Avvo Legal Services and the Rules of Professional Conduct

There is a massive gulf in legal service offerings. With few exceptions, the legal marketplace offers a single choice: full-scope legal representation or do-it-yourself solutions. If this were the fashion industry, consumers would be forced to choose between buying haute couture and sewing their own clothes.

No Nordstrom, no Gap, no Wal-Mart. Just bespoke or sew your own dresses. It’s ridiculous. And this gulf—this lack of reasonable products that look something more like “off the rack” than tailor made—is keeping way too many consumers and small businesses out of the legal marketplace (just google “access to justice”). And that’s bad for consumers and lawyers alike.

Launching Avvo Legal Services is our effort to fill this gulf by offering a variety of fixed-price legal services. Instead of waiting in dread to receive a bill of an unknown amount at the end of the month, consumers and small businesses can buy specific legal services for a set price.

One reason this gulf has persisted relates to the ways the practice of law is regulated. We’ve built Avvo Legal Services to comply with the Rules of Professional Conduct while also meeting the American Bar Association’s goal of expanding access to legal services. Here’s how:

How to think about the ethics rules

It’s important to start with this premise: the state rules of professional conduct relating to attorney advertising are consumer protection rules intended to safeguard consumers from deceit and harm. Since these rules also impact speech—both the right of attorneys to speak and the right of consumers to be informed about legal services—the advertising rules must be narrowly applied to practices that are actually harmful. The rules aren’t amenable to broad readings or mechanical application.

Limited-scope representation

Avvo Legal Services is a form of “limited-scope representation,” also referred to as “unbundled legal services.” Traditionally, legal services are purchased when a client hires a lawyer to handle the entirety of a legal matter from start to finish. Limited-scope representation, on the other hand, involves breaking the legal matter into component parts, some of which are handled by the client and some of which are handled by the lawyer. Given the division of labor in limited-scope representation, it’s essential to have a crystal-clear understanding of what’s in the package at the outset. That’s why consumers buying Avvo Legal Services are shown, up front and in plain English, what’s included—and not included—in the service they are considering buying.

Fee-splitting

Attorneys may not, under most circumstances, split legal fees with non-lawyers. Since Avvo collects the fee for Avvo Legal Services from the client, passes it on to the attorney, and then charges the attorney a marketing fee, some attorneys ask whether this constitutes impermissible fee-splitting.

There are 2 things to keep in mind here. First, there is no sharing of the fee, as the entire fee for legal services is passed through to the attorney, and the attorney pays a marketing fee to Avvo separately. Mechanically, that’s exactly how attorneys pay for advertising today.

The second and more important thing to keep in mind is the purpose of the prohibition against fee splitting, which protects clients by ensuring that a lawyer’s independent judgment remains uncompromised. Avvo Legal Services involves no such influence. In fact, the service is no different than programs many state bar associations have found acceptable, even in cases where actual fee-splits occur, such as in credit card processing and on deal-of-the-day websites.

Conflicts

An attorney’s first interaction with a potential client who has purchased a service through Avvo Legal Services is no different than the first interaction an attorney would have with a potential client who calls or visits his or her office. As with those initial inquiries, at the beginning of the call, the attorney must ensure that there are no conflicts. If any issue compromises an attorney’s ability to provide the services, the call can be concluded, and the consumer can choose another attorney or obtain a full refund from Avvo.

Trust accounts

Because Avvo does not transfer the fee paid by the client until after legal services have been provided and the fee earned, participating attorneys need not worry about trust account issues.

Avvo Legal Services represents a bold new step on the path to better meeting consumer legal needs. Although we’ve thought long and hard about all of these issues, we’re sure there will be plenty of ways we can improve what we’re doing. We welcome your feedback.

Note: Because many of our readers are lawyers, citations for everything I’ve referred to here are available upon request. Just email josh@avvo.com.

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