The Connecticut Office of Disciplinary Council has filed with the Statewide Grievance Committee a recommendation that 5 lawyers that participated in the www.totalbankruptcy.com web site for territories in Connecticut be charged with violation of Rule 7.2 for paying a fee for leads, and Rule 8.4 for engaging in felonious conduct. A copy of the Memorandum is Here
Total Bankruptcy operates a consumer based web site that gives consumers information and the opportunity to seek a consultation from an attorney in their local area. Despite some legal nuances about how the participating attorneys are charged, essentially, according to the memo, they pay a fee of approximately $65.00 for every consumer who requests a consultation with the lawyer for their given territory. The lawyer can then presumably follow up with the prospect on a timely basis. While it is clear that such a scheme is the payment of something of value in exchange for a referral, for that matter, so is Google AdWords. Although AdWords usually costs considerably less per click, AdWords also does not perform the extremely valuable service of pre-screening clickers the way that total bankruptcy does, so the higher cost can possibly be justified by the value added. Those who click adwords are more often than not, web surfing, and are not likely to stay on your site long or make any contact, yet you pay for their surfing, while those that volunteer contact information in the total bankruptcy scheme have generally self-screened themselves before giving up their information and requesting a consult. What seems to have the General Counsel's office worked up was not so much the fact that payment was made for clicks, but rather that the recipient of the clicks was exclusive to a territory. That same concern was raised by other bars that have rendered opinions on similar advertising schemes. The memo, as well as the bar complaints apparently filed in 47 jurisdictions should serve as a warning to lawyers before jumping into marketing driven by new computer technology. The so-called Web 2.0 is interactive with potential consumers, which is exactly what TotalBankruptcy seeks to capitalize on for the benefit of participating lawyers, and presumably consumer's benefit as well. Yet ethics rules designed to prohibit runners or pay-for-referral schemes written decades before Al Gore ever invented the internet still apply. Those on the cutting edge will necessarily be the test cases to determine how those old rules apply to new technologies. Unfortunately for these 5 Connecticut lawyers, they may have discovered where the edge of one of those lines lies, at least in Connecticut. While I sympathize, I do not agree with some that have suggested that we should all be outraged that they are being charged with wrongdoing at all. These lawyers knew the ethics rules, and alarm bells should have gone off when they were presented with an exclusive pay-per-contact marketing system. They knew the risk of what they were doing and they did it anyway. I do hope that they prevail, because I think that this is different than the pay-for-referral schemes Rule 7.2 was designed to prohibit, but I am not outraged that they are being charged.