Daily Dispatch

WHAT YOU NEED TO KNOW IN 2013

Lawyer Advertising and Marketing Ethics Today: An Overview

By | Jan.23.13 | Daily Dispatch, Ethics, Extras, Law Practice Management, Legal Marketing, Marketing & Business Development

At the start of the new year, we asked Will Hornsby, Staff Counsel at the American Bar Association, what lawyers need to know about changes made in ethics rules regarding marketing in 2012—and what to expect in 2013. The following feature article is excerpted from Attorney at Work’s new e-guide, Really Good Marketing Ideas: How to (Really) Get More Clients This Year

The legal profession constantly struggles to set advertising policies that strike the balance between consumer protection and access to justice. What are the boundaries we impose on ourselves to make certain that people are not subject to over-reaching when lawyers are seeking clients, yet still enable people to get the information needed to make decisions about representation? We all agree on the objective, but we don’t often agree on the means to get there. In the past year, rule-makers, committees drafting ethics opinions and disciplinary agencies have all weighed in, but frequently not with the same results. Here’s an overview.

Really Good Marketing IdeasIt Was a Busy Year. In August, the American Bar Association House of Delegates approved changes to the comments to the Model Rules of Professional Conduct that address advertising and solicitation. Nevada’s supreme court adopted substantial changes to the ethics rules that govern advertising in that state, while the courts of Florida and Tennessee are considering changes that are far afield from the ABA rules. Ethics committees in several states have issued opinions that attempt to apply the rules to aspects of technology-based marketing, such as daily deals, question-and-answer sites and recommendation requests. Meanwhile, Virginia became the first state to bring disciplinary charges against a lawyer for failure to apply the advertising rules to his blog.

ABA Ethics 20/20

The ABA is the proverbial 800-pound gorilla in the room. Ironically, the ABA Model Rules of Professional Conduct have no force and effect. Compliance with them serves as no protection for a lawyer who advertises in ways in violation of the lawyer’s state rules. The Model Rules are developed to assist the states, but few states have adopted the ones governing client development (Rules 7.1 through 7.5) verbatim. The ABA rules are important, however, because nearly every state has embraced them as a core of their rules. The states then embellish from there.

The cornerstone of the rules governing advertising and solicitation is the prohibition against false or misleading communications. Rules governing solicitation, or “direct contact,” have included other limitations, such as the anti-ambulance chasing prohibition on most in-person solicitations and a requirement to label mailed material as an advertisement.

In 2009, the ABA launched an initiative known as Ethics 20/20. The 20/20 Commission was charged with a reconsideration of all the Model Rules because of globalization and technological developments. The Ethics 20/20 working group on technology and client development sought comments on the direction it should follow. Lawyers from across the country responded with an overwhelming sentiment to focus on the prohibition on false or misleading communications and to abandon notions of micromanaging technology-based advertisements.

Based on this input and a dedication to apply a light touch, Ethics 20/20 retained the rules with miniscule changes. But it recommended important amendments to the comments. Two fundamental changes resulted.

Pay-per-lead. First, the comment to Model Rule 7.2 explicitly embraces “pay-per-lead.” At the 2012 ABA Annual Meeting, the House of Delegates adopted a change to the comments to the Model Rule governing lawyer advertising that states:

… a lawyer may pay others for generating client leads, such as Internet-based client leads, as long as the lead generator does not recommend the lawyer, any payment to the lead generator is consistent with Rules 1.5(e) (division of fees) and 5.4 (professional independence of the lawyer), and the lead generator’s communications are consistent with Rule 7.1 (communications concerning a lawyer’s services). To comply with Rule 7.1, a lawyer must not pay a lead generator that states, implies, or creates a reasonable impression that it is recommending the lawyer, is making the referral without payment from the lawyer, or has analyzed a person’s legal problems when determining which lawyer should receive the referral. 

Lawyers have participated in “pay-for-click” advertising on search engines for over a decade. In fact, a 2001 ethics opinion from South Carolina makes it clear that paying for keywords on search engines and coming up in an advertising space in search results using those keywords is nothing more than the 21st-century equivalent of paying for television commercials or ads in the Yellow Pages. While pay-per-lead differs from pay-per-click in some respects, the comment to Rule 7.2 not only clarifies that it is permissible under the Model Rules, but gives clear direction on the circumstances in which it can be done.

Remember, however, that this does not green-light pay-per-lead in each state. It is merely the ABA’s recommendation to the states. Until and unless it is adopted by the states, some states may conclude that it is inappropriate for a lawyer to seek clients on this basis.

Solicitation. The great majority of states govern direct contact with potential clients without defining the term “solicitation.” Those states that do define it vary from one to another. The ABA Model Rules also lacked a definition of that term until August 2012, when the Comment to ABA Model Rule 7.3 was amended to state:

A solicitation is a targeted communication initiated by the lawyer that is directed to a specific person and that offers to provide, or can reasonably be understood as offering to provide, legal services. In contrast, a lawyer’s communication typically does not constitute a solicitation if it is directed to the general public, such as through a billboard, an Internet banner advertisement, a website or a television commercial, or if it is in response to a request for information or is automatically generated in response to Internet searches.

Prior to this change, the rule imposed no exceptions for information provided by a lawyer or firm upon the request of a potential client. It was something of an “unwritten rule” that these limitations did not apply when someone contacts a lawyer seeking information about his or her services. This change clarifies that exception and goes further to find that technology-generated responses to Internet searches are also acceptable. Again, this definition is not in place in the states and some states will almost certainly continue to have variations defining solicitation.

State Rule Changes

While the ABA focuses on the prohibition against false or misleading communications, and includes a handful of rules imposing requirements and limitations on advertising and solicitations, several states take a more micro view and set out detailed obligations. The related ABA Model Rules cover about four pages. Those of states such as Florida and Nevada have three to four times that volume.

Florida first adopted advertising restrictions in 1990. Since then The Florida Bar and the state supreme court have dedicated an enormous amount of time to considering the policies governing client development. The court has gone back and forth with the bar on rule changes over the past year. Lawyers in Florida must submit ads to the bar for screening, but websites are exempt from this requirement. The current Florida rules position websites as “information upon request.” Like the newly adopted ABA comment on solicitation, information requested by a potential client is not subject to the same level of scrutiny as other forms of advertising. Since people must proactively seek websites, the theory goes that the content becomes information upon request. Some have suggested this is really an exception based on a pragmatic notion, given that it is difficult, if not impossible, for the bar to screen all parts of all law firm websites. At the end of 2012, this issue, with other aspects of the Florida rules, remains unresolved.

Nevada is another state that historically has imposed substantial restrictions on client development. In December, its supreme court adopted changes that removed some restrictions and imposed others. Prior to the changes, Nevada had a rule that prohibited anyone from portraying a lawyer in an ad unless the person was admitted to the Nevada Bar and would be the lawyer providing the service. Under the rule change, lawyers may use actors if they include disclaimers. Stock photos live!

The prior rules required advertisements to include a statement:

NOTICE: THIS IS AN ADVERTISEMENT!

The statement had to be in a font at least twice the size of the largest type used in the ad. While the obligation to include the statement continues in the new rules, the court has struck the font size and included provisions that disclaimers must be clearly legible and prominently placed.

In addition, Nevada has joined a short list of states that require emails to include the label “Attorney Advertising” at the beginning of the email’s subject line. The rule changes also require details to be set out when a lawyer advertises past results.

The Tennessee Supreme Court is considering multiple petitions for rule changes, too, some that are based on Florida’s rules. Among other things, provisions would prohibit a lawyer from including past results and using any celebrity whose “voice or image is recognizable to the public.” The proposal would also establish a screening process, requiring lawyers to submit ads to the state for determining their compliance, much like the Florida requirements.

Ethics Opinions

States have issued ethics opinions to address using Internet-based technology for marketing legal services since the 1990s. Ethics opinions are issued by bar association or court committees and apply the rules to various factual situations. Although they are not binding in most states, they generally provide good direction. At the same time, an ethics opinion in one state may come to a different conclusion than an opinion in another state, even when applying the same facts to the same rules. This was the situation for the states that examined lawyers’ participation in daily deals, such as Groupon’s.

At least seven states have issued ethics opinions on a lawyer’s participation in daily deal programs between 2011 and 2012. New York, South Carolina, North Carolina, Nebraska and Maryland have concluded participation is ethical under certain circumstances, while Indiana and Alabama indicate it is impermissible unless the program has certain safeguards. The issues are not focused on the rules governing lawyer advertising as much as they look at matters of client confidentiality, conflicts of interest and the division of fees with the corporate sponsor of the programs. Lawyers considering participation in these programs should make sure they research the details of the opinions to decide whether it is proper under their state rules. Some who have written on this issue wonder if lawyers would really be interested in participation in this type of client outreach on a broad scale.

It is somewhat ironic that so many states have addressed daily deals while lawyers are embracing other technology-based strategies where guidance is needed. For example, sites that provide answers to consumers’ questions have emerged as a client development tool. An ABA report from 2011 indicates that the public is more likely to use Q&A sites than other forms of online legal information when seeking a lawyer. South Carolina has issued an opinion critical of the site www.justanswer.com. The site tends to use terms deemed misleading, such as “expert.” The opinion does conclude that Q&A sites may be compliant, but cautions lawyers about the possibility of inadvertently entering into an attorney-client relationship.

North Carolina has also issued ethics opinions that provide direction on aspects of social media use. The ABA report indicates that client feedback sites are about as well-liked by the public as Q&A sites. States have various standards for testimonials, but North Carolina Opinion 2012-1 tells us that not all testimonials are the same. It divides testimonials into those that are “soft” and “hard.” A soft testimonial goes to the lawyer’s characteristics such as the level of service or professionalism. A hard testimonial goes to the outcome of the matter. The opinion concludes a disclaimer is not necessary for a soft testimonial, but is for a hard testimonial. This opinion should be considered with Opinion 2012-8, which concludes that a lawyer may not only accept recommendations from current and former clients on networking sites, but may also seek recommendations as long as the site and communications conform to the state’s advertising rules.

Disciplinary Action for Blogging

Was there ever a time when lawyers didn’t blog? Seemingly they have been doing it forever. However, it took a Virginia disciplinary case for the legal community to get its first direction on the ethical compliance of blogging. Horace Hunter dedicated a portion of his firm’s website to a section called “This Week in Richmond Criminal Defense.” Some argue it was not a blog at all, but merely a portion of a law firm website that advertised the firm’s services. Many of the posts, but not all, pertained to Hunter’s representation of criminal defense clients. The state took the position this was misleading without a disclaimer that it is advertising material, and prevailed on this issue at both the hearing level and the disciplinary appellate level.

While compliance in Virginia would have been met with the simple notation that the material is an advertisement, compliance in other states could be far more rigorous. Consider the viability of a lawyer’s blog in a state that has a screening requirement. Must the lawyer submit an initial post, with the proper forms and screening fee, wait for the review to be completed before posting and repeat the process anytime someone engages in online conversation about the blog’s topic? We may have to wait for a future court to decide about applying the advertising rules to blogs based on the content of the communications and the lawyer’s First Amendment rights.

Looking Forward

So, 2012 provided us with better insights into pay-per-lead, solicitations, daily deals and blogging. What will we see in 2013? We’ve gotten our first glimpse already, as California has issued an ethics opinion providing direction on when the ethics rules apply to a lawyer’s use of social media. The bottom line: The rules apply if the content of the message is “concerning the availability of professional employment.” See CA Formal Opinion 2012-186 for more details. Here are three additional possibilities.

  • We are seeing substantial growth in apps pertaining to legal services. Is there anything about these apps that makes them different from other types of communications? They are not really websites and certainly not emails, but do they merit special treatment within the rules or analysis for ethics opinions?
  • Second, we are seeing a more sophisticated integration of marketing into social networking, not just for legal services but across the board. Some restaurant guides now note that those on your social network sites have reviewed a restaurant you are looking at, or, maybe even two levels down, someone in the network of someone in your network has done so. The management of social networking personal information and its integration into marketing should be frightening to policy-makers. The marketing community has only scratched the surface of those strategies.
  • Finally, we are seeing turf wars with the titans of online legal service providers. LegalZoom and Rocket Lawyer have become involved in litigation with one another, which will play out over the next year. And we might wonder how they found their lawyers.

Will Hornsby has served as Staff Counsel at the American Bar Association for more than 20 years. He writes and speaks extensively on issues of ethics, technology and client development. Follow him at @willhornsby. This material should not be construed as legal advice or the policy of the ABA or any of its constituent entities.

Illustration ©iStockPhoto.com 

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One Response to “Lawyer Advertising and Marketing Ethics Today: An Overview”

  1. Noah Kovacs
    11 September 2013 at 8:33 am #

    While I think it is a necessity to have ethics/rules for how lawyers advertise this can cost smaller firms and solo lawyers a lot of money to stay ahead in the marketing world. Thanks for letting us know the new changes on both the state and federal level for 2013.


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