be the best rule of thumb: Treat every electronic response as though it is going to be seen in print, attributed to you, in a newspaper. And we'll take it one step further: Act as though your comment in that newspaper is going to be read by your mother.

The other timely article appeared in law.com, where Harry Valetk discussed the challenges of a socially networked jury.

Valetk's conclusion that trial courts must "adapt to jurors hopelessly dependent on information" includes the following focal points:

Probe jurors during voir dire on Facebook and Twitter use. Establish frequency of use and a juror's ability to refrain from using social networking tools during trial.

Monitor juror Facebook and Twitter activity during trial. Tools like Social Mention allow you to search blogs, microblogs, networks, videos and much more. This engine also allows you to create alerts for your search terms that you can have e-mailed to you daily.

Ask the trial judge to remind jurors that they may come forward to report a fellow juror's misconduct. The judge should also remind jurors about the fines and other potential consequences for failing to follow the court's ban on communicating with others about the case.

Warn jurors before and after every jury break about the court's ban on communicating with others about the case during trial, including the use of Facebook, Twitter and other web-based tools.

Explain the logic behind the presumption of juror prejudice. Jurors today may be more receptive to complying with court-ordered bans on communicating with others during trial if they understand the logic behind the ban.

Survey of Law Firm Financial Performance

Last month's midyear survey results from Citi Private Bank's Survey of Law Firm Financial Performance offered some much needed good news, however each positive nugget came tempered with caveats.

According to coverage in AmericanLawyer.com:

The Good News: Law firm expenses decreased, compared with the first half of 2009.

The Mitigating Factors: Lower expenses are largely due to the reductions in lawyer head count that firms implemented last year. Also, since these reductions took effect mainly in the second half of 2009, we will now start to see much flatter year-to-year comparisons.

The Good News: The impact of head count reductions has been positive, with productivity up about 4 percent and contribution per lawyer (revenue per lawyer minus expense per lawyer) up almost 20 percent.

The Mitigating Factors: We're coming from a low base, and there will be a bump in head count created by the new incoming class starting in the third quarter, so firms may still have excess capacity.

The Good News: Billing rates are up, trending at 4 percent. This is a good result, albeit lower than the historic 6-7 percent.

The Mitigating Factors: We have two caveats. These rate increases are before realization, and we're still hearing that realization is under pressure (though not falling as steeply as in 2009). Further, since leverage is declining, rate increases may be artificially inflated because a higher percentage of more senior lawyers with higher billing rates are doing the work.

The Good News: Net income and profit per equity partner for the first half of 2010 show improvement over the same period in 2009.

The Mitigating Factors: Given the traditional bump in fourth-quarter collections, this may not be an accurate reflection of net income and profit per equity partner for full-year 2010 and cannot be taken as a prediction.

The Good News: As a sector, demand at global firms is up by almost 2 percent.

The Mitigating Factor: Global firms underperformed the industry over the last two years.

Taken as a whole, there seem to be enough rays of sunshine to argue that we may have at least reached the bottom. But there are more than enough caveats to argue that we're still deep in the canyon.

Tech Savvy Cost Reductions

Florida commercial litigation lawyer Marc Dobin wrote an informative article for law.com on cost saving tech solutions for smaller firms.

Starting with securing a firm's web presence, Dobin recommends GoDaddy.com, which offers domain name registration, very low cost web hosting, and has tremendous customer service to assist the novices.

While GoDaddy also offers adequate, free website templates, Dobin points to justia.net for the free version of their search engine optimized websites specifically for law firms. According to the article: "It is a template-based, form-based, legal-specific website, but is very professional looking and has good SEO. It is probably 75 percent of what I would want with a website with 0 percent of the cost."

For the firm's blog, he utilized the free Google product blogger.com, and then he registered his blog's domain name to protect against domain name poachers.

For email he turned to another Google product at Google Business Solutions that provides email accounts that function just like Gmail accounts -- but they also allow a firm to use their registered domain name.

The Google Business email accounts also have POP3 access, so IPhones and BlackBerries can access the mailbox.

Rather than a land-line fax, Dobin highlights unityfax.com -- a site that allows you to send and receive faxes (using a traditional fax number) via the web or email. For only $4.99 a month for unlimited inbound faxes, it is cheaper than a fax line and you can keep your fax number permanently (in fact, they can even port your existing fax number).

Dobin explains the way unityfax operates: "The faxes are sent to an e-mail address that can then forward them, using a Google Mail filter, to any user on the domain." And because the faxes are received as PDFs, they can be read on your computer or smartphone.

And for document delivery, he recommends yousendit.com, which allows password protected large volume delivery of electronic documents. You can send up to 2 GB of files in a password protected zip folder for $3.99, which is a significant savings over Fed-Exing hard copies.

As every legacy form of communication and marketing now offers a digital complement or alternative, Mr. Dobin underscores the advantage enjoyed by the technologically savvy.

Ernst & Young's Global GC on the Evolution of the Business of Law

Each week there seems to be a new indication of the evolution of the business of law.

This past week, American Lawyer.com posted a video of a conversation with Ernst & Young's Global General Counsel, Trevor Faure, discussing the future of the law firm model, as well as the client model.

Some of the highlights of the interview include:

• Currently, GC's are facing the application of world class business methodology to the practice of law.

• Attorneys across the board are being asked to increase coverage, compliance, and client satisfaction, while minimizing costs and stabilizing headcount.

• To do this, attorneys need to -- on some level -- define, measure, and analyze elements of the business, including financial efficiency.

• If GC doesn't address the issues of efficiency, then Finance or Procurement will.

• While lawyers may be conservative by nature -- and perhaps not the most comfortable with data and financial management -- they are nonetheless facing demands for financial efficiency driven by globalization.

• The challenge for lawyers is to become business astute, which means facing the imperative of translating complex, subjective, unpredictable services into some sort of metric-based management.

• This challenge applies to every size of law firm or general counsel.

• Even when the economy completely rebounds, the re-evaluation of the attorney/client relationship is not going to revert to pre-recession status, because...

• Globalization is a one-way street. The movement of capital around the world seeking the highest return is resulting in both law firms and clients building and designing efficiencies that they are not likely to give back.

Corporate-Minded Law

September's ABA Journal has a feature story on the growing momentum of private equity legal-service companies taking market share away from the traditional law school model.

According to the article, "Backed by institutions, private investors and hedge funds, these entrepreneurs and financiers employ a growing legion of lawyers in the United States and offshore."

"Even though their enterprises don't counsel clients—they are prohibited from doing so by the ABA Model Rules of Professional Conduct—they are changing expectations about how legal services are priced and delivered."

The common denominator for these legal service companies' business models is the unbundling of traditional legal disciplines and then providing specific efficiencies.

• Some drive down costs by automating routine legal tasks.

• Others assemble dedicated teams of lawyers for in-house legal departments to draft simple contracts, review documents and conduct research.

• Still others use proprietary models to predict probable outcomes in complex commercial litigation, then contract to finance the most promising cases, freeing up corporate litigants' capital for other uses.

This emerging hybrid of lawyer-entrepreneurs "speak a language investors understand. Rather than profits per partner, they talk about market share and return on invested capital. They converse as easily about finance, technology and management as finer points of law. And their enterprises produce steady returns even when unemployment soars and stock markets tank."

The Return of Legal Rebels

The ABA Journal started their Legal Rebel's project last fall, with a manifesto announcing their commitment to innovation in the legal profession, questioning the status quo, and using technology to serve clients and society.

After an eight month hiatus, the Legal Rebels site looks to be back in the saddle, with profiles featuring a slew of innovative and off-the-beaten-path approaches to the business of law.

Included in the updates are:

• A young lawyer who purchased a 100-year-old firm on craigslist and is now thriving in a small town.

• Continued coverage of SoloCorps.

• The story of an ex-prison guard's path to law school.

• The need for bookkeeping skills in a solo practice.

• How the lessons of military intelligence apply to a solo practitioner.

Add these to the 50 existing profiles, which weigh in heavily on technology, and the Legal Rebels project remains an important look at the stew of ideas shaping the next generation of lawyers.

SoloCorps

With a wink and a nod to the classic movie "Blues Brothers", Carolyn Elefant and Lisa Solomon kick off their road trip with: "It's 529 miles to Omaha, we've got two fully-charged laptop batteries, a Kodak Zi8, it's hot and we're wearing sunglasses."

This is SoloCorps, a multi-armed social media project organized by two East Coast entrepreneurial solo practitioners who set out to explore the "the rich range of experiences of solos and small firm lawyers across the country."

Lisa and Carolyn's posts at myshingle.com provide an overview of the project, which inlcudes attending solo-themed conferences and capturing the stories and experiences of like-minded attorneys. As Lisa writes:

"As lawyers, we’re all constantly telling stories, whether we’re making an impassioned closing argument before a jury or just swapping war stories over drinks after work. And, as longtime members of Solosez, Carolyn and I have witnessed, time and again, experienced lawyers helping newer ones by sharing stories of what they’ve been through over the years."

"As you’ve probably read a million times, the legal profession is in a state of upheaval, with conventional law jobs being lost each day and biglaw on the demise. Yet out of this turmoil, the solo experience endures and inspires."

Part mentoring program and part documentation of the different approaches to being a solo or small firm, you can view travelogue videos and interviews with lawyers (topics range from Alternative Legal Careers to Going Solo After Big Law to IP to general interviews) on their blog.

Follow the project on Twitter (hashtag #soloheart)

Or meet up with the SoloCorp project September 29 - October 1 at the 7th Annual Solo and Small Firm Institute in Grand Rapids, MI.

Leaving Big Law Behind

Much of what we've been discussing on this blog for the past year went mainstream last week, with Slate profiling the evolving Big Law model as a field "rife with upheaval".

Listed as one of Slate's five most read articles, the piece touched on many of the hot buttons that insiders have been watching, including:

• The assault on the billable hour, via The Economist.

• The wide range of alternative models currently testing the waters.

• Outsourcing internationally to teams of attorneys in India, via the New York Times.

• Onshoring to lower cost regions within the U.S., via The Washington Post.

• The Great Recession's squeeze on the legal field.

The article also identifies "companies below the $100 million revenue level" as the primary target clients of Big Law ex pats.

Finally, the piece notes that the transformation taking place in the business of law is not unique; rather it is simply the legal profession catching up with most other industries:

"Partners who ditch overcomplicated Big Law practices for nimble, flexible shops that facilitate simpler client relationships are like other denizens of the little-guy economy."

E-Discovery and Social Networking

Here we have the inevitable collision of two massive movements.

The first is e-discovery, which over the last decade has moved from a subset of discovery to its own umbrella, covering email, IM chats, databases, CAD files, web sites, and any other electronically-stored information that could be relevant evidence in a law suit.

The second is social networking. Facebook, twitter, and myspace may be the best known, but there are also LinkedIn, Xanga, Badoo, Migente, Orkut, Studivz, Bebo, and hundreds if not thousands of more niche specific networks.

The wrinkle with social networking networking sites as they pertain to e-discovery is that they are very transient; pertinent information may only be online for days at a time.

Last week TechnoLawyer featured a product called Cloud Preservation, which is an online e-discovery service that archives and preserves content from Web sites, blogs, and social media.

According to TechnoLawyer:

"The people who work at your company (your clients for those of you who serve as outside counsel) continually add to, delete from, update, and refine your corporate Web sites, blogs, Facebook fan pages, Twitter accounts, and more. Nextpoint designed Cloud Preservation to automatically crawl these online properties at predefined intervals, creating a comprehensive and searchable archive of this content, including HTML source code and images."

While it obviously doesn't archive retroactively (although webarchive.org is an interesting source for websites pre-2009), anyone with a hint of advance notice can specify sites to monitor, thus precluding any possible spoliation.

Also, from the Cloud Preservation site comes the cryptic offer of a preferred customer program for "Corporations, consultants, law firms, and any organization interested in volume pricing with fewer restrictions."

The New York Times Spotlights Legal Services Outsourcing

The New York Times ran an article this week on the continued growth in the legal services outsourcing sector.

Highlights from the piece include:

• "India’s legal outsourcing industry has grown in recent years... to a small but mainstream part of the global business of law. Cash-conscious Wall Street banks, mining giants, insurance firms and industrial conglomerates are hiring lawyers in India for document review, due diligence, contract management and more."

• “This is not a blip, this is a big historical movement,” said David B. Wilkins, director of Harvard Law School’s program on the legal profession. “There is an increasing pressure by clients to reduce costs and increase efficiency,” he added, and with companies already familiar with outsourcing tasks like information technology work to India, legal services is a natural next step."

• "Employees at legal outsourcing companies in India are not allowed by Indian law to give legal advice to clients in the West, no matter their qualifications. Instead, legal outsourcing companies perform a lot of the functions that a junior lawyer might do in a American law firm."

• According to Janine Dascenzo, associate general counsel at General Electric, while G.E. “will continue to go to big firms for lawyers who are experts in subject matter, world-class thought leaders and the best litigators," what G.E. does not need is the “army of associates around them. You don’t need a $500-an-hour associate to do things like document review and basic due diligence,” she said.

• "Thanks to India’s low wages and costs and a big pool of young, English-speaking lawyers, outsourcing firms charge from one-tenth to one-third what a Western law firm bills an hour."

• "The number of legal outsourcing companies has more than tripled in the last five years."

• "Revenue at India’s legal outsourcing firms is expected to grow to $440 million this year, up 38 percent from 2008, and should surpass $1 billion by 2014."

• “It really is the future of legal services,” says Leah Cooper, former managing lawyer for mining giant RioTinto and current director of legal outsourcing for CPA Global.

Support For Solo Practitioners

Last week the ABA rolled out new online support for solo practitioners. They tout their new Smart Soloing Center as "an online resource that is the latest in its growing portfolio of products and services designed for sole practitioners."

The Smart Soloing Center includes:

The Solo Blog Network, featuring posts from some of the most insightful lawyers who are writing about the joys and challenges of solo practice.

• Articles drawn from the ABA’s dozens of substantive law magazines.

• The most popular discussions from SoloSez, the ABA’s free e-mail discussion list for solo practitioners.

• The latest news about solos and small firms from the daily feed of the ABA Journal.

• Links to a wide variety of websites for solos.

ABA President Carolyn Lamm acknowledges that “solos need things other lawyers don’t."

Here at LegalEase, we are also keenly aware that solo practitioners have their own set of needs. Which is why we offer legal support services like document/contract review, deposition summaries, and legal research/writing .

Our legal support is scalable, allowing solo practitioners to navigate heavy loads as well as giving solos the opportunity to accept larger cases they would otherwise have to refer elsewhere.

And our cost structure is designed to be the most efficient alternative for solo practitioners. But don't just take our word for it; read what others have to say.

New Jersey Bar Updates Bona Fide Office Requirements

In a testament to the degree that technology is changing the day-to-day practice of law, the New Jersey State Bar Association is proposing to amend a finding issued last March by a state Supreme Court Committee that seemed rooted in a pre-internet mindset.

As reported in the New Jersey Law Journal:

"Recognizing that technology has fundamentally changed the way lawyers conduct business and responding to a recent state Supreme Court Committee finding that essentially opposes the use of virtual offices, the New Jersey State Bar Association is now suggesting the state Judiciary amend the parameters lawyers must adhere to for establishing a law office.

"We do not at all mean to suggest that the 'traditional' law office is a relic of a bygone era ... But for many attorneys and their clients, mobile telephones, personal digital assistants, e-mail and video conferencing offer opportunities for communication and information-gathering far more suited to their client's needs than a physical office location," states the Bar report."

This is a significant departure from the Bar's position over the last ten years, during which they advocated for the necessity of bricks-and-mortar law offices in the state to ensure the quality of legal representation.

"Even before the March opinion, the state Bar had been examining the bona fide office rule, given the changing nature of the way lawyers conduct business.

After several months of examination, a committee of the association's Professional Responsibility and Unlawful Practice Committee and Solo and Small Firm Section said the time had come for the rule to change.

In the report, which was forwarded to the Supreme Court last month, the groups said attorneys might need to designate physical locations for some things, such as audits and the service of papers. But for day-to-day work with clients, an office might not be necessary, and might even increase the cost of legal services.

It also suggested revising the rule to allow flexibility while stating that accessibility and responsiveness to clients, other lawyers and the courts must remain a top priority."

Here we have yet another example of technology stripping away the vestiges of Old Law and reshaping the way the practice of law is actually executed.

Outsourced and Off-Site

Law.com reports an interesting change in the way contract attorneys are being used.

"In the old model, firms would call a staffing agency and request 20 or so contract attorneys to come to the firms' offices and handle document review for a client. The law firms would then mark up the bill for housing the contract attorneys and having them use their computer systems, and then bill the client.

Under the new system... clients are calling the staffing agencies directly and creating deals on what they will pay for contract attorneys. Those rates typically include discounts or rebates...

The clients then tell the law firms that if they have to use contract lawyers on the clients' matters, they have to use the certain staffing agency at the rates the clients negotiated.

... in response, law firms are starting to ask that these contract attorneys not be placed in the firms' spaces or use their computer systems. The rationale is that the firms are no longer getting any profit from using the contract lawyers and don't have as much control over who is selected, creating security concerns when opening up the firms' computer system to attorneys it didn't hire."

Interestingly, this model is looking more and more like traditional offshoring always has. The attorneys doing the work are sitting in offices off the law firms' premises, and technology has eliminated any distinction between domestically located offices and international offices.

The Mobile Lawyer

Technology continues to tear down the walls of the traditional "office", extending the workplace beyond the horizon.

A recent ABA survey documenting the rise of telecommuting polled more than 850 attorneys and reports:

• 71% of ABA members surveyed telecommute

• Of those, 88% perform remote work from home

• 32% in hotels

• 21% in others’ offices

• 14% in public places such as libraries or courthouses

• 12 % in coffee shops and cafes

• A significant portion of that work being performed remotely is legal research (35%)

This last statistic is consistent with the type of work that is most successfully and efficiently performed remotely.

Attorneys are comfortable undertaking more rudimentary tasks like legal research and legal writing outside the "office" because it is background work that will later be integrated into a larger whole.

For the same reason, these are the types of work that are also most successfully outsourced to project-based, contract attorneys.

The foundation of legal outsourcing is apparent in the types of work attorneys are already comfortable having performed outside the office.