Lawyers have ethical rules about how clients can be recruited to become clients of a law firm. Attorneys cannot directly solicit hurricane damage claims. Lawyers can’t let third parties do it for them too. So while lawyers can advertise for clients to call their law offices, lawyers cannot call or knock on the door of non-clients asking them to sign up as clients. They cannot pay or incentivize third parties to circumvent these rules. All lawyers know that they can face disciplinary proceedings and potentially be disbarred for such misconduct. In some states, these acts are criminal. The lawyers and these third parties can face jail time.
In an extraordinary filing yesterday,1 an insurance defense attorney filed a memorandum in federal court describing how a third party solicited him on behalf of a hurricane damage law firm. The specific allegations of alleged improper solicitation were as follows:
At 18:58 EST on Wednesday, January 25, 2023, the undersigned representative received an unsolicited text message from a telephone number identified as ‘+52 56 3977 9530’. The unsolicited text message says the following:
You have Hurricane Ian and Ida storm compensation pending, fill out this form pi4q.com/1PG2
At no time did the undersigned take any action to solicit this text message from any person or entity. In fact, the undersigned counsel could not believe he received this text after alerting the Louisiana Bar to MMA’s inappropriate text solicitation on August 3, 2022. The unsolicited text did not identify the sender and did not identify any attorney or law. fixed. There was no location of practice identified, nor was there a Louisiana State Bar Association attorney providing application number. Rather, there was a promise of money by filling out a certain form on the website which was activated by the link ‘pi4q.com/1PG’.
The undersigned attorney clicked on the link that will take you to the website: www.HurricaneDamageLawsuit.com. On the first page of this website, there is no mention of a law firm or attorney involved. Rather, there is a series of questions presented to the viewer with under the tab “See if you qualify for compensation Get a FREE Case Evaluation”…
To determine who sent the unsolicited text message, the undersigned provided identifying information through the website late on the evening of January 25, 2023. The next morning at 8:47 a.m. EST, a person identifying himself as “Arnold” called the undersigned from phone number (346) 245-6143. The call lasted thirteen minutes and twenty-eight seconds (13:28). Arnold indicated that he was from an organization called Strategic Litigation Partners and proceeded to ask many questions similar to those listed in the website questions above. Arnold had a hard time mastering the English language but also asked if undersigned counsel was married; what was the best time and the best way to communicate; and indicated that if the law firm attempted to contact me unsuccessfully three times, I would lose my opportunity to work with them. Arnold made it abundantly clear, at least five times, that he was working on behalf of the law firm “Velawcity” in Texas.
During this conversation, Arnold informed the undersigned that he would be sending an email and instructed me to open the email while we were still on the phone. The email came from the address ‘Hurricane-Ida-Velawcity-MMA@slplegal.com’. The email was received during the phone conversation at 8:55 am EST. The email states the following:
Thank you for your interest in the hurricane/storm process. This email has been sent by the intake team member you are speaking with. Please take a moment to review your agreement while you are on the call with us so that we can answer any questions and get started on your case.
Click the link below to sign your agreement. Once it’s done, you’ll receive a welcome email with more information. Questions? (409) 683-9069 or Hurricane-Ida-Velawcity-MMA@slplegal.com.
The intake department
Strategic Litigation Partners, LP 21324 Provincial Blvd.
Katy, Texas 774504
As shown in the plain text of the agreement, the email was sent during the phone call and the signed agent was asked to “click on the link below to sign your agreement”. Arnold directed the undersigned attorney to click on the link. When the link was clicked, a screen appeared that said “Your document is ready to be signed!” This electronic correspondence asks the potential customer to follow three simple steps to set up the signing of the contract. The next step in the process instructs the reader to “Draw Your Signature” and “Draw Your Initial:” When the reader clicks the “Continue” button, the reader is provided with an employment contract for MMA Attorney with instructions to “Click here to begin” Signing’. At no point in this process was anyone from MMA involved or identified. Upon looking at the contract, the undersigned attorney even asked Arnold why MMA was on the contract when Arnold previously stated that he was calling on behalf of the Velawcity law firm. Arnold insisted he was working on behalf of Velawcity and was unfamiliar with MMA.
An astute reader might ask, “Chip, the solicitation started as a text message. Can attorneys solicit by text?” Each state bar has rules about this, and those specific rules must be followed. A number of states allow text advertising as long as other rules are followed. For example, the Florida Bar said:
“We found that sending text messages in person is not actually prohibited and is instead a form of written communication that is the same as any other written communication and must comply [Bar] Rule 4-7.8(b),’ Schwait said. “We allow email we allow [paper] mailings and other types of advertising, and our committee found after listening to the applicant. . . that they have a new method going forward that is allowed.’
The texts, he said, will follow all attorney rules, including that the first line of the text will announce that the communication is advertising, and if directed, will include the disclaimer that if the recipient already has an attorney, he or she should ignore the text, and will reveal how the law firm obtained the recipient’s name.
The Company will keep a record of the content of the texts and who received them, and will work with mobile phone service providers to ensure that the Company pays for the text if it is something the recipient would pay for under the recipient’s mobile phone plan.
I’m not sure of specific Louisiana Bar rules for text advertising.
What seemed so strange to me was that the third party encouraged the signing of a contract where no attorney from the law firm ever spoke to or reviewed the case before the client signed a contract with the law firm. The third party advertised and then received a signed attorney contract for a fee, and the law firm did nothing more than engage the third party to bring in new clients. This is very different from a third party generating “leads” of potential clients for a law firm, and the lawyers then follow up. Some states allow this form of marketing.
The allegations of an insurance defense attorney are one side of the story, and there will be “another side of the story.” But in Sunday’s post, Louisiana Department of Insurance accuses Texas-based law firm of fraud and unfair trade practicesI made the following comment:
The Louisiana Department of Insurance has taken the extraordinary step of filing an administrative action against a Texas-based law firm. I have worked in the first party insurance industry for over forty years. I’ve never seen anything like it.
I’ve never seen anything like it either. In this case, a law firm never talks to a potential client and never takes a case on its merits before signing up the new client through a third-party advertising agency.
I am waiting to read the response from the law firm. Perhaps I will learn from responses that will soon be submitted that this is ethically permissible. Louisiana’s insurance defense attorney doesn’t think so because he has asked for more than $13 million in sanctions from the law firm seeking through texts and third parties.
People have entire relationships via text now, but I’m not partial to texting. I need context, nuance, and the warmth and tone that can only come from a human voice.
1 Franatovich v. Allied Trust Ins. Co.No. 2:22-cv-02552, [Doc. 58, filed Feb. 22, 2023] (ED La.).