Business & Practice

Law Firms Remake Their Legal Services Model

Feb. 22, 2018, 10:49 PM

Law firms, moving away from the model of legal services, are beginning to embrace some of the diverse ways to offer services that alternative providers have made popular in recent years.

The latest example is a partnership announced by Hogan Lovells in London to partner with Elevate in a relationship that allows the global firm to hire from a cadre of pre-qualified lawyers when a firm client has unexpected or last-minute legal needs that require more help.

Law firms largely have clung to the model of services generated internally. They have argued that paradigm provides clients the best outcomes and value in legal matters. But more are adopting new, hybrid ventures after seeing alternative providers cut into their business.

In the Hogan Lovells case, its partnership gives its UK operations access to Elevate’s pool of some 1,500 on-demand lawyers .

“This will give us access to a pre-vetted group of qualified, experienced lawyers with specific expertise for a project,” said Stephen Allen, Hogan Lovell’s global head of legal services delivery.

Elevate attorneys will help clients complete routine matters, such as contracts and employment, not partner-level legal advice on high-stakes litigation and deals.

This would allow Hogan Lovells, a global firm with 2,600 lawyers, to quickly handle projects on shorter notice, and to reduce bills for clients.

Elevate, founded in 2011, has pre-screened attorneys by experience and leases them out on a shorter-term basis. The company’s service is called “Elevated Lawyers.”

“If a client needs a German-speaking lawyer with European court experience, we would be able to provide that quickly,” explained Allen, in a phone interview.

In advance of adopting its blended model, Hogan Lovells hired Allen, who engineered a 2015 partnership between DLA Piper in the United Kingdom and Lawyers on Demand, an international contract lawyer firm, to provide on-demand lawyers. The partnership was later extended to cover DLA Piper’s operations in Australia.

Firms that are stepping into such partnerships use a variety of approaches.

Allen & Overy, for example, announced last June one of the first partnerships between a BigLaw firm and a Big Four accounting company. The firm partnered with Deloitte to launch a new compliance system, which helps them make sure their deals are compliant with the laws in whatever countries are involved.

The system helps major banks deal with new regulatory requirements that went into effect last fall.

White & Case struck up a partnership with MergerMarket, a data services company, first to provide reports then to provide a free tool called the M&A Explorer, on the White & Case website to allow clients and the public access to data about mergers and acquisitions.

Firms have not disclosed the financial aspects of their relationships with providers, but have emphasized that such innovations are designed to provide broader and faster services and information to clients. Most are still in the exploratory phase for such relationships.

In the Hogan Lovells arrangement, the firm is using the Los Angeles-based company’s flexible lawyering service. But Elevate also offers legal project management and consulting to law firms and legal departments. Clients include in-house legal departments of major bank HSBC and communications giant British Telecoms.

Allen said Hogan Lovells anticipates using between 30 and 50 lawyers from the pool every year. Elevate recruits lawyers with between four and 10 years’ experience.

Demand includes clients dealing with Brexit matters, where upcoming changes in the single trading block are anticipated to create numerous situations, especially for banks and other financial institutions, that will require short-term increases in the amount of legal advice or services needed.

For now, the new partnership involves Hogan Lovells in the United Kingdom, but Allen said the arrangement could be expanded.

This is the second partnership Hogan Lovells has concluded recently with outside providers. The first was with FTI Consulting, to advise and provide legal services for the firm’s clients.

While Hogan Lovells and other firms are moving forward in remaking their delivery of legal services, Allen underscored that the services being adopted were backing up the core legal competencies that a traditional law firm provides.

“It’s not just saying ‘Let’s hire some robots,’” he said, “but partnering in particular areas to find a better way of doing things. The core competency is having really good lawyers.”

Law firms are slowly accepting cooperations with alternative services providers as the expected recovery from the slide in legal services demand that started a decade ago never fully materialized.

Alternative legal service providers sprang up and now include Elevate, Axiom Legal Services, Thomson Reuters, Lexis Nexis and Deloitte Legal. Also, among them is giant accounting firm PwC, which recently began offering certain services from its 3,000 lawyers to its clients.

Such a shift to pragmatic considerations has drawn the attention of law firms, many of which, like Hogan Lovells, are casting around to find a sweet spot of cooperation between their traditional structure and the new data and technology-heavy models offered by their “New Law” competitors.

To contact the reporter on this story: Elizabeth Olson at egolson1@gmail.com.

To contact the editors on this story: Casey Sullivan at csullivan@bloomberglaw.com and John Crawley at jcrawley@bloomberglaw.com.

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