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Law departments, ponder the spread of large, funded, business-like non-firm LPOs

Chock full of numbers, history, and specifics, an article in the ABA J., Sept. 2010 at 42, covers many of the entrepreneurs, and the investors who fund them, who are eating away at law firms’ hegemony. Law departments that don’t shake off the dead hand of tradition will lag those who benefit from the parallel legal services movement.

For example, I was astounded to read about Mindcrest, Inc., and its founder CEO Ganesh Natarajan, who has grown the legal process outsourcing company since 2001 to “700 lawyers in the U.S. and India.” Seven hundred lawyers! And Mindcrest, mind you, has a handful of comparable LPO providers.

What can’t such armadas of hungry legal talent do? The article mentions that legal research was Mindcrest’s modest first target, but in 2007 it started embellishing Bloomberg Law, and to do so sold a minority stake for $4 million to Talon Asset Management. Among their more recent scope of projects they now assist companies with reviewing garnishment orders. Natarajan sees numerous corporate processes that have a legal component. The entire field of legal services lies within their sights.

With hundreds of millions of dollars of third-party funding, with thousands of lawyers organized with corporate discipline, with entrepreneurial zeal and creativity untethered by culture, is it not inevitable that such hard drivers will steadily provide services and counsel that march ever closer to the heart of what law firms in the US offer? Xenophobic, protectionist, racist, and irrational obstacles will give way to the business advantages of offshore legal service providers. Even so, the frog will boil slowly.