Hello everyone and welcome to this Ethics Alert Update which will discuss the Florida Bar Board of Governors’ (BOG) recent approval of proposed lawyer referral rules. The proposed rules would substantially revise the current rules, including broadening the definition and changing the name of the services to “matching services” and the names of referral companies to “qualifying providers”, prohibiting fee splitting, and deleting the disclaimer that the entity is a lawyer referral service. The proposed rule revisions are here: https://www.floridabar.org/TFB/TFBResources.nsf/Attachments/D8FFF4171E28E5C085257FA300648D6B/$FILE/4-7.22%20et%20al%20legislative.pdf?OpenElement
The BOG met on Friday, July 29, 2016 in Miami Beach and approved the proposed revisions. If approved by the Florida Supreme Court, are designed to prevent fee splitting between those companies and lawyers and protect the public from deceptive, misleading, or false advertising by those companies. Under the proposed amendments, any private entities that connect consumers looking for legal services with lawyers are called “qualifying providers” regardless of whether they are a “traditional” referral service (ASK-GARY, 411 PAIN) or a technology-based provider (AVVO, LegalZoom).
On May 20, 2016, the BOG reviewed a report from the chair of the Board Review Committee on Professional Ethics and scheduled a final vote for the July meeting. That committee had been working on the revised rules with the BOG’s Technology Committee since 2015 after the Florida Supreme Court rejected the Bar’s proposed rule referral rule amendments. The Court stated that for profit referral service companies should only be owned by lawyers. The amendments will now be filed with the Supreme Court on August 15, 2016 and the Court must approve the proposed rules before they are implemented.
The Florida Bar’s website has a page summarizing the proposed revisions to the rules and also has a frequently asked questions section and comparison chart. The link to the page is here: https://www.floridabar.org/proposedlrsamend#Overview and the summary of the proposed rule changes is below.
Bottom line: As I have said previously, if these proposed rules are approved by the Florida Supreme Court, they will substantially change the landscape for lawyer referral services (which would be called “qualifying providers”) and the requirements for providers and lawyers to participate in such “matching services”. Although the Florida Supreme Court had strongly suggested that the referral entities should only refer to lawyers and only lawyers should own the services, the proposed rules do not limit ownership nor do they limit referrals only to lawyers.
If you have any comments, they must be filed directly with the Florida Supreme Court between August 15, 2016 and September 15, 2016.
Be careful out there.
OVERALL CHANGES TO RULE
Terminology
“Qualifying Provider” instead of “lawyer referral service”
Some states prohibit for-profit lawyer referral services
States that prohibit for-profit lawyer referral services define them differently than Florida – some on-line matching services are not considered referral services in some states
Broader definition of “qualifying provider” including:
Directories
On-line matching services
Group or pooled advertising programs
Tips or leads programs
REQUIREMENTS RETAINED
Ads for qualifying providers must comply with lawyer advertising rules
Lawyers may not divide fees with qualifying providers (except non-profit Florida Bar and voluntary bar lawyer referral services)
Qualifying providers must match consumers only to those authorized to provide the services in Florida
Qualifying providers must respond to official bar inquiries within 15 days
Qualifying providers may not state or imply bar endorsement (except non-profit Florida Bar and voluntary bar lawyer referral services)
Qualifying providers must use their actual names or a registered fictitious name
DELETED REQUIREMENTS
Malpractice insurance
Lawyer referral services and other qualifying providers find it difficult if not impossible to obtain malpractice insurance that covers lawyers who are in different firms
Most lawyers are not required by bar rules to carry malpractice insurance (currently only lawyers participating in either for-profit or Florida Bar or voluntary bar lawyer referral services or Florida bar-approved group or pre-paid legal insurance plans are required to carry malpractice insurance)
Disclaimer in all ads that it is a lawyer referral service
Some states prohibit for-profit lawyer referral services
States that prohibit for-profit lawyer referral services define them differently than Florida – some on-line matching services are not considered referral services in some states
Requiring the disclaimer creates problems in states where lawyer referral services are prohibited
Fewer requirements allow Florida Bar members to participate with more qualifying providers without having to be concerned that they cannot meet bar requirements
Disclaimer in all ads that lawyers pay to participate
It is obvious to most consumers that they are for-profit
Some qualifying providers do not charge lawyers to participate, but make money by selling advertising space or by charging consumers to participate
Requirement that all services provide The Florida Bar quarterly with names of all those authorized to act on behalf of the service
Fewer requirements allow Florida Bar members to participate with more qualifying providers without having to be concerned that they cannot meet bar requirements
Qualifying providers are required to respond to official bar inquiries, so if the bar needs the information, the bar can request it at that time
CHANGED REQUIREMENT
Report to the bar of the names of all participating lawyers changed from quarterly to annual
Fewer requirements allow Florida Bar members to participate with more qualifying providers without having to be concerned that they cannot meet bar requirements
Qualifying providers are required to respond to official bar inquiries, so if the bar needs the information, the bar can request it at that time
NEW REQUIREMENTS
Qualifying providers:
may not require or pressure the lawyer to provide cross referrals
must give participating lawyers documentation of compliance with bar rules
must disclose participating lawyers’ location by city, town or county when the referral is made
may not use a name or otherwise imply to the public that the qualifying provider is a law firm, can practice law or directly provide legal services
REQUIREMENTS CONSIDERED BUT NOT RECOMMENDED
Florida Supreme Court requested amendment that requires that lawyer referral services be owned or operated by a Florida Bar member
The BRC and Technology Committees discussed extensively and voted not to include the proposal
The Court already has regulatory authority over participating lawyers
Lawyers will become scapegoats for unscrupulous services
Services who are in compliance should not be penalized
Rules should be no more restrictive than is necessary to protect the public and ensure lawyer’s adherence to professional requirements
Defining ownership and operation is difficult and no parameters have been provided by the Court
FILING
Amendments will be considered for final action by The Florida Bar Board of Governors at its July 29, 2016 meeting in Miami Beach Comments may be sent to [email protected] – if filed with the bar by June 30, they will be provided to the board for its meeting
Petition to amend the rule will be filed with the Florida Supreme Court August 15, 2016
Comments may be filed directly with the Florida Supreme Court between August 15, 2016 and September 15, 2016
Disclaimer: this Ethics Alert is not an advertisement and does not contain any legal advice and the comments herein should not be relied upon by anyone who reads it.
Please note: Effective June 27, 2016, my new office address is:
29605 U.S. Highway 19 N., Suite 150, Clearwater, Florida 33761
E-mail addresses and telephone numbers below will remain the same.
My main office number, (727) 799-1688, is temporarily unavailable due to a telephone company issue. Please call (727) 286-6625 (my rollover number) if you need to contact me immediately. Thank you.
Joseph A. Corsmeier, Esquire
Law Office of Joseph A. Corsmeier, P.A.
2454 McMullen Booth Road, Suite 431
Clearwater, Florida 33759
Office (727) 799-1688
Fax (727) 799-1670
