The Indianapolis Star has an Editorial about the Attorney General’s insider deal outsourcing civil suit defense to a recent deputy AG formerly in charge of the in-house defense of such cases. The editorial board is not amused. They point out that outside competition was all but nonexistent and that ethics review was illusory. Pretty poor performance, they say, for folks who ran on an ethics platform.

For my own part, I simply don’t see the source of the savings in outsourcing a core function of the AG’s office. I think either the contract will run over, the level of service will be cut back, or the contracting law firm will take a big financial hit trying to fulfill the contract.

Update The Indiana Law Blog has more.

Michele McNeil has an article in the Indy Star entitled, State lawyer won contract from his boss. The Attorney General’s office awarded a contract to defend the state in civil suits to former deputy Attorney General, John Lewis, who was chief of the tort litigation division. The contract award has at least the appearance of impropriety. If I’m reading this right, Lewis contributed information for the drafting of the Request for Proposals for outsourcing the division’s work, then turned around and bid on the project.

Aside from that, I’m wondering how the economics of this is going to work. When doing the work in-house, the Attorney General had 12 staff positions to deal with the cases, (3,000 of them filed in 2004), and now the private firm of Lewis and Wilkins will do the work with 4 people. (Or maybe I’m misreading the article and the number of Lewis & Wilkins attorneys is not specified, just there will be 4 who used to work at the AG’s office.) In any event, I don’t see how a private firm is going to have a competitive advantage in this case. Normally you outsource peripheral duties. But litigation ought to be a core competency of the AG’s office. Furthermore, AG attorneys generally work cheaper than the private practice attorneys. And, overhead is not as much of a direct problem. There is almost certainly relevant information I don’t have in analyzing this situation, but from what I have it seems that, either this outsourcing will end up costing a lot more than the $650k that was bid or Lewis & Wilkins will end up taking a financial hit from this contract.

I believe the contract is available here. (Scroll down to Lewis & Wilkins). I was unable to view the PDF document, but that could very well be a problem with my software and not the document itself.