Afternoon Coffee: Online legal marketplace UpCounsel is closing; Jobs, job-seekers rise; SourceDay growing; China to reduce tariffs

San Francisco-based UpCounsel abruptly announced this week that it would be shutting down its site and discontinuing business on March 4. UpCounsel, founded in 2012, may have been the first online legal marketplace, and the company has raised $26 million since inception.

According to a Bloomberg Big Law Business article, UpCounsel “provided freelance attorneys for brief consultations, full-time legal department staff positions, and everything in between.” The article also noted that “in a 2018 lawsuit, UpCounsel was accused of flouting ethics rules and competition laws. Specifically, it had been accused of “brazenly” violating the California bar rule that prohibits lawyers from sharing legal fees with nonlawyers. But the suit in Federal Court was settled.

Why the shutdown? The jury is still out on that.

Another driver that we have thought about is that a lot has changed in the legal environment, including the development of the so-called New Law. At the high corporate and big law firm end of the market, temporary or freelance lawyers are now available globally via many platforms, such as Lawyers on Demand (even the Big 4 accountancies’ fast-growing legal services units have gotten into the game). Equally, at the lower SMB and consumer end of the market, competition has intensified with the entry of firms such as Lexoo, Law Path, Rocket Lawyer and Legal Zoom.

So most likely, the laws of economics have had at least something to do with it.

Jobs report shows hiring but higher unemployment

A Labor Department report Friday shows that the U.S. job market saw 225,000 jobs added in January, likely due to unseasonably mild temperatures that may have boosted hiring in the weather-sensitive sectors, Reuters reports. The manufacturing sector shed 12,000 jobs. The department’s closely watched monthly employment report also showed that since more people were seeking jobs that the unemployment rate ticked up to 3.6% for January from 3.5% in December, according to The Associated Press, which also said the department annual revision showed that hiring wasn’t as robust in 2018 and into early last year. “Employers added 2.3 million jobs in 2018, down from a previous estimate of 2.7 million,” the AP said.

SourceDay growing

SourceDay announced that it is growing in staff, procurement technology and office space. The Austin, Texas-based specialist for managing direct materials spend said it had “75% growth in total annual contract value during 2019 (and) added thousands of additional manufacturers, distributors and suppliers to its platform, driving over $66 billion in total direct spend processed.” SourceDay recently beefed up its RFQ and AP collaboration capabilities. It also said that its staff doubled to more than 50 people, and that the firm is moving to a larger location in Austin.

SourceDay CEO Tom Kieley said in the press release that “2019 was an important year for us. We achieved big milestones, which validate the quality of our team, the impact of our product portfolio and the strength of our customer relationships.”

U.S. Air Force to test blockchain for sharing of data

The U.S. Air Force will pilot a blockchain-based graph database test that will permit it to share documents internally as well as with the various branches of the Department of Defense and allied governments, Computer World reports.

The Winston-Salem, N.C., start-up Fluree will provide the permissioned blockchain ledger. It will work with the Air Force’s Small Business Innovation Research AFWERX technology innovation program to launch a proof of concept of the distributed ledger technology later this year.

China to reduce tariffs on U.S. goods

As part of the ongoing U.S.-China trade talks, China announced this week that it would reduce tariffs on about $75 billion in U.S. good imported into China. The reductions take effect Feb. 14.

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