Internet Wars: The Bar Against the Websites. Gerard J. Clark* Cite as 13 J. High Tech. L. 247

Transcription

1 Internet Wars: The Bar Against the Websites Gerard J. Clark* Cite as 13 J. High Tech. L. 247 A. Introduction B. LegalZoom 1. Introduction 2. The Site 3. Disclaimers 4. Offers of Memberships 5. Website Blog 6. Every day Law Articles 7. Miscellaneous C. Other websites D. Legal and Ethical Questions 1. Introduction 2. The Publication of Forms and Information 3. Advertising a. Rule 7.1 b. Rule Group legal services and Insurance 5. Bulletin Boards 6. Rule 5.5- Unauthorized Practice 7. Home Office Rules 8. Rule 5.4 Form of Ownership 9. Rule 1.2 (c) Disaggregation E.Conclusion A. Introduction Consumers are increasingly consulting the internet to find providers of legal services. 1 Sites that respond to this demand are * Professor of Law, Suffolk University Law School. Copyright 2013 Journal of High Technology Law and Gerard J. Clark. All Rights Reserved. ISSN

2 248 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 proliferating. 2 This new supply and demand system is changing the nature of the delivery of legal services and challenging a profession which is resistant to change. 3 The tension between the new providers and the traditional bar appears to be escalating. 4 This article will describe the tensions and will highlight the ethical and legal questions that these changes present. Three of the more popular sites will be used as examples of the huge number of legal delivery services that are available on the internet. 5 LegalZoom appears to be the most successful such website. 6 It has recently raised $100 million from Kleiner Perkins and Institutional Venture Partners 7 and is poised to go public. 8 Nolo was recently purchased by Internet Bands; Rocket Lawyer has recently raised $18.5 million in financing, in which Google Ventures participated. 9 Investors are attracted by the fact that these web-based pro- 1 See Jennifer Smith, No-Frill Legal Services Grow, WALL ST. J., Dec. 3, 2012, archived at (observing newfound access to online legal services). 2 See id. (describing the online legal services market as having become increasingly crowded ). 3 See WILLIAM HORNSBY, IMPROVING THE DELIVERY OF AFFORDABLE LEGAL SERVICES THROUGH THE INTERNET: A BLUEPRINT FOR THE SHIFT TO A DIGITAL PARADIGM 4 (1999) (commenting on lawyers unwillingness to adapt to an online, unbundled offering of legal services). 4 See Smith, supra note 1 (noting the many legal conflicts between the traditional legal community and its online counterpart). 5 See LegalZoom: Online Legal Documents Services, LEGALZOOM, archived at [hereinafter LegalZoom] (providing an example of an online legal service outlet); Nolo: Law for All, NOLO, archived at [hereinafter Nolo] (noting services offered by another online legal service organization); Rocket Lawyer, archived at (describing the services of an online legal services provider as, [e]verything you need to make it legal. ). 6 See LegalZoom, supra note 5 (presenting various accolades received by the likes of Forbes and the Wall Street Journal). 7 See John Wallbillich, LegalZoom: Substance Over Forms?, WIREDGC, May 4, 2011, archived at (announcing two venture capitalists investment in LegalZoom). 8 See LegalZoom.com, Inc., Form S-1 Registration Statement, U.S. SEC, May 10, 2012, archived at (indicating LegalZoom s intent to go public). 9 See Internet Brands Acquires Nolo, the Definitive Online Source for Consumer Legal Information, MARKET WIRED, May 2, 2011, archived at, (announcing the acquisition of Nolo); Debra

3 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 249 viders of legal service to the public are disruptive models in huge, decentralized business of law, with revenues of $230 billion last year in billings from 160,000 law firms.10 These sites provide legal services to the public in a variety of ways: first, by providing legal information in a format to be understood by a lay audience, 11 second, by offering to find the customer an appropriate lawyer, 12 third, by maintaining a bulletin board and inviting the public to post questions to be answered by lawyers who are registered with the site, 13 fourth, by selling memberships which entitle the member to free or discounted legal services on a continuing basis as the needs arise, 14 and fifth, by selling legal forms, either in blank, or, customized to the particular needs of the customer by interactive branching software which will use customer information to develop the appropriate document. 15 Cassens Weiss, Rocket Lawyer Raises $18.5M; Google Ventures is Among the Investors, ABAJOURNAL, Aug. 11, 2011, archived at (reporting the investment made by large investors in Rocket Lawyer). 10 See Daniel Fisher, Silicon Valley Sees Gold in Internet Legal Services, FORBES, Oct. 5, 2011, archived at (reporting fee billings by 160,000 law firms in a year); see also Richard Granat, LegalZoom s Achilles Heel: Free Legal Forms, E LAWYERING BLOG, Aug. 4, 2012, archived at [hereinafter LegalZoom s Achilles Heel] (describing the financial benefits of free online legal forms, and the harm that they may cause the online legal services market). 11 See Lawguru, archived at (attempting to provide free legal advice that can be understood by a lay audience); Rocket Lawyer, supra note 5 (providing another example of online legal research). 12 See Rocket Lawyer, supra note 5 (including amongst the services provided, the ability to connect with a lawyer). 13 See, e.g., Lawguru, supra note 11 (allowing customers to visit message boards and post questions). 14 See, e.g., Plans and Pricing, ROCKETLAWYER, archived at (proving various pricing plans for services provided). 15 See Rocket Lawyer, supra note 5 (offering clients the ability to make a document and allowing them to personalize their legal needs electronically).

4 250 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 B.LegalZoom 1.Introduction LegalZoom was founded in 2001 by two former firm associates in Hollywood, California and currently claims serving over 1 million customers and employing roughly 400 workers. 16 Co founder Robert Shapiro, a California attorney best known for his role on the O.J. Simpson defense team, is touted as one of the top attorneys behind the development of the site. 17 A nationwide advertising program in major national media markets seeks to brand LegalZoom as the leading legal services web site on the Internet. 18 However, the scheduled August 2, 2012, IPO was cancelled when institutional investors evaluated its stock at $7 to $8 per share, one third less than LegalZoom s evaluation. 19 The gloomy assessment by investors is probably influenced by the legal problems described herein, as well as the proliferation of competing sites. 2.The Site LegalZoom maintains a multi-faceted website that provides information, maintains a blog, and sells personalized forms. 20 It also markets legal services plans for a monthly fee which entitles members to certain circumscribed services free of charge. 21 LegalZoom uses the tag line: We Put the Law on Your Side See Lawsuits Challenge LegalZoom Document Business, L.A. DAILY NEWS, June 20, 2010, archived at (stating various attributes of the LegalZoom company). 17 See id. (describing Shapiro as the public face of the company). 18 See Bill Draper, Missouri Lawyers Challenge LegalZoom s Service, THE SAN DIEGO UNION-TRIBUNE, July 30, 2011, archived at (discussing the advertising campaign designed to position LegalZoom as the most recognizable of the online legal services websites). 19 See LegalZoom s Achilles Heel, supra note 10 (discussing how LegalZoom s IPO was delayed because they were not able to get the $10-$12 per share that they desired). 20 See LegalZoom, supra note 5 (advertising the range of LegalZoom s services). 21 See Personal Legal Plan, LEGALZOOM, archived at (offering a variety of legal service plans). 22 See Richard Granat, Analyzing LegalZoom s Advertising Practices, ELAWYERING BLOG, Feb. 12, 2009, archived at (stating LegalZoom s tagline).

5 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 251 When customers arrive at the LegalZoom web site they are presented with a menu of legal documents that are sold for a fixed price. 23 The documents are either those commonly needed by the individual client like powers of attorney, living wills, residential leases, purchase and sale agreements and no-fault divorce petitions; or those commonly needed by businesses such as certificates of incorporation, trademark applications, and contracts for the sale of goods. 24 These forms are available in blank or they may be customized by the site software. 25 The customer completes a series of questions and the document assembly software generates a legal document, which is sent to the customer in paper format by regular mail after the customer pays for the document by credit card. 26 Examples of costs are: 501(c)(3) application - $595, certificate of incorporation - $99, last will and trust -$69, living will - $39, joint venture agreement - $129 and copyright application - $ The company provides a peace of mind review to assure that all answers are completed, that the spelling and formatting is cor- 23 See LegalZoom, supra note 5 (providing a gateway to access the legal documents and services offered). 24 See LegalZoom, supra note 5 (listing several of the most popular forms provided). 25 See Donna Seyle, LegalZoom and Unauthorized Practice of Law, LAWYERIST, Aug. 17, 2011, archived at (quoting a Missouri District Court as saying that, LegalZoom s sale of blank forms over the internet does not constitute the unauthorized practice of law. ) LegalZoom has touted the ability of clients to fill the documents, as well. See id., noting of LegalZoom advertising that clients needs only, answer a few simple online questions and LegalZoom takes over. You get a quality legal document filed for you by real helpful people. ). 26 See, e.g., Trademark Registration, LEGALZOOM, Feb. 5, 2013, archived at [hereinafter Trademark Registration] (prompting the customer to complete the online questionnaire to obtain their document). 27 See 501c3 Application, LEGALZOOM, archived at (providing the cost of an application); Certificate of Incorporation, LEGALZOOM, archived at (showing the cost of a certificate of incorporation); Last Will and Testament, LEGALZOOM, Feb. 5, 2013, archived at (showing the cost of a last will and testament); Living Will, LEGALZOOM, archived at (providing the cost of a living will); Joint Venture Agreement, LEGALZOOM, archived at (showing the cost of a joint venture agreement); Copyright Registration, LEGALZOOM, archived at (showing the cost of a copyright registration).

6 252 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 rect, and that the document has been proof-read. 28 Some documents come with a higher priced package that includes a one-half hour consultation with a lawyer The Disclaimers The LegalZoom site includes the following disclaimer: The information provided in this site is not legal advice, but general information on legal issues commonly encountered. LegalZoom is not a law firm and is not a substitute for an attorney or law firm. Communications between you and LegalZoom are protected by our Privacy Policy, but are not protected by the attorney-client privilege or work product doctrine. LegalZoom cannot provide legal advice and can only provide self-help services at your specific direction; LegalZoom cannot provide any kind of advice, explanation, opinion, or recommendation to a consumer about possible legal rights, remedies, defenses, options, selection of forms or strategies. 30 The site has a detailed section entitled Our Commitment to Privacy, which explains in detail the difference between contractual privacy and the attorney-client privilege, how personal data is handled, how third party vendors may have access to personal information, and customer options to withhold information. 31 The customer satisfaction guarantee provides company credit for the price of documents that do not satisfy the customer See Peace of Mind Review, LEGALZOOM, archived at (describing attributes of the policy). 29 See Legal Plan Contract, LEGALZOOM, archived at (providing for a legal consultation). 30 About Us, LEGALZOOM, archived at 31 See Our Commitment to Privacy, LEGALZOOM, archived at (explaining some of the company s policies). 32 See The LegalZoom Satisfaction Guarantee, LEGALZOOM, archived at (articulating the refund process for LegalZoom products).

7 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES Offer of Membership After the completion of the creation of a document, the customer is offered a variety of membership options. 33 For the individual or family subscriber, there are two options: the Legal Advantage Standard subscription for $7.99 per month and the Legal Advantage Plus subscription at $14.99 per month. 34 For the business subscriber, the options include the Business Advantage Standard subscription at $7.99 per month and the Business Advantage Pro subscription at $29.99 per month. 35 The site proceeds to explain these plans in great detail Website Blog The site also maintains a busy interactive blog on which an attorney fields the questions of the public on every imaginable subject. 37 LegalZoom answers additional questions on Facebook and can be followed on Twitter. 38 In addition, one can find over one hundred 33 See Legal Plan Contract, supra note 29 (setting forth fees for Business and Legal Advantage subscription services); Supplemental Terms of Service for Advantage Subscriptions, LEGALZOOM, archived at (quoting monthly subscription prices). 34 See Legal Plan Contract, supra note 29 (stating a specific price for Advantage Plus subscription); Supplemental Terms of Service for Advantage Subscriptions, supra note 33 (explaining the pricing of the Advantage Standard subscription plan). 35 See Legal Plan Contract, supra note 29 (publishing prices for the Business Advantage Pro subscription plan); Supplemental Terms of Service for Advantage Subscriptions, supra note 33 (providing prices for the Business Advantage Standard subscription plan). 36 See Business Legal Plan, LEGALZOOM, archived at (outlining details of the legal plan for business entities); Personal Legal Plans, LEGALZOOM, Feb. 5, 2013, archived at (explaining the details of the legal plan for individuals and families). 37 See LegalZoom Blog, LEGALZOOM, archived at (offering explanations and insight into various legal issues in the news). 38 See LegalZoom, supra note 5 (inviting visitors to follow LegalZoom on Facebook, Twitter, LinkedIn, and their blog).

8 254 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 LegalZoom videos on YouTube. 39 These run the gamut of type and subject matters: including testimonials, how-to-do-it legal advice, biographies of the founders and employees and even video of the firm Christmas party Everyday Law Articles The site maintains a library of articles that seek to explain legal issues in plain and simple language. 41 For instance, the site makes available the article titled, 5 Steps to Protect Family Heirlooms. 42 You ve probably heard at least one horror story about adult children fighting over how to divide up possessions or whether to keep or sell those precious family heirlooms after their parents have died. 43 The article then provides several steps to avoid family disputes over the items Miscellaneous The website also seeks affiliates to sell memberships in the group legal services plans at 15% commission. 45 The website states, [t]he LegalZoom Affiliate Program is a way for you to earn a commission by promoting LegalZoom products using banner ads or text links within your website. Each time a visitor clicks on a LegalZoom link on your website and completes a purchase, you ll earn money. 46 The site goes on to describe who might be attractive applicants: [w]eb marketers committed to preserving the integrity of the LegalZoom brand, [f]ranchise companies searching for a cost effective solution for business formation requirements, Esq., CPAs, CFAs & CFPs 39 See LegalZoom, YOUTUBE, archived at (showing 649 results for a search of LegalZoom videos on YouTube.com). 40 See id. (demonstrating the range of search results for LegalZoom on YouTube). 41 See Article Center, LEGALZOOM, archived at (displaying a number of articles that users can use for reference). 42 See Heleigh Bostwick, 5 Steps to Protect Family Heirlooms, LEGALZOOM, Oct. 2010, archived at (describing steps that one can take to protect family heirlooms). 43 Id. 44 See id. (outlining five steps). 45 See LegalZoom Affiliates Program, LEGALZOOM, archived at (describing the benefits of being a LegalZoom affiliate). 46 Id.

9 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 255 exploring value added services to their clientele, [c]ompanies with online marketing specialists and content writing teams, [c]ompanies who look for niche products and build sites to promote products, [w]ebsite owners with a strong SEO presence for legal keywords, and [s]ites or directories that are targeted and useful to online shoppers. 47 The site also suggests that affiliations will not be from the following: [c]oupon or incentives-only websites, [a]pplications or adware known to overwrite cookies, [e]xcessive use of banners with no supporting content, [f]lash or graphics-only websites, [w]ebsites that have no value-add content, [u]se of black-hat SEO tactics, [a]ny version of spam[.] 48 Finally the site is seeking over twenty job applicants at one of the three LegalZoom office in Glendale, San Francisco and Austin in one of the following job classifications: corporate legal, customer care, finance, human resources, marketing, operations, product management, research and development, and sales. 49 C. Other Sites The Nolo site encourages the visitors to post legal questions publicly on the site and then posts answers from lawyers who have registered with the site. 50 Rocket Lawyer sells legal forms and also has a stable of lawyers ready to assist the purchasers of the forms who feel that they need further assistance. 51 The Total Attorneys site provides advertising for its member lawyers by eliciting rudimentary 47 Id. (listing several parties that might benefit from the arrangement) (changes to punctuation not identified). 48 Id. (changes to punctuation not identified). 49 See Career Center, LEGALZOOM, archived at (providing a list of available positions at LegalZoom). 50 See Nolo, supra note 5 (encouraging users to post legal questions). 51 See Rocket Lawyer, supra note 5 (offering users the opportunity to purchase legal forms and related legal assistance). LegalZoom has sued Rocket Lawyer for unfair competition. See Jennifer Smith, LegalZoom Gets in the Ring with Rocket Lawyer, WALL ST. J., Nov. 28, 2012, archived at (reporting that RocketLawyer was sued by LegalZoom for allegedly employing unfair business tactics, for the purpose of injuring LegalZoom ).

10 256 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 client information and then linking the client with their most appropriate lawyer member who has paid for the affiliation with Total Attorneys and pays for each lead. 52 The cost varies with subject matter but cost $50 to $107 per referral. 53 It provides other services targeting the solo practitioner or small firm, including a virtual receptionist, training in law firm management, and client-tracking technology. 54 D. Legal and Ethical Questions 1. Introduction It is certainly not surprising that a company that is tending to the legal needs of a nationwide clientele and is claiming one million satisfied customers might draw the attention of the organized bar. 55 LegalZoom has had to do battle on many fronts and no less than seven states have expressed the opinion that LegalZoom is engaged in the unauthorized practice of law. 56 In Missouri and California LegalZoom has had to pay damages to classes of consumers who 52 See Total Attorneys, TOTAL ATTORNEYS, archived at (advertising the ability to Turn more Prospects into Clients ). 53 See Neil J. Squillante, Total Attorneys Practice Management Platform: Read Our Exclusive Report, TECHNOLAWYER BLOG, Feb. 15, 2012, archived at (citing lead prices under the heading What Else Should You Know? ). 54 See id. (describing the various services offered by Total Attorneys, including ipad and iphone applications, payment processing, and virtual receptionists); Marketing and Leads, TOTAL ATTORNEYS, archived at (promoting the virtual receptionist s function in hot-transferring calls to attorney offices); Practice Management, TOTAL ATTORNEYS, archived at (describing several tools that support administrative functions of attorneys, such as cloud storage of documents, management of time and billing practices, and client contact). 55 See Catherine Lanctot, Does LegalZoom Have First Amendment Rights?: Some Thoughts About Freedom of Speech and the Unauthorized Practice of Law, 20 TEMP. POL. & CIV. RTS. L. REV. 255, 257 (2011) (describing the campaign the organized bar has launched against LegalZoom). 56 See Brandon Schwarzentraub, Electronic Wills & The Internet: Is LegalZoom Involved in the Unauthorized Practice of Law or is Their Success Simply Ruffling the Legal Profession s Feathers?, 5 EST. PLAN. & COMMUNITY PROP. L.J. 1, 6-13 (2013), archived at (summarizing legal issues LegalZoom has had in multiple states).

11 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 257 claimed fraudulent and deceptive practices. 57 In Pennsylvania, Ohio, Connecticut, North Carolina and Alabama bar authorities found unauthorized practice violations. 58 The authority of the various state disciplinary agencies over an out-of-state corporation that maintains a legal website is not always clear. 59 Bar disciplinary committees are typically populated by lawyers appointed by the state s highest court which may oversee an office that handles everyday enforcement of the rules of professional conduct against the state s licensed lawyers. 60 They typically deal with fee disputes, 61 IOLTA and lawyer trust account regulation 62 and lawyer incompetency and non-feasance. 63 They may or may not have jurisdiction over claims of unauthorized practice against a foreign corporate entity whose website is available to the state s residents over the internet. 64 Some states make unauthorized practice a crime which may be prosecuted by a local district attorney or a state attorney general See id. at 9-11 (describing LegalZoom s payment of damages for engaging in deceptive practices). 58 See Lanctot, supra note 55, at (describing findings of violations in several states); Schwarzentraub, supra note 56 at 6-13 (explaining concerns of several states and their Opinion that LegalZoom is acting unlawfully). 59 See Lanctot, supra note 55, at (noting the enforcement issues related to the internet websites). 60 See Debra Moss Curtis, Attorney Discipline Nationwide: A Comparative Analysis of Process and Statistics, 35 J. LEGAL PROF. 209, (providing and in depth state-by-state analysis of legal disciplinary operations); Richard Granat, UPL and Legal Document Preparation by Non-Lawyer Providers, ELAWYERING BLOG, May 25, 2012, archived at (summarizing how 21 states permit some form of limited practice by non-lawyers). 61 See MODEL RULES OF PROF L CONDUCT R. 1.5 (2011) (listing reasonable fee factors). 62 See MODEL RULES OF PROF L CONDUCT R (2011) (noting the funds should be kept in separate accounts). 63 See MODEL RULES OF PROF L CONDUCT R. 1.3 (2011) (stating that a lawyer shall, act with reasonable diligence and promptness ). 64 See Lanctot, supra note 55, at (expressing the difficulty in enforcement); MODEL RULES OF PROF L CONDUCT (2011) (making no mention of internet and its effect on jurisdiction). 65 See, e.g., MASS. GEN. LAWS ANN. ch. 221, 41 (West 2011) (laying out penalties for incorrectly holding oneself out as being an attorney).

12 258 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 In a civil class action, former customers made claims of fraudulent and deceptive practices and malpractice and sought damages and injunctive relief as a remedy. 66 In the Jansen case a federal district court in Missouri found that LegalZoom s sale of customized documents to be a fraudulent and deceptive practice because the service was unauthorized practice of law ( UPL ) under Missouri law. 67 These and other ethical claims lodged against LegalZoom and other providers will be summarized below. 2. The Publication of Forms and Information Explanations of the law and the legal process designed for the non-professional have been common in paper form since In New York Lawyers Ass n v. Dacey, 69 the New York bar sought an injunction against the publication and sale of the book How to Avoid Probate which contained about sixty pages of narrative describing the will probate process in negative terms and suggesting methods for avoidance of the process, including blank forms which the reader could adopt and file in court. 70 The NY Supreme Court granted the injunction and the Appellate Division affirmed over a dissent by Justice Stevens. 71 The NY Court of Appeals reversed and adopted the Stevens opinion as its own. 72 In his appellate dissent, Justice Stevens asked: [s]tripped of the arguments and the contentions of the various parties, the question 66 See Janson v. LegalZoom.com, Inc., 802 F.Supp.2d 1053, 1057 (W.D. Mo, 2011) (describing the complaint); Janson v. LegalZoom.com, Inc., 271 F.R.D. 506, (W.D. Mo. 2010) [hereinafter Janson Motion to Certify Class] (seeking class certification against LegalZoom). 67 See Janson. 802 F.Supp.2d at (offering an in-depth analysis of Missouri case law and its application). 68 See New York Cnty. Lawyers Ass n v. Dacey, 283 N.Y.S.2d 984, 1001 (N.Y. App. Div. 1967) (Stevens, J., dissenting), rev d, 21 N.Y.2d 694 (N.Y. 1967) (stating that books giving advice on the law have been published and would, in all likelihood, continue to be published). 69 See id. 70 See Dacey, 283 N.Y.S.2d, at (reviewing the contents of the book and noting the request for an injunction) 71 See id. at 984, (outlining the procedural history of the case, the Special Term s conclusions, and providing the dissent of Justice Stevens). 72 See New York Cnty. Lawyer s Ass n v. Dacey, 21 N.Y.2d 694, (N.Y. 1967) [hereinafter Dacey II] (reversing the Order of the Appellate Division).

13 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 259 may be briefly and baldly expressed: Does the writing, publication, advertising, sale and distribution of How to Avoid Probate! constitute the unauthorized practice of law within the meaning of Section 750(B)? 73 Like Justice Stevens, the Court of Appeals would later answer the question in the negative. 74 The dissent further stated: Every individual has a right to represent himself if he chooses to do so, and to assume the risks attendant upon what could prove a precarious undertaking. Those of sufficient substance to require trusts or wills for the most part are persons of some common sense and, normally, would hardly be expected to rely completely and unquestioningly upon a mass-printed form, even with accompanying instructions. However, they have a right to do so. 75 The Stevens dissent also cited the First Amendment case of Whitney v. California 76 in remarking: Books purporting to give advice on the law, and books critical of law and legal institutions have been and doubtless will continue to be published. Legal forms are available for purchase at many legal stationery stores. Unless we are to extend a rule of suppression beyond the obscene, the libelous, utterances of or tending to incitement, and matters similarly characterized, there is no warrant for the action here taken. 77 Dacey s holding that books that instruct the public in how to achieve their legal goals by doing their own research and drafting are protected by the First Amendment seems to have settled that question for books and also for the internet. 78 That conclusion is ratified by 73 Dacey, 283 N.Y.S.2d at 997 (Stevens, J., dissenting). 74 See Dacey II, 21 N.Y.2d at 694 (reversing the Order). 75 Dacey, 283 N.Y.S.2d at 999 (Stevens J., dissenting) U.S. 357 (1927). 77 Dacey, 283 N.Y.S.2d at (Stevens, J., dissenting) (distinguishing the book at issue in Dacey from content that would provoke disorder or public disturbance). 78 See Dacey II, 21 N.Y.2d at 694 (overturning the Appellate Division s decision and implicitly adopting the Stevens dissent); Dacey, 283 N.Y.S.2d at (Ste-

14 260 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 the number of websites maintained by courts, both state and federal, which are seeking to assist their pro se litigants with on-line forms and explanations. 79 Virtually every governmental agency now maintains a website with full text statutes and regulations. 80 Forms are available as well. 81 Administrative offices for courts and court libraries maintain a large catalogue of forms which encourage the public to do their own legal work. 82 The Massachusetts Trial Court Libraries, for example, supplies free forms for conservatorships, health care proxies, FOIA requests, 14 day notices to quit (a tenancy) and affidavens, J., dissenting) (holding that a book about probate is protected speech under the First Amendment and does not constitute the practice of law); see also State Bar of Michigan v. Cramer, 249 N.W.2d 1, 8-9 (Mich. 1976) (remarking that, advertisement and distribution to the general public of forms and documents utilized to obtain a divorce together with any related textual instructions would not rise to the level of legal practice); Oregon State Bar v. Gilchrist, 538 P.2d 913, 919 (Or. 1975) (concluding that advertising and selling divorce kits was not the unauthorized practice of law). But see People v. Landlords Prof l Servs., 264 Cal.App.3d 1599, 1608 (Cal. Ct. App. 1989) (concluding that offering eviction assistance beyond merely clerical services amounts to the unauthorized practice of law); Florida Bar v. Brumbaugh, 355 So. 2d 1186, (Fla. 1978) (differentiating between selecting and preparing legal documents and selling printed materials explaining the legal practice and procedures). 79 See Representing Yourself, U.S. DISTRICT COURT, N. DISTRICT OF CA, archived at (providing litigants information on selfrepresentation); Representing Yourself in Federal Court (Pro Se), U.S. DISTRICT COURT, S. DISTRICT OF NY, archived at (offering information to litigants that are not represented by an attorney); Introducing Serving the Self-Represented Litigant: A Guide By and For Court Staff, MA COURT SYSTEM, July 15, 2010, archived at (directing court staff on how to advise pro se litigants); Representing Yourself in a Civil Case: Things to Consider When Going to Court, MA COURT SYSTEM, Jan. 4, 2010, archived at (outlining the civil process for pro se litigants). 80 See, e.g., Tax Code, Regulations and Official Guidance, INTERNAL REVENUE SERVICE, Aug. 2, 2012, archived at (providing online access to the Internal Revenue Code, Treasury Regulations, and other Official Tax Guidance); Rules and Regulations for the Securities and Exchange Commission and Major Securities Laws, U.S. SECURITIES & EXCHANGE COMMISSION, June 28, 2012, archived at (outlining and linking to securities laws and regulations). 81 See, e.g., Forms and Publications, INTERNAL REVENUE SERVICE, Feb. 7, 2013, archived at (linking to self-service IRS forms). 82 See, e.g., Massachusetts Legal Forms, MASSACHUSETTS TRIAL COURT LAW LIBRARIES, Feb.1, 2013, archived at (offering topic-based legal forms to the general public).

15 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 261 vits of indigence: it also has a Questions? Ask us function. 83 Other sites include the Internal Revenue Service 84, LawHelp Interactive 85, Illinois Legal Aid 86, and the US Bankruptcy Court. 87 Private vendors proliferate as well Advertising Lawyers have engaged in extensive advertising since the 1977 decision of Bates v. State Bar of Arizona. 89 In Bates, the Court extended First Amendment protection to newspaper advertisements offering to provide various services for specified fees including uncontested divorce, adoption, non-business bankruptcy, and change of name. 90 In Bates, the Arizona Supreme Court had censured two lawyers for conduct in violation of its code of professional responsibility. 91 The U.S. Supreme Court reversed, noting that a consumer s interest in commercial speech is substantial and often may be far keener than concern for urgent political dialogue. 92 Further, the Court noted commercial speech serves important societal interests by informing the public of the availability, nature, and the price of 83 See id. (making numerous legal forms readily available to the general public). 84 See Forms and Publications, supra note 81 (containing links to IRS forms). 85 See Fill Out Legal Forms Faster, LAWHELP INTERACTIVE, archived at (providing an example of an organization that, helps you fill out legal forms ). 86 See Illinois Legal Aid Automated Form Library, ILLINOIS LEGAL AID, Feb. 7, 2013, archived at (indexing automated forms provided by Illinois Legal Aid). 87 See Bankruptcy Forms, U.S. BANKRUPTCY COURT, archived at (offering fillable forms from the United States Bankruptcy Court). 88 See, e.g., State-Specific Legal Forms, U.S. LEGAL FORMS, archived at (cataloguing over 36,000 online legal forms) U.S. 350, 383 (1977) (holding that attorneys cannot be subjected to blanket suppression of advertisement). See Whitaker and Coale, Professional Image and Lawyer Advertising, 28 TEX. TECH. L. REV. 801, (1997) (describing the legacy of Bates as, growth with respect to attorney advertisements and the regulation thereof). 90 See Bates, 433 U.S. at 353, 384. (protecting right of attorneys to advertise services subject to various rules and restrictions). 91 See id. at (reducing Board of Governor s recommended punishment of suspension to censure). 92 Id. at 364.

16 262 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 products and services. 93 The court rejected the State s claims that advertising had an adverse effect on professionalism, was inherently misleading, or had an adverse effect on the administration of justice. 94 In subsequent cases the court invalidated prohibitions on targeted advertising, 95 direct mail advertising, 96 bona fide advertising of one s field of specialization, 97 and lawyer participation in collective activity undertaken to obtain meaningful access to the courts. 98 Today it is the rare law office, whether large or small, that does not maintain a firm website, which, like most instruments of public relations, attempts to present the firm in a positive light. 99 The site is typically created and maintained by a technology consultant. 100 The firm uses the website to pursue the goals of information and public relations. 101 The biographies and accomplishments of the firm members are publicized. 102 Blogs, tweets, list-serves, videos, podcasts and other postings may be added at the initiative of members of 93 Id. 94 See Bates, 433 U.S. at (analyzing the purported adverse effects of advertising). 95 See Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985) (holding that an attorney could not be disciplined after having advertised to persons with a specific legal problem). 96 See Shapero v. Kentucky Bar Ass n, 486 U.S. 466, (1988) (concluding that First and Fourteenth Amendments preclude complete prohibition of direct mail to potential clients). 97 See Peel v. Att y Registration & Disciplinary Comm n of Illinois, 496 U.S. 91, 109 (1990) (finding unconstitutional a prohibition of attorney advertising found to be dissemination of accurate factual information ). 98 See Brotherhood of R.R. Trainmen v. Virginia ex rel. Virginia State Bar, 377 U.S. 1 (1964) (establishing that solicitations by an attorney working alongside a railroad group which intended to advise workers on their legal rights and recommending specific lawyers were constitutionally protected). 99 See Kristine M. Moriarty, Law Practice and the Internet: The Ethical Implications that Arise from Multijurisdictional Online Legal Service, 39 IDAHO L. REV 431, (2003) (explaining that attorneys use the internet to provide legal services, casting a favorable light on their law firms). 100 See Clover Legal Web Design, CLOVER, archived at (providing an example of a technology consulting company that helps create and manage websites for law firms). 101 See Marketing the Law Firm: Business Development Techniques, LAW J. PRESS, 11C.03, (2013) (describing methods, techniques, and various content housed on legal websites). 102 See id. (explaining the various content forms that may appear on websites belonging to law firms).

17 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 263 the firm. 103 Lawyers may also make liberal use of other social media like Facebook, LinkedIn, YouTube and Twitter in order to advance their practices. 104 Lawyers in search of clients may contract with independent websites to provide other opportunities for lawyers to gain contact with potential clients. 105 Both Nolo and Rocket Lawyer provide a lawyer referral service. 106 Nolo s appears a bit more accessible by seeking only a subject area and state of residence from the customer in order to be presented with a list of lawyers. 107 The lawyers then provide links to their firm or other relevant websites. 108 Rocket Lawyer requires the questioner to provide personal information and then seeks a description of the client s legal problem. 109 The site then states that it will present the client s description to a lawyer who will then contact the client. 110 Depending upon the site s rules, lawyers may participate for free, or for a fixed monthly fee, or on a fee per re- 103 See id. (describing forms of substantive content that can be utilized on a law firm s website). 104 See id. (discussing content on websites); InstaLaw.com, archived at (facilitating lawyer access to social media); Rebecca Porter, Texts and Tweets by Jurors, Lawyers Pose Courtroom Conundrums, AM. ASS N FOR JUSTICE, Aug. 2009, archived at (noting courtrooms around the country have allowed lawyers to access social media and blogs during trials). 105 See Rocket Lawyer, supra note 5 (connecting clients and lawyers through the website s online database); but see Laurence A. Canter, B.P.R , Board of Prof l Resp. of the Supreme Court of Tennessee, (1997) archived at (disciplining a lawyer for placing pop-up ads on unrelated sites). 106 See Rocket Lawyer, supra note 5 (providing an example of a service that matches lawyers and clients); Find Law Firms, Lawyers and Attorneys, NOLO, archived at (allowing potential clients to search for a lawyer in the Nolo database). 107 See Find Law Firms, Lawyers and Attorneys, supra note 106 (allowing users to first select from the practice area needed, and then choose the state in which legal services are needed). 108 See Law Firms, Lawyers and Attorneys, supra note 106 (allowing a party to arrive at a page offering a link to the attorney webpage). 109 See Connect With a Lawyer, ROCKET LAWYER, archived at (displaying the screen asking the potential client to insert their personal information). 110 See id. (informing patrons that after entering their contact information, they will be contacted within one business day and connected with an attorney).

18 264 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 ferral. 111 Total Attorneys provides advertising services. 112 In return lawyers receive referrals produced by the site s software. 113 The cost to the lawyer is typically between $50 and $100 regardless of whether the referral turns into a retained case. 114 Total Attorneys also provides other services to the lawyer including client management software, billing services, and credit card payment capabilities. 115 a. Rule 7.1 The Attorney General of Washington charged LegalZoom with a violation of Rule 7.1 which prohibits making a false or misleading communication about a lawyer or a lawyer s services. 116 He objected to LegalZoom s statement that With LegalZoom s lawyer-free service, you can save up to 85% off the rates an attorney would charge for the same procedure. 117 The Attorney General objected that this comparison misrepresents the contribution that an attorney makes when serving a client. 118 It suggests that the LegalZoom service is equivalent to the services of an attorney and 111 See On Call Sign Up, ROCKET LAWYER, archived at (showing an example of a possible payment plans for lawyers to utilize the website s services); Build Your Business Online, NOLO, archived at (showing an example of a possible payment plans for lawyers to participate in Nolo s services). 112 See Marketing and Leads, supra note 54, (summarizing the company s services to help expand law practices). See also Stephen Fairley, Law Firm Marketing and Business Development Strategies, THE RAINMAKER BLOG, archived at (posting marketing and advertising tactics). 113 See Marketing and Leads, supra note 54 (illustrating some of the benefits lawyers receive from the site). 114 See Squillante, supra note 53 (citing pricing models for the Total Attorneys website). 115 See Practice Management, supra note 54 (advertising client management services offered by Total Attorneys). 116 See Gene Quinn, Legal Zoom and Washington State Reach Agreement Over Unauthorized Practice of Law, I.P WATCHDOG, Sept. 25, 2010, archived at see also MODEL RULES OF PROF L CONDUCT R. 7.1 (2011). 117 See Richard Granat, What is Legal Zoom?, ELAWYERING BLOG, Apr. 8, 2008, archived at (claiming that this statement misrepresents the contribution that an attorney makes when serving a client. ). 118 See id. (describing the confusion that can arise from the statement); see also Jason Beahm, WA State AG: 'DIY Legal Forms Aren't a Substitute for an Attorney', FINDLAW, Sept. 27, 2010, archived at (citing concerns about the potential for confusion).

19 2013] INTERNET WARS: THE BAR AGAINST THE WEBSITES 265 that a consumer will receive the same result that they would get if they went to an attorney. 119 The charge was settled. 120 The settlement agreement prohibits LegalZoom from engaging in the unauthorized practice of law, selling personal information obtained from Washington customers or misrepresenting the benefits of any estate distribution document; it also requires a Washington attorney to review any and all estate planning forms sold by LegalZoom to Washington customers. 121 Likewise, South Carolina Ethics Advisory Opinion suggests that lawyers not participate in Just Answer s website because of misleading statements on the site and the dangers of creating an unintended attorney-client relationship. 122 The website s use of testimonials, endorsements, the word expert, and other misleading statements prohibit South Carolina lawyer s participation. The site invites specific questions about specific legal matters and offers specific legal advice but uses buried smalltype statements to attempt to disclaim the creation of attorney- client relationships and to warn against reliance on the advice. The Committee believes lawyer s participation under these circumstances would be improper. 123 b.rule See Granat, supra note 117 (explaining that LegalZoom clearly isn t equivalent to the services of an attorney). 120 See Quinn, supra note 116 (discussing the Assurance of Discontinuance entered by LegalZoom and the State of Washington). 121 See In re LegalZoom.com Assurance of Discontinuance, Sept. 15, 2010, archived at (providing the Attorney General s assertions and the Agreement between the parties); Quinn supra note 116 (reviewing the Assurance of Discontinuance and the implications thereof). 122 See Ethics Advisory Opinion 12-03, SOUTH CAROLINA ETHICS ADVISORY COMMITTEE, 2003, archived at (warning attorneys that the Just Answer website could put attorneys at risk). 123 Id.; see also Formal Opinion , ABA COMMITTEE ON ETHICS & PROF L RESPONSIBILITY, August 5, 2010, archived at (conveying fears about creation of an attorney-client relationship through lawyer websites).

20 266 JOURNAL OF HIGH TECHNOLOGY LAW [Vol. XIII: No 2 Yet another objection to websites that make any kind of qualitative assertion about an attorney on a legal website arises out of Rule MR 7.2 (b) prohibits a lawyer from giving anything of value to a person for recommending the lawyer s services, although he may pay the usual charges of a legal services plan or referral service. 125 A New Jersey Ethics Committee opinion states that the website, as a lay intermediary, cannot guide customers to particular lawyers. 126 As such, websites must make full lists of participating attorneys available to the site s visitors. 127 Participating attorneys almost certainly cannot split fees with website operators. 128 Payment of a fixed fee is probably permissible. 129 A fee per click or fee per referral should await future pronouncements. 130 Rule 1.5 prohibits fee splitting among lawyers unless the division is in proportion to the services performed by each lawyer [and] the client agrees to the arrangement. 131 The committee stated: In sum, the content and operation of Internet advertising websites must not be misleading. Internet websites must make the methodology for the selection of the attorney s name clear, especially if the website limits participation of attorneys by geographical area or practice area. If participation is limited, all requirements for attorneys to participate in the website must be specified. Websites may state that the participating attorneys meet these requirements but must refrain from making statements vouching for the quality 124 See MODEL RULES OF PROF L CONDUCT R. 7.2 (2011) (governing attorney advertisements). 125 Id. 126 See Internet Advertising, Misleading Content, and Impermissible Referral Services Opinion 43, N.J. COMMITTEE ON ATTORNEY ADVERTISING, 10-12, June 28, 2011, [hereinafter Op. 43] archived at (warning about Internet advertising, misleading content, and impermissible referral services). 127 See id. at 10 (listing the requirements for compliance with the Committee s opinion). 128 See MODEL RULES OF PROF L CONDUCT R. 5.4a (2011) (stating the general rule that lawyer s cannot split fees with non-lawyers). 129 See MODEL RULES OF PROF L CONDUCT R. 7.2 (2011) (stating that lawyers are allowed to pay a reasonable fee for advertising services). 130 See Op. 43, supra note 126 at (noting that the permissibility of pay-perlead referral agreements between lawyers and websites has some limited support). 131 See MODEL RULES OF PROF L CONDUCT R. 1.5 (2011).