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New York ethics opinion finds that fees paid to Avvo for legal services violate referral, fee splitting, and advertising Bar Rules

Hello everyone and welcome to this Ethics Alert which will discuss recent (August 8, 2017) New York Ethics Opinion 1132 which found that lawyers in New York are prohibited from participating in AVVO’s client referral services.  This opinion found that the referral services violate the Bar rules since they involve improper “vouching for” (and recommendation of) the lawyer, improper lawyer referral fees, and fee sharing with a non-lawyer.

The companion New York Ethics Opinion 1131 (August 8, 2017) sets forth the structures of various web-based services and attempts to explain how those services could comply with the New York Bar Rules.  Both New York State Bar Ethics Opinions are here: http://www.nysba.org/EthicsOpinion1132/ and here: http://www.nysba.org/EthicsOpinion1131/ .

NYSBA Ethics Opinion 1132 states that, since Avvo Legal Services provides ratings of lawyers using the service based on various qualifiers such as years in practice, information provided by the lawyers, volunteer bar work and other publicly available information, and offers to find a client “the right” lawyer with a money-back guarantee, there is an implied recommendation as to the lawyer’s “credentials, abilities, competence, character, or other professional qualities”; therefore, the marketing fee is “an improper payment for a recommendation in violation the New York  Bar Rules.

The opinion also states that since “the Avvo website also extols the benefits of being able to work with highly rated lawyers,” it creates a reasonable impression that it is recommending its top-rated lawyers. and the satisfaction guarantee “also contributes to this impression.”

“Avvo is giving potential clients the impression that a lawyer with a rating of ‘10’ is ‘superb,’ and is thus a better lawyer for the client’s matter than a lawyer with a lower rating. Avvo is also giving potential clients the impression that Avvo’s eligibility requirements for lawyers who participate in Avvo Legal Services assure that participating lawyers are ‘highly qualified.’” The opinion states that Avvo Legal Services’ “satisfaction guarantee” also contributes to the impression that Avvo is recommending its lawyers’ services “because it stands behind them to the extent of refunding payment if the client is not satisfied.”

According to the opinion, Comment 1 of New York Rule 7.2 prohibits a lead generator not only from stating that it is recommending a lawyer, but also from implying or creating a reasonable impression that it is making such a recommendation.

NYSBA Ethics Opinion 1132 concludes:

“This opinion does not preclude a lawyer from advertising bona fide professional ratings generated by third parties in advertisements, and we recognize that a lawyer may pay another party (such as a magazine or website) to include those bona fide ratings in the lawyer’s advertisements. But Avvo Legal Services is different.  It is not a third party, but rather the very party that will benefit financially if potential clients hire the lawyers rated by Avvo.  Avvo markets the lawyers participating in the service offered under the Avvo brand, generates Avvo ratings that it uses in the advertising for the lawyers who participate in Avvo Legal Services, and effectively ‘vouches for’ each participating lawyer’s credentials, abilities, and competence by offering a full refund if the client is not satisfied. As noted earlier, Avvo says: ‘We stand behind our services and expect our clients to be 100% satisfied with their experience’” Accordingly, we conclude that lawyers who pay Avvo’s marketing fee are paying for a recommendation, and are thus violating Rule 7.2(a).”

NYSBA Ethics Opinion 1131 sets forth the structures of various web-based services and attempts to explain how those services could potentially comply with the New York Bar Rules.  That opinion concludes:

“A lawyer may pay a for-profit service for leads to potential clients obtained via a website on which potential clients provide contact information and agree to be contacted by a participating lawyer, as long as (i) the lawyer who contacts the potential client has been selected by transparent and mechanical methods that do not purport to be based on an analysis of the potential client’s legal problem or the qualifications of the selected lawyer to handle that problem; (ii) the service does not explicitly or implicitly recommend any lawyer, and (iii) the website of the service complies with the requirements of Rule 7.1.  A lawyer who purchases such a lead to a potential client may ethically telephone that potential client if the potential client has invited the lawyer selected by the service to make contact by telephone.”

The opinions also briefly discuss the potential confidentiality issues related to AVVO’s “money back guarantee”.

Bottom line:  New York has now joined the list of jurisdictions finding that Avvo’s “marketing fee” taken from fees paid to lawyers using its client generation services violate ethics rules and are impermissible referral fees.  This New York ethics opinion (like all ethics opinions) is advisory only; however, it is the most recent finding that the fee charges in AVVO’s plan constitute improper referral fees and fee sharing.  Other jurisdictions (such as a pending North Carolina opinion) may also publish ethics opinions in the future.  Stay tuned…

…and 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.

29605 U.S. Highway 19, N., Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

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Virginia Supreme Court makes revisions to lawyer advertising rules which streamline the rules and reduce their number

Hello everyone and welcome to this Ethics Alert which will discuss the recent Virginia Supreme Court opinion which adopted revisions to the Virginia Bar Rules which streamline the lawyer advertising rules and reduce the number of rules.  The Virginia Supreme Court opinion is here: http://www.courts.state.va.us/courts/scv/amendments/part_6_sect_ii_para_7_1_thru_7_5.pdf.  The revised Virginia advertising rules become effective on July 1, 2017.

On April 17, 2017, the Virginia Supreme Court adopted lawyer advertising rules which streamline and reduce the number of rules and should make it easier for Virginia lawyers to market their services without risking disciplinary charges.  Virginia became the first jurisdiction to adopt the revisions recommended by the Association of Professional Responsibility Lawyers (APRL) and later adopted by the American Bar Association (ABA).

The revisions reduce Virginia Bar Rule 7.1 (communications concerning lawyer’s services) to a single paragraph prohibiting false or misleading communications.  The revisions also eliminate Rule 7.4 (communicating fields of practice and certification) and Rule 7.5 (lawyer and law firm names).  Those subjects are addressed in the comments to revised Rule 7.1.

Revised Rule 7.3 (solicitation) incorporates some new language from the APRL’s proposal, but does not incorporate the blanket prohibition against in-person solicitation which is set forth in ABA Model Rule 7.3 and APRL’s draft Rule 7.3.

Some of the rules were not revised or deleted.  Rule 7.3 still requires any advertising materials to have the disclaimer “ADVERTISING MATERIAL” unless the recipient is a lawyer or family member, has had a personal or prior professional relationship with the attorney, has had prior contact with the attorney, or if the materials are pursuant to a court-ordered class action notification.

Bottom line:  These revised Virginia Bar advertising rules substantially streamline and reduce the number of rules.  This appears to be a trend and we will see whether (or when) other jurisdictions follow.  Stay tuned…

…and 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.

29605 U.S. Highway 19, N., Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

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California Ethics Opinion addresses ethics issues related to lawyer blogging and advertising and provides guidelines

Hello everyone and welcome to this Ethics Alert which will discuss the recent California Formal Ethics Opinion which addresses ethics issues related to lawyer blogging and advertising and provides guidelines for lawyers who blog.  The Opinion is The State Bar of California Standing Committee on Professional Responsibility and Conduct Formal Opinion No. 2016-196 and the ethics opinion is here: Cal. Formal Opinion No. 2016-196

The opinion reviews the application of advertising rules to attorney blogging and when blogging by an attorney considered a “communication” under the California Bar Rules and the provisions of California Business and Professions Code which regulate attorney advertising.  The California rules prohibit false or deceptive “communications” which confuse, deceive or mislead the public (as do most, if not all Bar rules throughout the U.S.)  This proscription applies to both affirmative statements and/or to omissions necessary to make a statement not misleading.

The opinion discusses U.S. Constitution First Amendment principles, including the fact that lawyer advertising is protected commercial speech, and truthful lawyer advertising cannot be absolutely prohibited; however, it can be subject to reasonable regulation and restrictions.  In addition, communications for publication by lawyers that are primarily informational and educational have long been considered to be core political speech and protected under the First Amendment, and such speech can be restricted only under extraordinary circumstances.

The First Amendment protections apply even if the lawyer also hopes, as a partial motive, to use the informational and educational communications to increase his or her legal business; however, commercial motivation is only one factor to be considered.  The key questions are whether a blog is a message or offer (1) made by or on behalf of a California attorney; (2) concerns the attorney’s availability for professional employment; and; (3) is directed to a former, present or prospective client.  Since all blogs will meet factors 1 and 3, the important question is whether the blog concerns the attorney’s availability for professional employment under question 2.

The opinion discusses Cal. Formal Opinion 2012-186, which analyzes the application of California advertising rules to attorney social media posts, and found that a post which has words of offer or invitation relating to representation is a “communication’; however, if a post is only informational in nature, it is not a communication. The opinion concluded that this same analysis applies to lawyer blogs.

The opinion also discusses Cal. Formal Opinion 2001-155, which found that, even without specific words of invitation or offer, a website that included information such as a detailed listing of services, qualifications, backgrounds, and other attributes of the attorney or law firm, with their distribution to the public, could carry a “clear implication” of availability for employment, and would therefore be a “communication” subject to advertising  regulation. The opinion concluded that the same analysis applies to lawyer blogs.

The opinion states that a listing of all of an attorney’s cases and outcomes, without comment, could be considered informational and not a “communication”; however, a communication with the result of a specific case or cases without providing information related to the facts and/or law giving rise to the result, would be presumed to be false, misleading or deceptive, and could be a prohibited “guarantee, warranty or prediction regarding the result of representation.” The opinion stated that even a numbered listing of “wins” might be misleading without clarification about what is considered a “win.”  The use of disclaimers may (but will not necessarily) overcome a presumption of violation.

Bottom line:  Lawyer blogging has become a very popular and somewhat ubiquitous form of legal communication and is often recommended to lawyers as a business strategy.  This recent California Bar ethics opinion provides solid guidance to lawyers who are blogging or plan to blog to attempt to insure compliance with the Bar rules, regardless of whether the lawyer is in California or another state.  If a lawyer blogs, each blog should primarily informational and educational to potentially avoid the application of Bar advertising rules (like this one).

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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Florida Bar Board of Governors agrees with BOG Ethics and Bar Advertising Committees that “Results So Good, You’ll Think It’s Magic!” violates Bar Rules

Hello everyone and welcome to my first Ethics Alert of 2017 which will discuss the recent decision of the Florida Bar’s Board of Governors (BOG) to uphold the opinion of the Bar’s Standing Committee on Advertising (SCA) and the recommendation of the BOG Ethics Committee (BRCPE) that a law firm’s “Results So Good, You’ll Think It’s Magic!” slogan violates the Bar Rules.

According to an article in the January 1, 2017 issue of The Florida Bar News, the SCA had opined that the law firm’s proposed name: “Ticket Wizards”, and a slogan: “Results So Good, You’ll Think It’s Magic!” violated two Florida Bar advertising rules: 1) promising results to potential clients; and 2) characterizing the “skills, experience, reputation, or record” of the firm in a way that the firm could not objectively verify.

After the SCA found against the law firm, it appealed to the BOG.  The BOG considered the matter at its recent meeting in Clearwater and, by a 24-20 vote agreed with the BRCPE and denied the appeal; however, it found the name and the picture of a wizard did not characterize the firm’s experience, skills, reputation, or record.  The BRCPE had recommended that the firm should only be permitted to use the name and image if it could objectively show it is a “master or expert” in that area of practice.  The BOG voted that the law firm could use the name and image if it could objectively verify the implications of the title and picture.

With regard to the slogan “Results So Good, You’ll Think It’s Magic!,” the BOG agreed that the slogan can “reasonably be construed as a prediction of success” and, therefore, it violated the Bar rules. The BOG also found that the slogan violated the rule against characterizing a firm’s “skills, reputation, character, or record “unless it is objectively verifiable.

Bottom line: It appears that the lesson here is that lawyers are prohibited from promising magical results (unless perhaps they are magicians?)…

Happy New Year to you and yours and 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.

29605 U.S. Highway 19 N. Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

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California interim ethics opinion addresses when lawyer blogging is subject to regulation under Bar Rules

Hello everyone and welcome to this Ethics Alert which will discuss lawyer blogging and the interim opinion of the State Bar of California which addresses the topic of lawyer blogging and when lawyer blogs may be subject to regulation under the California Bar Rules and advertising statute.  The interim ethics opinion is The State Bar of California Standing Committee on Professional Responsibility and Conduct Formal Opinion Interim No. 12-0006 and the opinion is here:  Cal Bar Opinion Interim No. 12-006- lawyer blogging.  The comment period on the interim opinion has expired; however, the opinion has not been finalized.

The interim opinion frames the issue: “Under what circumstances is ‘blogging’ by an attorney a ‘communication’ subject to the requirements and restrictions of the Rules of Professional Conduct and related provisions of the State Bar Act regulating attorney advertising?”

The interim opinion’s digest section states:

  1. Blogging by an attorney may be a communication subject to the requirements and restrictions of the Rules of Professional Conduct and the State Bar Act relating to lawyer advertising if the blog expresses the attorney’s availability for professional employment directly through words of invitation or offer to provide legal services, or implicitly through its description of the type and character of legal services offered by the attorney, detailed descriptions of case results, or both. (emphasis supplied)
  1. A blog that is an integrated part of an attorney’s or law firm’s professional website will be a communication subject to the rules and statutes regulating attorney advertising to the same extent as the website of which it is a part.
  1. A stand-alone blog by an attorney, even if discussing legal topics within or outside the authoring attorney’s area of practice, is not a communication subject to the requirements and restrictions of the Rules of Professional Conduct and the State Bar Act relating to lawyer advertising unless the blog directly or implicitly expresses the attorney’s availability for professional employment.
  1. A stand-alone blog by an attorney on a non-legal topic is not a communication subject to the rules and statutes regulating attorney advertising, and will not become subject thereto simply because the blog contains a link to the attorney or law firm’s professional website. However, extensive and/or detailed professional identification information announcing the attorney’s availability for professional employment will itself be a communication subject to the rules and statutes.

In the discussion section, the opinion recognizes that “(b)y its nature, blogging raises First Amendment free speech issues. Prohibited for most of the 20th Century, advertising by attorneys was found to be protected commercial speech by the U.S. Supreme Court in Bates v. State Bar of Arizona (1977) 433 U.S. 350 [97 S.Ct. 2691].  Bates provides that truthful attorney advertising cannot be absolutely prohibited, but may be subject to reasonable restrictions.”

The opinion then provides four examples of attorney blogs and analyzes each of the hypothetical blogs regarding the application of the California Bar Rules and the California advertising statute and concludes that:

“A blog by an attorney will not be considered a ‘communication’ subject to rule 1-400 or an “advertisement” subject to Business and Professions Code sections 6157, et seq., unless the blog expresses the attorney’s availability for professional employment directly through words of invitation or offer to provide legal services, or implicitly, for example, through a detailed description of the attorney’s legal practice and successes in such a manner that the attorney’s availability for professional employment is evident.

A blog included on an attorney’s or law firm’s professional website is part of a ‘communication’ subject to the rules regulating attorney advertising to the same extent as the website of which it is a part.

A stand‐alone blog by an attorney on law‐related issues or developments within his or her practice area is not a ‘communication’ subject to the rules regulating attorney advertising unless it invites the reader to contact the attorney regarding the reader’s personal legal case, or otherwise expresses the attorney’s availability for professional employment.

A stand-alone blog on law-related issues maintained by an attorney that is not part of the attorney’s professional website is not ‘communication’ subject to attorney advertising regulations unless the blog indicates the attorney’s availability for professional employment.

A non-legal blog by an attorney is not a ‘communication’ subject to the rules or statutes regulating attorney advertising, even if it includes a hyperlink to the attorney’s professional web page or contains biographical or contact information. However, the biographical or contact information itself may be subject to the rules and statutes.”

The general consensus among the jurisdictions (including Florida) would appear to be that, if the lawyer’s blog is primarily educational and/or informational in nature and not primarily for obtaining employment, it is not subject to advertising regulation (see NYSBA Ethics Op. 967 (6/5/13) here: NYSBA Ethics Op. 967).

This California interim opinion states that: “”(b)logging by an attorney may be a communication subject to the requirements and restrictions of the Rules of Professional Conduct and the State Bar Act relating to lawyer advertising if the blog expresses the attorney’s availability for professional employment directly through words of invitation or offer to provide legal services, or implicitly through a description of the attorney’s legal practices and successes in such a manner that the attorney’s availability for professional employment is evident.” (emphasis supplied).  The opinion does not address whether blogs which are primarily for educational and informational purposes are subject to regulation even if it also expresses the attorney’s availability for professional employment.

Bottom line:  Lawyer blogs are subject to state Bar regulations only to the extent that the regulations do not violate the lawyer’s federal constitutional First Amendment free (commercial) speech rights; however, lawyers who blog must research the requirements of their state advertising rules, ethics opinions, and other sources to insure compliance with those state regulations.  To the extent that those rules may violate the lawyer’s First Amendment free (commercial) speech rights, the lawyer could consider a constitutional challenge.

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.

29605 U.S. Highway 19 N. Suite 150

Clearwater, Florida 33761

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

 

 

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The Florida Bar will file petition with advertising rule amendment regarding lawyer’s use of “expert” and “specialist” on October 15, 2016

Hello and welcome to this update of the May 25, 2016 Ethics Alert regarding the proposed amendment to Florida Bar Rule 4-7.14 with new subsection 4-1.14(a)(5) related to claims of “specialization” and “expertise” in advertisements.  The BOG approved the rule amendment and the Bar will file an Omnibus Rules Petition with the proposed rule amendment with the Florida Supreme Court on October 15, 2016 (along with other proposed rule amendments).  The proposed rule revisions are here:  2016 Annual Florida Bar Rules Proposals and the new Rule 4-7.14(a)(5) language is below:

RULE 4-7.14 POTENTIALLY MISLEADING ADVERTISEMENTS

A lawyer may not engage in potentially misleading advertising.

(a) Potentially Misleading Advertisements. Potentially misleading advertisements include, but are not limited to:

(5) a statement that a lawyer is a specialist, an expert, or other variations of those terms unless:

(A) the lawyer has been certified under the Florida Certification Plan as set forth in chapter 6, Rules Regulating the Florida Bar and the advertisement includes the area of certification and that The Florida Bar is the certifying organization;

(B) the lawyer has been certified by an organization whose specialty certification program has been accredited by the American Bar Association or The Florida Bar as provided elsewhere in these rules. A lawyer certified by a specialty certification program accredited by the American Bar Association but not The Florida Bar must include the statement “Not Certified as a Specialist by The Florida Bar” in reference to the specialization or certification. All such advertisements must include the area of certification and the name of the certifying organization;

(C) the lawyer has been certified by another state bar if the state bar program grants certification on the basis of standards reasonably comparable to the standards of the Florida Certification Plan set forth in chapter 6 of these rules and the advertisement includes the area of certification and the name of the certifying organization; or

(D) the lawyer’s experience and training demonstrate specialized competence in the advertised area of practice that is reasonably comparable to that demonstrated by the standards of the Florida Certification Plan set forth in chapter 6 of these rules and, if the area of claimed specialization or expertise is or falls within an area of practice under the Florida Certification Plan, the advertisement includes a reasonably prominent disclaimer that the lawyer is not board certified in that area of practice by The Florida Bar or another certification program if the lawyer is not board certified in that area of practice.

The new subsection in Rule 4-7.14(5)(a)(D) states that a lawyer is prohibited from stating that he or she is  “a specialist, an expert, or other variations of those terms” unless “the lawyer’s experience and training demonstrate specialized competence in the advertised area of practice that is reasonably comparable to that demonstrated by the standards of the Florida Certification Plan.”  In addition, if the lawyer’s area of expertise is an area in which the Bar approves certifications, the lawyer would be required to include “a reasonably prominent disclaimer that the lawyer is not board certified in that area of practice by The Florida Bar or another certification program.”

According to the Bar’s filing notice: “Members who desire to comment on these proposed amendments may do so within 30 days of the filing of the Bar’s petition(s). Comments must be filed directly with the clerk of the Supreme Court of Florida, and a copy must be served on the executive director of The Florida Bar. Rule 1-12.1, Rules Regulating The Florida Bar, governs these proceedings.”

Bottom line:  As I previously said, it remains to be seen whether the Florida Supreme Court will approve the amendment as drafted and, if it does, whether the restrictions in the amended Bar rule on their face and as applied are in compliance with the federal district judge’s 9/30/15 order finding that the previous rule violated the United States Constitution.  The Order here: 9/30/15 J. Hinkle Order and Injunction.

Stay tuned…and be careful out there.

Disclaimer:  this Ethics Alert  is not an advertisement and does not contain any legal advice, 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.

29605 U.S. Highway N., Suite 150

Clearwater, Florida 33759

Office (727) 799-1688

Fax     (727) 799-1670

jcorsmeier@jac-law.com

www.jac-law.com

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