Top Ten Reasons Why Law Firms Should Consider Selective Legal Outsourcing

In the last quarter of 2008 America faces economic challenges never imagined even a few months ago. How will businesses manage and survive the limitations on credit, demand and growth? How does the economic downturn impact lawyers and law firms which service the business community?

It is an obvious fact that businesses can only look at modifying two revenue streams, income and expenses, in order to increase profitability. If income is down and not expected to increase markedly in the near term, clients of law firms will take the hatchet to expenses in order to survive. Legal fees will be under extreme scrutiny. Legal outsourcing, while still a nascent industry, is gaining momentum, being considered in more corporate boardrooms. As the pressures to outsource build, lawyers ponder whether they should embrace outsourcing legal work offshore or resist it. In the face of global economic challenges coupled with the increasing loss of American jobs why would a U.S. law firm want to even consider legal outsourcing? Are there valid reasons why targeted legal outsourcing should be considered by every U.S. law firm?

Several weeks ago I received an email from a lawyer who was considering outsourcing some of the legal work of his law firm. Facing resistance and challenges from many in his law firm who wanted to maintain the status quo, he asked for my advice as to what he should tell his partners. Why should the firm outsource legal work offshore, a practice seen by some as adventuresome and risky, instead of staying the course, doing it “the way we have always done it.” I answered him with the top ten reasons why every law firm should consider selective legal outsourcing:

1. PRUDENT, TARGETED OUTSOURCING WILL RESULT IN REDUCED LAW FIRM OVERHEAD

Outsourcing some legal work to qualified providers in India will result in significantly lower overhead to the outsourcing law firm. In assessing the comparative costs the law firm will be wise to carefully calculate the real costs of employing one lawyer or paralegal. Those costs include salary and bonus, health insurance, vacation and holiday pay, sick time expense, FICA, office space and equipment for the lawyer, paralegal and secretarial staff assigned to that lawyer, pension and profit sharing, auto and parking expense, CLE seminar costs, and other employment benefits such as disability and life insurance. The real annual cost of one lawyer earning a base annual salary of $150,000-$175,000 is more likely in the range of $250,000 to $300,000 per year. NONE of these customary expenses accrue to a law firm utilizing supplemental offshore legal providers.

2. OUTSOURCING WILL ENHANCE LAW FIRM EFFICIENCIES

Selective outsourcing will improve the efficiency of your law firm. Because Indian lawyers work while American lawyers sleep, it will be like your law firm has a full time, fully staffed night shift. Some work can be assigned by a partner at 6 p.m. in the evening and the completed task on his desk when he arrives at the office the next morning. Litigation cases will move more rapidly through the court system with less need for extensions of time.

3. OUTSOURCING WILL RESULT IN IMPROVED LAWYER MORALE

As a child not many of the sermons I heard from my pastor stuck with me. But one, when I was fourteen years of age still rings a bell. He said: “Ninety percent of any worthwhile endeavor is pack work, plugging, day in and day out. Only ten percent of our work tasks are necessarily fun and enjoyable.” I have always remembered that statement. In more than two decades as a trial lawyer I enjoyed strategizing and trying cases to juries. But I did not necessarily enjoy all of the trial and deposition preparation, research and briefing, document review, and other mundane essentials of the practice of law. A law firm which incorporates outsourcing into its practice will inevitably foster more contented lawyers who devote their time and energies to the more challenging, fun and rewarding parts of the practice of law. Only the “chore” legal work is outsourced with the “core” work staying onshore. This allows more time for client interaction and development by the firm’s lawyers.

4. OUTSOURCING WILL RESULT IN OVERALL SAVINGS IN LEGAL FEES TO CLIENTS

Clients of law firms, particularly business clients, are searching far and wide for ways to cut their legal expenses. Many ask why they should pay, for example, $200 to $300 hourly for document review. Gone are the days when legal bills are simply paid without scrutiny. Likewise, the annual increases in hourly rates will not be well received by clients looking to cut costs. Wise law firms put the interests of their clients above their own. What is good for the client will ultimately be good for the law firm itself.

5. THE RULES OF PROFESSIONAL CONDUCT REQUIRE OUTSOURCING CONSIDERATION

The Rules of Professional Conduct of require that: a. “A lawyer should seek to achieve the lawful objectives of a client through reasonable permissible means.” (Rule 1.2) b. “A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions about the representation.” (Rule 1.4 b) c. “A lawyer shall make reasonable efforts to expedite litigation consistent with the interests of the client.” (Rule 3.2)

A lawyer is required to explore and discuss with his client all reasonable means of accomplishing the client’s objectives. A lawyer is not permitted to charge an unreasonable or excessive fee. It would seem that a lawyer is arguably required to discuss selective outsourcing as a way of reducing the client’s ultimate fee obligation and furthering the interests of the client.

6. OUTSOURCING “CHORE” LEGAL WORK PROMOTES CLIENT RETENTION AND DEVELOPMENT

Clients have long questioned ever-increasing legal fees for basic, “chore” legal work. However, they felt as if they had no alternative. They needed the legal representation and wanted good quality work. As there was not a significant degree of fee variance from law firm to law firm, clients tended to “stay put.” This trend is beginning to change as clients learn that they have options. Lawyers who outsource selectively are reporting a more contented, loyal client base. Clients who perceive that their lawyers are looking out for the entirety of the their interests, including fee costs, tend to remain committed to their existing law firms and even refer other clients (whose lawyers refuse to outsource).

7. THE COMPETITION IS OUTSOURCING

If your law firm is not outsourcing, be certain that your competition is. On August 21, 2007 Bloomberg. com reported that even long-established AMLAW 100 law firms like Jones Day and Kirkland & Ellis are outsourcing under pressure from clients.

8. OUTSOURCING U.S. LAW FIRMS MAY CHARGE A REASONABLE SUPERVISORY FEE

It is reasonable and acceptable for U.S. law firms outsourcing legal work offshore to charge a reasonable supervisory fee in conjunction with outsourced legal work. It is axiomatic that a lawyer who outsources legal work, whether to an associate, contract lawyer or offshore provider, ultimately remains responsible to his client for the quality and timeliness of delivery of the legal product. If a lawyer assigns the research and writing of a brief to a junior associate, the assigning lawyer will not customarily submit the final work product to the court without review and supervision. So it is with offshore legal outsourcing. Published ethics opinions of the San Diego, New York and American Bar Associations indicate that a lawyer who outsources offshore may charge a reasonable supervisory fee.

9. CLIENTS ARE INSISTING ON SELECTIVE OUTSOURCING TO ACHIEVE COST SAVINGS

Clients talk to one another. Executives of major companies golf and have lunch with one another. Corporate General Counsel attend meetings and CLE seminars, sharing information and ways to increase efficiencies and cut costs. They know about offshore outsourcing and the dramatic cost savings that can be achieved. It is unacceptable, therefore, to ignore legal outsourcing and, as one managing law firm partner told me, have “no appetite” for it.

10. OUTSOURCING WILL HAPPEN.

Doing nothing is not an option. Some are outsourcing. Many more are considering it, whether prompted by keen business sense or financial realities. Outsourcing is like a large, ominous wave a few miles offshore. It is preferable to surf the wave than wait to be engulfed, overwhelmed by its power and left wondering what happened.

British economist Herbert Spencer is credited with originating the term “survival of the fittest” in the mid 19th century. Although also having application to biology, Spencer applied the concept of survival of the fittest to free market economics. In a free market, companies and businesses will do what is necessary to survive. If that means outsourcing some U.S. legal jobs for the greater good of survival of the entity itself, then so be it. The model of ever increasing salaries and expenses for law firms followed by even higher legal fees charged clients cannot sustain itself any longer. Legal outsourcing is here to stay. The wise will take notice, survive and flourish.

Wikipedia Marketing – Use a Wiki to Market a Law Firm Or Practice

Wikipedia is a very important tool in a tech-savvy legal marketers’ arsenal. Web technologies like RSS from blogs, wikis, forums, and other kinds of channels into feed-enabled portals create buzz about an attorney or law firm.

Wikipedia has a massive traffic volume and influence in search engine results. The site also tends to attract a tech-savvy audience that researches RSS and other Web 2.0 technologies. Presented carefully, a strong presence for a law firm with relevant Wikipedia entries can help drive traffic to the Firm’s website. In the ever-expanding world of social computing, it makes sense for firms and attorneys to take the plunge into Wikipedia, but it is just as important to learn the rules of the game first.

GETTING STARTED

When creating the firm or attorney page, first check the state bar’s rules for the filing requirements for public advertising and written, recorded, electronic or other digital solicitations. In Texas, all attorney advertising copy must be submitted to the Advertising Review Department. However, since Wikipedia entries are assumed written by a neutral third-party the pages don’t officially fall into the “advertising” category.

Here is the official word from the Texas State Bar Advertising Review Department Director Gene Major; “Read the Texas Disciplinary Rules for Professional Conduct. Rule 7.07(e) lists the type of exemptions the Bar allows without submission for approval from us. These exemptions include publicly available information about the attorney or law firm, business card-type information about practice areas, firm website and information concerning legal issues, such as news articles, legal articles, editorial opinions, or other legal developments or events.”

Before constructing the framework for the Wikipedia page, the best advice is to list everything planned for the page, then read the individual state bar’s exemptions rule on filing requirements and make sure nothing on the Wikipedia list contradicts the state bar rule.

Wikipedia’s strict content guidelines must also be addressed and understood thoroughly. Wikipedia’s editors are basically anyone who owns a computer, and they can be merciless. Wikipedia defines itself as: an encyclopedia, not a forum for advertising or self-promotion, or a vanity press. As such, it should contain only material that complies with its content policies, and Wikipedians must place the interests of the encyclopedia first. Any editor who gives priority to outside interests may be subject to a conflict of interest.

There are no firm criteria to determine whether a conflict of interest exists, but there are warning signs. Adding material that appears to promote the interests or visibility of an article’s author, its author’s family members, employer, associates, or their business or personal interests, places the author in a conflict of interest. When editors write to promote their own interests, their contributions often show a characteristic lack of connection to anything the general reader might want to consult as a reference.

When constructing a page if its decided to write an article on an area of law where there is personal involvement, be sure to write in a neutral tone and cite reliable, third party published sources, its important to beware of unintentional bias. A neutral point of view is the key to success on Wikipedia.

The best learning tools here are examples. Houston attorney Mark Lanier’s page is a good model of how to write a Wikipedia entry properly. It can be found here: http://en.wikipedia.org/wiki/W._Mark_Lanier

You will notice Lanier’s page is categorized under American Lawyers/Living People. A page’s category is an important designation. According to the Wikipedia article traffic statistics (http://stats.grok.se/) Lanier’s page has been visited 246 times in June of 2008.

A law firm that created their Wikipedia entry properly can be found here:
http://en.wikipedia.org/wiki/Skadden%2C_Arps%2C_Slate%2C_Meagher_%26_Flom

This firm categorized their entry under: Law firms of the United States | Law firms established in 1948 | Law firms based in New York City. According to the traffic counter, their page has been viewed 6,508 times in June of 2008. That’s a strong audience.

Along with the successful pages we should also cite examples of problem entries. Haynes & Boone is a good cautionary tale. Their page can be found here: http://en.wikipedia.org/wiki/Haynes_%26_Boone

You will notice there is a warning header at the top of the page listing the entry as being written as an advertisement. Judging from the length of the page a lot of work went into building it. But there aren’t any external links except self-promoting websites and there are no references listed. Whoever wrote this entry probably thought the link to the firm’s website would be enough to justify the time and effort it took to build the page. However, a quick check of the page traffic counter shows the page was visited once in May and not at all in June. It is important to cite sources and make sure other articles link to the page from related topics. Make content relevant for the Wikipedia community, not just the firm.

CASE CITATIONS

You will notice from the Mark Lanier page example citations of some of his flagship cases. These cases should not be cited unless they are considered closed by the courts and all parties involved. If an attorney is involved in a court case, or close to one of the litigants, it would be very difficult to demonstrate that what is written about a party or a law firm associated with the case, or a related area of law, was entirely objective.

The courts or their parties could potentially notice even a minor slip up in neutrality in a court-case article on Wikipedia for an active case-in-progress, and this could potentially cause real-world harm. Because of this, restrict case citations and edits on other Wikipedia pages to cases officially closed.

STEPS FOR DEVELOPING THE PAGE

1. Research State Bar Professional Conduct Guidelines for filing requirements.

2. Research Wikipedia’s guidelines for content creation and editing, including standards for writing style, formatting, editing, adding links, etc.

3. Study the attorney and firm pages listed in this article and notice how they crafted their page, then make it easy on yourself and copy them with your own content.

4. Choose the proper category for the page. Study other related firms and attorney pages to distinguish the particular area that will most benefit your practice.

5. Find someone outside of your organization to do the actual development of the entry to avoid being deleted by Wikipedia’s conflict-of-interest policy.

6. Craft practice articles in the Wikipedia Sandbox:
http://en.wikipedia.org/wiki/Wikipedia:Sandbox The Wikipedia Sandbox section of the site allows members to post draft articles, experiment with formatting, tone, and linking strategies, and receive feedback from the community

7. Write articles according to Wikipedia’s neutral point-of-view standards, which discourages users from putting spin or bias in articles. Remove all the slick marketing hype for the copy. This sentence, for instance, is similar to something that would appear in company marketing materials:
o “XYZ Firm is a diversified law practice focused on the highest level of customer service”
For Wikipedia, it needs to sound like this:
o “XYZ Firm is comprised of attorneys representing a number of diverse practice areas including, Intellectual Property, Maritime Law and Business Litigation.”

8. Strategically link related pages within Wikipedia. Guidelines state that content creators should provide relevant links to other Wikipedia articles.

9. Use external links to send traffic to a Firm’s site. Hotlinks are permitted in certain sections of a Wikipedia article, such as External Links. Be sure to add links to relevant Firm Web pages where possible. Use concise, targeted pages relevant to the Wikipedia article in question, rather than just linking to the company’s homepage. Add links to the firm’s Web pages, data sheets, and white papers in an article’s “References” section. Include links to third-party sites on company-specific pages to demonstrate neutrality.

Finally, take all the valuable content just created and add value to the Wikipedia community by expanding the information available on RSS technology.

TRACK THE RESULTS

Starting with the article traffic statistics, track how many people are visiting the Wikipedia page. Be sure to monitor where clients are hearing about the firm and keep a record of the new calls into the office and be sure and ask the client where they heard of the firm.

Wikipedia is a collaborative, constantly evolving site, and a firm’s page must be constantly monitored. The team responsible for overseeing the page must constantly be aware of edits to the page, participate in ongoing discussions about pages, and look for opportunities to add more relevant, useful content to the site. Provide value to the Wikipedia community and reap the rewards!

Law Firm Ratings and Related Information

Before engaging the services of a law firm, it is necessary to know its background and performance record. To do this, you have to find out the ratings of the firm about its legal ability and standards.

Law firms are rated based on their ability and general ethical standards. There are rating boards across the country which conduct and evaluate law firms based on confidential opinions of members of the bar and the Judiciary. The ratings are given on a five-year interval, usually after a lawyer has been admitted to the bar.

The two components of the ratings system are:

o Legal Ability – This component is graded in three ways: C (good to high), B (high to very high) and C (very high to preeminent)

o The General Ethical Standard Ratings denotes ‘adherence to professional standards of conduct and ethics, reliability, diligence and other criteria related to the discharge of legal responsibilities’. The general recommendation rating of a law firm must be a “V” which it must first receive in order to gain the legal ability rating.

Ratings Classification

The ratings are typically described as follows:

o CV Rating – An excellent first rating, a statement of the firm’s above average ability and high ethical standard

o BV Rating – Means an exemplary reputation and well-established practice, also indicates that law firm is in mid-career, with a significant client base and high professional standard

o AV Rating – The firm has reached the height of professional excellence, indicates long years of law practice with the highest level of skill and integrity

The Importance of the Rating System

The rating system on lawyers and their firms are conducted to help you determine which lawyer or legal entity is worth hiring. The rating will also show you the level of competence and experience of a law firm as seen on the classification grade. Nevertheless being un-rated does not mean a law firm has no credibility. Many competent and reputable law firms in the country remain unrated or choose not to participate in the ratings. In researching about a firm’s credentials, peers, colleagues and former clients are still the best sources of real information.

Important Characteristics of a Reputable Legal Firms

For a law firm to be respectable, the following characteristics must be observed:

o Professional – Lawyers of a firm must show a high level of professionalism by treating each client with their full attention and support

o Experience – Lawyers must meet stringent practice area qualifications and must be dedicated to the practice of one area of law

o Good Standing – Lawyers must be of good record in the bar associations where they belong and must have no record of disciplinary action against them.

o Respected – The lawyer and the firm he represents must be respected by the community and his peers

Finding a reputable law firm is very much like looking for the right lawyer. Look for the firm that will suit your needs. However, when it comes to choosing the right firm, you should look at afirm’s experience and reputation. These are the two important factors to be considered when selecting a firm that will handle your legal needs.

More information about law firm ratings and information by consulting with California law firm