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    ABA Reviewing Ethics Rules, Examining Legal Outsourcing

    The American Bar Association (ABA) is reviewing its Model Rules of Professional Conduct, including the rules applicable to legal process outsourcing (LPO).  Integreon recently submitted formal comments to the ABA and testified at an open hearing.  This post provides background on the ABA process, reports on a recent open meeting, and reproduces Integreon’s formal statement at the open meeting.

    Public Forum on Offshore Outsourcing of Legal Services (17 April 2010, NYC)

    The ABA Section of International Law held its 2010 Spring Meeting last week.  On Saturday, April 17th, there was an open meeting, Public Forum on Offshore Outsourcing of Legal Services.   The purpose of this session was “to gather viewpoints for the Section’s Leadership Council ["Council"], which is considering the formulation of policy recommendations to the larger ABA. The forum will include brief presentations from a panel involved with outsourcing issues and will also encourage audience statements and participation regarding views on outsourcing as they relate to legal practice.”  The Section also invited submission of written information using the same set of questions as the 20/20 Commission (see below).

    Background on the ABA Commission on Ethics 20/20 and Its Information Gathering Process

    A hand-out at the Public Forum summarizes the ABA goal nicely:

    “The ABA has long provided national leadership and vision in developing and interpreting standards of legal ethics and professional regulation. The speed with which technological advances and globalization affect lawyers, law firms, and clients requires thoughtful action and leadership by the Association because they present challenges that our ethics and professional regulatory rules may not yet fully address. Accordingly, in August 2009, ABA President Carolyn B. Lamm created the Commission on Ethics 20/20 to perform a thorough review of the ABA Model Rules of Professional Conduct and the U.S. system of lawyer regulation and propose policy recommendations that will allow lawyers and law firms to better serve their clients, the courts, and the public in this new practice paradigm.  For additional information about the Commission and its work, please go to http://www.abanet.org/ethics2020/home.html

    The 20/20 Commission is seeking public comment.  Its home page states “The Commission is also interested in gathering information about domestic and international legal process outsourcing from lawyers, law firms, clients and outsourcing providers, and developed the following questions to do so.”

    In addition, the Commission is working with the ABA Section of International Law’s Outsourcing Task Force to gather information.

    ABA Section of International Law’s Outsourcing Task Force

    The hand-out also summarizes the Section’s goal nicely (see also Section web page):

    “The purpose of the Section of International Law’s Outsourcing Task Force is to examine the international outsourcing of legal processes with the intention of proposing a Report with Recommendations to the House of Delegates on the subject. From solo practitioners to the largest law firms, the legal profession is increasingly embracing international legal process outsourcing to assist in providing legal services to clients. Outsourcing is the delegation of legal tasks, including but not limited to research, drafting, and document review to third-parties particularly to other countries. This practice raises professional questions for attorneys and others involved in the legal profession.”

    Report on Public Forum and Integreon’s Response

    My colleague Foster Gibbons (Integreon’s Director of Global Document Review) and I attended the Public Forum; I testified.  We also submitted written responses to the Section’s questions.

    Panel Presentation. The session opened with a brief presentation by a panel.  Prof. Robert E. Lutz of Southwestern University School of Law explained the ABA process of examining LPO.  The International Section focuses on the international perspective on outsourcing whereas the 20/20 Commission focuses on the domestic perspective.  The Council will provide inputs to the Commission, which in turn will report its recommendations by November 2010 to the ABA House of Delegates (the ultimate governing board of the ABA) .

    Prof. Lutz framed three questions the ABA is considering:

    1. Do the Model Rules as they exist adequately address both onshore and offshore legal outsourcing?
    2. Should the commentary to the Model Rules be amended?
    3. Does the ABA need to provide any additional guidance to lawyers who outsource, for example, how to chose an LPO or how to structure an LPO relationship?

    He indicated a range of outcomes is possible, including changing nothing, changing the model rules, editing the commentary, issuing a report on LPO, offering guidance documents, or addressing specific types of outsourcing (for example, for IP work).

    Audience Statements. Two people then spoke.  James P. Duffy, III has served as Chair of the International Law and Practice Section of the New York State Bar Association (”NYSBA”) and is currently involved in a number of trans-border initiatives for the NYSBA.  Mr. Duffy said that NYSBA has been studying LPO since 2007 and that it is a topic of great interest.  He shared with the Council and general audience his personal experiences of working with LPOs “on the ground” in India.  His report of the experience was favorable.

    I then presented.  I read a prepared 3-minute statement, which I reproduce below.  (I improvised a bit so the official transcript will vary.)  Since no one else wished to testify, the Task Force asked me to stay at the podium to answer questions, which I did.  Questions concerned security, confidentiality, and the difference between law “practice” and “process”.

    Integreon’s Formal Three-Minute Statement to the Public Forum

    Here is the text of Integreon’s formal oral statement at the open forum:

    “I want to thank the panel and Section for this opportunity to speak to these important issues. We have prepared and will be submitting to the Section a written statement. I wish to address a few points in brief this morning.

    Integreon is a global Knowledge and Legal Process Outsourcing provider. We have been serving demanding professionals in large US and UK law firms and law departments, investment banks, and corporations since 1998.   Our management team includes numerous executives with extensive law firm, law department and LPO experience.

    We provide LPO services from the US, UK, India and the Philippines.  We also operate in China, and South Africa.   We employ about 2,200 people worldwide, 40% of whom provide legal support services.  About 430 are attorneys who deliver LPO services.  Another 150 provide e-discovery solutions.

    We do not, in any jurisdiction, practice law.  We provide only legal support services.  Our teams work under strict instruction from client’s counsel.

    We comply fully with the recommendations in ABA Formal Opinion 08-451, which states:

    “At a minimum, a lawyer outsourcing services . . . should consider conducting reference checks and investigating the background of the lawyer or nonlawyer providing the services”

    In support of this, we provide clients with CVs for key team members.  Clients can also interview proposed team members.

    We also teach, internally and externally, an accredited MCLE Ethics course called “Ethics of Legal Outsourcing”.  Some of the issues it covers include Unauthorized Practice of Law, Supervisory Responsibilities, Conflict of Interest Implications and Risks, and Client Confidentiality.

    We take quality and security seriously.   Our lawyers work with our Quality and Continuous Improvement  team of Six Sigma Blackbelts to set objective benchmarks.   All of our offshore LPO work is conducted in separately demised rooms that are secured by state of the art physical and IT security measures.   Our corporate and law firm clients regularly audit our facilities and procedures.

    Integreon has a conflicts checking process similar to a law firm.

    Though we are not directly regulated, many statutes, rules, and regulations apply to us.   We are very conscious, both as a legal and business matter, of the unauthorized practice of law rules.

    Law is not the only framework governing business practices.  To achieve high quality, we have voluntarily sought and received certification for several standards, many of which require a 3rd-party audit.  For example, our Information Security Management is certified to ISO 27001:2005 and our Quality Management Process is certified to the new QMS of ISO 9001:2008.  Integreon also complies with all Safe Harbor policies.

    In sum, we are conscious of the concerns lawyers have about outsourcing and have taken many measures to address them.”


    There was a a cordial and productive dialogue at the Public Forum.  We are pleased that the ABA is devoting significant time to assess LPO and look forward to future opportunities to assist the ABA in its inquiry.


    One Response to “ABA Reviewing Ethics Rules, Examining Legal Outsourcing”
    1. C. Bartlett says:

      To accurately determine the ethics standards applicable to legal outsourcing, the ABA Commission on Ethics should clearly define the types of legal work deemed as the practice of law and the unauthorized practice of law and by whom and where such types of legal work can be performed.

      Law firms have traditionally used both non-lawyers within the firm, and third-parties such as forensics experts, ediscovery providers, document review agencies, and copy services – technically classified as legal outsourcing companies – to perform legal work. Legal Process Outsourcing (LPO) by any other name is still, in actuality, just another name for ediscovery, document review, paper to electronic document conversion, and other like services performed on behalf of the firm and in-house counsel.

      As clients pressure outside counsel to reduce these and other legal expenses, some clients are directing outside counsel to engage legal outsourcing companies who have contracted directly with the client. In this scenario, outside counsel must adapt to a shared-resource model for its legal work and often with an organization that has reduced or completely circumvented a portion of the firm’s revenue.

      Consequently, it can be suggested that there is a bilateral derivative of the ABA’s reexamination of ethics and legal outsourcing:(1)Counsel’s ultimate liability for compliance and adherence to professional rules of conduct and (2) The direct economic impact to law firms.

      Perhaps the best solution is clear definition by the ABA Commission on Ethics of what types of legal work are categorized and permissible as the non-practice of law while conjoining globally uniform standards of practice and confidentiality for both “lawyers” and “non-lawyers” who perform these types of legal work.