TALLAHASSEE -- The Florida Supreme Court issued a ruling March 8 that went directly against its previous judgment that banned lawyers from participating in for-profit lawyer referral services.
The decision stems from its previous ruling in Re: Amendments to Rule Regulating the Florida Bar 4-7.22—Lawyer Referral Services. The Supreme Court states in the opinion that by redefining the term for lawyer referral services as “qualifying providers," it will “create a single regulatory scheme."
The court included in the definition for “qualifying providers” all for-profit lawyer referral services, pooled advertising programs, any lawyer directories, “matching” sites and lead generation services.
Justices Jorge Labarga, Barbara Pariente, Peggy Quince and Ricky Polston concurred. Justice Fred Lewis dissented, and Justice Alan Lawson wrote a separate opinion concurring in part and dissenting in part, joined by Justice Charles Canady.
In 2012, the special committee was tasked with deciding to what extent the Florida Bar could regulate, if they could, the for-profit lawyer referral services that do not follow Florida Bar rules and regulations. After finding that many for-profit lawyer services not regulated by the bar did not always have the public’s best interest in mind, the committee recommended several amendments aimed to regulate how lawyers participate in those for-profit services.
The bar proposed amendments based on the committee’s recommendations that change certain aspects, such as including an annual report to the bar and documents and disclosure statements for both lawyer and client, but left in place the ban on fee-sharing and rules that restrict ads to recommending licensed attorneys in Florida only.
The bar keeps the Amendment 4-7.22, proposed to be titled “Referrals, Directories, and Pooled Advertising,” that prohibits a lawyer from receiving a fee or fee-sharing. The proposed amendment states, “A lawyer may not participate with a qualifying provider that receives any fee that constitutes a division of legal fees with the lawyer, unless the qualifying provider is The Florida Bar Lawyer Referral Service, or a lawyer referral service approved by The Florida Bar pursuant to chapter 8 of these rules.”
Although the Supreme Court acknowledged the “the bar had disregarded the findings of the Special Committee on Lawyer Referral Services (special committee) in its July 2012 final report as to the potential harm non-lawyer-owned for-profit referral services pose to the public," commenting that the bar had not rejected lawyer participation in such services but, instead, proposed amendments that focused on any lawyer referrals, matching or advertising being subject to the same regulations the bar has set, the court issued the order to adopt the amendments.
The court recognized its ruling goes against its directive in the previous ruling, but ultimately granted the amendments, finding the changes “are necessary to ensure that all services that connect prospective clients to lawyers conform to the rules regulating the Florida Bar and operate in a manner consistent with the public interest.”
The Supreme Court is concerned still by the potential for harm.
“The findings of the special committee on this matter are troubling and we continue to believe additional measures are needed to ensure the public is not exposed to harm,” the ruling noted.
The court has ordered the bar to file further amendments within 90 days that would prohibit a lawyer from taking a referral from a for-profit service.
In his separate opinion that concurred in part, Lawson, joined by Canady, noted his dissent on requiring the bar to file further amendments, stating that the court should not adopt the committee’s now-outdated recommendation, but rather wait for the Florida Bar to determine if any regulation is needed in legal and medical client referral.
“Although I certainly recognize the potential mischief that could flow from doctor/lawyer cross-referral relationship ... I have not been able to discern any basis for concluding that Ask Gary’s or 411 Pain’s models of connecting an injured citizen to a lawyer—which this nearly 6-year-old recommendation would prohibit—poses any danger not existent in direct doctor/lawyer referral relationships,'' Lawson wrote.
The new rules are set to take effect April 30.
Supreme Court of Florida case No. SC16-1470