Wisconsin Lawyer: Technology 'Text A Lawyer' App: More Uberization of Legal Services:

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Format: MM/DD/YYYY
    October
    12
    2018

    Technology
    'Text A Lawyer' App: More Uberization of Legal Services

    New apps might be easing consumers' lives by making finding a lawyer almost as easy as hailing a cab, but lawyers, like cab drivers, still must comply with the rules of the road when providing their services.

    Aviva Meridian Kaiser

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    “Uberization” describes the introduction of cheaper or more efficient alternatives, especially those using mobile technology.1 The term often is used interchangeably with “spontaneous private deregulation,” which is the open disregard of laws and regulations that are seen as obsolete and roadblocks to innovation. Spontaneous private deregulation is increasing as business platforms circumvent regulations that make traditional businesses less competitive. As briefly discussed, the legal services market is not immune from uberization and spontaneous private deregulation.

    Platform-based business and technological innovations continue to increase. In January 2018, the National Organization of Bar Counsel reported more than 700 technology platforms were providing varying levels of legal services to consumers and connecting clients to lawyers. As alternative legal service providers become more technologically innovative, they will no doubt find creative ways for these platforms to either comply with or circumvent the rules. One recent example is the “Text A Lawyer” app.

    Robert Ambrogi, a lawyer and consultant who writes about the internet and legal technology, published a blog post on June 20, 2018, titled, “Launching Soon: ‘Text A Lawyer’ Aims To Be the Uber of Legal Help.”2 According to Ambrogi, the Text A Lawyer service “allows consumers to get answers to their legal questions by text for a flat price of $20.”3 The service is “modeled after the ride-sharing service Uber in that it uses two separate mobile apps, one for consumers to submit legal questions and another for lawyers who are in a waiting pool ready to give answers.”4

    Aviva Kaiserorg akaiser wisbar Aviva Meridian Kaiser, Univ. of Buffalo 1979, is ethics counsel with the State Bar of Wisconsin. Ethics question? Call the Ethics Hotline at (608) 229-2017 or (800) 254-9154.

    Although Text A Lawyer is set to launch in Oregon and Washington, for landlord-tenant issues only, it plans to expand nationwide.5

    Text A Lawyer’s demonstration video describes how Text A Lawyer works.6 After opening the Text A Lawyer app, the consumer is prompted to select the state and the area of law and to describe the legal question in a few sentences. When the consumer submits the question, the payment-processing company places a hold on the consumer’s credit card but does not charge the card. The app next prompts the consumer to provide the names of others involved such as adverse parties and witnesses so that the lawyer can check for conflicts.7

    Text A Lawyer then automatically selects the highest-rated lawyer who is online and who fits the state and practice area chosen by the consumer. Before connecting the consumer with the lawyer, Text A Lawyer will send the conflict-of-interest information to the lawyer. After the lawyer verifies that there is not a conflict of interest, the consumer is then asked to agree to the terms of the lawyer’s limited-engagement agreement. Only after the consumer has agreed to the limited-scope representation is the consumer’s question sent to the lawyer.8

    The consumer and the lawyer are then connected in an encrypted chat window where the lawyer can ask clarification questions. When the lawyer submits the final answer, the consumer’s credit card is charged. The consumer has two minutes to read the final answer and decide whether to ask a follow-up question or disconnect. The consumer is charged $9 for each follow-up question. Once the consumer chooses to disconnect, the engagement is concluded. The consumer and the lawyer may, however, extend the relationship outside the app. After the engagement is concluded, the consumer is asked to rate the lawyer. The ratings are used by Text A Lawyer to assign lawyers: the ratings are not made available to the consumers.9

    The lawyer earns $15 of the $20 for the initial question and $8 of the $9 for each follow-up question. Text A Lawyer takes $5 of the initial fee: $4 for a connection fee10 and $1 for a software licensing fee.

    In its demonstration video, Text A Lawyer provides an example of how to “[u]se Text A Lawyer to make money whenever, wherever.” In the example, the lawyer spent 12 minutes using Text A Lawyer during which time the lawyer processed three clients, one of whom was rejected and two of whom were accepted. In the 12 minutes, the lawyer earned $46 from two initial questions and two follow-up questions. At that rate, according to the video, the lawyer would earn $230 per hour. The lawyer also was rehired for traditional legal services on the same day.11

    What Exactly Is Text A Lawyer?

    Ambrogi’s blog post refers to Text A Lawyer as a “service” or an app and does not characterize it as advertising, a referral service, or a recommendation. The demonstration video states that Text A Lawyer is compliant with the Rules of Professional Conduct. Moreover, Ambrogi reports that the app’s founder worked with a national law firm to make the app compliant in almost every state.

    However, online services that connect lawyers and clients risk violating SCR 20:7.2, which governs advertising, referral services, and recommendations. SCR 20:7.2(b) prohibits a lawyer from giving anything of value to a person for recommending the lawyer’s services. Lawyers are permitted, however, to pay the reasonable costs of advertising and to pay the usual charges of a nonprofit or qualified lawyer-referral service.

    Is It Advertising?

    A lawyer is permitted by SCR 20:7.2(a) to advertise services through written, recorded, or electronic communication, including public media. Although “advertising” is not defined in the Rule, ABA Comments [1] and [2] provide guidance.

    “[1] To assist the public in learning about and obtaining legal services, lawyers should be allowed to make known their services not only through reputation but also through organized information campaigns in the form of advertising.

    “[2] This Rule permits public dissemination of information concerning a lawyer’s name or firm name, address, email address, website, and telephone number; the kinds of services the lawyer will undertake; the basis on which the lawyer’s fees are determined, including prices for specific services and payment and credit arrangements; a lawyer’s foreign language ability; names of references and, with their consent, names of clients regularly represented; and other information that might invite the attention of those seeking legal assistance.”

    The [Text A Lawyer] service is ‘modeled after the ride-sharing service Uber in that it uses two separate mobile apps, one for consumers to submit legal questions and another for lawyers who are in a waiting pool ready to give answers.’

    In addition, SCR 20:7.2(b)(1) specifically permits a lawyer to pay the reasonable cost of advertising. ABA Comment [5] explains:

    “Paragraph (b)(1), however, allows a lawyer to pay for advertising and communications permitted by this Rule, including the costs of print directory listings, on-line directory listings, newspaper ads, television and radio airtime, domain-name registrations, sponsorship fees, Internet-based advertisements, and group advertising. A lawyer may compensate employees, agents and vendors who are engaged to provide marketing or client-development services, such as publicists, public-relations personnel, business-development staff and website designers.”

    Text A Lawyer, on its face, does not appear to be advertising as contemplated by SCR 20:7.2(a) and ABA Comment [1] and [2]. In fact, the consumer does not even know the lawyer’s identity: the app selects the highest-rated lawyer in the waiting pool. There appears to be no public dissemination of information concerning the lawyer that would invite those seeking legal assistance to contact the lawyer.

    Moreover, Text A Lawyer also does not appear to be advertising as contemplated by SCR 20:7.2(b)(1) and ABA Comment [5]. The “connection fee” and “software licensing fee” are not the types of advertising and communications illustrated by ABA Comment [5].

    Is It a Referral Service?

    A lawyer is permitted by SCR 20:7.2 (b)(2) to pay the usual charges of a nonprofit or qualified lawyer-referral service. A qualified lawyer-referral service is a lawyer-referral service that has been approved by an appropriate regulatory authority. Text A Lawyer is not a nonprofit referral service, and it has not been approved by the Wisconsin Supreme Court, the appropriate regulatory authority. Consequently, if Text A Lawyer is in fact a referral service, it is an impermissible referral service in violation of SCR 20:7.2(b).

    While Text A Lawyer’s demonstration video is silent about whether it is a referral service, in his interview for Stanford Law School blog CodeX founder Kevin Gillespie, stated:

    “It’s tough to choose a lawyer. Our system removes the choice because customers are always connected to the highest rated lawyer available. All clients rate their lawyer from 1-5 stars at the end of the conversation. This rating is kept internal; the clients never see the rating. This prevents legal ethics problems with a lawyer referral service, which we are not.”

    Even though the founder of Text A Lawyer asserts that it is not a referral service, Florida has concluded that a similar service, Avvo Advisor, is in fact a referral service. Avvo Advisor offers a 15-minute consultation with a lawyer for $39. A prospective client visits the website www.avvo.com/advisor, selects the legal topic, pays Avvo $39, and Avvo arranges for an “experienced [name of state] lawyer” to return the prospective client’s call within minutes. In December 2017, the Florida Bar Board of Governors unanimously concluded that the Avvo Advisor online system for connecting potential clients with questions to lawyers meets the Florida Bar’s definition of a referral service12 and must comply with the rules regulating referral services.

    Is It a Recommendation?

    Recommendation is defined in ABA Comment [5] to SCR 20:7.2. “A communication contains a recommendation if it endorses or vouches for a lawyer’s credentials, abilities, competence, character, or other professional qualities.”

    ABA Comment [5] provides further clarification. 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 and the lead generator’s communications comply with the rule governing communications concerning a lawyer’s services, SCR 20:7.1.

    To comply with SCR 20:7.1, “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.”

    Even though the founder of Text A Lawyer asserts that it is not a referral service, Florida has concluded that a similar service, Avvo Advisor, is in fact a referral service.

    Text A Lawyer’s demonstration video begins: “Text A Lawyer. The Right Lawyer. Right Now.”13 In addition, the demonstration video states that “clients are always connected to the highest-rated lawyer available.”14 Yet Text A Lawyer appears to believe that it is not recommending the lawyer because the ratings are “kept internal”15 and because Text A Lawyer does not independently evaluate lawyers, except for a daily scan of bar disciplinary pages to deactivate any lawyer who has been disbarred or suspended.

    It seems inconceivable that Text A Lawyer would connect a lawyer to a client and, at the same time, maintain that it is not recommending that lawyer or vouching for that lawyer’s competence, especially when the client cannot see the ratings and has no choice but to rely on Text A Lawyer. At the very least, the demonstration video creates a reasonable impression that Text A Lawyer is recommending the highest-rated lawyer, especially when the video does not contain a statement that Text A Lawyer is not recommending the lawyer. Moreover, the founder of Text A Lawyer seems to believe that the clients can rely on Text A Lawyer to help them navigate the overwhelming process of choosing the right lawyer. “[F]or somebody who maybe doesn’t have an education past high school, that is just overwhelming to them. And most of the time, they have a court paper in their hands they don’t understand. So Text A Lawyer removes the option – you don’t pick a lawyer. You don’t pick anything except a state and legal category.”16

    Conclusion

    As Text A Lawyer illustrates, alternative legal service providers continue to develop innovative platforms. The business norms and sources of competition continue to change.17 While Text A Lawyer is preparing to launch, other platform “matching services” such as Court Buddy18 have been operating for years. Innovators assert that these “platforms are nothing more than a form of modern commerce in a digital world.”19 Perhaps now is the time to discuss how the Rules of Professional Conduct should apply in the digital world of modern commerce.

    Endnotes

    1 SeeThe ‘Uberization’ of Legal Services” (Wisconsin Lawyer, Feb. 2017).

    2 www.lawsitesblog.com/2018/06/launching-soon-text-lawyer-aims-uber-legal-help.html.

    3 Id.

    4 Id

    5 Id.

    6 Id.

    7 Id.

    8 Id.

    9 Id.

    10 While Ambrogi’s blog describes the $4 as a connection fee, Kevin Gillespie, the app’s developer, describes it as an “attorney verification fee,” which includes identity and license verification services. https://finance.yahoo.com/news/apos-serial-entrepreneur-apos-thinks-140047157.html.

    11 Text A Lawyer demonstration video at 16:40. The demonstration video at 13:40 explains: “A good Text A Lawyer provides satisfying answers while enticing your clients to ask follow-up questions.” The video at 15:30 further elaborates: “Our lawyer seizes the opportunity to add [the client] as a full-service client. Text A Lawyer is a great way for attorneys to bring high quality clients into their practice.” In his blog, Ambrogi notes that the app is designed for “simple” legal questions.

    12 Florida Rules of Professional Conduct Rule 4-7.22.

    13 Demonstration video at 0:02.

    14 Demonstration video at 4:48.

    15 “This ‘Serial Entrepreneur’ Thinks Finding a Lawyer Can Be as Easy as Hailing an Uber,”ALM Media (July 5, 2018).

    16 Id.

    17 In fact, the Text A Lawyer founder has other ideas. He is currently developing “Do I Need a Lawyer?,” which is “planned to operate basically like Turbo Tax: Yes and no questions that anyone could answer to help you determine if you need a lawyer.”He also has an undeveloped idea called “Client Code,” a marketplace in which lawyers would bid on clients. Clients would be identified by a code. By providing the code and not specific client information, Client Code would “avoid violating any [Rules of Professional Conduct],” he added. “This ‘Serial Entrepreneur’ Thinks Finding a Lawyer Can Be as Easy as Hailing an Uber,” supra note 15.

    18 “Courtbuddy.com is a new and innovative way for people and businesses to get matched with attorneys who can appear in court for them or handle their other legal needs based on their budget. Our mission is to provide people with access to an attorney when needed, regardless of their financial status. The process is simple: (1) go to courtbuddy.com and choose either “I Am An Attorney” or “I Am Looking For Attorneys,” (2) fill out a brief questionnaire, and (3) become a member and start getting matched. Pick your budget. Pick your attorney. Get matched today.” Court Buddy’s website also has the following disclaimer: “Court Buddy is not a lawyer, law firm, lawyer directory, or a lawyer referral service. Court Buddy does not endorse or recommend any particular lawyer. Lawyers are listed on Court Buddy for advertising purposes only.” https://www.courtbuddy.com.

    19 https://myshingle.com/2018/06/articles/ethics-malpractice-issues/how-legal-ethics-rules-on-non-fee-splitting-platforms-lead-to-unintended-consequences-and-ludicrous-results/.




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