Something that was simmering below the surface for the past week finally erupted into the mainstream legal press on Friday in a feature by LegalWeek.
It was first reported by in The Hindu and then Bar & Bench, that the Association of Indian Lawyers filed a writ petition with in the Madras High Court alleging that international law firms were “using visitor visa(s) thereby violating immigration norms,” which India laws ban foreign-based law legal firms from entering and operating in India. To date this has not included legal outsourcing operations by international law firms such that legal outsourcing engagements are structured as only providing “legal support” services.
The only LPO vendor cited in the writ petition was Integreon, who swiftly offered their official statement, stating the allegations were “without merit.” No official statements from any of the other major law firm respondents have been released to date.
It does seem a bit peculiar that India, with an economy which is driven largely by it’s attractiveness as a professional services outsourcing destination, would seek to enforce blatantly protectionist measures. Ironically, similar protectionist measures debated in the US have been largely criticised by the Indian government and business community.
I have delayed comment on the petition because I am not sure about the ancillary implications on the legal outsourcing industry. Off the record, most major law firms cited as respondents seem to think the writ petition will not be a major issue such that allegations are not reflective of the work being performed in India. For the time being, however, all respondents seem to be taking the proceedings seriously. Further, per my personal interactions, most firms cited in the petition have not been deterred from advancing their outsourcing initiative plans. Lines have also been drawn linking the writ petition to the Newman McIntosh & Hennessey case* which was readily withdraw shortly after filing in 2008.
In addition to the protectionist notions of the writ petition, Indian law firms may also be partially reacting to increased competition from LPO’s who are recruiting more of India’s qualified lawyers.
More to follow as the petition proceeds.
*Newman McIntosh & Hennessey vs. Bush, filed in the United States District Court for the District of Columbia in May 2008 (Civ. No. 08-00787 [CKK] [D.D.C]). The lawsuit alleged that offshoring legal work constituted a waiver of the attorney-client privilege and Fourth Amendment protection, since data sent overseas may be subject to eavesdropping by the US government such as that permitted by the USA Patriot Act. In particular, the complaint alleged that, “This waiver of rights would nullify the reasonable expectation of privacy that American citizens — litigating purely domestic disputes in U.S. Courts — would have in the documents that they produce in the course of civil litigation.” The lawsuit was withdrawn by the plaintiff firm only days after the ABA issued its outsourcing opinion, endorsing the practice of outsourcing. To date, no further litigation has been forthcoming in the US challenging the legality of legal outsourcing. – Implementing a Successful Legal Outsourcing Engagement (fronterion.com/book/)