Legal Process Outsourcing (LPO) – Top Ten Service Providers
May 15, 2010
Up until recently, the legal profession experienced few if any dramatic changes in how they operate. However and in the last few years, the rise of new technologies combined with the renewed drive to cut costs in the wake of the global downturn has increasingly forced law firms and corporate legal departments alike to reevaluate how they operate and to consider outsourcing the more mundane tasks associated with the legal profession. This has led to the rise of legal process outsourcing (LPO) along with numerous new and unfamiliar firms, many of which are based offshore, to specialize in providing LPO services to both law firms and corporate legal departments.
However and with so many firms now operating in the new LPO arena, choosing an appropriate provider of LPO related services can be difficult. Further complicating the selection and decision making process is the fact that the legal profession itself is governed by strict accountability rules and ethical regulations regarding who can practice law and how confidential client information must be handled.
Hence and in this research report, we will address the following questions about the LPO industry and providers of LPO services:
• What are the important services of legal process outsourcing (LPO) and what are the advantages of using an LPO service?
• What issues are important to consider before deciding to outsource legal work?
• Who are the top 10 providers of LPO services and what makes them different from the other providers of such services?
2. Key Legal Process Outsourcing (LPO) Related Terms
The following are key legal process outsourcing (LPO) terms used throughout this research report that would also be found in any articles about LPO and on the websites of LPO firms themselves:
- Certified Computer Examiner (CCE). First awarded in 2003 and administered by the International Society of Forensic Computer Examiners (ISFCE, LLC), the Certified Computer Examiner (CCE) certification certifies the competency of forensic computer examiners and has certified over 1200 individuals, including employees of LPOs, across 28 countries.
- Clearwell Gold Partner Certified. Founded in 2004 in Mountain View California, Clearwell Systems is an electronic discovery software company and the developer of the Clearwell E-Discovery Platform. LPOs who are Certified Gold Partners receive greater access to Clearwell’s technical and marketing resources, training and support.
- Contract Review. Prior to the signing of a contract, contract review includes all of the activities carried out to ensure that all requirements are adequately defined, free from ambiguity, documented and can be realized. Contract review is often a service offered by LPOs.
- The Data Protection Act 1998 (DPA). A United Kingdom Act of Parliament that was passed in order to bring UK law into line with the European Directive of 1995, this act defines UK law on the processing of data on identifiable living people and governs the protection of personal data in the UK. LPOs involved with UK data need to be aware of this act.
- Document Drafting. This LPO service would include the drafting of standard contracts, agreements, letters to the clients, patent applications and other legal documents.
- Document Modeling. This LPO service looks at the inherent structure in documents, including the formatting structure and the content structure. Most document modeling done by an LPO would involve form templates which provide a form of structured data that is set in the visual context of a document.
- Due Diligence. This term covers a number of concepts performed by law firms, LPOs and other organizations and involves the performance of an investigation of a business or a person prior to the signing of a contract or completion of a transaction.
- Electronic Discovery or e-Discovery. Electronic Discovery or e-Discovery refers to discovery in civil litigation that deals with information in electronic format. This term is used because electronic information is different from paper information due to its intangible form and the fact that it’s usually accompanied by metadata.
- EnCase Certified Examiner (EnCE). Developed by Guidance Software, a developer of eDiscovery, data discovery and computer forensics solutions, the EnCase Certified Examiner (EnCE) program certifies forensics professionals, including those who work for LPOs, in the use of Guidance Software’s EnCase computer forensic software.
- The eSourcing Capability Model for Service Providers (eSCM-SP). Developed by the eSourcing Capability Model for Service Providers (eSCM-SP), the eSCM-SP is a “best practices” capability model. The model has 84 Practices that address critical capabilities needed by IT-enabled service providers, including LPOs.
- European Union (EU) Directive on Data Protection. Implemented in 1995 and officially known as Directive 95/46/EC on the protection of individuals with regard to the processing of personal data and on the free movement of such data, the directive effectively regulates the processing of personal data within the European Union. LPOs involved with data from EU sources need to be aware of this directive.
- European Union (EU) Safe Harbor Guidelines. The US Department of Commerce runs a certification program called Safe Harbor which aims to harmonize data privacy practices in trading between the USA and the European Union Directive 95/46/EC on the protection of personal data. LPOs may seek to obtain this certification.
- Intellectual Property (IP) Research. This LPO service would cover any research applicable to intellectual property (IP), including research involving copyrights, trademarks, patents, industrial design rights and trade secrets.
- Intellectual Property (IP) Services. A blanket term for any services related to intellectual property, IP services may include intellectual property asset management, IP research, patent litigation, patent prosecution, patent portfolio management and patent opinions.
- ISO 9001 Certification Achieved for Quality Management System. One of the standards in the ISO 9000 family, ISO 9001:2008 includes a set of procedures that cover all key processes in the business. This includes monitoring processes to ensure they are effective, adequate record keeping, checking for defects, taking appropriate and corrective action as necessary, regular review of individual processes and the quality system itself to check for effectiveness and the facilitation of continual improvement. ISO 9001 is a common certification sought by LPOs.
- ISO/IEC 27001 Certification. An Information Security Management System (ISMS) standard published in October 2005 by the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC), the standard’s full name is “ISO/IEC 27001:2005 – Information technology — Security techniques – Information security management systems – Requirements.” However, the standard is also simply known as ISO 27001 and is commonly sought by LPOs.
- Legal Billing. This LPO service would include activities like the preparation of invoices, collation of time sheets and other billing related processes and procedures.
- Legal Research: The process of identifying and retrieving information that is necessary to support legal decision-making, legal research has a formalized course of action that begins with an analysis of the facts of a problem or case and concludes with the application and communication of the results of the investigation. Generally speaking though, legal research involves finding primary sources of law in a particular jurisdiction, searching secondary authority (i.e. legal literature) for background information and searching non-legal sources for investigative or supporting information. Legal research is a service offered by many LPOs.
- The Project Management Institute (PMI). A non-profit professional organization for the project management profession, PMI offers the Organizational Project Management Maturity Model Certified Consultant (OPM3-CC) certification and several credentials, namely: the Certified Associate in Project Management (CAPM), Project Management Professional (PMP), PMI Scheduling Professional (PMI-SP), PMI Risk Management Professional (PMI-RMP) and Program Management Professional (PgMP). Such certifications and credentials would be commonly sought by employees working for LPOs.
- Personal Information Protection and Electronic Documents Act (PIPEDA) from Canada. Passed in the late 1990s, PIPEDA is a federal Canadian law focused on data privacy and it governs how private-sector companies can collect, use and disclose personal information. LPOs involved in work originating from Canada need to be aware of this Act.
- SAS 70 Type II. The SAS 70 Type II report is recognized as the authoritative benchmark of the American Institute of Certified Public Accountants (AICPA) against which service providers report control activities and processes to customers and their auditor. The Type II form of SAS 70 examination is the most stringent form as it includes the service provider’s description of controls related to information technology and security processes and the detailed testing of these controls.
- Six Sigma. A business management strategy originally developed by Motorola and geared for manufacturing, Six Sigma is widely employed by companies in a variety of industries – including LPO.
- US–European Union Safe Harbor Framework. Approved by the EU in July 2000, the Safe Harbor Framework is a way for US companies, including US based LPOs, to comply with European privacy laws.
- US-Switzerland Safe Harbor Framework. The Department of Commerce and the Federal Data Protection and Information Commission of Switzerland have completed negotiations to establish a data protection framework between the two countries. The framework simplifies the transfer of personal data by Swiss firms to American companies that self-certify to the US Department of Commerce and strengthens the data protection rights of all those concerned with respect to these companies.
3. What are the important services of Legal Process Outsourcing?
Legal Process Outsourcing (LPO) refers to a law firm or corporate legal department obtaining legal support services from an external law firm or legal support services firm. Typically, a lawyer will contract either directly or indirectly through an intermediary with an individual or a firm to perform various legal support related services. Following are the important services of LPO:
- Bookkeeping and billing
- Contract management
- Contract review
- Data analysis and management
- Document drafting
- Document production
- Due diligence
- General litigation support services
- Intellectual Property (IP) services
- Legal research
- Legal transcription
And while much of this work would typically be the mundane legal work done by paralegals and legal secretaries, some of this work could also include work that would otherwise be done by junior attorneys.