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OUTSOURCING LEGAL SERVICES:

“CHANGING THE WAY LAWYERS DO


BUSINESS”

By: N13 shukla


Patent Services:
• Patent research and analysis : Landscape studies, patent appraisals and
valuation studies, infringement analysis and prior art searching.
• Patent application drafting: Various stages of filing of patent application
(prior art searches, patentability assessment, patent landscaping, drafting
specifications, drawings etc) may be outsourced to an Indian Party.
• Patent prosecution: Indian companies are helping US attorneys in the
patent prosecution process, from providing a technical assessment of the
prior art cited by a patent examiner to drafting responses to the examiner’s
objections.

Legal Support:
• Drafting and revising contracts/ agreements:
Employee contracts, Non disclosure contracts, licensing
and supplier agreements etc are initially drafted by
trained Indian Lawyers and sent for review to US
attorney.
• Legal Research: Lawyers sift through large quantities
of data using electronic database and the Internet, to
provide focused research to law firms and attorneys.
Legal research is conducted for all sorts of US laws
including case and statutory law.

Paralegal Support: • Legal Counsel: Outsourced legal counsel services for


an in-house firm (with or without legal department) or a
Document Processing, legal firm, encompass most of the areas: Antitrust,
production and management bankruptcy, construction, Corporate, Criminal and civil
(includes word processing, legal transcription, rights etc.
legal coding, document conversion, keyword
and XML tagging and archiving
Legal Overview :
Market Potential, Breakdown by Service Category
• Worldwide spend on legal outsourcing is estimated to be in the region of
$20BN growing at a CAGR of 8.1% [Hildebrandt International]
Litigation
• Of this composite figure, approximately $6BN is generated from purely Support
“legal” services:
– Litigation Support (4.9BN) (82%)
– Customized Legal Research (0.62BN)
– Patent & Trademark Prosecution (0.4BN) [Hildebrandt Global
International] Market
Contracts
and Research
• NASSCOM estimates the size of the outsourced component of this global
pie to be around $3-4BN IP

• With current revenues around $60MM, NASSCOM estimates that India


currently has about 2-3% market share in the outsourced LPO market
• The current sectoral breakdown of the Indian market shows heavy bias
towards IP solutions: ( Value Notes Estimates June 2006) IP Services

– $42MM – 70% Patent and Trademark filing support services


– $12MM – 20% Customized legal research
– $6MM – 10% Litigation Support [ValueNotes] Indian
Market
Contracts and
Research

Lit. Sup.

The short-term will see a trend correction in the Indian LPO market which will bring Litigation Support’s
current 10% market share into line with the global market i.e. 83%. This trend correction will happen at
the expense of IP services.
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Market spending for legal services
Country Amount Growth over the previous year
(US $ Billion) (%)

Australia 6.9 11.6

China 1.6 7.0

France 18.4 14.0

Japan 1.09 8.0

South Korea 1.61 -3.3

UK 34.2 3.6

USA 166.8 5.6


• Client Types

– Corporate Legal Departments - With a rising tide of corporate litigation,


consolidations, mergers, and some of the century’s most sweeping changes to
corporate governance; corporate legal departments are facing unprecedented
workloads and increased scrutiny. Tight budgets mandate even more vigilance
in controlling large costs such as outside legal fees and discovery requests.
Increased focus on outsourcing quasi-legal work including contracts

– Law Firms - Consolidations, mergers and the dispersal of legal expertise


across geographically distributed offices have put significant pressures on law
firms to efficiently manage critical assets. At the same time, law firms are
under pressure to provide clients with a single unified face, higher levels of
service, and reduced legal fees

– Government and Universities - Huge market with a urgent need to find a low
cost solution
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Legal Services - Summary
Litigation Electronic Document
Discovery
Data wrangling, extraction of metadata, de-duplication, data culling,
conversion into desired format and legal review
Support Paper Discovery Image capture solutions, OCR/ICR/Text clean-up, logical utilization,
indexing and database conversion
Coding of Documents Objective/bibliographic coding, In-text coding, subjective coding
Attorney Document Privilege determination, substantive issue coded review for
Review responsiveness

Legal Research Conducting research by using Westlaw/Lexis Nexis, preparing memos


and research notes

Contract Contracting Automation Reduces the creation time, lowers administrative costs, reduces contract
and Standardization risk, fosters greater collaboration, works on pre-defined templates and
Management clauses

Document Management Establishes searchable central repository, greater visibility to contracts,


System saves cost, uncovers risk and improves compliance, increased
awareness of business terms

Audit and Compliance Audits internal contract management processes and controls,
organizational and structural alignment
Contract Abstraction andReviewing the contracts, creating templates for abstracting/summarizing
Summarization the contracts, working on such templates

Intellectual Patent Prosecution Prior art search, patentability assessment, patent illustration,
response to office actions, claims drafting, docketing
Property Intellectual Property Claims mapping, infringement analysis, technology landscaping,
Asset Management competitor analysis, patent mining, competitive intelligence
(IPAM) benchmarking
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Patent/Trademark
• Prior Art Research

• Preparation of Initial Application Drafts

• Illustrations for Applications

• Administrative Filing of Approved Forms

• Tracking & Notifying of Renewal Dates

• Validity Research for IP Litigation


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Domestic
Offshore
Domestic in house Offshore in-house
sourcing sourcing
In-house
Example: Example:
Company provides its Company uses services
services domestically supplied by its own
without any outside foreign based affiliates
contracts (subsidiary)

Domestic outsourcing Offshore outsourcing

Outsource Example: Example:


Company uses services Company uses services
supplied by another supplied by an unaffiliated
domestically based foreign based company
company
2008 LPO Research
• Customers
– 2008 is projected to attract 920,700 new
customers
– 27% of first-time customers have become
repeat customers
• Legal Financial Turnover (in USD Million)
– Average transaction in the United States for
any Legal matter involves = $20,000/- per
case
Why India?

• Highly Educated/Skilled Personnel (250 Million)


• Technologically Connected/Adept
• English Speaking Lawyers/Legal Proceedings
• 40% of US Based Cost
• Common Law System
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Why India??
• Faster
• 40%-60% cost Pr turnaround time
reduction for ty od
offshored process uc o Time zone
ti
Cost vi odifference
o Differential in
o 24X7 service
wages from the US
0r UK parent India’s
• Learning curve
location at approx value effect, given
70%-80%. propositi increased activity
on across companies
o Interaction costs
and increased
increase 10%-20%
centralization
bcoz of India being a
within company
remote • Established methodologies and
location….thus net processes being rapidly adopted
t
savings of 40%-60%
u ali for better performance
Q
• Labour cost y • Well defined quantifiable
arbitrage, the reason metrics for quality and process
for cost savings
likely to exist for • Access to highly qualified –
next 20-30 years skilled pool