Featured Deal: Discount Legal Services*
On the issue of whether a lawyer can ethically participate in a daily deal program, such as Groupon, the score is 5-3 in favor of allowing participation. Maryland is the most recent state to weigh in. It says participation is fine, subject to some guidelines. For instance:
1. Attorney Communications
According to the Maryland Lawyers’ Rules of Professional Conduct, lawyers can’t make false or misleading statements in their advertisements, regardless of whether the ad comes in traditional print form or on a daily deal Web site.
Also, lawyers can only pay the reasonable cost of advertising. That means that the cost to place this daily deal must be in line with other forms of attorney advertising.
2. Fee Sharing and Referrals
Lawyers can’t split legal fees or pay for a referral.
Most daily deal Web sites collect the purchase price from the purchaser and keep a portion of that amount as payment for its services. According to the ethics committee, these retained sums constitute payment for the advertising services and web hosting—not shared legal fees, since they’re deducted from bottom line figure paid for the lawyer’s services.
Also, the retained sum is not a referral fee because the Web site merely sends email blasts to its entire user database. It doesn’t target or take any particular action to refer a purchaser to a specific product or service.
3. Attorney-Client Relationship
Even if someone buys the coupon, she may not ultimately become a client. The lawyer must still consult with the client, review the matter, and advise the client accordingly. Because of this, the online offer must explicitly state that the offer is conditioned on this process.
And if the attorney can’t represent the purchaser for any reason (whether because of conflict of interest or the purchaser never redeems the coupon), the attorney must decline representation and refund the entire amount paid – including any fees retained by the Web site.
- 4. Advance Payments
- Payments collected through online offers are unearned, and Maryland requires such fees (even flat fees) to be held in a trust account, unless the client instructs otherwise.
- So here’s the scorecard, for all those enterprising lawyers keeping track.
- Approving of the daily deal Web site advertising:
- Against the daily deal Web site advertising:
- Maryland Ethics Op. 2012-07 (2012);
- Nebraska Ethics Op. 12-03 (2012);
- New York State Ethics Op. 897 (2011);
- North Carolina Ethics Op. 2011-10 (2011); and
- South Carolina Ethics Op. 11-05 (2011).
- · Alabama Ethics Op. 2012-01 (2012);
- Indiana Ethics Op. 1 of 2012 (2012); and
- Pennsylvania Ethics Op. 2011-027 (2011).
· · *Some restrictions apply – and offer may be dangerous to the lawyer’s mental health.