WHEN IS ATTORNEY REFERRAL UNDER B&P § 6155 ILLEGAL? LEGALMATCH?
WHEN IS ATTORNEY REFERRAL UNDER B&P § 6155 ILLEGAL? LEGALMATCH?
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WHEN IS ATTORNEY REFERRAL UNDER B&P § 6155 ILLEGAL? LEGALMATCH?

| Nov 28, 2019 | Firm News

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LegalMatch.com (LegalMatch) is an online service company that connects individuals seeking legal assistance to lawyers who have purchased a LegalMatch subscription. LegalMatch sued Dorian Jackson, a lawyer, when he allegedly failed to pay for his LegalMatch subscription.

LegalMatch operates an online website, www.legalmatch.com, that connects individuals to lawyers. Individuals who utilize the service are invited to fill out an intake form with information about their legal issue. Users must select their specific geographic location and the legal category that relates to their issue, such as business litigation, family law, criminal defense, or intellectual property. Depending on the legal category selected, LegalMatch requests additional information from potential clients about issues “prospective attorneys would like to hear.”

However, responding to the requests for additional information is not mandatory, and the potential clients’ answers can be “gibberish.” Potential clients may also write a “summary of [their] case,” but they are not required to do so. LegalMatch’s website represents that this process is designed to mimic a “lawyer . . . during an initial consultation.” Finally, individuals may require a lawyer with a minimum number of years of experience and designate a preferred method of payment. Potential clients are required to accept LegalMatch’s terms and conditions before the intake process is completed. In its terms and conditions, LegalMatch represents that it “does not screen or vouch for any of its users.”

Additionally, LegalMatch includes a disclaimer that it “[p]rovid[es] a service where potential clients and legal professionals can meet. [It d]oes not imply an endorsement of any subscribing attorney or service provider. LegalMatch makes no representation concerning an attorney’s qualifications, except the attorney was licensed to practice in at least one state at the time of registration nor does it sanction statements that an attorney may post on the system. LegalMatch makes no representations concerning the qualifications of non-attorney legal service providers. [A client’s] case will not be reviewed by non-attorney legal service providers by consent. LegalMatch does not screen individual cases or otherwise channel potential clients to select attorneys.”

Once individuals have completed the intake process and accepted the terms and conditions, LegalMatch communicates the information collected during the intake  process to lawyers who have subscribed to LegalMatch’s service. Only subscribing lawyers associated with the geographic location and legal category selected by the potential client receive the information.

LegalMatch sends information to lawyers based solely on the client’s selection of geographic location and area of expertise. After the lawyers receive this information, each lawyer has the opportunity to affirmatively reach out to the individual. The lawyer must first utilize LegalMatch’s platform to initiate contact with the potential client. Depending on the client’s preferences, the potential client may choose to send contact information to the lawyer so that they may continue their discussion outside of the platform. Lawyers and clients negotiate between themselves to determine the parameters of their attorney-client relationship.

LegalMatch’s business model relies on yearly or multi-year subscriptions that lawyers may purchase to receive LegalMatch’s intake information. Each lawyer who purchases a subscription is slotted into a geographic location and category of legal expertise. The number of lawyers in a geographic location and category of legal expertise is limited by an algorithm (allocation system) that maintains LegalMatch’s profitability by balancing the number of clients and lawyers available. For example, LegalMatch placed Jackson on a waiting list before he was accepted to the panel of subscribing lawyers for the category of wills, trusts, and estates. Potential clients may use the site for free, and LegalMatch receives no fee for the successful formation of an attorney-client relationship.

Dorian Jackson purchased a subscription with LegalMatch, initially in the field of business litigation and then, after he was accepted, in the category of wills, trusts, and estates. When LegalMatch sued Jackson to recover unpaid subscription fees, Jackson   cross-claimed, asserting that LegalMatch was an uncertified lawyer referral service that was operating in violation of section 6155.

Section 6155 regulates entities that refer potential clients to attorneys. In relevant part, section 6155, subdivision (a)(1) provides that “[a]n individual, partnership, corporation, association, or any other entity shall not operate for the direct or indirect purpose, in whole or in part, of referring potential clients to attorneys, and no attorney shall accept a referral of such potential clients,” unless “[t]he service is registered with the State Bar of California and . . . is operated in conformity with minimum standards for a lawyer referral service established by the State Bar” or “is operated in conformity with” standards set by the Supreme Court. Subdivision (h)(1) provides that “[p]ermissible joint advertising, among other things, identifies by name the advertising attorneys or law firms whom the consumer of legal services may select and initiate contact with,” while subdivision (h)(2) states that “[c]ertifiable referral activity involves, among other things, some person or entity other than the consumer and advertising attorney or law firms which, in person, electronically, or otherwise, refers the consumer to an attorney or law firm not identified in the advertising.” (§ 6155, subd. (h).)

The California Court of Appeal read the statutory text to give a “plain and commonsense” meaning to the term “referral.” (Meza v. Portfolio Recovery Associates, LLC (2019) 6 Cal.5th 844, 856.) As used in the statute, the terms “refer” and “referral” focus on the act that an individual or entity commits in sending potential clients to an attorney.

Jackson asserted that the trial court erred when it found that LegalMatch did not engage in referral activity because it did not exercise judgment on a client’s legal issues. Based on The California Court of Appeal’s interpretation of the statute and the plain meaning of the term “referral,” they agreed. Under section 6155, it does not matter whether LegalMatch exercises judgment on an individual’s legal issues before communicating that information to a lawyer. Rather, a referral occurs when an entity directs or sends a potential client to an attorney.

Jackson cross-claimed on the basis that LegalMatch is operating an uncertified lawyer referral service in violation of Business and Professions Code section 6155, rendering the subscription contract illegal and unenforceable. After a bench trial, the court rejected Jackson’s argument, finding that LegalMatch does not engage in referral activity within the meaning of section 6155.

The California Court of Appeal disagreed and therefore reversed and remanded.

See Jackson v LegalMatch.com.

If you are faced with breach of contract issues, you need a highly skilled and tenacious attorney as your advocate!  Contact the Law Office of Robert Rodriguez! (209) 596-4263.

Robert Rodriguez has litigated well over 100 family law cases and civil litigation matters including personal injury motor vehicle cases, dog bite and slip & fall cases, breach of contract, defamation & invasion of privacy, fraud, unfair business practice, malicious prosecution, workplace and employment matters including sexual harassment, wrongful termination, wage & hour violations, discrimination pursuant to the FEHA, Gov’t Code §§ 12940 et seq., violations of the FMLA & Pregnancy Leave, Civil Rights  discrimination pursuant to 42 U.S.C. § 1983 and Title VII of the 1964 Civil Rights Act in the State of California and California federal district courts.

* Disclaimer – Robert Rodriguez is licensed to practice only in the State of California & this analysis is applied only under State of California law.  Robert Rodriguez is also admitted to practice in the U.S. District Courts, Central, Northern & Eastern Districts of California.  Robert Rodriguez has practiced in the California Court of Appeal.

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