On September 27, 2017, Utah joined the growing list of states1 condemning Avvo Advisor’s lawyer-referral service. The Utah Ethics Advisory Opinion Committee concluded that Avvo Advisor’s service “violates Rule 5.4’s prohibition on splitting fees with a non-lawyer. It also violates Rule 7.2’s restrictions on payment for recommending a lawyer’s services and it may violate a number of other Rules related to client confidentiality, lawyer independence, and safekeeping of client property, depending on facts not presented.” See Utah Ethics Advisory Opinion Committee, Op. No. 17-05 (Sep. 27, 2017).
How does Avvo Advisor work? A prospective client visits the website https://www.avvo.com/advisor, selects the legal services needed, pays Avvo a fixed fee, and Avvo arranges for an “experienced lawyer” to return the prospective client’s call within minutes.2
From the lawyer’s standpoint, participating is easy. The lawyer simply clicks the “Join Today” button and agrees to provide certain legal services for a fixed fee. For example, the flat fee for a “15-minute Family advice session” is $39.00; filing for an “uncontested divorce” is $995.00; and creating a “last will and testament” is $295.00. Avvo boasts:
With more than 8 million visits to Avvo each month, we can connect you with clients who have already paid for limited-scope legal services. There’s no chasing leads.
You choose from dozens of legal services and control your availability. Clients only buy what you want to sell, when you want to sell it.
Avvo handles the billing up front, so you can focus on getting the client the help they need. No sending invoices.
After the lawyer provides the services, Avvo sends the lawyer “100% of the client’s payment.” The lawyer then “[a]s a completely separate transaction,” pays a “per-service marketing fee.” The amount of that marketing fee “depends on the service, and ranges from a $10 marketing fee for a $39 service, to $40 marketing fee for a $149 service, up to a $400 marketing fee for a $2995 service. See Attorney FAQ for Avvo Legal Services.
“Is it ethical?,” you ask. According to Avvo, “yes, it is.” Avvo says that it is not getting paid for lawyer referrals: “Avvo is not referring people to a particular lawyer. Potential client choose which attorney they would like to work with from all available, participating attorneys.” Furthermore, Avvo says that it is not sharing in legal fees: “Fee splits are not inherently unethical. They only become a problem if the split creates a situation that may compromise a lawyer’s professional independence of judgment. We believe that Avvo Legal Services fees, if deducted like credit card fees, would involve the sort of technical fee split that would not create such a potential for compromise.” See id.
The problem is that Avvo is wrong. As the new Utah opinion correctly concludes: “The referral service described in the request violates Rule 5.4 as impermissible fee sharing, [and] violates Rule 7.2 as paying for a recommendation of services beyond the reasonable costs of advertising” among other problems. See Utah Ethics Advisory Opinion Committee, Op. No. 17-05 at 4-5 (Sep. 27, 2017).
Considering these unfavorable ethics opinions, Louisiana lawyers should avoid participating in Avvo Advisor. Louisiana Rule 5.4(a) provides that a “lawyer or law firm shall not share legal fees with a nonlawyer,” except under unusual circumstances. Similarly, Louisiana Rule 7.2(c)(13) provides that a “lawyer shall not give anything of value to a person for recommending the lawyer’s services, except that a lawyer may pay the reasonable cost of advertising or written or recorded communication permitted by these Rules, and may pay the usual charges of a lawyer referral service . . . .” Both rules are squarely implicated by Avvo’s questionable business model.
- The Utah opinion cited opinions from five other states that likewise condemned Avvo’s lawyer-referral service. See South Carolina Ethics Op. 16-06 (2016); Pennsylvania Ethics Op. 2016-200 (2016); Ohio Ethics Op. 2016-3 (2016); New York State Ethics Op. 1132, (2017); New Jersey Ethics Op. 732, (2017). ↩
- Note that Avvo offers this service in Louisiana. ↩