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LegalZoom Sued by Alabama Bar Group for Unauthorized Practice

By Stephanie Rabiner, Esq. on July 20, 2011 6:44 AM

The DeKalb County Bar Association has officially sued LegalZoom, asking a judge to bar the Los Angeles-based legal form company from serving clients in Alabama.

Accusing LegalZoom of engaging in the unauthorized practice of law, the association's president believes that offering customized standard legal forms is strictly forbidden under current rules, particularly when done by a person who is not licensed in Alabama.

For those who have never encountered LegalZoom, it is an internet-based company that provides standard legal forms. With client-provided information, the company then tailors the documents to the client's needs.

Its privacy policy affirmatively states that it is not providing legal advice, nor creating an attorney-client privilege. Presumably, this means that no attorneys oversee the creation of documents.

With this in mind, it's not difficult to see why LegalZoom is being accused of the unauthorized practice of law. Virtually every state considers the completion of standard forms legal practice, even requiring that paralegals be supervised if doing such work.

This is why the Alabama lawsuit is not the first time someone has sued LegalZoom for engaging in the unauthorized practice of law.

In 2010, a group of consumers who had used the website filed a class action suit in Missouri, and the North Carolina State Bar sent the company a cease-and-desist letter for the same reason.

While it makes some sense for these groups to have sued LegalZoom as a measure against shoddy legal work, are they really doing consumers or the profession any favors? Do these lawsuits make small practitioners look like market protectionists? And what about people who can't afford an attorney's services?

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