LegalZoom is being sued in a class action for unfair and deceptive business practices. For a summary of allegations see Dan McCue, Class Claims LegalZoom Is Unfair & Misleading, Courthouse News Service, June 1, 2010.
A class action accuses LegalZoom, an online legal document preparation service, of unfair and deceptive business practices. . . .
Katherine Webster sued as executor of the estate of Anthony Ferrantino and trustee of the Anthony J. Ferrantino Living Trust. . . .
Webster claims the defendants failed to comply with laws and regulations governing practice of law in California, led customers to practice law without a license, assisted in unauthorized practice of law, and used fraudulent business practices. She seeks disgorgement and punitive damages for negligence, elder financial abuse, consumer law violations and illegal and unfair business practices.
Others have blogged about this lawsuit:
- Candice N. Aiston, LegalZoom sued!, Oregon Estate Planning Blog, June 4, 2010 (“I'm glad that someone is finally stepping up to fight LegalZoom.”).
- Gerry W. Beyer, LegalZoom Class Action Lawsuit, Wills, Trusts & Estates Prof Blog, June 4, 2010.
- Brian Ellexson, LegalZoom Class Action Lawsuit, Elia Ellexson PLLC, June 4, 2010 (“Do you think this will help clients see the danger of using LegalZoom for DIY estate planning? I have a feeling that our profession still has a lot of education to do before we get to that point”).
- Joseph Timothy Hahn, LegalZoom Sued In Class Action For Deceptive Business Practices, Hahn’s Estate Planning Blog, June 2, 2010.
Note that this suit is not the first legal challenge that LegalZoom has faced. A February 19, 2010 ABA Journal post reports that
LegalZoom is facing a potential class action that claims the company is unlawfully charging consumers for the preparation of legal documents.
An amended class action petition(documents posted by IP Watchdog) filed in January seeks a refund of all fees paid to LegalZoom by Missouri consumers. The company is seeking to remove the suit to federal court, according to IP Watchdog. . . .
Brian Liu, a lawyer who is co-founder and chairman of LegalZoom, spoke to the ABA Journal about the lawsuit for an article expected to be published in an upcoming issue of the magazine. “LegalZoom is aware of the Missouri lawsuit and is confident we have not violated any laws,” he said. “Class actions of this nature are common tactics of plaintiffs' attorneys. We intend to vigorously defend the plaintiffs' claims.”
Debra Cassens Weiss, Suit Claims LegalZoom’s Document Prep Is Unauthorized Practice, ABA Journal, Feb. 19, 2010.
LegalZoom may or may not have violated any laws, but its users should be very careful. The law is complicated and mistakes can be very costly.