Friday, September 30, 2005

Writing History

I think I can stop laughing now! This post by Shyster (he is becoming my favorite blawger - law blogger - now!), is hilarious. The post discusses a recent article (see posts below, especially, this one) by Wall Street Journal about the latest in outsourcing, Legal Process Outsourcing, outsourcing of legal work to low cost, high quality destinations like India.

On the skeptic side, the article quotes a senior partner at a patrician law firm:

"Gregg Kirchhoefer, a partner at Kirkland & Ellis of Chicago, one of the more prestigious and profitable American firms, estimates it could be 50 years before lawyers in India do more than "routine, prosaic" American legal work.

Well, without saying too much, take my word for it, this one will go down the history. What was Gregg thinking? Think of what Thomas Watson, chairman of IBM in 1943, was contemplating when he said, “I think there is a world market for five computers.” Or, like the urban myth by Bill Gates, who said in 1981 that "640KB ought to be enough for anyone".

When they say, you can watch history being made, they are not wrong!

Thursday, September 29, 2005

FT on Legal Outsourcing

After WSJ, its the turn of Financial Times, to talk about Legal Process Outsourcing. In an article titled, US law firms outsource to India, FT reports:

US companies and law firms have started to ship legal work to India - services such as case study research, review and analysis of legal documents, contracts, patent applications and even the drafting of contracts.

Pangea3, launched in Mumbai in February with 15 lawyers and one client, now has 30 trained professionals and roughly the same number of clients, including Yahoo, five other Fortune 1000 companies and a number of Manhattan law firms.

(The rest of the article is available only to subscribers of FT)

Wednesday, September 28, 2005

Wall Street Journal takes note of LPO! is an article titled, "Legal Services Enter Outsourcing Domain", by Eric Bellman and Nathan Koppel, Staff Reporters of the WSJ.

The article talks about providers of legal services, such as Pangea3, and large corporations running patent divisions out of India, such as DuPont.

"Short of anything where you have to physically be there or sign on the dotted line, we can do it",says Sanjay Kamlani, co-chief executive officer of Pangea3, a New York-based legal outsourcingfirm that opened shop a year ago and already has more than 25 lawyers in India and over 20 U.S.clients.

The article further talks about the cost savings, quality work and focus on activities core to business, that some of the clients of Pangea3, such as technology companies such as Roamware, Internet companies such as DirectoryM and other corporates such as Trico Marine, attained while working with Pangea3.

The article comments on the outcomes of legal services getting cheaper, while retaining the work product quality.

Indeed, outsourcing could ultimately change the way legal work is done in Western countries, industry analysts and company executives say. They expect it to free up American and British lawyers from time-consuming paperwork, allowing small firms to take on bigger cases -- while cutting the number of legal jobs needed in the U.S. Some suggest it could even encourage companies and individuals to become more litigious by lowering the costs of filing lawsuits.

So far, outsourcing has created as many as 12,000 legal jobs world-wide, according to ForresterResearch. The Cambridge, Mass., firm predicts that number could shoot up to 29,000 in 2008,with most of those jobs going to India.

Among some sceptic comments regarding the future of Legal Process Outsourcing are the who-wants-to-go-first comments from large law firms like Reed Smith LLP:

But that attitude may change once major companies grow comfortable using Indian lawyers. "Law firms don't want to be the first to embrace the trend," says Philadelphia lawyer Ajay Raju, who advises companies doing business in India. They figure, "Let others get burned first," he says. But he says he plans to propose that his firm, Reed Smith LLP, which has about 1,000 lawyers, start using lawyers in India for litigation support and other discrete tasks. After all, he says, "Why have a $300-per-hour lawyer do due diligence when it can be done [more cheaply] by someone else?"

The article finally discusses the argument by providers in the LPO space, that offshoring and outsourcing is not different from on-shore outsourcing, when it comes to quality on the provider's part and accountability on the client's.

So, all and sundry, Go Offshore! Outsource!

Fed Rate Hikes and Offshoring of Legal Work

Terry Corbell, a Seattle area management consultant writes about the impact of fed rate hikes on expensive services, such as legal work. To be able to operate comfortably in the event of a recession caused by the hikes, offshoring of legal work would be inevitable. Terry thus advocates acquiring skills that may help law firms in pulling a successful offshoring arrangement:

Making economic forecasts can be tricky. A lot depends on unanticipated events and human behavior. There are limitless variables to consider and all of them aren’t publicized in government reports.

For example, what will be the impact of legal offshoring? Yes, you read right. Legal offshoring. The U.S. has nearly 900,000 attorneys and paralegals, according to the U.S. Bureau of Labor, but are you aware that your legal fees might be kept low because of law firm outsourcing?

That’s right, according to a published report quoting Evalueserve. The Indian business and legal research firm believes 1,300 Indians now perform legal research for U.S. law firms to the tune of $52 million. Exponentially, that means in 10 years, U.S. law firms will outsource $970 million of work – just another example of why it’s important to develop management skills and become the chief decision-maker.

Monday, September 26, 2005

Valuemart Info acquires Tejas Infoscripts


Valuemart Info Technologies Ltd. said Monday that the company has acquired a 74 percent stake in Bangalore-based business process outsourcing (BPO) firm Tejas Infoscripts Private Ltd.
Post acquisition, Tejas will be a subsidiary of Valuemart Info Technologies, said a statement issued to the Bombay Stock Exchange.

"The acquisition will give us a head-start in the fast growing legal BPO segment," said C.K. Vasudevan, director of Valuemart Info Technologies.

Tejas Infoscripts is a BPO with a focus on the legal domain. The company's services help overseas law firms to increase their service value by freeing up valuable time for attorneys to concentrate on specialised legal services.

Typically, services outsourced include back office transactions, data management, E-filing, and research activities. The company currently employs 50 people and is poised to grow to 150 people by March 2006.

Tejas Infoscripts is also building a contemporary service platform for BPO services for banking, financial services and insurance verticals, said the statement

Sunday, September 25, 2005

Market Size and Growth Plans

Some snippets from here and there about companies operating in the LPO space...
Pangea3 Global co-CEO Sanjay Kamlani told PTI that the company will be raising up to $2 million to fund its expansion plans. "We will be raising the money by the end of this year to fund our expansion plans which include shifting the existing Mumbai office to a much larger facility, expanding our operations in the US and opening a new office in Bangalore or Delhi," he said.

Kamlani said the company would be recruiting an additional 120 people which would take the number of its employees to 150, a majority of them lawyers.

A recent National Association of Software and Service Companies-report pegged the market potential for legal outsourcing from the US at $3-4 billion.

"While the size of the Indian legal BPO segment is still very small, the success achieved by early movers has established the proof-of-concept, which is the key to unlocking the potential in new waves of offshore-outsourcing. "

Global spending on legal services is estimated to be at least over $250 billion, with the U.S. accounting for more than two-thirds of the market.

The report observes that increasing levels of interest in offshore-outsourcing of legal services to India have been aided by a steady growth in demand for legal services.

"The legal services outsourcing segment in India is still at a nascent stage, with no known large `one-stop' service provider. "

Currently, the market comprises a fair mix of captive centers established by large law multinational corporations as well as third-party providers," it says.

Hindustan Times says:

Legal outsourcing to India seems to be fast catching up in the US, with large number of attorneys in Grand Forks increasingly relying on lawyers, sitting thousands of miles away, in cities like Bangalore, Delhi and Chennai, drafting legal briefs and doing research for cases to be fought in American courts.

Given the advantage the Indian lawyers have, experts in Grand Forks believe it is unlikely that other Asian or African countries would compete in this sector as has been in case of call centres.

"There is no difference between Indian and American advocates. The quality of work is the same," said Attorney-at-Law, Jay Ethington, specialising in criminal defence.

A former Assistant United States Attorney, Ethington said he had tried Indian advocates to do research and complete the paper work for about half-a-dozen cases. "Results have been very good all the time," he told

Indian advocates do not fight the case directly in US courts. Sitting thousands of miles away, they do the research work, analyse the case and draft the legal brief for advocates, who fight the case in US courts. This saves lot of time and energy, besides money, for American attorneys.

Now a strong advocate of legal outsourcing, because the advantages India have, Ethington said: "I am very much impressed by the work done by Indian lawyers to help fight cases in US courts." Initially, like other US advocates, he too was reluctant in hiring Indian lawyers to do research work for his court cases.

Highly impressed by the quality of work executed by Indian lawyers, Larry Newman, who specialises in corporate transaction, said: "They have been instrumental in getting favourable results even in complex cases." Author of Texas Corporation Law, Newman said he favoured legal outsourcing to India because of cost efficiency, fast response and good quality of work done by the advocates. This is the reason, why it is fast catching up, he argued.

One of the greatest advantage, he said, was the time difference between India and the US. "While our legal research associate are busy preparing the case, our rivals - US lawyers, sleep. As such our company works 24 hours," Dhir said.

A CNN article comments:

A number of U.S. companies, including members of the Fortune 500 and some of the country's largest law firms, are now embracing the idea of outsourcing routine legal work to India, South Korea, Australia and other locales with far lower labor costs.

General Electric, the country's fifth-largest corporation, has taken the idea the farthest of any company and set up a subsidiary in India that employs about 30 lawyers.

This year 12,000 legal jobs moved offshore -- less than one percent of the total -- according to Forrester Research, a Cambridge, Mass.-based market research firm.

It didn't take much for University of Pennsylvania law school friends David Perla and Sanjay Kamlani to become entrepreneurs. After working as corporate counsels for years in the US, they wanted to make an impact on the legal market.

Last May, they set up legal services firm -- Pangea 3 -- with five US lawyers and two clients. Today, they have a dozen clients, and 15 professionals. And in the next three years, they hope to have about 200 lawyers and 100 clients.

Their clients -- US law firms and legal departments of corporates -- may be American and British, but they are serviced from Mumbai, thousands of miles away.

Or take Evalueserve, the BPO which has hired three lawyers and plans to hire seven more immediately. “Fortunately, the area is still nascent,” says Alok Agarwal, chairman, Evalueserve.

$5 bn is what US firms alone will outsource in litigation support by 2006

$17 bn is what the KPO revenue (of which LPO is a part) will grow to by 2010

$300 mn is the revenue para-legal services will generate by 2010

Friday, September 23, 2005

A Case for Legal Process Outsourcing

Shyster at presents a great case for Legal Process Outsourcing. The author is a US Attorney himself and like a majority in the US Attorney community, is waking up to a world where outsourcing of legal services is not longer mission impossible.

India, being a favored destination for knowledge based outsourcing, is home to a number of providers of legal services. These providers are located all over the country and provide services that span a wide spectrum of legal services. Their success is an indicator of a successful trial run of not only outsourcing but also offshoring legal work.

This blog will track the players in this space, the services they provide, and their well being. In addition, this blog will host pointers to interesting activities within the legal world with a greater focus on intellectual property.

To begin with, as pointed in the article by Shyster, we take a look at Pangea3. The firm is based out of Mumbai (India's commercial capital), is run by US Attorneys, and employs Indian lawyers and technologists. Being uniquely located in Mumbai, Pangea3 has the advantage of being able to provide a whole gamut of legal related services, within the broader scope of Patent Prosecution and Litigation, Contract Review and Drafting, Legal Research, Document Review and so on.

Being led by US Attorneys is the USP of the firm. Pangea3 uniquely offers the combination of lawyers and technologists for lawyers and technologists, two groups who form a majority of the firm's clients - effectively aYour team in India concept.

Legal Process Outsourcing is slated for a huge success, news reports and analysis on this blog will prove that. Watch this space!