ON EACH OF HIS FREQUENT TRIPS TO INDIA, American entrepreneur Leon Steinberg sets aside time to have a pair of shoes made. He insists
workmanship can't be matched in United States, nor can price. "These are
the most comfortable shoes I've ever worn," he said of a pair of leather loafers he had on recently.
Steinberg, who was standing in his office in Noida, a high-tech suburb of New Delhi, is not in shoe
business. He believes he's found another product that can be made in India at high quality and low cost: legal
services. His 1 1/2-year-old company, Intellevate, specializes in intellectual property work. Its staff, about
one-fifth of them lawyers, prepares patent applications and conducts technical research on intellectual
property questions. Among its clients are legal departments of Fortune 500 companies.
The market for outsourced legal work is expected to reach $163 billion by next year, and India is positioned
to seize largest share. The time difference between India and United States allows for work to be done
overnight, and many people in India's enormous workforce are college-educated and English-speaking.
Intellevate recently placed a want ad for a patent researcher in Times of India, leading
English-language daily. The company received 1,700 résumés. "There are 200 million English-speaking,
college-educated Indians and there are not 200 million jobs," Steinberg said. Such a disparity in supply and
demand allows his company to hire credentialed, capable labor, cheaply. "We're not selling shoes," Steinberg
likes to say. "We're selling cobblers."
Puneet Mohey, president of a legal outsourcing company called Lexadigm on other side of town, has a more
straightforward pitch: "We provide large-law-firm-quality work at literally one-third price." Lexadigm's
rates range from $65 to $95 an hour for work that large U.S. firms might bill at $250 an hour or more. Nearly
all employees at Mohey's company are lawyers.
With outsourcing, those who are not members of an American bar are supervised, and their work vouched for, by
someone who is. "To extent that what you have them do is legal research for U.S. firms, it's not much
different than having law students do it," said George Washington University Law School professor Thomas
Morgan, a scholar of professional responsibility.
Some of dozen or so outsourcing companies that have sprung up over last decade in India focus on
low-level paralegal work—keeping track of filing dates and document reviews. But Intellevate and Lexadigm
prefer to take on more sophisticated work like patent applications and appellate briefs because work
commands higher rates from clients. Lexadigm recently drafted its first brief for a U.S. Supreme Court case,
involving application to a tax dispute of Fifth Amendment's due process clause. The brief will
ultimately be filed by an American law firm, which can use all, part, or none of Lexadigm's work—the same as
if draft had been written by one of its own associates.
With work being done in India becoming more sophisticated, some American attorneys are skeptical of
American firms that use outsourced legal services. "I think a lawyer has a responsibility over his work and he
just can't delegate it," said former ABA president Jerome Shestack, now head of litigation at
Philadelphia firm of Wolf, Block, Schorr and Solis-Cohen. "The problem with outsourcing is, how do you keep
control over it? How do you see how it's being done?"
OUTSOURCING LEGAL WORK TO INDIA began in 1995, when 34-lawyer, Dallas-based litigation firm of Bickel &
Brewer opened an office in Hyderabad. Co-founder and co-managing partner Bill Brewer, who is 53 years old,
explained that idea was hatched when he was out to brunch with a relation by marriage. The relative, C. S.
Prasada Rao, was originally from India. "We were looking for new ways to be more efficient in handling
millions of pieces of information that confront us in each case. I'm not sure how it came out of
conversation but somewhere a light went off. I asked, 'You can have a lawyer for how much an hour in India?'
He said, 'Two dollars an hour.' We didn't make it to dinner before we were setting up subsidiary in
India."
Bickel & Brewer has since spun off its Hyderabad office, run by Rao, into a separate company called Imaging &
Abstract International, which handles work for Bickel & Brewer as well as other American clients. In 2001,
General Electric added a legal division to a currently existing base of operations in India to handle legal
compliance and research for two of its divisions, GE Plastics and GE Consumer Finance.
While it has become commonplace to outsource call centers for customer service and diagnostic offices for
