Florida Supreme Court issues opinion stating that lawyers should be prohibited from accepting referrals from non-lawyer owned referral services

Revised with corrected link to Supreme Court opinion only.  I apologize for any inconvenience.

Hello and welcome to this Ethics Alert which will discuss the recent opinion of the Supreme Court of Florida which rejected The Florida Bar’s proposed lawyer referral rules and stated that lawyers should be prohibited from accepting referrals from non-lawyer owned referral services.  The opinion is In Re: Amendments to Rules Regulating The Florida Bar 4-7.22- Lawyer Referral Services, No. SC14-2126 (September 24, 2015) and the opinion is here: http://www.floridasupremecourt.org/decisions/2015/sc14-2126.pdf

According to the opinion, a Special Committee on Lawyer Referral Services was created after “the recent and dramatic growth of for-profit lawyer referral services, along with a corresponding increase in public concern as to both the misleading nature of the activities of these services and the potential harm they may cause.”  The Special Committee issued a report, which was modified by the Bar’s Board of Governors, which would have allowed lawyers to receive referrals from for-profit lawyer referral services which were owned by non-lawyers and which made referrals to both lawyers and other providers, including medical providers.

The opinion also states that the restriction of ownership only to lawyers “is absolutely necessary” to protect the public from referral services that “use lawyers to direct clients to undesired, unnecessary or harmful medical treatment or services” and such a rule would also “prevent conflicts of interest, such as where a lawyer feels compelled or pressured to refer a client to another business operated or controlled by the owner of the referral service so that the lawyer may continue to receive referrals from that service.”

The opinion’s full conclusions are below:

We have carefully reviewed the final report of the Special Committee and conclude that the public is at significant risk from for-profit lawyer referral services that also refer clients to other businesses. We recognize that the anecdotes presented in the final report do not represent every non-lawyer-owned, for-profit referral service; however, the potential harm is too great for us to approve the amendments proposed by The Florida Bar. These amendments would not cure the multiple concerns highlighted by the Special Committee, but would allow the troubling incidents discussed in the final report to continue. The dangers that nonlawyer-owned, for-profit referral services pose to members of the public—who may be especially vulnerable after they suffer an injury, or when they face a legal matter that they never anticipated—leads us to conclude that much stricter regulations upon lawyer referral services are required than those proposed by the Bar.

Accordingly, we reject the current petition and instruct The Florida Bar to propose amendments to rule 4-7.22 that preclude Florida lawyers from accepting referrals from any lawyer referral service that is not owned or operated by a member of the Bar. We further instruct the Bar to review any other rules or regulations that address lawyer referral services to determine whether new rules are necessary to implement our direction today. Based upon this review, the Bar may conclude that amendments to, or repeal of, other rules are required. While the action we take today may be viewed by some as severe, we conclude it is absolutely necessary to protect the public from referral services that improperly utilize lawyers to direct clients to undesired, unnecessary, or even harmful treatment or services. Our action today will also prevent conflicts of interest, such as where a lawyer feels compelled or pressured to refer a client to another business operated or controlled by the owner of the referral service so that the lawyer may continue to receive referrals from that service.

The Florida Bar was ordered to submit a new petition on or before May 24, 2016.

Bottom line: This opinion may very well be the beginning of the end of non-lawyer owned for-profit lawyer referral services in Florida.  The Florida Bar will now prepare and file revised proposed rules in compliance with the opinion’s suggestions/mandate and file the rules with the Court for review.

Be careful out there.

Disclaimer:  this e-mail is not an advertisement, does not contain any legal advice, and does not create an attorney/client relationship and the comments herein should not be relied upon by anyone who reads it.

Joseph A. Corsmeier, Esquire

Law Office of Joseph A. Corsmeier, P.A.

2454 McMullen Booth Road, Suite 431

Clearwater, Florida 33759

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

 

 

 

 

 

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Filed under Florida Lawyer Ethics and Professionalism, Florida Lawyer Referral Services, joe corsmeier, Joseph Corsmeier, Lawyer ethics, Lawyer Ethics and Professionalism, Lawyer Referral Services

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