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A year and a half ago, Legal Anywhere Inc., a Tualatin, Ore.-based maker of legal extranets, seemed poised for stardom. At the time, the startup was selling its extranet application to legal heavyweights like New York’s Kelley Drye & Warren and Los Angeles’ Paul, Hastings, Janofsky & Walker. Legal Anywhere’s chief executive, Robert Wiggins, was smart, driven, and respected in the Northwest’s big firm community. And the company had a pile of money behind it. In February 2000, Wiggins and the company’s founder, Peter Ozolin, sold Legal Anywhere to Redwood City, Calif.-based Niku Corporation. A month later, Niku went public and quickly amassed a market capitalization of over $3 billion. But Legal Anywhere went absolutely nowhere. Today, Legal Anywhere extranets aren’t for sale, not even to law firms with whopping IT budgets. And Niku claims it will only support Legal Anywhere extranets through the end of next March. So what happened? The story begins and ends with Niku. Niku is a young company — it was founded in May 1999 by a former senior vice president at Oracle Corporation named Farzad Dibachi. Early on, like a lot of troubled youth, Niku struggled to find an identity. Through the early part of last year, Niku made extranets and intranets for a range of vertical markets. And it operated a Web-based swap meet for buyers and sellers of professional services. But in the summer of 2000, after the tech implosion drove Niku’s stock from over $100 a share to under $30, Niku rewrote its mission statement. It stopped selling “turnkey” Web products and developed a larger intranet product meant to streamline companies’ internal workings, like accounting and personnel. Niku figured that the companies most in need of such a product would be big and brawny. So last fall it started targeting the world’s 2000 largest companies and stopped courting smaller niches, like the legal industry. About that time, Niku stopped paying attention to Legal Anywhere. “The product was great in 1999,” says Mary Odson, the chief information officer at Paul Hastings, “but it never really seemed to improve, and we sort of stopped using it.” Odson says that compared to other extranet products, Legal Anywhere was hard to customize and didn’t integrate well with law firms’ document management systems. Wiggins bolted from Legal Anywhere shortly after the sale to Niku. Ozolin saw the handwriting on the wall and left Niku last winter. And Niku officially buried Legal Anywhere in April, when it let the remaining staffers go. “It was too bad,” laments Ozolin. “We had a very profitable third quarter in 2000, and we thought we could make this thing work out. Unfortunately, Niku decided to go in another direction.” Niku isn’t bemoaning its growing pains. “Buying Legal Anywhere was definitely not a mistake,” says Robert Visini, Niku’s senior director of marketing. “At the time, we thought it was the best legal extranet out there, and we really had plans to expand it.” Visini also says that Niku learned a lot about building “collaborative tools” from Legal Anywhere. So now what does Niku do with Legal Anywhere? The company first tried to sell it back to Ozolin. But, according to Chris Santella, a former marketing director at Niku, Ozolin balked at the “lofty” price. So now Niku’s stuck with a product it doesn’t want and, incidentally, a stock price that’s currently below $1. Visini claims the company is close to licensing the Legal Anywhere code to a group of former Legal Anywhere staffers. But, as of press time, no deal had been reached. So, for the time being, Niku will pay to support a dormant product. Meanwhile, Ozolin is coming out of a dormancy of his own. This winter, he and a handful of Legal Anywhere cronies hope to roll out the first product made by his new company, called AchieveOne Inc. Apparently Ozolin hasn’t forgotten who let his first company wither on the vine. He says the product will look a lot like Niku’s new “professional services automation” intranet, only geared for law firms. Through a secure Web site, clients and lawyers will be able to collaborate and create documents out of sets of predesigned document templates. At the outset, the product will target transactional lawyers, but Ozolin hopes he’ll find a way to make it useful to litigators, too. Ozolin lost his first-mover advantage the day Niku decided to abandon Legal Anywhere. But that’s not stopping him from courting Legal Anywhere’s clientele. Already, Paul Hastings, San Francisco’s Pillsbury Winthrop, and the Los Angeles office of Chicago’s Seyfarth Shaw have signed on to beta test AchieveOne’s debut offering. They just better hope Ozolin doesn’t sell out as fast with this one.

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