How Two Engineers Started a Revolution in the Legal Profession
When Bluecurrent Inc., a small Texas-based technology company, needed help suing Dell Inc. over allegations of theft of trade secrets and copyright infringement, their greatest litigation tools were provided by two engineers named Michael J. Dolan and John C. M. Thickett. Dolan and Thickett own an Austin-based company by the name of Tusker Group.
In a classic David vs. Goliath match, Dell was represented by one of the largest most prestigious law firms in Texas, while Bluecurrent was represented by a very capable but small Austin law firm, DiNovo Price Ellwanger & Hardy LLP. With four partners and 2 associates, Bluecurrent's law firm seemed outgunned by Dell’s firm, which currently employs nearly 1,000 lawyers worldwide. It hardly seemed like a fair fight, but the Dell lawyers soon found out that Tusker Group leveled the playing field for Bluecurrent and gave them better-than-even odds of prevailing in the litigation, simply because they could afford the cost of litigation.
Dolan and Thickett are engineers who met while students in Harvard's MBA program. As engineers they are trained in such quality control matters as statistical process control and designing systems that work the same way every time. After finishing at Harvard, both Dolan and Thickett spent a number of years developing foreign manufacturing plants designing quality control systems and efficient manufacturing processes. In 2002, the friends decided to start their own small business.
With their engineer hats on, they looked at many different industries in the U.S. where they could use their flow charts, cause-and-effect analysis training, and all the other engineering tools they carry in their briefcases. They settled on the legal profession because they felt there were potentially billions of dollars to be saved by businesses if they could begin to unbundle some of the services that cost businesses so much money in litigation and discovery.
During their research phase, they discovered that 58 to 90 percent of all litigation costs are spent in what is known as document review. That is where each side gets to see every shred of paper and bit of electronic data a company possesses that could possibly relate to the litigation. It is estimated that the top 100 litigation firms charge their clients between $30 billion and $40 billion in document review annually.
The Tusker Group was established in May of 2003 to provide companies like Bluecurrent a financial advantage in the document review portion of litigation.
Dolan's company is not a law firm, nor does it provide any legal services, yet Tusker is poised to take tens of millions of dollars of revenue away from big law firms in the next year or two.
The Tusker Group outsources document review to lawyers it employs in India. Tusker provides numerous technology tools to make the process of document review faster, more effective, and more secure.
In the Bluecurrent case, Tusker used a group of Indian lawyers to review over 400,000 (mostly electronic) Dell documents related to the case. Tusker completed its work ahead of schedule and under budget. Many people who have dealt with outsourced customer service personnel know that results can vary, but Tusker employs well-trained, loyal Indian attorneys and provides them with the most state-of-the-art tools to do their document review.
Since the process of document review can be optimized much like a manufacturing assembly line, Dolan and Thickett put all their energies into perfecting the process. Using methodology like Six Sigma, the two engineers set out to obtain the highest quality document review process possible with the highest rate of return (savings) for the client.
By all accounts they have succeeded, and now outsourced document review has become commonplace. Companies involved in litigation have learned that they can spend more of their legal dollars on legal advocacy rather than document review.
Says Michael Dolan, "We unbundle the process of document review from the process of legal advocacy you want from the attorney or law firm representing you. You want your lawyers to be 100 percent in your corner and you want them to have access to the best document review possible."
Although large law firms have lobbied against using offshore document review because it is a significant source of income for them, the American Bar Association's recent Ethics Opinion 08-451 has helped pave the way by confirming the benefits of offshore document review. As the need to limit litigation fees has grown, so has the number of large corporations involved in litigation who turn to companies like Tusker Group for offshore document review.
Currently $80 million a year is spent on offshore document review and according to Boston-based Forrester Research, the amount is expected to grow to $4 billion in India alone by 2015.
Jay Ellwanger, managing partner of DiNovo Price and Bluecurrent's counsel in the lawsuit against Dell, says, "In the Bluecurrent case, the court imposed a short deadline for one phase of the document review. Dell’s law firm used 40 attorneys to conduct their review, but my client couldn't afford the cost of so many U.S.-based professionals. Bluecurrent hired Tusker Group to conduct document review using 8 to12 attorneys based in India to review approximately 400,000 electronic documents in six weeks. Tusker met the deadline and completed the project under budget. Although the terms of my client's settlement are sealed, Bluecurrent was very happy with the results. They would not have been able to afford this type of expedited document review without using Tusker."
Technology and the Internet have enabled so many efficiencies, in such varied processes as e-mail and remote surgery. It is about time for companies like Tusker to help reduce the cost of expensive litigation using proven engineering practices.
Sam Thacker is a partner in Austin Texas based Business Finance Solutions.
You may contact Sam directly at: sam@lesliethacker.com
or follow him on Twitter: SMBfinance
