It’s not as if the idea wasn’t ugly when first announced, though it smelled of the typical taint of skirting ethical rules. Then again, for Rachel Rodgers, ethics existed to oppress young, innovative, lawyers such as her. Rules didn’t apply to Rodgers.
But that was back when Rodgers hooked up with a marketeer, Ash Ambirge, who had a marketing biz named House of Moxie and ran a website called The Middle Finger Project. Much as Rodgers feigned being cool, Ambirge took it to a level well beyond anything Rodgers could have imagined. Ambirge had edge, where Rodgers was the innovative twinkie lawyer.
Ambirge first retained Rodgers as her lawyer, paying a monthly retainer of $750 for a year under “Small Business Package #2,” but they were soon to be partners in an e-book, Small Business Bodyguard, which gave/didn’t give legal advice. According to Ambirge, the book consisted of “rudimentary legal checklists” which she jazzed up with her ‘tude. So what? If dopey online entrepreneurs were foolish enough to get their legal advice from a book of basic lists, with the fees for that advice split between lawyer and non-lawyer, they get what they deserve.
Except trouble soon developed in paradise, resulting in Rodgers suing Ambirge because, she claims, the cool girl failed to do her marketing voodoo, and Ambirge counterclaiming against Rodgers for, well, this is where it gets ugly. The story is long, beginning on page 20 of the counterclaim, ¶ 18, and running to page 47, ¶ 122. But it’s an interesting story.
According to Ambirge’s counterclaim, she and Rodgers became joint venturers while Rodgers was her lawyer. She entered into an agreement with Rodgers without independent counsel because, well, Rodgers was her lawyer. She later learned that Rodgers’ work on her behalf stunk, and claims that Rodgers was not merely incompetent, but made misrepresentations under penalty of perjury in filings.
And in the process, Rodgers sent DMCA notices that caused Ambirge’s host to pull down her websites. This happened, she says, because Rodgers couldn’t manage to make her three payments of $5000 apiece to buy her out, or give her the commissions she earned for selling this silly book.
And apparently this wasn’t just a problem for Ambirge, but for others doing business with Rodgers as well:
For example, an SBB affiliate responsible for generating numerous sales of the SBB e-book (and revenue to SBBI), Stephanie St. Claire, wrote to Ms. Ambirge:
[I] feel pretty screwed over by your ex-partner Rachel. If you remember, just before you guys went your separate ways, I became an affiliate for SBB and sold to 20 of my people back in June. I’m still waiting on my $1,553.00 commission. I had to track Rachel down, after being told by Tressa that no one got back to me because everyone was on a “company retreat” . . . Then Rachel fessed up that she was having a company issue that is keeping her from paying everybody and I would have my commission by the end of September. I asked her to be in touch with me to let me know when I would be paid, emailed her because she hasn’t, and still no answer.
As with any suit, both sides make claims against the other. Which are true, which are not, is a matter for trial. But what appears throughout the Ambirge counterclaim, and begins with the launch of this book that gives/doesn’t give legal advice, even if rudimentary and worthless, is that Rodgers was too special to be bound by such banal and archaic matters as the
Code of Professional Responsibility Model Rules of Professional Conduct.
Ambirge may have been foolish, but she is incapable of violating the attorney disciplinary rules because she isn’t a lawyer. Rodgers, on the other hand, can’t find similar comfort. That Rodgers entered into a business deal with her own client, without independent counsel, appears to be unquestionably true. No matter how cool a gal Ambirge may be, or how innovative-y Rodgers portrays herself, this is a flagrant violation of
DR 5-104 Rule 1.8(a).
Rule 1.8 Conflict Of Interest: Current Clients: Specific Rules
(a) A lawyer shall not enter into a business transaction with a client or knowingly acquire an ownership, possessory, security or other pecuniary interest adverse to a client unless:
(1) the transaction and terms on which the lawyer acquires the interest are fair and reasonable to the client and are fully disclosed and transmitted in writing in a manner that can be reasonably understood by the client;
(2) the client is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel on the transaction; and
(3) the client gives informed consent, in a writing signed by the client, to the essential terms of the transaction and the lawyer’s role in the transaction, including whether the lawyer is representing the client in the transaction.
As for the wealth of other ethical issues raised, the unlawful practice of law, splitting fees with a non-lawyer, misrepresentations, perjury, incompetence, well, it emits an unpleasant odor. Indeed, everything about this nastiness stinks.
For all the rhetoric and excuses about how ethics are used by dinosaur lawyers to bully young lawyers, what happened here reflects why these rules exist. They aren’t there for the good times, the cool times, when all the kids are happy and making money, even if from selling crap books to ignorant baby entrepreneurs who are too foolish to be able to distinguish sound legal advice from simplistic nonsense surrounded by edgy copywriting.
As Rodgers, the pundit to the baby lawyers promoted by Susan Cartier Liebel at her Solo Marketing University, admonished:
And young lawyers, my message is do not be afraid. Do not let the word “ethics” prevent you from establishing a law practice, even one that is cutting edge.
Because special people aren’t bound by ethics. Ash Ambirge may have learned this the hard way. As well as learning why ethics, not to mention actual legal competence, matters. While being a marketeer may be all about making the quick buck, that’s not what it means to be a lawyer. Right, Rachel?
H/T Jordan Rushie