Sunday, July 24, 2011

Labor market trends and working conditions in Washington, DC's electronic discovery industry

Labor Market Trends and Working Conditions in Washington DC’s Electronic Discovery Industry
by Tequila Brooks, Employment and Compliance Attorney and e-discovery specialist

Recent articles in The New York Times (John Markoff, “Armies of Expensive Lawyers, Replaced by Cheaper Software,” March 4, 2011, available at The Wall Street Journal (Vanessa O’Connell, “New Work Rules for Temp Lawyers,” June 15, 2011, available at along with scenes of document review in John Grisham’s 2009 novel The Associate highlight the fact that electronic discovery is both a critical part of the modern legal practice and a modern trend in today’s legal labor market.  What does this mean for the legal profession?  It means documents.  Lots and lots of documents.  Hundreds, thousands and millions of emails, spreadsheets, memoranda, pleadings and powerpoint presentations.  Despite Markoff’s assertion that new e-discovery software programs are replacing lawyers, armies of attorneys and paralegals are still required to analyze, categorize, summarize, read and review for privilege the millions of documents uploaded and stored to e-discovery platforms as a routine part of modern litigation proceedings.  This isn’t going to change any time soon - though since the Financial Crisis the armies have gotten a little smaller.  With the potential for legal sanctions and damage to the client memorialized in The E-Discovery Journal (Greg Buckles, “McDermott Sued Over Outsourced Review,” June 10, 2011, available at, what self-respecting attorney or law firm would engage in an electronic production without having an attorney ensure that no privileged documents are being produced?  Computer software can do many things and can be a wonderful tool, but without a skilled user it is nothing more than that - a tool.  Moreover, new e-discovery software programs require attorneys who are versed not only in the law but in how to effectively utilize modern e-discovery technology.  While O’Connell’s article highlights some of the grimmer realities of the modern e-discovery labor market - especially in the wake of the recent economic meltdown - e-discovery can provide decent (and not-so-decent) jobs, “gap” jobs and, in rare cases, career options.  This note will discuss some of these jobs and career options - where to find them, what to expect and how these jobs can affect attorneys’ long-term career prospects.

    The e-discovery industry tends to center in large metropolitan areas - especially Washington, DC and New York - as well as on the west coast because of the high concentration of the tech industry (the Bay Area and Los Angeles) and in Houston and Dallas because of the high concentration of the oil and gas, energy and tech industries.  Smaller metropolitan areas are becoming more popular as e-discovery industry centers such as Charlotte, North Carolina both because of the concentration of the banking and financial services sectors and the lower wage rates that can be paid to attorneys and paralegals outside Washington, DC and New York.

    The primary driver of large electronic discovery projects is the federal government investigation.  Investigations by federal agencies like the Department of Justice (DOJ), Securities and Exchange Commission (SEC), Federal Energy Regulatory Commission (FERC), Internal Revenue Service (IRS) and the Federal Trade Commission (FTC) often require the production of thousands and sometimes millions of electronic documents.  In addition, the Equal Employment Opportunity Commission (EEOC) utilizes electronic discovery in large class action litigation.  Intellectual property litigation is also a growth industry for those with a scientific and/or IP background.  While federal agencies hire attorneys and paralegals to work on electronic review projects, the bulk of employers for electronic discovery work are large law firms representing clients in government investigations.  These law firms contract for document review attorneys, paralegals and e-discovery specialists through a variety of legal employment agencies.

Like other temporary agencies, legal temporary agencies create a triangular employment relationship between the attorney, the agency and the law firm.  Generally, the attorney receives an hourly rate plus overtime for work over 40 hours, the agency charges the law firm about double what it pays the attorney and the law firm bills the client between $135-$250/hour for the attorney’s time depending on how savvy the client is when it comes to negotiating rates with its law firm for the use of contract attorneys on large- and small-scale e-discovery projects.  Rates in the DC area for DC-barred English language reviewers range between $30-$34/hour plus overtime and between $38-$42/hour for DC-barred foreign language reviewers.  Rare and in-demand languages such as Japanese, Korean and Chinese can garner as much as $50-$60/hour.  Rates for non-DC-barred attorneys tend to be lower, so it is a good idea to waive into the DC Bar as soon as you consider moving to the DC area.  The waiver process is not onerous, but it can take 6-12 months to complete.  Because the waiver process takes such a long time, “DC-pending” attorneys often receive rates that are close to or the same as those paid to DC-barred attorneys.

Before the economic crisis, rates for DC-barred English language reviewers had stagnated at $35-$38/hour and at $45/hour for foreign language reviewers.  It was rare for projects in the DC area to offer straight time (no overtime rate) but this practice was more frequent in New York.  After the economic meltdown of September 2008 and during the crisis, more DC agencies offered projects which required overtime hours but did not offer overtime pay.  A few agencies offer DC-barred attorneys $26 or even $22/hour.  These practices (no overtime and rock bottom hourly rates) became rarer in mid-2011 as the economy recovered, merger and acquisition activity increased and as thousands of lawyers laid off from large law firms in major metropolitan areas in the 2008-2010 period were absorbed into the legal labor market, decreasing the competition for the smaller number of e-discovery jobs that were available after September 2008..

E-discovery projects tend to be big hours projects.  Many projects require at least 10 hours of overtime a week and some high-volume, fast-paced short-term projects (such as Second Requests) keep work spaces open so that attorneys may bill up to 80-90 hours/week - though attorneys on those projects can work less overtime (60 hours/week - six 10 hour days or five 12 hour days)  or make an arrangement with their agent for reduced hours (40-50 hours/week) due to family, educational or other responsibilities.  While the number of hours may appear to be onerous, they are often worked in a group environment where attorneys achieve a certain level of camaraderie with other attorneys so it isn’t as bad as it might seem.  Another advantage of high overtime projects is the possibility of earning a lot of money quickly to achieve personal goals like paying off student loans or saving up for a down payment on a house.  Since the economic meltdown, agencies frequently offer projects that allow for 40-hour weeks.  Many attorneys in the DC area do not prefer these projects because they don’t allow them to achieve financial goals, especially in the wake of the lower rates offered during the crisis period - though shorter hour projects do allow for more outside activities like searching for a full-time job.

Electronic discovery and document review projects involve a variety of areas of law.  For example, since the DOJ has such a wide subject matter jurisdiction, projects resulting from DOJ investigations range from Foreign Corrupt Practices Act investigations to routine “Second Request” reviews in company mergers.  Whenever two or more companies enter into a merger deal, the DOJ requests documents to help it determine whether the merger will negatively impact competition and consumers.  In the wake of the financial crisis, financial regulators such as the Federal Deposit Insurance Corporation (FDIC) and the SEC conducted widespread investigations of financial malfeasance leading up to and in the aftermath of the crisis, along with the SEC’s steady diet of insider trading, back-dated stock option and other securities-related investigations.

Working in the e-discovery field has a number of advantages and disadvantages.  Some of the advantages include being afforded the opportunity to break into the legal field in a new city relatively quickly, using the wage structure to achieve personal and professional goals like paying off student loans or financing further study or travel, meeting new people, being exposed to the e-discovery aspects of large government investigations or litigation and being exposed to new areas of law.  In many ways, working as a contract attorney is like job dating.  Some of the dates are great, some of them not so great, some terrible - but all critical to your development.  Some of the disadvantages are the potential for career stagnation, the rarity of opportunities for advancement and lack of job security (projects can end with less than a couple hours of notice).  The key to effectively navigating the field if you enter on purpose or otherwise is approaching your time as a contract attorney strategically to maximize the advantages and minimize the disadvantages.

Attorneys enter the e-discovery industry for a variety of reasons.  These include moving to a new city, leaving or losing a job, waiting for a federal job application to finalize or a security clearance process to be completed, re-entering the job market after time away (for example, to raise children) or the desire to achieve short- or long-term financial goals in order to pursue other opportunities - like taking a job in the public interest or non-profit sector or opening a plaintiff’s law office or solo practice.  I have met a surprising number of human rights advocates working in the e-discovery industry who conduct human rights advocacy or work on development projects between e-discovery projects.  I have also met young attorneys who worked 60-90 hour weeks and lived on ramen for a few years to pay down or pay off their student loans in order to transition into a lower-paid public interest career like the Foreign Service or the DC Employment Justice Center - not to mention former litigators who just wanted a break from the stress of litigating and running a law practice and retired attorneys who were tired of being at home all the time.

Whatever your reasons for entering or wanting to enter the e-discovery industry, it is a good idea to maintain focus on your goals.  The heavy hours can discourage attorneys from seeking and applying for other jobs.  Don’t let that happen.  Some attorneys fall into the competitive streak of wanting to bill as many hours as possible.  At a certain point, however, billing more than 67 hours/week has diminishing financial returns because of the income tax consequences - not to mention the deleterious effects on your health.  I once had a friend remark that DC is a wonderful place to be unemployed because of all the organizations, seminars and educational and networking opportunities the city has to offer.  Take those few hours off a week to attend networking events and do pro bono work.  Make sure you are pursuing your dream while you work in the e-discovery industry.

Success in the e-discovery field and finding those rare opportunities for advancement depends on the same habits and qualities that guarantee success in any job.  Have a good work ethic, pay attention to detail, listen to and follow instructions, exercise some emotional judgment in your dealings with other attorneys and professionals (don’t gossip or get involved with petty office drama) and, platitudes and clichés aside, have a good attitude.  Take each e-discovery project as a learning opportunity.  Research the e-discovery platform you are using and try to study or master some of the advanced search and other capabilities of the platform.  Take some time at work (if you are allowed internet access) or at home to research the case, the area of law and the agencies and entities involved in the case.  A few pieces of equipment are also critical to your survival in the e-discovery field.  Absolutely critical?  Headphones.  While many of the attorneys on e-discovery projects are some of the most interesting people you may come across in your life, others can be difficult to deal with.  Either way, it is not easy to sit with people for 10, 11, 12 or 14 hours straight for several days in a row without getting to know them a little too well.  Your headphones may afford the only privacy you’ll have at some points of the day.    A smart phone with internet access is also key, especially on projects where internet access is prohibited or limited.  And your constant companion?  The Posse List, where you can learn about recent e-discovery trends, new software, training opportunities and conferences as well as jobs and projects (  The best “in” to the field, however, is a referral from an attorney trusted and known to some of the agencies who can fill you in on the characteristics of different agencies and firms.

What does success in the e-discovery industry mean?  At its most basic, it means making contacts in the legal field and earning some money while you seek other employment.  Success in e-discovery may be learning all you can about e-discovery, achieving financial goals and moving into a legal in your field of interest or open a law practice.  On the other hand, It can mean longevity on a project.  Successful contract and project attorneys often remain on a project after the official end to conduct further privilege review, draft privilege logs or to be “rolled over” onto other projects by the firm or agency.  It doesn’t happen on all projects and it may not happen on every project for you, but take the decision with grace.  It also means additional opportunities to master advanced e-discovery tasks and to witness and participate in the final stages of a large electronic document production.  In rare cases, it can lead to promotion to a Staff Attorney or Discovery Attorney position in a large law firm, which affords some economic and professional stability and the opportunity to work on more interesting cases.  Unfortunately, during the economic crisis staff attorneys were often the first to be let go by large law firms, and hiring has not yet picked up.  Many associates and some partners were also let go from large firms in major metropolitan areas so not all attorneys were immune.  Another disadvantage of the staff attorney position is that most of the large law firms that can afford to have technical/legal/e-discovery expert positions at the staff attorney level offer no additional form of advancement to the associate or partner level.  In most cases, if you want to use the e-discovery path to get your foot in the door of an employer, you may want to seek out smaller firms or employment agencies that make placements with the government.  The strict hierarchy of large DC and New York law firms makes upward mobility almost impossible in those firms.  If you work on a project for a smaller firm or a government agency, however, you may be able to advance based on your merit and work ethic.

I have heard that some attorneys and firms will not hire lawyers who have worked in the e-discovery field as document reviewers.  In my opinion, this stance is misguided.   Professor Ted Occhialino told my first year Civil Procedure class, “If you don’t know Civil Procedure, you will lose cases you should win.  If you know Civil Procedure well, you will win cases you should lose.”  Nowadays, the same principle applies to e-discovery.  If you do not understand the mechanics of electronic document production - what data exists, how to ask for it, how to process it, which e-discovery platforms are most user-friendly and easy to search, how to conduct document review, how to choose and manage document reviewers, how to analyze documents for attorney-client privilege and work product doctrine (not as easy as it sounds), how to draft a privilege log, what standards are used to challenge a privilege log - you will lose cases you should win.  If you aren’t familiar with these processes, you may find yourself or your firm in the unenviable position in which the McDermott law firm found itself - being sued for millions of dollars for inadvertently waiving privilege on a number of produced documents.  Gone are the days depicted in a recent episode of the new USA Network dramedy “Suits” in which a young attorney encounters a room full of boxes.  Nowadays, it is a room full of computers attached to millions of documents housed in “The Cloud” or in document retention centers in the Denver area.  In fact, in almost every large law firm in the country, electronic document review is a rite of passage for young associates.  It is both humbling and educational for young associates - and, in my opinion, absolutely critical to one’s development as an effective attorney or litigator.  Litigation doesn’t only involve court appearances and drafting memos and pleadings.  It involves a huge back-room operation.  Moreover, despite staff attorney lay-offs during the crisis, the trend in top law firms is to assign a partner to be in charge of e-discovery aspects of all major litigation and to have attorneys dedicated to e-discovery.  This is a necessary and good trend in my opinion.  I believe every law firm in the country, and support organizations for plaintiff attorneys such as the National Employment Lawyers’ Association (NELA) should develop e-discovery programs to assist solo practitioners and small law firms in the effective use of e-discovery in all forms of litigation.

So do I recommend a stint in the e-discovery industry despite its drawbacks?  You bet - for every attorney who wants to be an effective litigator in this day and age.  As in any job, however, keep your wits about you and your eyes open for other opportunities.