52 LEXPERT MAGAZINE
|
JUNE 2017
| OUTSOURCING |
recruitment numbers much lower than a
decade ago, she says. "But this work is at
the lower end of sophisticated law work.
It's highly repeatable and highly commod-
itized, so it's not particularly great training
for sophisticated legal thinking … so I don't
see it as a huge concern."
WHEN IT COMES to managing out-
sourcing strategy, Fasken Martineau Du-
Moulin LLP, like McMillan, sees "going
steady" as the model that makes the most
sense to them.
Vera Toppings, a partner in the litigation
and dispute-resolution group in Toronto,
says back in 2013, when the firm was wrest-
ling with the explosion of big-document
trials and how best to manage e-discovery,
it narrowed down its options to building
its own group or partnering with an ex-
isting provider. She says it quickly became
apparent that building their own group
would not be the most efficient way, partly
because of the upfront investment needed,
but also because of the ongoing costs of
buying and constantly retraining its own
people on quickly evolving technology.
In the spring of 2014, the firm put out a
request for proposal and eventually signed
a "managed-services" agreement with
PwC, which came into force in the fall of
last year. PwC has the technology capabili-
ty as well as worldwide access to e-discovery
experts for Fasken's clients in Asia, South
America "or anywhere in the world," Top-
pings points out.
"Before, you'd need a whole team flying
from Toronto to somewhere in Asia to do
Canadian businesses has been overseas,
he says, pointing to the pension funds as
an example. "When they go overseas, they
don't use Canadian law and they don't use
Canadian lawyers."
Even in cross-border deals, which ac-
count for most of the high-end M&A deals
that make headlines, "the lawyering's being
done in New York even if it's a Canadian
company. at's the frothy work that is
fairly price-insensitive. Clients don't really
care whether the legal bill is $2 million or
$4 million on something like a $2-billion
takeover." What they do care about, he
says, are the smaller pieces of work, "and
they want firms to do it for, say, $300,000.
If you say no, then they say they'll go to
someone else even though you've been their
lawyer of choice for 20 years."
Firms see some of the lower-end docu-
ment review and due diligence work as a
form of education for junior lawyers so,
instead of putting an associate on it and
billing them out at $350, they've been writ-
ing the time off. But at the end of the day,
Sweeney says, "that model's not sustain-
able. You've got to make money somehow."
at pressure is why so many law firms
are developing outsourcing strategies, if
not outright relationships, with outsourc-
ing firms. But it comes with a cost: those
junior lawyers.
Sarah Millar, who heads the discovery
management group at Osler, Hoskin &
Harcourt LLP, says an increased use of
outsourcing means "firms will take fewer
juniors," and it's already caused law firms
to rethink staffing, with overall student
the data collection, you'd need translators
— there'd be a whole symphony you'd have
to create every single time. We have clients
all around the world, and PwC operates
all over the world. ey have people on the
ground who have the resources, the infra-
structure and the language capabilities to
assist our clients directly where they work."
USING OUTSOURCERS is "an absolute
fact of life," these days, says Sarah Millar
at Osler, which is taking a different ap-
proach from that of McMillan, McCar-
thy and Fasken. Osler favours playing the
field — for now. e firm uses a variety of
legal services outsourcers, with Deloitte
LLP as one of its main suppliers in e-dis-
covery and due diligence.
In 2014, Deloitte acquired ATD Legal
Services, an e-discovery firm launched by
former Davies Ward Phillips & Vineberg
LLP partner Shelby Austin, and last spring
it announced the formation of Conduit
Law LLP. "I'm not sure what their plans are
for their new firm, but it is certainly going
to eat our lunch to some extent," says Mil-
lar. Deloitte declined to be interviewed.
But Osler is not interested in going
steady in any event, says Millar. She points
to the alliance formed between Fasken
Martineau and PwC for e-discovery servi-
ces as an example of why not. PwC oen
acts as the auditor on a file, she says, so they
may end up being excluded. Also, an Osler
client may have its own relationships to
bear in mind, and may want a say in who
does the work. Millar sees formal alliances
between law firms and outsourcers as "win-
dow dressing to some extent. I think a lot
of it is a rush by firms to look like they're
reacting to changes in the market. People
want to look like they're being proactive
and minimizing costs by pushing stuff out
to outsourcers."
Toppings at Faskens says that is abso-
lutely not correct. In arriving at a deal with
PwC, she says, the firm negotiated a bulk
rate: "e rates our clients are paying are
far below what they'd be paying if they just
went and scoped out providers each and
every time. e goal was ensuring that the
rates are significantly below what the mar-
ket rate would otherwise be." She also says
Fasken's clients aren't bound by the PwC
arrangement if they have an outsourcer
they prefer, and that the law firm has a
"We have clients all
around the world and
PwC operates all over
the world. They have
people on the ground
who have the resources,
the infrastructure and the
language capabilities to
assist our clients directly
where they work."
VERA TOPPINGS
FASKEN MARTINEAU DUMOULIN LLP
