LegalZoom.com Sues Competitor Rocket Lawyer for Offering “Free” Legal Services

Well, this is an interesting one. Do-it-yourself legal forms website LegalZoom.com (founded in part by former OJ Simpson attorney Robert Shapiro) has sued a rival, Rocket Lawyer, which seems to provide similar services, but for free.  LegalZoom charges ordinary individuals various fees for giving them access to legal forms to help them form businesses, prepare Wills, or prepare other divorce, adoption, or similar legal paperwork.  

According to the LegalZoom lawsuit, Rocket Lawyer is liable for “false and misleading advertising, trademark infringement and unfair competition.”  The LegalZoom lawsuit was filed in California federal court in Los Angeles.

The lawsuit came after numerous unsuccessful attempts by LegalZoom over the past year to convince RocketLawyer to cease the “false advertising.”  Apparently, LegalZoom sent RocketLawyer a copy of Federal Trade Commission guidelines  addressing when the word “free” can be used in advertising.   According to LegalZoom, Rocket Lawyer uses the phrases “free incorporation,” “free legal review,” and “free help from local attorneys” but allegedly requires filing fees or buying a paid membership plan.

We took a look at the RocketLawyer website after hearing about the LegalZoom lawsuit. It is unclear what “false advertising” LegalZoom is referring to, because on the front page of the Rocket Lawyer website is a link, as clear as day, that takes the user to ”Plans and Pricing.” According to the price list, although there are  “free” trial features of Rocket Lawyer services, the membership plans and prices are clearly disclosed.  Like with many online services, it appears that a trial run of Rocket Lawyer services is free, and then the user is charged once a certain period of time expires.  Unless LegalZoom has some written documentation or proof that Rocket Lawyer has actually made or been making confusing, misleading, deceptive or false advertisements, LegalZoom may not succeed in the lawsuit asserting allegations alone.

Further, it is also especially interesting that when a Google search of Rocket Lawyer is done, Legal Zoom’s ads come up. Registering Google keywords that use a competitor’s trade name, mark, or business name, on the other hand, does use a portion of the intellectual property and brand of the competitor.

Maybe there is more to the LegalZoom lawsuit than meets the eye. At first blush though, it appears that LegalZoom has just sued a competitor to protect its stake in the DIY-legal forms  market.  Finally, it is worth mentioning that although both sites offer “cheap” and “affordable” legal services to consumers, there is no ”on-demand” or one size-fits-all substitute for discussing a legal problem with a live lawyer.

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