Business processing outsourcing ("BPO") is en vogue across corporate America. Everything from call centers to manufacturing has been outsourced to countries outside of the U.S. One of the most popular locations for outsourcing has been India which has seen a double digit growth in its BPO services. Even U.S. law firms and corporate in-house departments have begun to analyze the benefits/drawbacks of outsourcing legal work to India. This Tip Sheet discusses some of the challenges associated with conducting large-scale subjective document reviews in India versus using "on-shore" U.S.-based resources.
Indian lawyers do not undergo the same training as U.S. lawyers. Indian legal training and law schools are very different from those in the U.S. Indian lawyers receive an LL.B. as opposed to an American J.D. upon completion of their legal schooling. In addition, there is much less uniformity across Indian law schools: some require a 5-year course, while others require only 3 years.
There is no nationally recognized law examination required to practice law in India. While there is a national exam for those who want to practice before specific courts in India, there is no nationally recognized law examination required before a lawyer can practice law in India. In fact, most Indian lawyers simply enroll with the bar association of the state in which they intend to practice. If the bar council is satisfied with the credentials and references of the lawyer, they are admitted as practicing lawyers.
Training and assessment costs are much higher when using India-based lawyers. Key critical skills for an effective review of complex documents, such as English proficiency, effectiveness of communication, reading comprehension and conversation ability must be carefully assessed on an individual basis for each Indian lawyer.
Indian lawyers are unfamiliar with U.S. legal procedures and discovery mechanisms. It is not common in India to engage in large-scale document production or review during the course of litigation. Since Indian lawyers are unfamiliar with the complexity of large-scale document production and review, they are also very unfamiliar with its many pitfalls.
Privilege is different. While the attorney-client privilege offers some of the same protections in India as in the U.S., one huge difference is that communications between clients and in-house counsel are not protected! So while most corporate communications may be protected under confidentiality agreements, THEY ARE NOT PRIVILEGED.
Indian lawyers are not accustomed to reviewing documents for privilege. While the scope of privilege in India may be similar to that in the U.S., Indian lawyers usually have very little experience in reviewing documents for attorney-client privilege. Under Indian practice, requests for documents are quite narrow and the production of documents typically is quite small. As a result, Indian lawyers rarely have to worry about ensuring that privileged documents are not inadvertently produced to the other side.
Indian lawyers are not familiar with large-scale electronic discovery. Even though the Information Technology Act of 2000 amended India's rules of evidence to apply them to electronic documents, Indian lawyers have not gained much experience in this area due to the relative novelty of this type of data. As a result, Indian lawyers must be provided significant training on managing and manipulating electronic data and databases.
Culture differences can cause large problems. While language and communication barriers can make a subjective document review project more difficult in India, an even greater hurdle is the significant cultural difference between India and the U.S. Significant resources will be required to provide Indian lawyers with the necessary insight into U.S. business practices so that a meaningful review can be conducted in a particular case. For example, Indian lawyers may not truly understand the importance of key issues such as privilege, privacy and trade secrets.
Ethical obligations may require substantial supervision of off-shore attorneys. A recent ethics opinion by the New York Committee on Professional Ethics has concluded that a New York law firm has broad supervisory responsibility under the New York Code with respect to affiliated lawyers licensed in foreign countries and must ensure that compliance by such lawyers with foreign law and ethical standards does not compromise the firm's adherence to the New York Code. See N.Y. State Bar Op. 762 (2003). This significant obligation may apply in other jurisdictions as well.
As noted above, there are many challenges to outsourcing subjective document review projects to India or elsewhere. Before doing so, law firms and corporate in-house departments should carefully assess all these factors. The decision to offshore this type of work requires an analysis well beyond just the issue of cost alone. Additional challenges to those outlined above include geopolitical risks, foreign exchange fluctuations, potential conflicts of law or issues of jurisdiction for enforcement or resolution of disputes, telecom and electrical infrastructure, time zone differences, the likelihood of disruption from threats of terrorism, the possible impact of laws relating to international boycotts, currency controls, technology import and export, immigration restrictions, trade and customs and taxation issues, ownership and licensing of intellectual property, and the applicability of current insurance coverages to acts or omissions by foreign contracting parties.
Timothy Mahoney, Esq. is Executive Director of Esquire Group, a Special Counsel Company. He may be reached at (612) 340-0233. LegalReview, LLC, an affiliate company of THE ESQUIRE GROUPTM, provides sophisticated "on-shore" outsourced subjective legal document review for large litigation and transactional matters and works with leading law firms and corporate in-house departments in conducting large scale document reviews in complex sophisticated litigation.
The views expressed herein are those of the author and not those of The Metropolitan Corporate Counsel.