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COMPETITION FOR BUSINESS

Some years ago, Arizona lawyers placed an ad for their firm in a local newspaper that violated the model code of professional responsibility formulated in 1969 by the ABA and adopted in Arizona by the state’s supreme court. The lawyers were censured for their ad. They appealed the case to the U.S. Supreme Court, which decided in 1977 that state laws and bar associations prohibiting lawyers’ advertising were in conflict with the Constitution’s guarantee of free speech.

Advertising Historically, bar associations have strongly opposed advertising by lawyers (Cebula, 1998). In the common-law tradition, lawsuits were considered an evil, albeit a necessary evil (Solovo, 2009). They were thought to increase hostility and resentment among people who could otherwise find an opportunity to cooperate and to settle their pecuniary or personal differences. As a result, lawyers were forbidden to “stir up” litigation. Any attempt to drum up business as ordinary businesspeople did was discouraged. Lawyers were expected to wait passively for clients and to temper any entrepreneurial urge to solicit them (Olson, 1991b:27).

The demise of opposition to advertising that came with the Supreme Court decision just cited began with a simple idea. By the time of this decision, lawsuits had come to be considered an effective way to deter misconduct and to compensate wronged persons. There was also a need to increase the demand for legal services, in part because law schools kept turning out large numbers of newly minted attorneys. Many attorneys and law firms began to view law as a business that required the use of business marketing strategies (Savell, 1994). The Supreme Court decision in effect endorsed this view.

Following this decision, bar associations developed and subsequently refined guidelines to allow lawyers to advertise. Typically, these guidelines allow lawyers to indicate their education, specialties, public offices, teaching positions held, and memberships in professional organizations. They may also indicate other clients represented with those clients’ permission, tell what credit arrangements are acceptable, and indicate fees for initial consultations and other services.

The number of lawyers currently advertising has risen sharply in over the years. If you look on the Internet for lawyers in your area or consult the old-fashioned Yellow Pages, you will certainly see no shortage of advertising by lawyers. This is because effective advertising generates approximately $8 in revenue for each advertising dollar (Kennedy, 1994). Young, small-town, small-firm, or solo practitioners who earn relatively low incomes as lawyers are the most likely to advertise. Older, big-city lawyers still shy away from advertising.

These days, there are even manuals and how-to books for lawyers on how to advertise on their own (Randall and Johnson, 2005). A divorce attorney in Chicago, who may have been inspired by one of these, put a large billboard in Chicago in May 2007, getting all the attention it was hoping to attract. The ad showed the barely clothed torsos of a man and a woman with the caption: “Life is short. Get a divorce.” The ad overnight became controversial and was removed by order of city officials but not before generating a fair amount of publicity—and business for the divorce attorney (Newsweek, 2007).

Of course, members of the legal profession have not unanimously welcomed these changes. Some say that lawyer advertising has contributed to the low public image of attorneys. The profession has traditionally considered unethical the more obvious forms of competition— advertising and soliciting clients. However, because a lack of competition leads to higher fees for clients to pay, advertising helps potential clients to be better able to afford to hire an attorney.

Solicitation After advertising, the next step in competition for business has been solicitation. Until 1985, bar associations discouraged lawyers from actively trying to find clients for potential lawsuits against a corporation, hospital, or other common targets of lawsuits. In 1985, the Supreme Court, in Zauderer v. Office of Disciplinary Council, ruled that soliciting clients for injury claims against the company that produced the Dalkon Shield, a dangerous intrauterine device, was permissible. This decision created a precedent for lawyers recruiting litigants against all kinds of institutions and businesses, and lawyers now have the right to send letters to solicit the business of individuals known to have legal problems.

Even in-person solicitation is no longer a taboo. From airplane disasters to mine accidents, the scene is characterized by a “ravenlike descent” of tort lawyers anxious to contact the victims or their relatives. For example, competition for business among lawyers was so intense in the well-known 1989 Exxon Valdez oil spill in Bligh Reef in Alaska’s Prince William Sound that it was referred to as “tanker chasing.” A commentator vividly captured this scene: “Liability lawyers and prostitutes fresh from nearby Anchorage are said to prowl the dark, smoky bars in search of clients. Townspeople aren’t as concerned about the prostitutes as they are about the lawyers” (Olson, 1991b:32). One of the consequences of this well-publicized incident was the creation of a code of conduct for accident scenes by the Association of Trial Lawyers of America.

 
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