The Trouble With Avvo’s Ethics

An advisory opinion out of the South Carolina Bar Association doesn’t bode well for some of the new schemes for non-legal businesses to cash in on lawyers. This one wasn’t good at all for Avvo.

The South Carolina Bar’s Ethics Advisory Committee issued an opinion last month (Ethics Advisory Opinion 16-06) concluding that Avvo Legal Services violates the prohibition of sharing fees with a non-lawyer.

[T]he service collects the entire fee and transmits it to the attorney at the conclusion of the case. In a separate transaction, the service receives a fee for its efforts, which is apparently directly related to the amount of the fee earned in the case. The fact that there is a separate transaction in which the service is paid does not mean that the arrangement is not fee splitting as described in the Rules of Professional Conduct.

A lawyer cannot do indirectly what would be prohibited if done directly. Allowing the service to indirectly take a portion of the attorney’s fee by disguising it in two separate transactions does not negate the fact that the service is claiming a certain portion of the fee earned by the lawyer as its “per service marketing fee.”

The opinion further holds that the fee arrangement would violate the prohibition against giving anything of value to a person for recommending a lawyer’s services.

Who could have possibly seen this coming?  Avvo’s ethics guru* and chief marketeer, Josh King, hops on his unicorn to ride the rainbow:

Bottom line: we built Avvo Legal Services at every turn to delight consumers. We’re happy to entertain any feedback from Bars if they think we are doing something that is hurting consumers. But we’re not going to hobble the product just to comply with misguided regulatory interpretations.

To “delight consumers”? What consumer doesn’t want to be delighted, even if this is one of the most inane things to say to lawyers. But what is worse is that Josh, because he’s just an incredibly gracious guy, is “happy to entertain any feedback from Bars.” Are you? Are you happy? Are you happy to “entertain.” because ethics isn’t what bars say, but whatever Avvo deems worthy. How kind of Avvo to “entertain” ethics.

Josh gave another version of the spin to the ABA Journal.

King says Avvo Legal Services is a “marketplace,” rather than a referral service, and the fees paid by lawyers to Avvo “scale very directly” with the costs incurred by Avvo. The costs of legal services provided through the marketplace range from $39 to $4,000, and that results in different credit card fees and different risks in the event of refunds, King says.

The ethics rules, King adds, should be interpreted based on potential consumer harm, and lawyer advertising rules should be narrowly tailored to avoid First Amendment violations. “We really built the product looking at the consumer benefit and trying to navigate through the rules,” he said.

This is a pretty fair representation of the issues at stake here. Business trying to skim a piece out of the legal profession aren’t subject to the ethical proscriptions of deceit, and so they can puff all they want, use happy marketing language to make an obvious referral service a “marketplace,” as if calling a cow a horse means you can milk it**. And relating their fees to the legal fees isn’t fee splitting, but “scal[ing] very directly” because reasons.

But enough with noting the never-ending spin that Josh gets paid well to do full time. Sure, he’s been selling a false flavor of ethics, because if you repeat bullshit enough, lawyers will start believing it and it won’t seem nearly as wrong when the desperate and stupid hop aboard the train.  And make no mistake about it, Avvo’s shtick relies on lawyers being desperate and stupid, the ones who lack the capacity to grasp why Josh’s spin is nonsense.

Let’s instead go to what this is really all about. Avvo can sell legal services like laundry detergent to an unsuspecting and ignorant public. There are tons of hungry lawyers whose practices are dead in the water and are sucking wind. They’ll do anything for business. Some are the lawyers who think that if they get a cool logo, this will make them successful lawyers. Others have just given up, fighting the tide of cut-rate, low-rent lawyers who see the internet as an ethics-free zone and do anything they can, lie through their teeth, to get a fee.

Avvo wants its piece of that pie, and by connecting a clueless public with desperate lawyers, wants to take a percentage out of the middle. Avvo isn’t doing this because they’re great humanitarians, but because it’s a for-profit business. There’s nothing wrong with that, and nothing wrong with lying about their motives, but at least appreciate that it’s all a lie.

To have laundry detergent lawyers to sell, Avvo puts commercials on TV and fixes low prices. If you want them to send you business, you do it at the prices they set. These are the prices they can sell, and you can take them or not. But you won’t get a text message from Avvo with a prepaid client unless you play by their rules.

Are these lawyers competent? Are the prices adequate? Will lawyers short-cut their representation because they’re being paid just enough to buy a super-sized Slurpee? Who cares? The lawyer’s phone rings, which beats the hell out of a silent phone and he gets to play lawyer, even if he could earn more as the assistant manager at Dairy Queen, and Avvo gets a piece of every referral.  And it’s not as if the clients, oops, consumers, would know the difference between competent representation and a shit show if it bit them in the ass.

That’s the business model. The argument is that the old one isn’t working, that clients can’t find lawyers, that lawyers charge more than clients want to pay and that competence is an irrelevancy in this new world where lawyers aspire to mediocrity anyway.

Is this the future of law? Avvo’s betting the farm on it, and that lawyers are either too stupid to grasp the lie or too desperate to care. Is it better to split your pittance of a fee with Avvo or sit in your office staring at the silent phone? Cut the ethics crap, this is purely a business decision. Of course, there is one other alternative, but most lawyers don’t have the legs for it.

*In an inexplicable twist of irony, Josh is a regular lecturer on ethics for Avvo and other legal techs, where he teaches his flavor of Avvo Ethics that bears no relation to ethics as recognized by anyone else. Attendees get CLE ethics credit for listening to Josh spin his view of ethics that, coinicidentally, would entitle Avvo to a third of every legal fee in America.

**Yeah, horses are mammals and are technically milkable too.

35 thoughts on “The Trouble With Avvo’s Ethics

  1. JMK

    At the risk of invoking your one of your scathing responses for inanity, it’s worth noting that, since horses are mammals, they can, in fact, be milked.

      1. Procopius

        Pigs, no, but goats are good. Not sure about sheep. The Mongols and Huns milked horses. There’s a drink called kumiss, made from fermented mare’s milk. Maybe he meant to write, “… as if calling a horse a cow means you can milk it,” because in our culture we don’t normally consume horse milk (or horse meat, except as a substitute for beef).

  2. Mike

    So are we to assume that Avvo is different than Legal Zoom, which is another Internet legal sensation?

    Asking for a friend.

    1. SHG Post author

      That’s an excellent question. The models are somewhat different, and I don’t know the answer yet, but they are both trying to accomplish the same goal.

    2. EH

      They’re both slimy, but in different ways.

      Avvo is basically a referral/advertising service which is trying to interject itself between the clients and the lawyers. It wants people to think of Avvo as the first place to look to find help, but it doesn’t actually provide the help.

      Legalzoom is trying to replace lawyers. It wants you to hire Legalzoom instead of a real lawyer. It often provides really bad documents, though, so much that we all joke about doing “legalzoom fixes” as a full time career.

      1. SHG Post author

        Eh, no. LZ is moving away from the form business into prepaid legal and, maybe, referral. It’s okay that you can’t stay up to speed, but then, why comment if you can’t be bothered to know what you’re talking about?

        1. losingtrader

          Thanks for one-again adding to the list of SHGisms. This is like cheating on a test.
          One day the list will be so long I can have a cut&paste debate with you, which will only serve to lengthen the list.
          It’s sort of like AI .

      2. Marc Whipple

        Legalzoom’s latest ads feature “real lawyers” who talk about what their concentrations are (“I’ll write you a business contract,” “I’ll write you a patent”) so their emphasis is definitely on being the world’s biggest cheapest law firm, or something like that, as opposed to being something like a live-person version of Quicken Family Lawyer.

        When I say “real lawyers,” I don’t mean to imply that the ads I’ve seen are actively deceptive. They show people’s real names and what kind of law they do, and there’s no “actor portrayal” disclaimer. So I am willing to believe these are their most photogenic actual attorneys.

        1. SHG Post author

          If, as so many want, we break the wall of non-lawyer ownership, LZ is very likely to be the world’s biggest, cheapest law firm. Until the profession is decimated, at which time you can watch the fees (for LZ, anyway) soar to less than cheapest heights.

  3. Richard G. Kopf


    The problem is fee-splitting takes place all of the time between lawyers, although it is fancied up as fee sharing and “ethically” blessed as such. “Fee splitting” is scorned but generally only down market.

    I don’t like AVCO or Legal Zoom or Magic Lawyer (I made that last one up), but once advertising was allowed and the net came to become dominant we should be skeptical about bar association “ethics” opinions further only the economic interests of lawyers. It would be far better, in my view, to regulate AVCO, et al, by making such entities jointly and severally liable for the malpractice of the lawyer to whom a consumer is referred. If nothing else, that would provide some economic incentive to carefully vet the lawyers they recommend.

    All the best.


    1. SHG Post author

      That’s certainly a viable option, assuming we give up all hope of being a profession and succumb to the post-advertising world of being laundry detergent. That said, another round of legal proceedings to vindicate the last failure of legal proceedings in a brave new world of lawyer incompetence sold by used car salesmen sounds pretty inefficient.

      I’m thinking that people struggling to find competent and affordable counsel won’t really find yet more litigation, years and years of litigation, the answer to their prayers. And Avvo need only rely on the lawyers’ bar admission to beat every case. After all, aren’t all lawyers expert witnesses on the law?

  4. Marc Whipple

    I know you don’t do this for praise, but thank you. Avvo asked me to be one of their “early adopters” for this service and I thought I was going crazy. When I saw that their “marketing fee” was scaled to the matter fees I couldn’t understand how this could possibly be okay. Sure, maybe a straight charge scaled to the CC merchant fees (and let’s be fair, a little markup) but this was a big chunk.

    I asked and I got more of the Avvo Unicorn Ethics bibblebabble you cite above. Bottom line: they’re willing to face some of their member attorneys getting censured, and possibly fines on their part, to do some test cases. If they get thrown out of a few states but manage to hang on in a big market or two (NY/CA/IL/TX?) it’ll be worth it to them. And no, in case you had not guessed, there is absolutely zero indemnity for any ethics claims against the member attorneys, or at least there weren’t in the version of the signup I saw.

    And malpractice? Oh, my aching sides. Not only no, but Hell no.

    I guess they could get somebody to insure them against some kind of E&O claims, somehow, but they obviously CAN’T buy malpractice insurance. So they’ll want it both ways – splitting legal fees, whatever you call it, but no professional liability. Because after all all they did was arrange the meeting. The first time Avvo sends some poor schlub to a lawyer who passed the bar six months ago and loses a huge (and sympathetic) PI claim because they didn’t know what they were doing but Avvo gets money up front, maybe then somebody will do something. Until then it’ll all be arcane* ethics opinions and spin.

    *To the general public and the legislatures. To lawyers, not so much.

    1. SHG Post author

      What saddens me most is that it’s all so obvious, yet the passionate and desperate can’t see it at all.

      1. Marc Whipple


        One of the features that regular Avvo offers people looking for attorneys is a summary of their disciplinary record. It will be interesting to see how they report “censured for sharing legal fees with Avvo” on the summary if and when that happens.

  5. Josh King

    Scott, it’s odd that a guy with your knowledge of the First Amendment has such a blind spot for those issues in attorney advertising regulation.

    1. Charles

      Changing the subject, eh?

      Yes, the SC Bar called that strike, too: “The arrangement described herein violates the prohibition of sharing fees with a non-lawyer as described in Rule 5.4(a). In the alternative, assuming, for the purposes of this question only, that the arrangement does not violate Rule 5.4(a), the arrangement would violate the Rule 7.2(c) prohibition of paying for a referral and is not saved by the exceptions found in Rule 7.2(c)(1), (2), or (3).” But Scott’s post only is about the fee-splitting, to which you offer no rebuttal.

      And even if you did, what about strike three, the apparent violation of IOLTA rules (Rule 412 in S.C.), since “the service collects the entire fee and transmits it to the attorney at the conclusion of the case”?

    2. SHG Post author

      Putting aside that I think attorney advertising is the worst thing that ever happened to the profession, that it’s commercial speech and not fully protected, that it’s properly constitutionally limited by professional license and that it’s 99 44/100% bullshit (something, something deceptive), I will still defend your right to say Avvo’s bottom line (ironic phrase) is to “delight consumers.”

      But you can’t make me not laugh at it.

    3. Marc Whipple

      It is *inherently* deceptive to say you are a non-attorney marketing/coordinator when you get an actual cut of the actual fees produced by actual lawyering. That produces an irreconcilable conflict of interest. The First Amendment does not strongly protect knowing and willful deception made for commercial gain.

    4. Patrick Maupin

      If you care about unfettering the first amendment, you should first tackle the issues that affect ordinary citizens rather than licensed specialists — get all the blackmail laws repealed and then we’ll talk.

      1. SHG Post author

        While I have no clue what blackmail laws have to do with anything, is that really what affects “ordinary citizens”? Is everybody into blackmail? Why didn’t anyone tell me?

        1. Patrick Maupin

          Is everybody into blackmail?

          Not yet, because the average citizen is not as bold as Josh and knows that when the government says that some speech is not allowed, they aren’t kidding.

          is that really what affects “ordinary citizens”?

          Well, sure! The pittance that lawyers can make by fee splitting with avvo is dwarfed by the amount of hush money that Johnny could make for not spilling the beans about sister Suzy’s new boyfriend’s drug habits — times 300 million or so inhabitants.

          Why didn’t anyone tell me?

          I guess you just don’t have any secrets worth exposing that you give a shit about.

  6. Displaced Legal Professional

    The ABA has put out a report in connection with the alleged lack of access to justice. [Ed. Note: Link deleted per rules.]

    Guess the ABA is unaware of Avvo and the Streetwalking Lawyers of Aurora Avenue.

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