E-Discovery Started the Legal Outsourcing Revolution

It's easy to understand why American companies have outsourced low-skill, time-consuming office work to India -- consumers don't care who does the work, as long as it gets done, and Indian workers do it cheaper than Americans.

But what prompted American companies and law firms to start sending legal work overseas? After all, legal work is complex, high-end work; laws vary from state-to-state; and clients want a lawyer they can speak to face-to-face, in confidence.

According to a recent Washington Post article, new e-discovery regulations established in 2006 created a need for outsourcing. The Post quoted an official with an outsourcing company saying:

"The new e-discovery rules sent American companies scurrying all over the place. Neither the corporates [sic] nor the law firms in America are geared to do this kind of work at short notice. And that is where the Indian players come in. We can bring together a large number of skilled lawyers in no time at all and at one-fifth the cost."

Since the initial flurry of outsourcing, however, the range of work that can be outsourced has broadened. While Indian firms might initially have primarily performed document-review-type work, some legal outsourcing firms now research and draft motions for use in U.S. courts.

Now the question is how deep into the legal profession outsourcing will go. It was probably inevitable that East-Coast mega-firms would outsource document review. But will mid-size, middle-America firms eventually have to outsource to survive? Only time will tell.

$80 Million of Legal Work Sent Overseas This Year

Reuters recently reported that $80 million of legal work is outsourced annually, with over 75% going to India.

Like millions of Americans, I was excited when I read Tim Ferris's "4-Hour Work Week" and learned about outsourcing. As Ferris explains, via the internet it is easy to hire foreign workers to perform mundane tasks. And, by hiring someone in a country where wages are lower, you can really benefit from the arrangement.

If you've called customer support at any major company lately, you know that call centers in India are receiving a lot of outsourcing work.

But legal work? Should that really be sent overseas? Is it unethical for American lawyers to outsource? Are Indian lawyers practicing law without a license?

I will address these and many other issues surrounding the outsourcing of legal work on this new blog. Stay tuned...