1. Profile

Why should a client be forced to pay thousands of extra dollars to law firms for legal research that can be gathered by a network of experts and distributed at a much lower price? That question prompted Dov L. Seidman to start Legal Research Network Inc. (LRN), a nationwide legal research and information service headquartered in Los Angeles and designed for corporate counsel and law firms. Seidman started his network of legal specialists with the intention of making legal research more efficient and cost effective.

LRN has only eight full-time employees, 5 are formerly successful lawyers recruited by Seidman and 3 are non-lawyers. However, LRN keeps a computerized list of 1,100 top legal experts in 2,500 fields -- mostly law professors, solo practitioners and lawyers on leave from their regular jobs. It matches its experts with companies or law firms requiring legal research in their fields.

To use LRN, first, a customer contacts the company's Research Management Center in Los Angeles with a request. From there, a group of senior attorneys works with the customer to decide upon a fixed price rather than an hourly rate, as is typically found in law firms. In the third step, an expert in the specific area of law is assigned to the case. The expert submits the completed memo to the Los Angeles LRN headquarters where it is reviewed, written up and eventually distributed to the client.

2. Value proposition

Legal research has been inefficient as one of the traditional bundle of services that law firms provided. LRNÕs strategy is to get unbundle legal research service and focus it as a core business. It could be possible by leveraging knowledge and service through outsorcing legal research by using the innovative networks which offer high-quality legal research through the use of attorneys and law professors with specialized knowledge and expertise. Effective management of outsourcing and electronic system technologies are the critical factors for LRNÕs success. Responding to corporate law departments' need for quality work on a cost-effective basis, the networks offer one-stop-shopping for specialized legal knowledge and research, generally at fixed prices significantly below those charged by the better law firms. LRN has succeeded in constituting a distinct new sub-industry within the legal marketplace by creating the following competitive advantages:

Performance efficiency:

The LRN promises a third alternative for corporate law departments seeking legal research. Until recently, potential clients were limited to just two choices: assigning the work to either an in-house attorney or an outside law firm. In the latter case, the junior attorney typically assigned to conduct the research may lack significant knowledge and experience in the area to be researched and take much time to complete. For this reason, research has often been the least efficiently performed aspect of legal practice. The networks of LRN are more efficient and quicker, because they can assign research to attorneys and law professors who already specialize in that same area from the larger pool of experts available.

Cost efficiency:

LRN charges for their services on a fixed price basis, different from hourly billing by a traditional law firm. Therefore, clients donÕt have to worry about cost-overrun risk. Because LRN does not have the overhead of a traditional law firm, it can provide clients with detailed legal memoranda for 50 percent to less than 20 percent of the costs charged by a traditional law firm and at the same time to pay its researchers fees higher than the effective hourly rate paid to lawyers conducting such research at a traditional firm.

High quality:

The single most important question confronting any corporate lawyer in considering the use of LRN is the quality of its work. The key to quality control is the skill and judgment of the network's quality-control personnel. The better networks can offer a higher level of quality-control comparable to the major law firms, in part because the LRNÕs management are experienced attorneys formerly hired at the major law firms. LRN has large networks of law school faculty and practitioners with specialized knowledge in various areas of law who are managed and staffed by well-credentialed attorneys with major law firm experience and top level academic backgrounds. Therefore, LRN can maintain a quality level associated with a first-rate law firms.

3. Why does LRN work in relation to traditional law firms?

As I described above, because LRN serves clients in the best possible manner, as cost-effective as possible, and first-rate quality, it has been expanding its business. Especially, LRN makes considerable sense for labor-intensive research tasks where efficiencies can be realized as the result of specialization and volume. With such highly regarded research being produced so cost effectively, traditional law firms are threatened by LRN. However, smart law firms can focus on their core business by outsourcing legal research as a way to provide better service for their clients. Because LRNÕs business is not to advise, but to sell expert legal research. Both traditional law firms and LRN can focus and develop each selected core business in greater depth and the most effective possible maintainable competitive edge.

4. Why interesting?

Legal Research Network keeps a computerized list of 1,100 top legal experts in 2,500 fields -- mostly law professors, solo practitioners and lawyers on leave from their regular jobs. It then matches its experts with companies or law firms requiring legal research in their fields. LRNÕs strategy is to focus on legal research as a core business and leverage knowledge and service through outsourcing legal research by using the innovative networks which offer high-quality legal research through the use of attorneys and law professors with specialized knowledge and expertise with weapons: excellent performance efficiencies, low cost, and first grade quality. Effective management of outsorcing and electronic system technologies are the critical factors for LRNÕs success.

With such highly regarded research being produced so cost effectively, traditional law firms are threatened by LRN. However, smart law firms can focus on their core business by outsourcing legal research as a way to provide better service for their clients. Because LRNÕs business is not to advise, but to sell expert legal research. Both traditional law firms and LRN can focus and develop each selected core business in greater depth and the most effective possible maintainable competitive edge. Law firms that are threatened by the innovative company can also add value to their products by utilizing the threatening companyÕs service. Both companies are compatible with each other.