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May 28, 2004


Randy Wells

Want inovation? Read on
Jeff Gananian is an attorney, who recently established and heads the Financial Products Division of LegalMatch, in San Francisco.

Jeff did a little research to learn how LegalMatch fits into today's legal community in light of the 1977 U.S. Supreme Court decision (Bates v. State Bar of Arizona) and subsequent decisions that now allow lawyers to advertise. As commerce has moved beyond the 'Industrial Age' and into the age of new emerging technologies-- known as the ‘Knowledge Age’— a new series of questions has accompanied this massive shift. Jeff set out to understand how those court decisions have impacted both the health of the legal profession and consumers seeking competent legal services, and what the Internet has meant to contemporary modes of advertising as it pertains to protecting citizens. The following is what Jeff found:

In reviewing a White Paper, presented by the American Bar Association in July 1998, entitled, “A Re-Examination of the ABA Model Rules of Professional Conduct Pertaining to Client Development in Light of Emerging Technologies” it became evident to me that consumers are still at risk in finding the right attorney. Attorneys, guided by these Rules of Professional conduct, are in a very competitive market place, and still suffer unusual client acquisition issues that are rooted as far back as one hundred years or more. With the advent of the Internet, and more specifically, the coming of age of legal matching services through the Internet, it would appear a solution to both problems has been found. I thought it useful to share a summary of this 'white paper' with the visitors to LegalMatch Life and let readers decide for themselves whether LegalMatch is the appropriate solution for both parties:

Lawyer advertising and solicitation were common and generally lawful in the Nineteenth Century. In 1908, the American Bar Association (“ABA”) adopted the first national standards for ethical conduct governing lawyers, entitled the Canons of Professional Ethics. Canon 27 banned lawyer advertising, permitting nothing more than business cards. Solicitation was also banned. The bans, along with the other provisions of the Canons, were generally adopted by the highest courts of the individual states, becoming effective and thereby controlling the conduct of lawyers. While directory listings and very limited advertising became acceptable over time, the bans continued for nearly seventy years.

In 1977, the U.S. Supreme Court ruled, in Bates v. State Bar of Arizona (1977) 433 U.S. 350, that it was unconstitutional for states to impose bans on lawyer advertising, inasmuch as the First Amendment-based doctrine of commercial free speech prevented the government from prohibiting such communication. The Court found that states had the right to impose regulations and, indeed, had the obligation to do so to the extent it was necessary to protect consumers. However, the persistent problem that the middle 70% of the population were consistently unable to locate competent counsel actually created an obligation for the legal profession to reach out. The state bar organizations, as an agent of the supreme court of each state, had an obligation to foster such communication and education, and could not ban it. It then became the responsibility of the bar organizations to set new standards governing the rights of lawyers to advertise. Within six weeks of the Bates decision, the ABA had adopted a set of regulations and amended the Model Code of Professional Responsibility, which had replaced the Canons in 1969. In 1978, the U.S. Supreme Court found the ban on in-person solicitation to be a constitutional limit on commercial speech, indicating that lawyers are trained in the art of persuasion and that clients in need of legal services may be emotionally vulnerable to that persuasion.

In short, attorney advertising is a form of commercial free speech that is not only protected by the US Constitution, but which is necessary to fulfill the obligation of the legal profession to reach the middle sector of the population with the information that they need to select and retain competent legal counsel.

The primary limitations on attorney advertising are found in the ethics rules promulgated by the state government through the court branch, and which are designed to protect unsophisticated consumers from sophisticated over-reaching by lawyers motivated by pecuniary gain.

It is the heat from these two competing considerations that has forged the current framework of ethics regulations that govern attorney advertising.

But there is still a gap in reaching the majority of the population – the middle 70% - and properly connecting them to the appropriate attorneys; and, the thirty years of circumscribed attorney advertising since Bates in 1977 has still not yet solved this deep-seated problem. Solving this problem has proven to be much more difficult in practice than in theory.

The Supreme Court identified the problem in Bates v. State Bar of Arizona (1977) 433 U.S. 350, 402-403:

“The problem of bringing clients and lawyers together on a mutually fair basis, consistent with the public interest, is as old as the profession itself. It is one of considerable complexity, especially in view of the constantly evolving nature of the need for legal services. The problem has not been resolved with complete satisfaction despite diligent and thoughtful efforts by the organized bar and others over a period of many years and there are no reason to believe that today's best answers will be responsive to future needs.” Emphasis added.

Lawyer referral programs have been in existence for years, and represent probably the best solution to connect clients with lawyers in an industrial-age economy, which was based primarily on paper and the use of the telephone. In the time since 1977, lawyer advertising has eroded the effectiveness of lawyer referral services. For example, both the Tennessee State Bar and the Colorado State Bar had lawyer referral programs, but dismantled them in the 1980’s because of competition from lawyer advertising.

So, even though the ban was lifted on attorney advertising, it is still a wide-spread problem that the middle group of the population is restricted in finding competent counsel. Moreover, most attorney advertising does not educate or protect consumers from attorneys who "over reach".

It is, of course, not surprising that the Internet would provide the substrate upon which a solution could be developed to solve the competing concerns; online legal matching systems can (1) help the middle sector of the population gain access to good legal counsel, and (2) protect this same group from unscrupulous attorneys, misleading advertising, shoddy workmanship, and high-pressure solicitation tactics.

No free market-based solution has arisen (until LegalMatch) that has proven it can successfully reach the middle sector of the population, while sufficiently protecting and educating the consumer.

Online legal matching systems are not only ethical; they are a long-overdue solution to a difficult problem that has plagued the legal industry for centuries.

LegalMatch (www.legalmatch.com) is the pioneer of the online legal matching method and by far the biggest online legal matching service in the U.S. We believe LegalMatch is certainly the answer to the need of the consumer and to the health of the legal profession.

Visit http://legallog.blogs.com/ for the entire "White Paper"

Or visit a true inovation: www.legalmatch.com

Carolyn Elefant

I think that there are greater forces driving lack of innovation in legal practice than time which is apparently your obstacle. First, your nemesis, the billable hour, discourages innovation because under the billable system, lawyers earn less when tasks take less time. Second, law schools themselves present an obstacle to innovation by training students in the same techniques as 20 years ago. Legal research is a case in point; schools still allow LEXIS and Westlaw to dominate legal research training, to the exclusion of lower cost services - and other research techniques, such as mining brief banks to gather research from lawyers who've already addressed similar issues.
What I find troubling is that despite the technological changes of the past ten years - word processing and doc production programs that render much support staff unnecessary; the ability to retrieve documents on line and alternatives to expensive research like LEXIS and Westlaw - the cost of legal services continues to increase. I haven't been very innovative here myself, but I would like to see attorneys use technology to provide low cost, standard legal service for clients.

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