Friday, September 26, 2014
This post describes a new article by Professor Chris Birkel (Charlotte) called The Growth And Importance Of Outsourced E-Discovery: Implications For Big Law And Legal Education and available at 38 J. Legal Prof. 231 (2014) and here on SSRN. The abstract is toward the bottom.
Professor Birkel traces the history and growth of the e-discovery industry including an overview of different service provider models including the use of in-house lawyers, outsourcing, specialized e-discovery firms, etc. Next, Professor Birkel profiles a former law firm associate who developed a highly successful e-discovery business. Toward the end of the article, Professor Birkel suggests that due to a contracting legal job market, some law schools consider training 3L students to be more entrepreneurial so they are better able to "make a job" rather than "find a job." Michigan State University School of Law is already doing something similar to that with its ReInvent Law Lab (here and here). For balance, also check out Professor Campos' criticism of this idea that law schools can or should train lawyers as entrepreneurs since most such ventures fail even in good economic times.
Now for that abstract I promised:
The legal market is rife with inefficiencies at all levels of practice. Perhaps the most fundamental problems in the marketplace for legal services are informational asymmetries. Information important for lawsuits may not be available for analysis, sometimes by design of the parties involved, and that creates friction in the market. Clients demand greater efficiencies at lower costs, as legal services have become a commodity managers must buy. The creation of E-Discovery was itself an effort to further the efficient operation of the legal services market but that efficiency came at increased cost due to the dramatic increase in documents for review. Efforts to tackle the problem of cost have pushed the providers of E-Discovery to seek out objective metrics to measure value-added to gain advantage over rival firms.
This paper first examines changes in the macroeconomic conditions of the legal services market that predated and helped foster the E-Discovery boom. This paper will examine the concurrent changes to the traditional Big Law firm that created the market for E-Discovery. Next this paper will explore the history and growth of the E-Discovery market. Further, this paper will argue the record of growth along many variables of business success indicates the appetite of the market and the likely continued importance of E-Discovery and other non-traditional avenues of employment within the legal field.
This paper will examine the infancy and growth of one firm in this market space: NEXTRA. We will examine this growth through the lens of so-called Moneyball principles advocated by NEXTRA CEO, Bob Rowe. In Moneyball author Michael Lewis explores how Billy Beane, the Oakland Athletics’ General Manager, used inefficiencies in the marketplace for baseball players to his advantage. The lessons Beane borrowed from other industries to gain advantage over opposing general managers in baseball can also be implemented in legal education and legal practice.
Finally, this paper will suggest legal education refocus some of the 3L curriculum on entrepreneurial opportunities within the law. Evidence suggests traditional legal employment will not support the number of law school graduates currently entering the market. Meanwhile fiscal pressures mount on law schools due to declining overall enrollment. These twin pressures should lead law schools to change focus from “getting a job” to “making a job”.