NY Continues Trend of Rebuffing Online Legal Service Providers

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New York has joined a growing list of states with ethics boards limiting an attorney’s ability to participate in online legal service providers like Avvo and LegalZoom. Similar to other jurisdictions, the New York ethics board authored an opinion honing in on the so called “marketing fee” charged by Avvo for attorney use of its website. Although the opinion declines to decide a list of other potential ethical issues with the company, it concludes that the “marketing fee” is actually a referral fee in violation of Rule 7.2(a) of the New York Rules of Professional Conduct.

In reviewing the issue, the Committee on Professional Ethics describes the rule prohibiting referral fees as more than just a bar on explicit recommendations. Instead, Rule 7.2(a) also prohibits the reasonable impression that a lawyer is being recommended. With this as the backdrop, the Committee concludes that Avvo’s various indirect statements of the quality of attorneys on its website creates the impression that the attorneys are recommended by Avvo.

For example, the Avvo website includes attorneys’ ratings while touting the benefits of working with “highly rated, local lawyers near you” and that Avvo “only work[s] with highly qualified attorneys who are licensed to practice in your state.” The Committee also highlights the satisfaction guarantee Avvo offers to customers, essentially vouching for the quality of services the attorneys will provide. In combination, these all contribute to a reasonable impression of a recommendation for which the attorneys pay a “marketing fee” in violation of the New York Rules of Professional Conduct.

While some states have shown some flexibility in working with similar websites, it is clear that many are still resistent. This Ethics Opinion has been released on the heels of a similar determination in New Jersey that also declared certain online legal service providers as in violation of its ethics rules. While attorneys continue to participate in these services across many states, it would be wise for attorneys to continue to be on the lookout for potential ethical violations depending where they practice.