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The Dawn of Digital
ENTREPRENEURS by Dave Szymanski | Tampa Bay Editor
Jud Parker and his firm, Digital Legal, has gone beyond digital records to working with law firms on organizing data so they can win cases and serve clients better
Attorneys can load information into a laptop and bring that to court instead of lugging pounds of paper files.
But how does the information get to the laptop, especially when it comes from many sources, like the firm's files, clients or hospitals, and many of those sources keep it on paper?
Enter Jud Parker, 38, managing partner of Digital Legal, who started his own Tampa legal document business in August 2006 after cutting his teeth in various parts of the business with other companies from coast to coast since 1993.
Revenues should come in between $800,000 and $1 million this year. The eight-person firm has seen triple-digit growth since May.
Digital Legal splits its work into three different lines of business:
• E-discovery, or consulting: It meets with attorneys, preparing for case-management conferences. It filters information and puts it into databases. That improves the efficiency of evidence review.
• Litigation support: It scans paper documents and makes text searchable. It codes documents. Staff members review and extract relevant information for law firms.
• Medical records retrieval: Quite often medical records are subpoenaed. Digital Legal serves the subpoena. It gathers records, scans them and puts them on a Web site.
In the past six months, the medical records area has grown the most quickly. Most attorneys didn't grow up with these document retrieval services, so they need ramp-up time to learn how to use them.
Starting out
Before starting Digital Legal, Parker grew up as a son of an attorney for MacFarlane Ferguson in Tampa. He would finish soccer practice and do his homework on Saturdays in his dad's office. He saw the piles of paper there and at home.
"I think it opened me to considering a career in law," Parker says. "Life propelled me in this direction. It makes sense in hindsight."
An English major in college at Washington & Lee, Parker worked as a paralegal for two years and as a litigation analyst in San Francisco for a law firm which specialized in patent cases. Imaging was a big part of that business and it was cutting edge at the time. Employees would take all the documents, scan them and load them into a summation database.
"After three years, I realized there was a future in the tech side of the law," Parker says.
Summation, a San Francisco company that developed legal database software, needed a representative in the Northeast, so Parker became that person, working in New York from 2000 to 2005.
The practice of law was changing and he was part of it.
"I saw a seismic shift in best practices in San Francisco, New York and Chicago," Parker recalls. "There was a proliferation of email. The digital market started to pick up."
In the summer of 2005, Parker returned to Tampa, his hometown, and saw the need for a tech-based company to help attorneys handle litigation.
Changes to federal rules of procedure for all lawyers practicing in federal court became formalized in 2006, paving the way for digital records. Using personal funds and select private investors, Parker started Digital Legal.
"It was really a perfect storm," Parker says. "I always wanted to run my own business. I ran sales teams. I wanted to do something different that would make a difference."
The firm, Digital Legal, is in downtown Tampa, putting it close to the courthouses and many law firms. It has eight full-time employees and flexes up to 14 people with part-time help at times. Everyone has legal or technical backgrounds.
Parker brought along professionals he worked with over the years. David Wilkens, who worked at Summation as a litigation support manager in New York, is Digital Legal's executive director of development. Nick Carter, director of operations, was the No. 1 reseller of Summation on the west coast of Florida.
Competition
Besides Digital Legal, other companies have gotten into digital copies and database work. For example in Tampa Bay, Ikon also handles digital documents and electronic data discovery.
It's a competitive market.
"This has been going on for a long period of time," says entrepreneur R.J. Kwap, who has done document imaging in Tampa.
At some law firms, database crunching is done in-house. There is little time to call vendors, so they have to finish document- and data-sorting work quickly.
With the price of scanners coming down, it has made it faster and easier for businesses like law firms to scan documents themselves. Some of the first scanners cost $5,000. Now some sell for as little as $800. And it's actually faster to scan than to make paper copies today.
Ikon started working directly with major law firms on document work, Kwap says. "Quick turnaround is needed for discovery," he says. "There's plenty of people doing it."
However, Parker says that although there are about 18 legal services businesses in Hillsborough County, a majority are paper copiers.
"None are doing the consulting piece and medical records piece," he says. "There are plenty that do copies and scanning. At some point, skill sets change. What kind of strategy do they want to take in discovery?"
Parker recalled that in one case, Digital Legal was retained by both sides in a dispute. They needed to figure out the best and most impartial way to organize the information for both attorneys.
"We are the bridge between the IT (information technology) world and the legal world," Parker says. "Less than 5% of our business is making copies."
A growing industry
The field of e-discovery is growing exponentially and is expected to bring in $1.8 billion in revenues in the United States this year. By 2011, that figure is supposed to jump to $4.8 billion because of the changes in federal rules in converting information to digital data and because of the increasing amount of data.
In the next year, Parker sees the medical records division growing, and has been increasingly meeting with plaintiffs and defendants about the service.
"It's a high-volume business and we see more attorneys getting on board," Parker says. "We see this becoming more of a standard practice."
Litigation support should grow as well, as more attorneys embrace the technology. He projects 2008 revenues should grow 30% to 40%.
During the next five years, Parker wants to manage growth and keep the company small to mid-size.
"It's a service industry and we don't want to lose sight of our customers," he says. "We enjoy working with attorneys, especially senior attorneys, giving them another arrow, watching them succeed."
When he's not running Digital Legal, Parker is running Bayshore Boulevard in south Tampa with his two-year-old daughter, in a jogging stroller, and his wife, Renu Parker, general counsel at Hillsborough Kids, which manages foster programs in Hillsborough County. The family also likes to go to Tampa Bay Buccaneer games.
REVIEW SUMMARY
Company: Digital Legal, Tampa
Industry: Information management for law firms
Key: Help law firms manage their information to win cases.
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