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Crain's Cleveland Business coverage on legal outsourcing in Cleveland Area
January 8th 2007

Need for specialized expertise feeds growing use of outsiders; Some attorneys find an alternative for research, writing in freelancers from as far away as India

Legal Affairs
MAYA PAYNE SMART
08 January 2007
Crain's Cleveland Business(c) 2007 Crain Communications, Inc.
All rights reserved.

Heavy caseloads, mounting client pressure and expertise gaps have some Cleveland-area lawyers seeking research and writing support outside of their offices.

Jennifer Blaga, executive director of the Cleveland office of Special Counsel Inc., the legal staffing unit of Jacksonville, Fla.-based MPS Group Inc., said she believes a ``growing number'' of Cleveland firms are starting to tap into the expertise of outside lawyers in specific practice areas, such as securities law.

Despite this growth, Ms. Blaga said Cleveland lags behind cities such as Chicago, Washington, D.C., and even Pittsburgh in its use of contract lawyers - independent contractors who conduct legal work on a temporary basis for law firms and sole practitioners.

``The folks that do it are very small shops,'' she said.

Alison Kinnear, owner of Let Me Be Brief, a legal-writing company in Hudson, said she, too, has noticed an upsurge in legal research outsourcing, and she believes it is a response to new economic pressures.

Ms. Kinnear previously worked at Vorys, Sater, Seymour and Pease LLP, but spent most of her career as an in-house attorney and as a judicial law clerk at the federal level. She did freelance work on the side over the years for friends before she decided to make a full-fledged business of it in 2004. In a matter of months, she had 10 clients.

``Corporate clients are getting more critical of their outside attorney bills to the point where law firms need to find cost-effective ways of delivering a high-quality legal product,'' Ms. Kinnear said.

Time and money

While the price varies by firm and by researcher, Ms. Kinnear said her hourly rate is ``probably close to a discount of 50% off the typical rate for an associate.''

There's also The Cleveland Law Library, a provider of legal and business information services to its members. It charges $75 per hour for research services, which would be comparable to a typical contract lawyer's research fee.

Sumeet Nath, vice president and co-founder of Lawwave, a New York-based legal research firm, said large firms are getting even better rates by outsourcing to India.

The 1999 graduate of Case Western Reserve University's Weatherhead School of Management said Lawwave's research costs start at roughly $50 per hour, much less than a first-year associate's billing rate. Document review work is even less expensive at about $20 per hour.

``The value proposition we provide is that they can use the time zone efficiencies between here and India and get two days' worth of work done in one day,'' Mr. Nath said of his team of U.S.- and India-based lawyers. ``We compress the time frame in voluminous projects.''

Mr. Nath thought of outsourcing legal work to English-speaking attorneys in India while working as a controller for part of Lucent Technologies.

``I saw how much we were spending in this global effort to comply with Sarbanes-Oxley, so it made me think that if we saved even 10% of the cost of a large law firm, it's a win-win,'' he said.

Mr. Nath said Lawwave serves a mix of clients in Cleveland and beyond, including large law firms that want to maintain a lower cost structure, lawyers who are running complex litigation cases with thousands of documents and corporate counsel clients who need research on a daily, weekly or monthly basis to stay abreast of statutory changes.

Mr. Nath said U.S-based lawyers, including Case law school graduates, also are employed to give clients the round-the-clock service they need.

All hands on deck

According to Ms. Kinnear, outsourcing in the Cleveland area is most common among small law firms with fewer than five people that ``don't have someone readily available to pass off work to,'' and it works best for well-defined projects such as motions, research memoranda and trial briefs.

Cleveland criminal defense attorney Edward Heffernan said outsourcing research work to National Legal Research Group of Charlottesville, Va., has made it possible for him to spend more time working as an advocate for his clients.

``I do a lot of criminal defense work, so my basic philosophy is that the criminal justice system is broken and most of my time is spent in courtrooms waiting for prosecutors to appear and resolve cases,'' Mr. Heffernan said. ``There's just not enough time in the day to come back to the office and do research.''

Mr. Heffernan is a sole practitioner with offices in Mentor and Cleveland, and he has outsourced both research and writing work.

``If you've got the money, you hire the experts,'' he said. ``You're able to get the personnel in place to present the case most favorable to your client.''

Brian Glassman, a legal writing professor at Cleveland State University's Cleveland-Marshall College of Law, agrees that oftentimes outsourced legal writing and research services can help fill in the gaps for small firms, whether it's as an expert or as extra help.

Mr. Glassman operated a legal writing and research business for five years serving mostly small, plaintive firms before joining the Cleveland State faculty.

``The small firm simply doesn't have the personnel and resources to absorb the large case, but the large case is very appealing because it carries with it the promise of very large fees,'' he said.

Same level of responsibility

Nationwide, the outsourcing trend has become so widespread in recent years that the American Bar Association issued a formal ethics opinion on how clients should be billed when attorneys retain the services of contract lawyers.

``Some of them will advise their clients that they are using this service as a way to reduce fees, and others will absorb it into their normal practice and treat it as if an associate within the firm was doing the work,'' said Let Me Be Brief's Ms. Kinnear.

Although the American Bar Association ruled that outsourcing is not necessarily an ethical matter, it did say attorneys who used contracted services are responsible - no matter who does the work.

``When a contract lawyer's services are billed with the retaining lawyer's as fees for legal services, however, the client's reasonable expectation is that the retaining lawyer has supervised the work of the contract layer or adopted that work as her own,'' the opinion stated.

Mr. Glassman said that's exactly how he operated when he provided outsourced services.

``When I was doing this, the work was submitted to them for their approval and use. I did make it clear that I did the best possible job I could, but it was ultimately their work, not mine; their name was on it,'' Mr. Glassman.

© 2004 Lawwave.com. All Rights Reserved.