Participation in On-Line Legal Matching Service
Adopted: April 23, 2004
Opinion rules that a lawyer may participate in an on-line service that is similar to both a lawyer referral service and a legal directory provided there is no fee sharing with the service and all communications about the lawyer and the service are truthful.
Inquiry #1:
A commercial Internet company (the company) operates a website that matches prospective clients with lawyers. A prospective client logs onto the website where he registers and is given an identification number to preserve anonymity. The prospective client posts an explanation of his legal problem on the website and consents to contact from participating lawyers. There is no charge to the prospective client for the standard service but, for more individualized and faster service, there is a fee.
The company solicits lawyers to participate in its service. To participate, a lawyer must be licensed and in good standing with the regulatory agency of his state of licensure. A participating lawyer is charged a one-time registration fee that covers expenses for verifying credentials, technical system programming, and other set-up expenses. An annual fee is charged to each participating lawyer for ongoing administrative, system, and advertising expenses. The amount of the annual fee varies by lawyer based on a number of components, including the lawyer's current rates, areas of practice, geographic location, and number of years in practice.
Only participating lawyers can access the information posted by a prospective client on the website. A local participating lawyer who is interested in a posted case may list his qualifications and send the prospective client an offer message setting forth an explanation of the services he can provide and his qualifications. The prospective client can review offer messages from lawyers and learn more about these lawyers by reviewing the company's on-line lawyer profiles and consumer rating information. If a lawyer has a website, the prospective client may also visit it. Using this information, the prospective client selects a lawyer and contacts the lawyer at which time the prospective client reveals his identity.
If a client-lawyer relationship is formed between a participating lawyer and a user of the service, it is done without the participation of the company. The company does not get involved in the lawyer-client relationship or in related financial matters such as fees, retainers, invoicing, or payment.
May a lawyer participate in this service?
Opinion #1:
Yes, provided there is no fee sharing with the company in violation of Rule 5.4(a), and further provided the participating lawyer is responsible for the veracity of any representation made by the company about the lawyer or the lawyer's services or the process whereby lawyers' names are provided to a user.
This on-line service has aspects of both a lawyer referral service and a legal directory. On the one hand, the on-line service is like a lawyer referral service because the company purports to screen lawyers before allowing them to participate and to match a prospective client with suitable lawyers. On the other hand, it is like a legal directory because it provides a prospective client with the names of lawyers who are interested in handling his matter together with information about the lawyers' qualifications. The prospective client may do further research on the lawyers who send him offer messages. Using this information, the prospective client decides which lawyer to contact about representation.
A lawyer may participate in an on-line legal directory provided the information about the lawyer in the directory is truthful. RPC 241. A lawyer may also participate in a lawyer referral service subject to the following conditions set forth in Rule 7.2(d):
(1) the lawyer is professionally responsible for its operation including the use of a false, deceptive, or misleading name by the referral service;
(2) the referral service is not operated for a profit;
(3) the lawyer may pay to the lawyer referral service only a reasonable sum which represents a proportionate share of the referral service's administrative and advertising costs;
(4) the lawyer does not directly or indirectly receive anything of value other than legal fees earned from representation of clients referred by the service;
(5) employees of the referral service do not initiate contact with prospective clients and do not engage in live telephone or in-person solicitation of clients;
(6) the referral service does not collect any sums from clients or potential clients for use of the service; and
(7) all advertisements by the lawyer referral service shall: (A) state that a list of all participating lawyers will be mailed free of charge to members of the public upon request and state where such information may be obtained; and (B) explain the method by which the needs of the prospective client are matched with the qualifications of the on-line recommended lawyer.
It appears that the on-line service satisfies all of the conditions of Rule 7.2 except that it is operated for a profit, potential clients are charged a fee if they chose the priority service, and the website does not include a statement on how the names of all participating lawyers may be obtained.
Nevertheless, the company's on-line service is not strictly a referral service and failure to meet all of conditions set forth in Rule 7.2(d) should not prohibit a lawyer from participating. Unlike the passive recipient of a referral from a lawyer referral service, a user of the company's website must evaluate the information and offers he receives from potentially suitable lawyers and decide for himself which lawyer to contact. Thus, the potential harm to the consumer of a pure lawyer referral service is avoided because the company does not decide which lawyer is right for the client.
A lawyer's participation in on-line service is subject to the other requirements of the Rules. Notably, the prohibition on fee sharing with a non-lawyer must be observed. Although a participating lawyer may pay a proportionate share of the reasonable costs of operating the service, the lawyer may not pay the company any portion or percentage of legal fees earned from clients obtained through the service. Rule 5.4(a).
In addition, a participating lawyer is responsible for the truthful content of any information the company provides, via the Internet or otherwise, to prospective clients about the lawyer or the lawyer's services. Rule 7.1; Rule 7.2, cmt. [7]. The lawyer is also responsible for the veracity of any representations made by the company on the website or elsewhere about the screening and qualifications of the lawyers who participate in the service and the matching process and may not participate if such representations are untruthful or misleading.
Inquiry #2:
The company provides a satisfaction guarantee. If a dispute arises between the client and a lawyer engaged through the on-line service, a customer services representative from the company will try to resolve the problem. If this fails, the client and the lawyer will be directed to voluntary arbitration. If an arbitration judgment is awarded to the client, the company will pay up to $1000 ($5000 for priority service cases) to the client if the lawyer fails to pay.
Rule 1.5(f) requires a lawyer who has a fee dispute with a client to participate in the State Bar's program of fee dispute resolution. How does the guarantee relate to this requirement?
Opinion #2:
The guarantee may not interfere with a lawyer's compliance with the requirements of Rule 1.5(f) to notify a client of the State Bar's fee dispute resolution program and, if the client so requests, to participate in good faith. If the company's guarantee provides a duplicative dispute resolution procedure, it is only beneficial for clients.