Apparently Avvo.com is potentially “sharing” legal fees with attorneys, including Family law attorneys who advertise on its website according to a recent advisory opinion. And this violate attorney ethics rules.
Lawyers apparently pay a “marketing fee” to Avvo.com in exchange for, I guess, clients and exposure. According to the American Bar Association: which reported on the advisory opinion:
South Carolina ethics opinion on fee-sharing highlights a potential obstacle for Avvo’s fixed-fee legal referral service, launched this year in 18 states.
The July 14 advisory opinion—which describes a payment setup like the one used by Avvo Legal Services—is bad news for Avvo, according to Law Sites by Robert Ambrogi.
Avvo’s service matches lawyers willing to provide defined legal services with clients who pay a fee up front, Ambrogi explains in his blog post. Lawyers receive earned fees from Avvo once a month, and Avvo takes its marketing fee from the lawyers’ accounts in a separate transaction. The fee varies based on the type of legal service provided.
Avvo’s legal counsel disagrees with the advisory opinion however, the opinion hints that the fees being charged by Avvo are “irrrational.” Again, the Journal report:
In addition, the marketing fee must represent the reasonable cost of the service, according to the opinion. “In essence, the service’s charges amount to a contingency advertising fee arrangement rather than a cost that can be assessed for reasonableness by looking at market rate or comparable services,” the opinion said.
“Presumably, it does not cost the service any more to advertise online for a family law matter than for the preparation of corporate documents,” the opinion continued. “There does not seem to be any rational basis for charging the attorney more for the advertising services of one type of case versus another.”
Of course if your Avvo ads fall through, you can always advertise in our DIRECTORY. We definitely do NOT share fees at Divorce Saloon.