May I pay a for-profit internet company a flat fee for each client lead it sends me?

Plain-English summary

The inquiring attorney asked whether he or she may participate in, and pay the per-lead fees of, an internet service for lawyers. The company gathers leads through a website where consumers seeking attorneys complete a questionnaire, makes no representations about the quality of the referred attorney, and maintains an exclusive relationship with one attorney per jurisdiction in each field of practice. It forwards the consumer's information to the affiliated attorney by email or a telephone connection, and the attorney pays a flat fee per lead regardless of whether the lead results in an engagement or of the resulting fee.

The panel reviewed the two relevant websites: one where consumers read legal-topic articles and enter identifying information or call a toll-free number to connect to an attorney, and a second, entitled "Lawyer Referral Service," describing the arrangement for participating lawyers. The panel applied Rule 7.2(c), which bars a lawyer from giving anything of value for recommending the lawyer's services, with exceptions including paying the reasonable costs of permitted advertisements and "the usual charges of a legal service plan or a not-for-profit lawyer referral service."

Because the company describes itself as a "Lawyer Referral Service" and is a for-profit service, the panel concluded it is not a not-for-profit referral service, and a lawyer who participates in and pays it violates Rule 7.2(c). The panel treated that conclusion as dispositive and expressly declined to address the exclusivity, flat-fee, or other issues the inquiry raised.

In practice

Under this opinion, Rule 7.2(c) permits a lawyer to pay the usual charges of a not-for-profit lawyer referral service but not a for-profit one. The panel held that the internet company, which describes itself as a "Lawyer Referral Service" and operates for profit, is an impermissible referral service, so a lawyer who pays it per lead violates Rule 7.2(c). The panel found that conclusion dispositive and declined to reach the exclusivity and flat-fee questions.

Common questions

Q: Can a lawyer pay an internet company for client leads?

A: Not if the company is a for-profit lawyer referral service. The panel concluded that Rule 7.2(c) permits paying only the usual charges of a not-for-profit lawyer referral service, so paying this for-profit lead service violates the rule.

Q: What made this company a "lawyer referral service"?

A: The company's own second website, describing the arrangement for participating lawyers, is entitled "Lawyer Referral Service." The panel relied on that self-description in concluding it is a referral service.

Q: Did the panel decide whether the exclusivity or flat-fee terms were proper?

A: No. The panel found the for-profit referral-service conclusion dispositive and expressly declined to address exclusivity, flat fees, or the other issues raised.

Q: What kind of referral service may a Rhode Island lawyer pay?

A: A not-for-profit lawyer referral service. The panel cited Rule 7.2, Comment [7], and its Opinion 95-5, which requires that a referral service be operated, sponsored, or approved by the Rhode Island Bar Association.

Background and rules framework

The opinion applies Rule 7.2 (Model Rule 7.2, advertising), specifically Rule 7.2(c), which prohibits giving anything of value to a person for recommending the lawyer's services, subject to exceptions for the reasonable costs of permitted advertising and the usual charges of a legal service plan or a not-for-profit lawyer referral service. The panel relied on Rule 7.2, Comment [7], and its prior Opinion 95-5, under which a qualifying referral service must be operated, sponsored, or approved by the Rhode Island Bar Association.

Citations and references

Rules of Professional Conduct:

• MR 7.2 (advertising; paying for recommendations under 7.2(c); Comment [7])
• RI RPC 7.2

Statutes:

• None cited.

Cases:

• None cited.

Other opinions cited:

• RI EAP Op. 95-5 (1995): a lawyer referral service must be operated, sponsored, or approved by the Rhode Island Bar Association.

See also

• RI EAP Op. 2005-01: Online Lawyer-Matching Website and Flat-Fee Advertising
• RI EAP Op. 2016-07: Lawyer-to-Lawyer Referral Emails Are Not Solicitation or Advertising

Source

• Landing page: https://www.courts.ri.gov/attorney-resources/Pages/Ethics-Advisory-Panel-default.aspx
• Original PDF: https://www.courts.ri.gov/Opinions/EAP%2019-03.pdf

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

Rhode Island Supreme Court
Ethics Advisory Panel Op. 2019-03
Issued September 12, 2019

FACTS

The inquiring attorney asks whether he/she may participate in and pay the fees charged by an internet service for lawyers. The inquiring attorney states that the internet company offers to forward leads to attorneys which may result in clients. The company acquires leads through a website that asks consumers who are seeking attorneys to fill out a questionnaire. The company does not make any representations about the quality of the referred attorney. The inquiring attorney states that the company has an exclusive relationship with one attorney in a jurisdiction in each field of practice. The internet company forwards the consumer's information to the affiliated attorney either by email or by a telephone connection with the potential client. The attorney agrees to pay the company a flat fee for each lead regardless of whether the lead results in an attorney-client engagement, and regardless of the amount of the resulting attorney's fee.

ISSUE PRESENTED

The inquiring attorney asks whether the exclusive arrangement with an internet company that will provide leads connecting potential clients with him/her, and the charge per lead, are permissible under the Rules of Professional Conduct.

OPINION

The internet company which holds itself out as a "Lawyer Referral Service" is an impermissible for-profit lawyer referral service.

REASONING

The Panel has reviewed the pertinent websites. There are two. One website is where a consumer may read articles on various legal topics. The consumer may also either enter basic identifying information on the website, including name and zip code, or choose to call a toll-free telephone number to connect to an attorney.

The second website provides information for potential participant-lawyers, including a list of areas of law and a description of the arrangement between participating lawyers and the company. This webpage is entitled "Lawyer Referral Service."

Paragraph (c) of Rule 7.2 of the Rules of Professional Conduct provides in relevant part as follows.

(c) A lawyer shall not give anything of value to a person for recommending the lawyer's services except that a lawyer may
(1) pay the reasonable costs of advertisements or communications permitted by this Rule;
(2) pay the usual charges of a legal service plan or a not-for-profit lawyer referral service;

Rule 7.2(c) only permits lawyers to pay the usual charges of a not-for-profit lawyer referral service. See Rule 7.2, Comment [7]; Ethics Advisory Panel Op. 95-5 (1995) (a lawyer referral service must be operated, sponsored, or approved by the Rhode Island Bar Association). The internet company in the instant inquiry by its own description is a "Lawyer Referral Service." It is a for-profit service. A lawyer who participates in an internet lawyer referral service that is not a not-for-profit lawyer referral service violates Rule 7.2(c).

The Panel's conclusion that the internet company in this inquiry is an impermissible lawyer referral service, is dispositive. The Panel does not at this time address the ethical considerations relating to exclusivity, flat fees, or other significant issues presented by this inquiry.