Lawyers Using Groupon – Ethical?

-Submitted by David Drumm (Nal), Guest Blogger

We have previously discussed the law firm with the drive-thru window, here. That notion seems upscale compared to law firms using Goupon. Groupon (group coupon) is a deal-of-the-day website that can determine your computer’s location through it’s IP address and offer you discounts on goods and services in your area. If enough people sign up for the deal, it becomes available. If the predetermined minimum is not reached, no one gets the deal. Groupon makes money by keeping approximately half of the cost of the deal.

Groupon recently turned down a rumored $6 billion buy-out offer from Google.

Groupon doesn’t sound like an ideal way for an solo attorney to obtain clients but it may be better suited to a law firm with a broad range of expertise. However, Goupon may not be the kind of image a law firm is looking to project. Do enough people need attorneys often enough to make this a viable business model? However, there’s a bigger problem: Rule 5.4a of the ABA’s Model Rules of Professional Conduct: “A lawyer or law firm shall not share legal fees with a nonlawyer.”

The purpose of Rule 5.4a is to “protect the lawyer’s professional independence of judgment.” [What?] It could be argued that Groupon’s share is strictly for its advertising services similar to the [now obsolete] Yellow Pages. North Carolina has already rejected the use of Groupon by lawyers, while Missouri has approved the use of the site as a way to obtain new clients.

There are concerns regarding the appearance of professionalism using Groupon. Lawyers were prohibited from using display advertisements in the Yellow Pages, but that isn’t the case anymore. Perhaps the same will happen with Groupon.

In the movie The Firm, the client (who referred to “tipping”) knew how many hours Mitch had spent on his business. With that information, and the amount of the bill, he could have determined the hourly fee. Doesn’t that violate Rule 5.4a? Did Grisham use his literary license?

H/T: Legal Blog Watch, Lawyerist.