LegalZoom claims that “We Put The Law On Your Side.” To induce people to buy its services, LegalZoom asserts, prominently, that it was developed by expert attorneys with experience at the most prestigious firms in the country. The fine print, however, does the opposite. The fine print makes clear that the expert attorneys who developed LegalZoom are in no way responsible for the consequences of a customer using LegalZoom. In fact, LegalZoom requires that its customers pay for LegalZoom’s defense if the customer were to sue LegalZoom.
The Federal Trade Commission, charged with protecting consumers, encourages competition by non-lawyers as if price were the most important factor. The FTC’s policy is doctrinaire and is likely to change only after significant harm has not only occurred but has been documented and reported to it. In effect, the FTC is responsible for the de-regulation of the practice of law in the name of allowing free market competition, an approach similar to that taken by the Securities and Exchange Commission.
The FTC’s approach – encouraging competition between lawyers and non-lawyers – has now led to competition between lawyers who are regulated and lawyers who claim that lawyer regulations do not apply to them because, although they are lawyers and although they have set up a process for providing legal services without meeting with or talking to clients, they are not engaged in the practice of law. This is patent nonsense. LegalZoom is a case in point.
LegalZoom claims the benefits of lawyer regulation by advertising that it “was developed by expert attorneys with experience at the most prestigious firms in the country.” Only lawyers – licensd lawyers subject to lawyer regulations – may claim the benefit of having the right to practice law. LegalZoom does that it in advertising. It draws the public in by reference to its expert lawyers.
But then LegalZoom – in a classic bait and switch – states in its fine print – that it does not provide legal services, etc, etc and makes the customer responsible for LegalZoom’s legal fees. It is hard to imagine a more blatantly deceptive advertising campaign the LegalZoom’s.
In additon, LegalZoom engages in unfair competition. LegalZoom is run by lawyers who, using their legal skills and law licenses, have devised a way to compete nationwide at a much lower cost by evading rules governing the practice of law.
LegalZoom’s advertising is like an invitation to a fancy, Hollywood party which, once one drives to it, turns out to be held at a large, old, abandoned warehouse. The free market rewards short term profit. Whatever happens after that is too bad for whom ever it happens to.