Legal News

More Legal Work Moves to India, Including ?Sexy Stuff?

By Nathan Koppel

Sure, bonuses are down and layoffs are up, but it’s not all bad news for lawyers. At least, for those overseas.

The WSJ reports today that outsourcing legal work to India continues to be a booming business. As the economy has soured, the business has only picked up, since in-house counsel are desperate for cost savings wherever they can be found. Indian outsourcers now draw about $250 million in annual revenue.

The math behind the story is simple. Experienced Indian lawyers bill $75 to $100 an hour, less than many U.S. paralegals and half the billing rate of starting associates at many top firms. If you ever want to see a corporate counsel get red in the face, ask them whether BigLaw associates are worth their billing rates.

Indian lawyers typically do routine tasks for U.S. clients, like legal research, due diligence, title searches. But the “sophistication is increasing,” according to an Indian lawyer, who seems to have worked on pretty sexy stuff, such as researching U.S. laws on drug labeling and representing banks in auction-rate securities matters.

There are skeptics, to be sure. Some U.S. lawyers worry about whether their Indian counterparts are up to snuff, quality wise, and whether they may be more prone to disclose confidential client information. Turnover at Indian outsourcing firms is relatively high, exacerbating confidentiality concerns.

The WSJ piece also hints at an interesting rivalry: Who offers a better bang for the buck, Indian lawyers or temp attorneys in the U.S.? Temp lawyers are more expensive, but they are also licensed in the U.S. and thus may need less oversight.

We neglected to blog earlier on a Sunday Times piece that also offers a ray of sunshine, again for overseas attorneys. The piece takes a deep dive into how some of the nation’s top firms, while cutting back at home, are expanding their empires abroad. In a nifty feat of globe trotting, it profiles American law grads working in Japan, Dubai, and Abu Dhabi. The piece quotes Bruce MacEwen, a law firm consultant who writes a popular blog on the biz. Firms, he says, “have realized that based on demographics and petrodollars, there’s going to be growth in Asia and the Middle East that wasn’t in their plan 5 to 10 years ago.”

In other words, LB’ers, pack your bags!

Full post as published by Law Blog - WSJ.com on November 26, 2008 (boomark / email).