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Monday, March 19, 2012

DAILY GROUP COUPONS: INDIANA BAR SAYS NO!

Indiana's State Bar Association's Legal Ethics Committee, in its Ethics Op. No. 1 of 2012, determined that using group coupons or daily deal marketing, such as "Groupon", would likely be unethical if used to market legal services.  The Ethics Committee stated that using such services likely violated a number of rules of professional conduct, namely Rule 2.1 (exercise of independent professional judgment and render candid advice), Rule 1.15 (Client Trust Account), Rule 1.16 (declining/terminating client representation), Rule 5.4 (prohibition of fee sharing with non lawyers), and Rule 7.2 (prohibition on paying for channeling professional work). 

Two of the strongest reasons Indiana advocated for not allowing these types of coupons was that the Committee was concerned about having a person "purchasing services," without ever meeting with the attorney in order to create a "course of conduct best fitting the client's situation."  The Committee emphatically stated that "the creation and establishment of an attorney-client relationship is the non-delegable duty of the lawyer."  The other issue was Rule 1.15, which requires attorneys to deposit into a client trust account any legal fees and expenses paid in advance, and to withdraw funds only as fees are earned.  Having advanced legal fees (which is what the coupon would be) being held by a party who is not the attorney, clearly violates this Rule. 

While Indiana was not the first state to tackle this issue, it was the first to state that using these daily deal coupons were likely unethical.  North Carolina, Missouri, South Carolina and New York all have issued ethics opinions allowing the use of daily deal coupons.  See North Carolina Ethics Op. 2011-10, South Carolina Ethics Op. 11-05, and New York State Ethics Op. 897,

The Indiana opinion is available here.

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