Rule 7.1. COMMUNICATIONS CONCERNING A LAWYER’S SERVICES
A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. A communication is false or misleading if it contains a material misrepresentation of fa ct or law, or omits a fact necessary to make the statement considered as a whole not materially misleading. Comment [1] This rule governs all communications about a lawyer’s services, including advertising permitted by Rule 7.2. Whatever means are used to make known a lawyer’s services, statements about them must be truthful. [2] Truthful statements that are misleading are also prohibited by this rule. A truthful statement is misleading if it omits a fact necessary to make the lawyer’s communication considered as a whole not materially misleading. A truthful statement is also misleading if there is a substantial likelih ood that it will lead a reasonable person to formulate a specific conclusion about the lawyer or the lawyer’s services for which there is no reasonable factual foundation. [3] An advertisement that truthfully reports a lawyer’s achievements on behalf of c lients or former clients may be misleading if presented so as to lead a reasonable person to form an unjustified expectation that the same results could be obtained for other clients in similar matters without reference to the specific factual and legal ci rcumstances of each client’s case. Similarly, an unsubstantiated comparison of the lawyer’s services or fees with the services or fees of other lawyers may be misleading if presented with such specificity as would lead a reasonable person to conclude that the comparison can be substantiated. The inclusion of an appropriate disclaimer or qualifying language may preclude a finding that a statement is likely to create unjustified expectations or otherwise mislead a prospective client. [4] See also Rule 8.4(e) for the prohibition against stating or implying an ability to influence improperly a government agency or official or to achieve results by means that violate the Rules of Professional Conduct or other law. 140 141 Reporter’s Notes — 2009 Amendment V.R.P.C. 7.1 is amended to conform to the changes in the Model Rule. In In re PRB Docket No. 2002-093, 2005 VT 2, 177 Vt. 629, 868 A.2d 709 (mem.), after a thorough review of the basis and scope of V.R.P.C. 7.1-7.4, the Court held that the PRB could have reasonably found that an advertisement stating ‘‘WE ARE THE EXPERTS IN’’ three enumerated areas violated former V.R.P.C. 7.1(c) as an unsubstantiated comparison with the quality of other lawyers, and that the phrase ‘‘INJURY EXPERTS’’ violated former V.R.P.C. 7.1(b) as creating an unjustified expectation of results that the lawyer could achieve and could not be characterized as a proper description of a specialty under V.R.P.C. 7.4. The ABA Reporter’s Explanation is as follows: TEXT: 1. Modify to limit prohibition to false and misleading communications The Commission has limited Rule 7.1 to a prohibition against false or misleading communications, defined in terms of the material misrepresentations or omissions that are the subject of current paragraph (a). The categorical prohibitions in [former] paragraphs (b) and (c) have been criticized as being overly broad and have therefore been relocated from text to the commentary as examples of statements that are likely to be misleading. The Commission believes this approach strikes the proper balance between lawyer free-speech interests and the need for consumer protection. 2. Paragraph (b): Delete ‘‘is likely to create an unjustified expectation about results the lawyer can achieve’’ The Commission recommends deletion of this specification of a ‘‘misleading’’ communication because it is overly broad and can be interpreted to prohibit communications that are not substantially likely to lead a reasonable person to form a specific and unwarranted conclusion about the lawyer or the lawyer’s services. See Comment [2]. 3. Paragraph (b): Delete ‘‘states or implies that the lawyer can achieve results by means that violate the Rules of Professional Conduct or other law’’ The Commission recommends that this portion of paragraph (b) be moved to Rule 8.4(e) because this prohibition should not be limited to advertising. Comment [4] provides a cross-reference. 4. Delete paragraph (c) The Commission also believes that a prohibition of all comparisons that cannot be factually substantiated is unduly broad. Whether such comparisons are misleading should be assessed on a case-by-case basis in terms of whether the particular comparison is substantially likely to mislead a reasonable person to believe that the comparison can be substantiated. See Comment [3]. COMMENT: [1] The matters addressed by the deleted portions of [former] Comment [1] are now addressed in Comment [3]. [2] New Comment [2] discusses the prohibition against materially misleading statements. The third sentence sets forth a new standard for determining whether a lawyer’s truthful statement is misleading. The ‘‘substantial likelihood’’ test is used in Rule 3.6 to balance the competing interests in free speech and fair trial. The Commission thinks that this standard strikes the proper balance between the lawyer’s free-speech interests and the need for consumer protection. [3] New Comment [3] addresses the problem areas covered in [former] paragraphs (b) and (c), explaining circumstances under which statements raising unjustified expectations and making unsubstantiated comparisons may be false or misleading. The first sentence is a modification of the deleted portion of [former] Comment [1]. Rather than stating that truthful reports of a lawyer’s achievements are ordinarily prohibited as misleading, the Comment is limited to a warning that such statements may be misleading. The second sentence indicates that comparisons that cannot be factually substantiated will be misleading only if there is a substantial likelihood that a reasonable person would conclude that the comparison could be factually substantiated. Neither statement is as sweeping as its counterpart in the [former] Comment or paragraph (c). Because many jurisdictions encourage or require the use of disclaimers in lawyer advertising, the final sentence indicates that disclaimers may reduce the likelihood that a statement about the lawyer or the lawyer’s services will be misleading. [4] This new Comment is a cross-reference to Rule 8.4(e) which prohibits lawyers from stating or implying that they have an ability to influence improperly a government agency or official or that they can achieve results by means that violate the Rules of Professional Conduct or other law. ANNOTATIONS 1. Qualitative advertising claims. Attorney’s advertisement proclaiming his firm to be ‘‘injury experts’’ and ‘‘the experts’’ in certain enumerated fields of law fell squarely within that category of qualitative advertising claims that are not susceptible of measurement or verification; thus, they were likely to create an unjustified expectation and differentiation among those reading the advertisement about the results which can be achieved by .093, 2005 VT 2, 177 Vt. 629, a lawyer claiming to be an expert in violation of this rule. In re PRB Docket No. 2002 868 A.2d 709 (mem.). Any attorney advertisement using the term ‘‘specialist’’ or ‘‘specialty’’ in the sense that the terms imply expertise should be qualified by a disclaimer that the attorney has not been certified as a spec ialist by any recognized organization, in order to avoid potential confusion to the consumer and to comport with this rule’s prohibition against misleading communications. In re PRB Docket No. 2002.093, 2005 VT 2, 177 Vt. 629, 868 A.2d 709 (mem.). A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. A communication is false or misleading if it contains a material misrepresentation of fa ct or law, or omits a fact necessary to make the statement considered as a whole not materially misleading. Comment [1] This rule governs all communications about a lawyer’s services, including advertising permitted by Rule 7.2. Whatever means are used to make known a lawyer’s services, statements about them must be truthful. [2] Truthful statements that are misleading are also prohibited by this rule. A truthful statement is misleading if it omits a fact necessary to make the lawyer’s communication considered as a whole not materially misleading. A truthful statement is also misleading if there is a substantial likelih ood that it will lead a reasonable person to formulate a specific conclusion about the lawyer or the lawyer’s services for which there is no reasonable factual foundation. [3] An advertisement that truthfully reports a lawyer’s achievements on behalf of c lients or former clients may be misleading if presented so as to lead a reasonable person to form an unjustified expectation that the same results could be obtained for other clients in similar matters without reference to the specific factual and legal ci rcumstances of each client’s case. Similarly, an unsubstantiated comparison of the lawyer’s services or fees with the services or fees of other lawyers may be misleading if presented with such specificity as would lead a reasonable person to conclude that the comparison can be substantiated. The inclusion of an appropriate disclaimer or qualifying language may preclude a finding that a statement is likely to create unjustified expectations or otherwise mislead a prospective client. [4] See also Rule 8.4(e) for the prohibition against stating or implying an ability to influence improperly a government agency or official or to achieve results by means that violate the Rules of Professional Conduct or other law. 140 141 Reporter’s Notes — 2009 Amendment V.R.P.C. 7.1 is amended to conform to the changes in the Model Rule. In In re PRB Docket No. 2002-093, 2005 VT 2, 177 Vt. 629, 868 A.2d 709 (mem.), after a thorough review of the basis and scope of V.R.P.C. 7.1-7.4, the Court held that the PRB could have reasonably found that an advertisement stating ‘‘WE ARE THE EXPERTS IN’’ three enumerated areas violated former V.R.P.C. 7.1(c) as an unsubstantiated comparison with the quality of other lawyers, and that the phrase ‘‘INJURY EXPERTS’’ violated former V.R.P.C. 7.1(b) as creating an unjustified expectation of results that the lawyer could achieve and could not be characterized as a proper description of a specialty under V.R.P.C. 7.4. The ABA Reporter’s Explanation is as follows: TEXT: 1. Modify to limit prohibition to false and misleading communications The Commission has limited Rule 7.1 to a prohibition against false or misleading communications, defined in terms of the material misrepresentations or omissions that are the subject of current paragraph (a). The categorical prohibitions in [former] paragraphs (b) and (c) have been criticized as being overly broad and have therefore been relocated from text to the commentary as examples of statements that are likely to be misleading. The Commission believes this approach strikes the proper balance between lawyer free-speech interests and the need for consumer protection. 2. Paragraph (b): Delete ‘‘is likely to create an unjustified expectation about results the lawyer can achieve’’ The Commission recommends deletion of this specification of a ‘‘misleading’’ communication because it is overly broad and can be interpreted to prohibit communications that are not substantially likely to lead a reasonable person to form a specific and unwarranted conclusion about the lawyer or the lawyer’s services. See Comment [2]. 3. Paragraph (b): Delete ‘‘states or implies that the lawyer can achieve results by means that violate the Rules of Professional Conduct or other law’’ The Commission recommends that this portion of paragraph (b) be moved to Rule 8.4(e) because this prohibition should not be limited to advertising. Comment [4] provides a cross-reference. 4. Delete paragraph (c) The Commission also believes that a prohibition of all comparisons that cannot be factually substantiated is unduly broad. Whether such comparisons are misleading should be assessed on a case-by-case basis in terms of whether the particular comparison is substantially likely to mislead a reasonable person to believe that the comparison can be substantiated. See Comment [3]. COMMENT: [1] The matters addressed by the deleted portions of [former] Comment [1] are now addressed in Comment [3]. [2] New Comment [2] discusses the prohibition against materially misleading statements. The third sentence sets forth a new standard for determining whether a lawyer’s truthful statement is misleading. The ‘‘substantial likelihood’’ test is used in Rule 3.6 to balance the competing interests in free speech and fair trial. The Commission thinks that this standard strikes the proper balance between the lawyer’s free-speech interests and the need for consumer protection. [3] New Comment [3] addresses the problem areas covered in [former] paragraphs (b) and (c), explaining circumstances under which statements raising unjustified expectations and making unsubstantiated comparisons may be false or misleading. The first sentence is a modification of the deleted portion of [former] Comment [1]. Rather than stating that truthful reports of a lawyer’s achievements are ordinarily prohibited as misleading, the Comment is limited to a warning that such statements may be misleading. The second sentence indicates that comparisons that cannot be factually substantiated will be misleading only if there is a substantial likelihood that a reasonable person would conclude that the comparison could be factually substantiated. Neither statement is as sweeping as its counterpart in the [former] Comment or paragraph (c). Because many jurisdictions encourage or require the use of disclaimers in lawyer advertising, the final sentence indicates that disclaimers may reduce the likelihood that a statement about the lawyer or the lawyer’s services will be misleading. [4] This new Comment is a cross-reference to Rule 8.4(e) which prohibits lawyers from stating or implying that they have an ability to influence improperly a government agency or official or that they can achieve results by means that violate the Rules of Professional Conduct or other law. ANNOTATIONS 1. Qualitative advertising claims. Attorney’s advertisement proclaiming his firm to be ‘‘injury experts’’ and ‘‘the experts’’ in certain enumerated fields of law fell squarely within that category of qualitative advertising claims that are not susceptible of measurement or verification; thus, they were likely to create an unjustified expectation and differentiation among those reading the advertisement about the results which can be achieved by .093, 2005 VT 2, 177 Vt. 629, a lawyer claiming to be an expert in violation of this rule. In re PRB Docket No. 2002 868 A.2d 709 (mem.). Any attorney advertisement using the term ‘‘specialist’’ or ‘‘specialty’’ in the sense that the terms imply expertise should be qualified by a disclaimer that the attorney has not been certified as a spec ialist by any recognized organization, in order to avoid potential confusion to the consumer and to comport with this rule’s prohibition against misleading communications. In re PRB Docket No. 2002.093, 2005 VT 2, 177 Vt. 629, 868 A.2d 709 (mem.). A lawyer shall not make a false or misleading communication about the lawyer or the lawyer’s services. A communication is false or misleading if it contains a material misrepresentation of fa ct or law, or omits a fact necessary to make the statement considered as a whole not materially misleading. Comment [1] This rule governs all communications about a lawyer’s services, including advertising permitted by Rule 7.2. Whatever means are used to make known a lawyer’s services, statements about them must be truthful. [2] Truthful statements that are misleading are also prohibited by this rule. A truthful statement is misleading if it omits a fact necessary to make the lawyer’s communication considered as a whole not materially misleading. A truthful statement is also misleading if there is a substantial likelih ood that it will lead a reasonable person to formulate a specific conclusion about the lawyer or the lawyer’s services for which there is no reasonable factual foundation. [3] An advertisement that truthfully reports a lawyer’s achievements on behalf of c lients or former clients may be misleading if presented so as to lead a reasonable person to form an unjustified expectation that the same results could be obtained for other clients in similar matters without reference to the specific factual and legal ci rcumstances of each client’s case. Similarly, an unsubstantiated comparison of the lawyer’s services or fees with the services or fees of other lawyers may be misleading if presented with such specificity as would lead a reasonable person to conclude that the comparison can be substantiated. The inclusion of an appropriate disclaimer or qualifying language may preclude a finding that a statement is likely to create unjustified expectations or otherwise mislead a prospective client. [4] See also Rule 8.4(e) for the prohibition against stating or implying an ability to influence improperly a government agency or official or to achieve results by means that violate the Rules of Professional Conduct or other law. 140 141 Reporter’s Notes — 2009 Amendment V.R.P.C. 7.1 is amended to conform to the changes in the Model Rule. In In re PRB Docket No. 2002-093, 2005 VT 2, 177 Vt. 629, 868 A.2d 709 (mem.), after a thorough review of the basis and scope of V.R.P.C. 7.1-7.4, the Court held that the PRB could have reasonably found that an advertisement stating ‘‘WE ARE THE EXPERTS IN’’ three enumerated areas violated former V.R.P.C. 7.1(c) as an unsubstantiated comparison with the quality of other lawyers, and that the phrase ‘‘INJURY EXPERTS’’ violated former V.R.P.C. 7.1(b) as creating an unjustified expectation of results that the lawyer could achieve and could not be characterized as a proper description of a specialty under V.R.P.C. 7.4. The ABA Reporter’s Explanation is as follows: TEXT: 1. Modify to limit prohibition to false and misleading communications The Commission has limited Rule 7.1 to a prohibition against false or misleading communications, defined in terms of the material misrepresentations or omissions that are the subject of current paragraph (a). The categorical prohibitions in [former] paragraphs (b) and (c) have been criticized as being overly broad and have therefore been relocated from text to the commentary as examples of statements that are likely to be misleading. The Commission believes this approach strikes the proper balance between lawyer free-speech interests and the need for consumer protection. 2. Paragraph (b): Delete ‘‘is likely to create an unjustified expectation about results the lawyer can achieve’’ The Commission recommends deletion of this specification of a ‘‘misleading’’ communication because it is overly broad and can be interpreted to prohibit communications that are not substantially likely to lead a reasonable person to form a specific and unwarranted conclusion about the lawyer or the lawyer’s services. See Comment [2]. 3. Paragraph (b): Delete ‘‘states or implies that the lawyer can achieve results by means that violate the Rules of Professional Conduct or other law’’ The Commission recommends that this portion of paragraph (b) be moved to Rule 8.4(e) because this prohibition should not be limited to advertising. Comment [4] provides a cross-reference. 4. Delete paragraph (c) The Commission also believes that a prohibition of all comparisons that cannot be factually substantiated is unduly broad. Whether such comparisons are misleading should be assessed on a case-by-case basis in terms of whether the particular comparison is substantially likely to mislead a reasonable person to believe that the comparison can be substantiated. See Comment [3]. COMMENT: [1] The matters addressed by the deleted portions of [former] Comment [1] are now addressed in Comment [3]. [2] New Comment [2] discusses the prohibition against materially misleading statements. The third sentence sets forth a new standard for determining whether a lawyer’s truthful statement is misleading. The ‘‘substantial likelihood’’ test is used in Rule 3.6 to balance the competing interests in free speech and fair trial. The Commission thinks that this standard strikes the proper balance between the lawyer’s free-speech interests and the need for consumer protection. [3] New Comment [3] addresses the problem areas covered in [former] paragraphs (b) and (c), explaining circumstances under which statements raising unjustified expectations and making unsubstantiated comparisons may be false or misleading. The first sentence is a modification of the deleted portion of [former] Comment [1]. Rather than stating that truthful reports of a lawyer’s achievements are ordinarily prohibited as misleading, the Comment is limited to a warning that such statements may be misleading. The second sentence indicates that comparisons that cannot be factually substantiated will be misleading only if there is a substantial likelihood that a reasonable person would conclude that the comparison could be factually substantiated. Neither statement is as sweeping as its counterpart in the [former] Comment or paragraph (c). Because many jurisdictions encourage or require the use of disclaimers in lawyer advertising, the final sentence indicates that disclaimers may reduce the likelihood that a statement about the lawyer or the lawyer’s services will be misleading. [4] This new Comment is a cross-reference to Rule 8.4(e) which prohibits lawyers from stating or implying that they have an ability to influence improperly a government agency or official or that they can achieve results by means that violate the Rules of Professional Conduct or other law. ANNOTATIONS 1. Qualitative advertising claims. Attorney’s advertisement proclaiming his firm to be ‘‘injury experts’’ and ‘‘the experts’’ in certain enumerated fields of law fell squarely within that category of qualitative advertising claims that are not susceptible of measurement or verification; thus, they were likely to create an unjustified expectation and differentiation among those reading the advertisement about the results which can be achieved by .093, 2005 VT 2, 177 Vt. 629, a lawyer claiming to be an expert in violation of this rule. In re PRB Docket No. 2002 868 A.2d 709 (mem.). Any attorney advertisement using the term ‘‘specialist’’ or ‘‘specialty’’ in the sense that the terms imply expertise should be qualified by a disclaimer that the attorney has not been certified as a spec ialist by any recognized organization, in order to avoid potential confusion to the consumer and to comport with this rule’s prohibition against misleading communications. In re PRB Docket No. 2002.093, 2005 VT 2, 177 Vt. 629, 868 A.2d 709 (mem.).
Rule 7.2. ADVERTISING
(a) Subject to the requirements of Rules 7.1 and 7.3, a lawyer may advertise services through written, recorded or electronic communication, including public media. (b) A lawyer shall not give anything of value to a person for recommending the lawyer’s se rvices except that a lawyer may (1) pay the reasonable costs of advertisements or communications permitted by this rule; (2) pay the usual charges of a legal service plan or a not referral service. A qualified lawyer referrforprofit or qualified lawyer al service is a lawyer referral service that has been approved by any regulatory authority designated by the Supreme Court; (3) pay for a law practice in accordance with Rule 1.17; and (4) refer clients to another lawyer or a nonlawyer professional pursuant to an agreement not otherwise prohibited under these rules that provides for the other person to refer clients or customers to the lawyer, if (i) the reciprocal referral agreement is not exclusive, and (ii) the client is informed of t he existence and nature of the agreement. (c) Any communication made pursuant to this rule shall include the name and office address of at least one lawyer or law firm responsible for its content. Comment [1] To assist the public in obtaining legal services, lawyers should be allowed to make known their services not only through reputation but also through organized information campaigns in the form of advertising. Advertising involves an active quest for c lients, contrary to the tradition that a lawyer should not seek clientele. However, the public’s need to know about legal services can be fulfilled in part through advertising. This need is particularly acute in the case of persons of moderate means who ha ve not made extensive use of legal services. The interest in expanding public information about legal services ought to prevail over considerations of tradition. Nevertheless, advertising by lawyers entails the risk of practices that are misleading or over reaching. [2] This rule permits public dissemination of information concerning a lawyer’s name or firm name, address and telephone number; the kinds of services the lawyer will undertake; the basis on which the lawyer’s fees are determined, including pric es for specific services and payment and credit arrangements; a lawyer’s foreign language ability; names of references and, with their consent, names of clients regularly represented; and other information that might invite the attention of those seeking l egal assistance. [3] Questions of effectiveness and taste in advertising are matters of speculation and subjective judgment. Some jurisdictions have had extensive prohibitions against television advertising, against advertising going beyond specified fact s about a lawyer, or against ‘‘undignified’’ advertising. Television is now one of the most powerful media for getting information to the public, particularly persons of low and moderate income; prohibiting television advertising, therefore, would impede t he flow of information about legal services to many sectors of the public. Limiting the information that may be advertised has a similar effect and assumes that the bar can accurately forecast the kind of information that the public would regard as relevan t. Similarly, electronic media, such as the Internet, can be an important source of information about legal services, and lawful communication by electronic mail is permitted by this rule. But see Rule 7.3(a) for the prohibition against the solicitation of a prospective client through a realtime electronic exchange that is not initiated by the prospective client. [4] Neither this rule nor Rule 7.3 prohibits communications authorized by law, such as notice to members of a class in class action litigation. 142 143 Paying Others to Recommend a Lawyer [5] Lawyers are not permitted to pay others for channeling professional work. Paragraph (b)(1), however, allows a lawyer to pay for advertising and communications permitted by this rule, including the costs of print directory listings, on-line directory listings, newspaper ads, television and radio airtime, domain-name registrations, sponsorship fees, banner ads, and group advertising. A lawyer may compensate employees, agents and vendors who are engaged to provide marketing or client-development services, such as publicists, public-relations personnel, business-development staff and website designers. See Rule 5.3 for the duties of lawyers and law firms with respect to the conduct of nonlawyers who prepare marketing materials for them. [6] A lawyer may pay the usual charges of a legal service plan or a not-for-profit or qualified lawyer referral service. A legal service plan is a prepaid or group legal service plan or a similar delivery system that assists prospective clients to secure legal representation. A lawyer referral service, on the other hand, is any organization that holds itself out to the public as a lawyer referral service. Such referral services are understood by laypersons to be consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. Consequently, this rule only permits a lawyer to pay the usual charges of a not-for-profit or qualified lawyer referral service. A qualified lawyer referral service is one that is approved by an appropriate regulatory authority as affording adequate protections for prospective clients. See, e.g., the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act (requiring that organizations that are identified as lawyer referral services (i) permit the participation of all lawyers who are licensed and eligible to practice in the jurisdiction and who meet reasonable objective eligibility requirements as may be established by the referral service for the protection of prospective clients; (ii) require each participating lawyer to carry reasonably adequate malpractice insurance; (iii) act reasonably to assess client satisfaction and address client complaints; and (iv) do not refer prospective clients to lawyers who own, operate or are employed by the referral service.) [7] A lawyer who accepts assignments or referrals from a legal service plan or referrals from a lawyer referral service must act reasonably to assure that the activities of the plan or service are compatible with the lawyer’s professional obligations. See Rule 5.3. Legal service plans and lawyer referral services may communicate with prospective clients, but such communication must be in conformity with these rules. Thus, advertising must not be false or misleading, as would be the case if the communications of a group advertising program or a group legal services plan would mislead prospective clients to think that it was a lawyer referral service sponsored by a state agency or bar association. Nor could the lawyer allow in-person, telephonic, or real-time contacts that would violate Rule 7.3. [8] A lawyer also may agree to refer clients to another lawyer or a nonlawyer professional, in return for the undertaking of that person to refer clients or customers to the lawyer. Such reciprocal referral arrangements must not interfere with the lawyer’s professional judgment as to making referrals or as to providing substantive legal services. See Rules 2.1 and 5.4(c). Except as provided in Rule 1.5(e), a lawyer who receives referrals from a lawyer or nonlawyer professional must not pay anything solely for the referral, but the lawyer does not violate paragraph (b) of this rule by agreeing to refer clients to the other lawyer or nonlawyer professional, so long as the reciprocal referral agreement is not exclusive and the client is informed of the referral agreement. Conflicts of interest created by such arrangements are governed by Rule 1.7. Reciprocal referral agreements should not be of indefinite duration and should be reviewed periodically to determine whether they comply with these rules. This rule does not restrict referrals or divisions of revenues or net income among lawyers within firms comprised of multiple entities. Reporter’s Notes — 2009 Amendment V.R.P.C. 7.2 is amended to conform to the changes in the Model Rule. Rule 7.2(b)(4) and Comment [8] were added by amendment at the August 2002 meeting of the House of Delegates on the recommendation of the Standing Committee on Ethics and Professional Responsibility to provide guidance for lawyers for referral agreements with other lawyers or nonlawyer professionals. See ABA Report No. 114 (August 2002). The ABA Reporter’s Explanation of other changes is as follows: TEXT: 1. Paragraph (a): delete specification of types of public media and add reference to ‘‘electronic communication’’ This change is proposed to accommodate the new technology that is currently being used by law firms to market legal services-e.g., websites and e-mail. Examples of ‘‘public media’’ are being dropped from the Rule text and moved to Comment [3], obviating the necessity of changing the Rule to accommodate the next new public-communication technology. A specific reference to the Internet has been added to Comment [3]. A reference to electronic communication has also been added. To provide a specific example of this type of technology, a reference to e-mail has been added to Comment [3] with a cross-reference to the prohibition in Rule 7.3(a) of solicitation by real-time electronic contact. 144 2. Delete current paragraph (b) The requirement that a lawyer retain copies of all advertisements for two years has become increasingly burdensome, and such records are seldom used for disciplinary purposes. Thus the Commission, with the concurrence of the ABA Commission on Responsibility in Client Development, is recommending elimination of the requirement that records of advertising be retained for two years. 3. Paragraph (b)(2): Replace reference to ‘‘legal service organization’’ with ‘‘legal service plan’’ This change in terminology is intended to avoid confusion between a ‘‘legal services organization,’’ which provides direct legal services to clients and is included in the definition of a law firm in Rule 1.0(c), and prepaid and group legal service plans, and other similar delivery systems, whose usual charges are excepted from the prohibition against a lawyer giving anything of value to a person for recommending the lawyer’s services in Rule 7.2(b). 4. Paragraph (b)(2): Modify to permit lawyers to pay the usual charges of ‘‘a not-for-profit or qualified lawyer referral service’’ This change is intended to more closely conform the Model Rules to ABA policy with respect to lawyer referral services. It recognizes the need to protect prospective clients who have come to think of lawyer referral services as consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. The effect of the proposal is to permit lawyers to pay the usual charges of a for-profit lawyer referral service, but only if it has been approved by an appropriate regulatory authority [approved by the Vermont Supreme Court] as affording adequate protections for prospective clients, preferably in conformity with the four core standards prescribed in the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act. Because the need for special regulation arises from the prevailing public perception of lawyer referral services, this special regulatory regime is only applicable to a for-profit organization that holds itself out to the public as a lawyer referral service. See Comment [6]. 5. Paragraph (c): Modify to permit identification of law firm as entity responsible for advertisement The Commission thinks that law firms should be able to designate the firm as the entity responsible for the contents of an advertisement. Such information, rather than the name of a specific lawyer in the firm, should be sufficient to enable disciplinary authorities to take action necessary to protect the public from misleading advertising. 6. Paragraph (c): Require identification of the address of the law firm or lawyer responsible for advertisement Because Rule 7.5 permits the use of trade names and because lawyers frequently advertise in locations where they do not maintain an office, the Commission has added a requirement that each advertisement include an office address for the law firm or lawyer named in the advertisement. This information will help disciplinary authorities track down those who are responsible for an advertisement, but, more importantly, it will provide prospective clients with important information about where the lawyer or law firm is located -an important fact in this era of multi jurisdictional advertising. COMMENT: [3] Although the Commission concluded that a specification of the various public media lawyers can use to market their services should not be included in the Rule text, it thought it appropriate to explicitly affirm the legitimacy of using electronic media, including the Internet and the World Wide Web. The reference to ‘‘lawful’’ electronic mail was included to require lawyers to comply with any law that might prohibit ‘‘spamming’’-i.e., the mass e-mailing of commercial messages. A cross-reference to Rule 7.3(a) has been added to alert lawyers to the proposed prohibition of solicitation by real-time electronic contact. This Comment and the related caption have been deleted because [former] paragraph (b) was deleted from the Rule text. [5] The discussion of advertising expenses has been modified to more accurately reflect the current state of client-development activities in law firms. To this has been added a cross-reference to Rule 5.3 as a reminder of the partner’s and firm’s obligations with respect to the conduct of nonlawyers involved in client development activities. [6] In response to a concern about the ambiguity of the reference in paragraph (b)(2) to ‘‘a legal service organization,’’ this new Comment defines a legal service plan to specifically include prepaid and group legal service plans, and also to include ‘‘a similar delivery system that assists prospective clients to secure legal representation.’’ This clarifies that lawyers may pay the usual charges of not only traditional prepaid and group legal service plans, but also the usual charges of new hybrid plans that might undertake to provide a variety of services to prospective clients. Also by its definition of a lawyer referral service as an organization that holds itself out to the public as a lawyer referral service, the Comment precludes extension of the special regulatory regime governing lawyer referral services to prepaid or group legal service plans and other similar delivery systems. Finally the Comment articulates ABA policy with respect to the core characteristics of a qualified lawyer referral service. 145 [7] This new Comment alerts lawyers who accept assignments or referrals from legal service plans or referrals from lawyer referral services that they must act reasonably to assure that the activities of the plan or service are compatible with the lawyers’ professional obligations. (a) Subject to the requirements of Rules 7.1 and 7.3, a lawyer may advertise services through written, recorded or electronic communication, including public media. (b) A lawyer shall not give anything of value to a person for recommending the lawyer’s se rvices except that a lawyer may (1) pay the reasonable costs of advertisements or communications permitted by this rule; (2) pay the usual charges of a legal service plan or a not referral service. A qualified lawyer referrforprofit or qualified lawyer al service is a lawyer referral service that has been approved by any regulatory authority designated by the Supreme Court; (3) pay for a law practice in accordance with Rule 1.17; and (4) refer clients to another lawyer or a nonlawyer professional pursuant to an agreement not otherwise prohibited under these rules that provides for the other person to refer clients or customers to the lawyer, if (i) the reciprocal referral agreement is not exclusive, and (ii) the client is informed of t he existence and nature of the agreement. (c) Any communication made pursuant to this rule shall include the name and office address of at least one lawyer or law firm responsible for its content. Comment [1] To assist the public in obtaining legal services, lawyers should be allowed to make known their services not only through reputation but also through organized information campaigns in the form of advertising. Advertising involves an active quest for c lients, contrary to the tradition that a lawyer should not seek clientele. However, the public’s need to know about legal services can be fulfilled in part through advertising. This need is particularly acute in the case of persons of moderate means who ha ve not made extensive use of legal services. The interest in expanding public information about legal services ought to prevail over considerations of tradition. Nevertheless, advertising by lawyers entails the risk of practices that are misleading or over reaching. [2] This rule permits public dissemination of information concerning a lawyer’s name or firm name, address and telephone number; the kinds of services the lawyer will undertake; the basis on which the lawyer’s fees are determined, including pric es for specific services and payment and credit arrangements; a lawyer’s foreign language ability; names of references and, with their consent, names of clients regularly represented; and other information that might invite the attention of those seeking l egal assistance. [3] Questions of effectiveness and taste in advertising are matters of speculation and subjective judgment. Some jurisdictions have had extensive prohibitions against television advertising, against advertising going beyond specified fact s about a lawyer, or against ‘‘undignified’’ advertising. Television is now one of the most powerful media for getting information to the public, particularly persons of low and moderate income; prohibiting television advertising, therefore, would impede t he flow of information about legal services to many sectors of the public. Limiting the information that may be advertised has a similar effect and assumes that the bar can accurately forecast the kind of information that the public would regard as relevan t. Similarly, electronic media, such as the Internet, can be an important source of information about legal services, and lawful communication by electronic mail is permitted by this rule. But see Rule 7.3(a) for the prohibition against the solicitation of a prospective client through a realtime electronic exchange that is not initiated by the prospective client. [4] Neither this rule nor Rule 7.3 prohibits communications authorized by law, such as notice to members of a class in class action litigation. 142 143 Paying Others to Recommend a Lawyer [5] Lawyers are not permitted to pay others for channeling professional work. Paragraph (b)(1), however, allows a lawyer to pay for advertising and communications permitted by this rule, including the costs of print directory listings, on-line directory listings, newspaper ads, television and radio airtime, domain-name registrations, sponsorship fees, banner ads, and group advertising. A lawyer may compensate employees, agents and vendors who are engaged to provide marketing or client-development services, such as publicists, public-relations personnel, business-development staff and website designers. See Rule 5.3 for the duties of lawyers and law firms with respect to the conduct of nonlawyers who prepare marketing materials for them. [6] A lawyer may pay the usual charges of a legal service plan or a not-for-profit or qualified lawyer referral service. A legal service plan is a prepaid or group legal service plan or a similar delivery system that assists prospective clients to secure legal representation. A lawyer referral service, on the other hand, is any organization that holds itself out to the public as a lawyer referral service. Such referral services are understood by laypersons to be consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. Consequently, this rule only permits a lawyer to pay the usual charges of a not-for-profit or qualified lawyer referral service. A qualified lawyer referral service is one that is approved by an appropriate regulatory authority as affording adequate protections for prospective clients. See, e.g., the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act (requiring that organizations that are identified as lawyer referral services (i) permit the participation of all lawyers who are licensed and eligible to practice in the jurisdiction and who meet reasonable objective eligibility requirements as may be established by the referral service for the protection of prospective clients; (ii) require each participating lawyer to carry reasonably adequate malpractice insurance; (iii) act reasonably to assess client satisfaction and address client complaints; and (iv) do not refer prospective clients to lawyers who own, operate or are employed by the referral service.) [7] A lawyer who accepts assignments or referrals from a legal service plan or referrals from a lawyer referral service must act reasonably to assure that the activities of the plan or service are compatible with the lawyer’s professional obligations. See Rule 5.3. Legal service plans and lawyer referral services may communicate with prospective clients, but such communication must be in conformity with these rules. Thus, advertising must not be false or misleading, as would be the case if the communications of a group advertising program or a group legal services plan would mislead prospective clients to think that it was a lawyer referral service sponsored by a state agency or bar association. Nor could the lawyer allow in-person, telephonic, or real-time contacts that would violate Rule 7.3. [8] A lawyer also may agree to refer clients to another lawyer or a nonlawyer professional, in return for the undertaking of that person to refer clients or customers to the lawyer. Such reciprocal referral arrangements must not interfere with the lawyer’s professional judgment as to making referrals or as to providing substantive legal services. See Rules 2.1 and 5.4(c). Except as provided in Rule 1.5(e), a lawyer who receives referrals from a lawyer or nonlawyer professional must not pay anything solely for the referral, but the lawyer does not violate paragraph (b) of this rule by agreeing to refer clients to the other lawyer or nonlawyer professional, so long as the reciprocal referral agreement is not exclusive and the client is informed of the referral agreement. Conflicts of interest created by such arrangements are governed by Rule 1.7. Reciprocal referral agreements should not be of indefinite duration and should be reviewed periodically to determine whether they comply with these rules. This rule does not restrict referrals or divisions of revenues or net income among lawyers within firms comprised of multiple entities. Reporter’s Notes — 2009 Amendment V.R.P.C. 7.2 is amended to conform to the changes in the Model Rule. Rule 7.2(b)(4) and Comment [8] were added by amendment at the August 2002 meeting of the House of Delegates on the recommendation of the Standing Committee on Ethics and Professional Responsibility to provide guidance for lawyers for referral agreements with other lawyers or nonlawyer professionals. See ABA Report No. 114 (August 2002). The ABA Reporter’s Explanation of other changes is as follows: TEXT: 1. Paragraph (a): delete specification of types of public media and add reference to ‘‘electronic communication’’ This change is proposed to accommodate the new technology that is currently being used by law firms to market legal services-e.g., websites and e-mail. Examples of ‘‘public media’’ are being dropped from the Rule text and moved to Comment [3], obviating the necessity of changing the Rule to accommodate the next new public-communication technology. A specific reference to the Internet has been added to Comment [3]. A reference to electronic communication has also been added. To provide a specific example of this type of technology, a reference to e-mail has been added to Comment [3] with a cross-reference to the prohibition in Rule 7.3(a) of solicitation by real-time electronic contact. 144 2. Delete current paragraph (b) The requirement that a lawyer retain copies of all advertisements for two years has become increasingly burdensome, and such records are seldom used for disciplinary purposes. Thus the Commission, with the concurrence of the ABA Commission on Responsibility in Client Development, is recommending elimination of the requirement that records of advertising be retained for two years. 3. Paragraph (b)(2): Replace reference to ‘‘legal service organization’’ with ‘‘legal service plan’’ This change in terminology is intended to avoid confusion between a ‘‘legal services organization,’’ which provides direct legal services to clients and is included in the definition of a law firm in Rule 1.0(c), and prepaid and group legal service plans, and other similar delivery systems, whose usual charges are excepted from the prohibition against a lawyer giving anything of value to a person for recommending the lawyer’s services in Rule 7.2(b). 4. Paragraph (b)(2): Modify to permit lawyers to pay the usual charges of ‘‘a not-for-profit or qualified lawyer referral service’’ This change is intended to more closely conform the Model Rules to ABA policy with respect to lawyer referral services. It recognizes the need to protect prospective clients who have come to think of lawyer referral services as consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. The effect of the proposal is to permit lawyers to pay the usual charges of a for-profit lawyer referral service, but only if it has been approved by an appropriate regulatory authority [approved by the Vermont Supreme Court] as affording adequate protections for prospective clients, preferably in conformity with the four core standards prescribed in the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act. Because the need for special regulation arises from the prevailing public perception of lawyer referral services, this special regulatory regime is only applicable to a for-profit organization that holds itself out to the public as a lawyer referral service. See Comment [6]. 5. Paragraph (c): Modify to permit identification of law firm as entity responsible for advertisement The Commission thinks that law firms should be able to designate the firm as the entity responsible for the contents of an advertisement. Such information, rather than the name of a specific lawyer in the firm, should be sufficient to enable disciplinary authorities to take action necessary to protect the public from misleading advertising. 6. Paragraph (c): Require identification of the address of the law firm or lawyer responsible for advertisement Because Rule 7.5 permits the use of trade names and because lawyers frequently advertise in locations where they do not maintain an office, the Commission has added a requirement that each advertisement include an office address for the law firm or lawyer named in the advertisement. This information will help disciplinary authorities track down those who are responsible for an advertisement, but, more importantly, it will provide prospective clients with important information about where the lawyer or law firm is located -an important fact in this era of multi jurisdictional advertising. COMMENT: [3] Although the Commission concluded that a specification of the various public media lawyers can use to market their services should not be included in the Rule text, it thought it appropriate to explicitly affirm the legitimacy of using electronic media, including the Internet and the World Wide Web. The reference to ‘‘lawful’’ electronic mail was included to require lawyers to comply with any law that might prohibit ‘‘spamming’’-i.e., the mass e-mailing of commercial messages. A cross-reference to Rule 7.3(a) has been added to alert lawyers to the proposed prohibition of solicitation by real-time electronic contact. This Comment and the related caption have been deleted because [former] paragraph (b) was deleted from the Rule text. [5] The discussion of advertising expenses has been modified to more accurately reflect the current state of client-development activities in law firms. To this has been added a cross-reference to Rule 5.3 as a reminder of the partner’s and firm’s obligations with respect to the conduct of nonlawyers involved in client development activities. [6] In response to a concern about the ambiguity of the reference in paragraph (b)(2) to ‘‘a legal service organization,’’ this new Comment defines a legal service plan to specifically include prepaid and group legal service plans, and also to include ‘‘a similar delivery system that assists prospective clients to secure legal representation.’’ This clarifies that lawyers may pay the usual charges of not only traditional prepaid and group legal service plans, but also the usual charges of new hybrid plans that might undertake to provide a variety of services to prospective clients. Also by its definition of a lawyer referral service as an organization that holds itself out to the public as a lawyer referral service, the Comment precludes extension of the special regulatory regime governing lawyer referral services to prepaid or group legal service plans and other similar delivery systems. Finally the Comment articulates ABA policy with respect to the core characteristics of a qualified lawyer referral service. 145 [7] This new Comment alerts lawyers who accept assignments or referrals from legal service plans or referrals from lawyer referral services that they must act reasonably to assure that the activities of the plan or service are compatible with the lawyers’ professional obligations. (a) Subject to the requirements of Rules 7.1 and 7.3, a lawyer may advertise services through written, recorded or electronic communication, including public media. (b) A lawyer shall not give anything of value to a person for recommending the lawyer’s se rvices except that a lawyer may (1) pay the reasonable costs of advertisements or communications permitted by this rule; (2) pay the usual charges of a legal service plan or a not referral service. A qualified lawyer referrforprofit or qualified lawyer al service is a lawyer referral service that has been approved by any regulatory authority designated by the Supreme Court; (3) pay for a law practice in accordance with Rule 1.17; and (4) refer clients to another lawyer or a nonlawyer professional pursuant to an agreement not otherwise prohibited under these rules that provides for the other person to refer clients or customers to the lawyer, if (i) the reciprocal referral agreement is not exclusive, and (ii) the client is informed of t he existence and nature of the agreement. (c) Any communication made pursuant to this rule shall include the name and office address of at least one lawyer or law firm responsible for its content. Comment [1] To assist the public in obtaining legal services, lawyers should be allowed to make known their services not only through reputation but also through organized information campaigns in the form of advertising. Advertising involves an active quest for c lients, contrary to the tradition that a lawyer should not seek clientele. However, the public’s need to know about legal services can be fulfilled in part through advertising. This need is particularly acute in the case of persons of moderate means who ha ve not made extensive use of legal services. The interest in expanding public information about legal services ought to prevail over considerations of tradition. Nevertheless, advertising by lawyers entails the risk of practices that are misleading or over reaching. [2] This rule permits public dissemination of information concerning a lawyer’s name or firm name, address and telephone number; the kinds of services the lawyer will undertake; the basis on which the lawyer’s fees are determined, including pric es for specific services and payment and credit arrangements; a lawyer’s foreign language ability; names of references and, with their consent, names of clients regularly represented; and other information that might invite the attention of those seeking l egal assistance. [3] Questions of effectiveness and taste in advertising are matters of speculation and subjective judgment. Some jurisdictions have had extensive prohibitions against television advertising, against advertising going beyond specified fact s about a lawyer, or against ‘‘undignified’’ advertising. Television is now one of the most powerful media for getting information to the public, particularly persons of low and moderate income; prohibiting television advertising, therefore, would impede t he flow of information about legal services to many sectors of the public. Limiting the information that may be advertised has a similar effect and assumes that the bar can accurately forecast the kind of information that the public would regard as relevan t. Similarly, electronic media, such as the Internet, can be an important source of information about legal services, and lawful communication by electronic mail is permitted by this rule. But see Rule 7.3(a) for the prohibition against the solicitation of a prospective client through a realtime electronic exchange that is not initiated by the prospective client. [4] Neither this rule nor Rule 7.3 prohibits communications authorized by law, such as notice to members of a class in class action litigation. 142 143 Paying Others to Recommend a Lawyer [5] Lawyers are not permitted to pay others for channeling professional work. Paragraph (b)(1), however, allows a lawyer to pay for advertising and communications permitted by this rule, including the costs of print directory listings, on-line directory listings, newspaper ads, television and radio airtime, domain-name registrations, sponsorship fees, banner ads, and group advertising. A lawyer may compensate employees, agents and vendors who are engaged to provide marketing or client-development services, such as publicists, public-relations personnel, business-development staff and website designers. See Rule 5.3 for the duties of lawyers and law firms with respect to the conduct of nonlawyers who prepare marketing materials for them. [6] A lawyer may pay the usual charges of a legal service plan or a not-for-profit or qualified lawyer referral service. A legal service plan is a prepaid or group legal service plan or a similar delivery system that assists prospective clients to secure legal representation. A lawyer referral service, on the other hand, is any organization that holds itself out to the public as a lawyer referral service. Such referral services are understood by laypersons to be consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. Consequently, this rule only permits a lawyer to pay the usual charges of a not-for-profit or qualified lawyer referral service. A qualified lawyer referral service is one that is approved by an appropriate regulatory authority as affording adequate protections for prospective clients. See, e.g., the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act (requiring that organizations that are identified as lawyer referral services (i) permit the participation of all lawyers who are licensed and eligible to practice in the jurisdiction and who meet reasonable objective eligibility requirements as may be established by the referral service for the protection of prospective clients; (ii) require each participating lawyer to carry reasonably adequate malpractice insurance; (iii) act reasonably to assess client satisfaction and address client complaints; and (iv) do not refer prospective clients to lawyers who own, operate or are employed by the referral service.) [7] A lawyer who accepts assignments or referrals from a legal service plan or referrals from a lawyer referral service must act reasonably to assure that the activities of the plan or service are compatible with the lawyer’s professional obligations. See Rule 5.3. Legal service plans and lawyer referral services may communicate with prospective clients, but such communication must be in conformity with these rules. Thus, advertising must not be false or misleading, as would be the case if the communications of a group advertising program or a group legal services plan would mislead prospective clients to think that it was a lawyer referral service sponsored by a state agency or bar association. Nor could the lawyer allow in-person, telephonic, or real-time contacts that would violate Rule 7.3. [8] A lawyer also may agree to refer clients to another lawyer or a nonlawyer professional, in return for the undertaking of that person to refer clients or customers to the lawyer. Such reciprocal referral arrangements must not interfere with the lawyer’s professional judgment as to making referrals or as to providing substantive legal services. See Rules 2.1 and 5.4(c). Except as provided in Rule 1.5(e), a lawyer who receives referrals from a lawyer or nonlawyer professional must not pay anything solely for the referral, but the lawyer does not violate paragraph (b) of this rule by agreeing to refer clients to the other lawyer or nonlawyer professional, so long as the reciprocal referral agreement is not exclusive and the client is informed of the referral agreement. Conflicts of interest created by such arrangements are governed by Rule 1.7. Reciprocal referral agreements should not be of indefinite duration and should be reviewed periodically to determine whether they comply with these rules. This rule does not restrict referrals or divisions of revenues or net income among lawyers within firms comprised of multiple entities. Reporter’s Notes — 2009 Amendment V.R.P.C. 7.2 is amended to conform to the changes in the Model Rule. Rule 7.2(b)(4) and Comment [8] were added by amendment at the August 2002 meeting of the House of Delegates on the recommendation of the Standing Committee on Ethics and Professional Responsibility to provide guidance for lawyers for referral agreements with other lawyers or nonlawyer professionals. See ABA Report No. 114 (August 2002). The ABA Reporter’s Explanation of other changes is as follows: TEXT: 1. Paragraph (a): delete specification of types of public media and add reference to ‘‘electronic communication’’ This change is proposed to accommodate the new technology that is currently being used by law firms to market legal services-e.g., websites and e-mail. Examples of ‘‘public media’’ are being dropped from the Rule text and moved to Comment [3], obviating the necessity of changing the Rule to accommodate the next new public-communication technology. A specific reference to the Internet has been added to Comment [3]. A reference to electronic communication has also been added. To provide a specific example of this type of technology, a reference to e-mail has been added to Comment [3] with a cross-reference to the prohibition in Rule 7.3(a) of solicitation by real-time electronic contact. 144 2. Delete current paragraph (b) The requirement that a lawyer retain copies of all advertisements for two years has become increasingly burdensome, and such records are seldom used for disciplinary purposes. Thus the Commission, with the concurrence of the ABA Commission on Responsibility in Client Development, is recommending elimination of the requirement that records of advertising be retained for two years. 3. Paragraph (b)(2): Replace reference to ‘‘legal service organization’’ with ‘‘legal service plan’’ This change in terminology is intended to avoid confusion between a ‘‘legal services organization,’’ which provides direct legal services to clients and is included in the definition of a law firm in Rule 1.0(c), and prepaid and group legal service plans, and other similar delivery systems, whose usual charges are excepted from the prohibition against a lawyer giving anything of value to a person for recommending the lawyer’s services in Rule 7.2(b). 4. Paragraph (b)(2): Modify to permit lawyers to pay the usual charges of ‘‘a not-for-profit or qualified lawyer referral service’’ This change is intended to more closely conform the Model Rules to ABA policy with respect to lawyer referral services. It recognizes the need to protect prospective clients who have come to think of lawyer referral services as consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. The effect of the proposal is to permit lawyers to pay the usual charges of a for-profit lawyer referral service, but only if it has been approved by an appropriate regulatory authority [approved by the Vermont Supreme Court] as affording adequate protections for prospective clients, preferably in conformity with the four core standards prescribed in the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act. Because the need for special regulation arises from the prevailing public perception of lawyer referral services, this special regulatory regime is only applicable to a for-profit organization that holds itself out to the public as a lawyer referral service. See Comment [6]. 5. Paragraph (c): Modify to permit identification of law firm as entity responsible for advertisement The Commission thinks that law firms should be able to designate the firm as the entity responsible for the contents of an advertisement. Such information, rather than the name of a specific lawyer in the firm, should be sufficient to enable disciplinary authorities to take action necessary to protect the public from misleading advertising. 6. Paragraph (c): Require identification of the address of the law firm or lawyer responsible for advertisement Because Rule 7.5 permits the use of trade names and because lawyers frequently advertise in locations where they do not maintain an office, the Commission has added a requirement that each advertisement include an office address for the law firm or lawyer named in the advertisement. This information will help disciplinary authorities track down those who are responsible for an advertisement, but, more importantly, it will provide prospective clients with important information about where the lawyer or law firm is located -an important fact in this era of multi jurisdictional advertising. COMMENT: [3] Although the Commission concluded that a specification of the various public media lawyers can use to market their services should not be included in the Rule text, it thought it appropriate to explicitly affirm the legitimacy of using electronic media, including the Internet and the World Wide Web. The reference to ‘‘lawful’’ electronic mail was included to require lawyers to comply with any law that might prohibit ‘‘spamming’’-i.e., the mass e-mailing of commercial messages. A cross-reference to Rule 7.3(a) has been added to alert lawyers to the proposed prohibition of solicitation by real-time electronic contact. This Comment and the related caption have been deleted because [former] paragraph (b) was deleted from the Rule text. [5] The discussion of advertising expenses has been modified to more accurately reflect the current state of client-development activities in law firms. To this has been added a cross-reference to Rule 5.3 as a reminder of the partner’s and firm’s obligations with respect to the conduct of nonlawyers involved in client development activities. [6] In response to a concern about the ambiguity of the reference in paragraph (b)(2) to ‘‘a legal service organization,’’ this new Comment defines a legal service plan to specifically include prepaid and group legal service plans, and also to include ‘‘a similar delivery system that assists prospective clients to secure legal representation.’’ This clarifies that lawyers may pay the usual charges of not only traditional prepaid and group legal service plans, but also the usual charges of new hybrid plans that might undertake to provide a variety of services to prospective clients. Also by its definition of a lawyer referral service as an organization that holds itself out to the public as a lawyer referral service, the Comment precludes extension of the special regulatory regime governing lawyer referral services to prepaid or group legal service plans and other similar delivery systems. Finally the Comment articulates ABA policy with respect to the core characteristics of a qualified lawyer referral service. 145 [7] This new Comment alerts lawyers who accept assignments or referrals from legal service plans or referrals from lawyer referral services that they must act reasonably to assure that the activities of the plan or service are compatible with the lawyers’ professional obligations. (a) Subject to the requirements of Rules 7.1 and 7.3, a lawyer may advertise services through written, recorded or electronic communication, including public media. (b) A lawyer shall not give anything of value to a person for recommending the lawyer’s se rvices except that a lawyer may (1) pay the reasonable costs of advertisements or communications permitted by this rule; (2) pay the usual charges of a legal service plan or a not referral service. A qualified lawyer referrforprofit or qualified lawyer al service is a lawyer referral service that has been approved by any regulatory authority designated by the Supreme Court; (3) pay for a law practice in accordance with Rule 1.17; and (4) refer clients to another lawyer or a nonlawyer professional pursuant to an agreement not otherwise prohibited under these rules that provides for the other person to refer clients or customers to the lawyer, if (i) the reciprocal referral agreement is not exclusive, and (ii) the client is informed of t he existence and nature of the agreement. (c) Any communication made pursuant to this rule shall include the name and office address of at least one lawyer or law firm responsible for its content. Comment [1] To assist the public in obtaining legal services, lawyers should be allowed to make known their services not only through reputation but also through organized information campaigns in the form of advertising. Advertising involves an active quest for c lients, contrary to the tradition that a lawyer should not seek clientele. However, the public’s need to know about legal services can be fulfilled in part through advertising. This need is particularly acute in the case of persons of moderate means who ha ve not made extensive use of legal services. The interest in expanding public information about legal services ought to prevail over considerations of tradition. Nevertheless, advertising by lawyers entails the risk of practices that are misleading or over reaching. [2] This rule permits public dissemination of information concerning a lawyer’s name or firm name, address and telephone number; the kinds of services the lawyer will undertake; the basis on which the lawyer’s fees are determined, including pric es for specific services and payment and credit arrangements; a lawyer’s foreign language ability; names of references and, with their consent, names of clients regularly represented; and other information that might invite the attention of those seeking l egal assistance. [3] Questions of effectiveness and taste in advertising are matters of speculation and subjective judgment. Some jurisdictions have had extensive prohibitions against television advertising, against advertising going beyond specified fact s about a lawyer, or against ‘‘undignified’’ advertising. Television is now one of the most powerful media for getting information to the public, particularly persons of low and moderate income; prohibiting television advertising, therefore, would impede t he flow of information about legal services to many sectors of the public. Limiting the information that may be advertised has a similar effect and assumes that the bar can accurately forecast the kind of information that the public would regard as relevan t. Similarly, electronic media, such as the Internet, can be an important source of information about legal services, and lawful communication by electronic mail is permitted by this rule. But see Rule 7.3(a) for the prohibition against the solicitation of a prospective client through a realtime electronic exchange that is not initiated by the prospective client. [4] Neither this rule nor Rule 7.3 prohibits communications authorized by law, such as notice to members of a class in class action litigation. 142 143 Paying Others to Recommend a Lawyer [5] Lawyers are not permitted to pay others for channeling professional work. Paragraph (b)(1), however, allows a lawyer to pay for advertising and communications permitted by this rule, including the costs of print directory listings, on-line directory listings, newspaper ads, television and radio airtime, domain-name registrations, sponsorship fees, banner ads, and group advertising. A lawyer may compensate employees, agents and vendors who are engaged to provide marketing or client-development services, such as publicists, public-relations personnel, business-development staff and website designers. See Rule 5.3 for the duties of lawyers and law firms with respect to the conduct of nonlawyers who prepare marketing materials for them. [6] A lawyer may pay the usual charges of a legal service plan or a not-for-profit or qualified lawyer referral service. A legal service plan is a prepaid or group legal service plan or a similar delivery system that assists prospective clients to secure legal representation. A lawyer referral service, on the other hand, is any organization that holds itself out to the public as a lawyer referral service. Such referral services are understood by laypersons to be consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. Consequently, this rule only permits a lawyer to pay the usual charges of a not-for-profit or qualified lawyer referral service. A qualified lawyer referral service is one that is approved by an appropriate regulatory authority as affording adequate protections for prospective clients. See, e.g., the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act (requiring that organizations that are identified as lawyer referral services (i) permit the participation of all lawyers who are licensed and eligible to practice in the jurisdiction and who meet reasonable objective eligibility requirements as may be established by the referral service for the protection of prospective clients; (ii) require each participating lawyer to carry reasonably adequate malpractice insurance; (iii) act reasonably to assess client satisfaction and address client complaints; and (iv) do not refer prospective clients to lawyers who own, operate or are employed by the referral service.) [7] A lawyer who accepts assignments or referrals from a legal service plan or referrals from a lawyer referral service must act reasonably to assure that the activities of the plan or service are compatible with the lawyer’s professional obligations. See Rule 5.3. Legal service plans and lawyer referral services may communicate with prospective clients, but such communication must be in conformity with these rules. Thus, advertising must not be false or misleading, as would be the case if the communications of a group advertising program or a group legal services plan would mislead prospective clients to think that it was a lawyer referral service sponsored by a state agency or bar association. Nor could the lawyer allow in-person, telephonic, or real-time contacts that would violate Rule 7.3. [8] A lawyer also may agree to refer clients to another lawyer or a nonlawyer professional, in return for the undertaking of that person to refer clients or customers to the lawyer. Such reciprocal referral arrangements must not interfere with the lawyer’s professional judgment as to making referrals or as to providing substantive legal services. See Rules 2.1 and 5.4(c). Except as provided in Rule 1.5(e), a lawyer who receives referrals from a lawyer or nonlawyer professional must not pay anything solely for the referral, but the lawyer does not violate paragraph (b) of this rule by agreeing to refer clients to the other lawyer or nonlawyer professional, so long as the reciprocal referral agreement is not exclusive and the client is informed of the referral agreement. Conflicts of interest created by such arrangements are governed by Rule 1.7. Reciprocal referral agreements should not be of indefinite duration and should be reviewed periodically to determine whether they comply with these rules. This rule does not restrict referrals or divisions of revenues or net income among lawyers within firms comprised of multiple entities. Reporter’s Notes — 2009 Amendment V.R.P.C. 7.2 is amended to conform to the changes in the Model Rule. Rule 7.2(b)(4) and Comment [8] were added by amendment at the August 2002 meeting of the House of Delegates on the recommendation of the Standing Committee on Ethics and Professional Responsibility to provide guidance for lawyers for referral agreements with other lawyers or nonlawyer professionals. See ABA Report No. 114 (August 2002). The ABA Reporter’s Explanation of other changes is as follows: TEXT: 1. Paragraph (a): delete specification of types of public media and add reference to ‘‘electronic communication’’ This change is proposed to accommodate the new technology that is currently being used by law firms to market legal services-e.g., websites and e-mail. Examples of ‘‘public media’’ are being dropped from the Rule text and moved to Comment [3], obviating the necessity of changing the Rule to accommodate the next new public-communication technology. A specific reference to the Internet has been added to Comment [3]. A reference to electronic communication has also been added. To provide a specific example of this type of technology, a reference to e-mail has been added to Comment [3] with a cross-reference to the prohibition in Rule 7.3(a) of solicitation by real-time electronic contact. 144 2. Delete current paragraph (b) The requirement that a lawyer retain copies of all advertisements for two years has become increasingly burdensome, and such records are seldom used for disciplinary purposes. Thus the Commission, with the concurrence of the ABA Commission on Responsibility in Client Development, is recommending elimination of the requirement that records of advertising be retained for two years. 3. Paragraph (b)(2): Replace reference to ‘‘legal service organization’’ with ‘‘legal service plan’’ This change in terminology is intended to avoid confusion between a ‘‘legal services organization,’’ which provides direct legal services to clients and is included in the definition of a law firm in Rule 1.0(c), and prepaid and group legal service plans, and other similar delivery systems, whose usual charges are excepted from the prohibition against a lawyer giving anything of value to a person for recommending the lawyer’s services in Rule 7.2(b). 4. Paragraph (b)(2): Modify to permit lawyers to pay the usual charges of ‘‘a not-for-profit or qualified lawyer referral service’’ This change is intended to more closely conform the Model Rules to ABA policy with respect to lawyer referral services. It recognizes the need to protect prospective clients who have come to think of lawyer referral services as consumer-oriented organizations that provide unbiased referrals to lawyers with appropriate experience in the subject matter of the representation and afford other client protections, such as complaint procedures or malpractice insurance requirements. The effect of the proposal is to permit lawyers to pay the usual charges of a for-profit lawyer referral service, but only if it has been approved by an appropriate regulatory authority [approved by the Vermont Supreme Court] as affording adequate protections for prospective clients, preferably in conformity with the four core standards prescribed in the American Bar Association’s Model Supreme Court Rules Governing Lawyer Referral Services and Model Lawyer Referral and Information Service Quality Assurance Act. Because the need for special regulation arises from the prevailing public perception of lawyer referral services, this special regulatory regime is only applicable to a for-profit organization that holds itself out to the public as a lawyer referral service. See Comment [6]. 5. Paragraph (c): Modify to permit identification of law firm as entity responsible for advertisement The Commission thinks that law firms should be able to designate the firm as the entity responsible for the contents of an advertisement. Such information, rather than the name of a specific lawyer in the firm, should be sufficient to enable disciplinary authorities to take action necessary to protect the public from misleading advertising. 6. Paragraph (c): Require identification of the address of the law firm or lawyer responsible for advertisement Because Rule 7.5 permits the use of trade names and because lawyers frequently advertise in locations where they do not maintain an office, the Commission has added a requirement that each advertisement include an office address for the law firm or lawyer named in the advertisement. This information will help disciplinary authorities track down those who are responsible for an advertisement, but, more importantly, it will provide prospective clients with important information about where the lawyer or law firm is located -an important fact in this era of multi jurisdictional advertising. COMMENT: [3] Although the Commission concluded that a specification of the various public media lawyers can use to market their services should not be included in the Rule text, it thought it appropriate to explicitly affirm the legitimacy of using electronic media, including the Internet and the World Wide Web. The reference to ‘‘lawful’’ electronic mail was included to require lawyers to comply with any law that might prohibit ‘‘spamming’’-i.e., the mass e-mailing of commercial messages. A cross-reference to Rule 7.3(a) has been added to alert lawyers to the proposed prohibition of solicitation by real-time electronic contact. This Comment and the related caption have been deleted because [former] paragraph (b) was deleted from the Rule text. [5] The discussion of advertising expenses has been modified to more accurately reflect the current state of client-development activities in law firms. To this has been added a cross-reference to Rule 5.3 as a reminder of the partner’s and firm’s obligations with respect to the conduct of nonlawyers involved in client development activities. [6] In response to a concern about the ambiguity of the reference in paragraph (b)(2) to ‘‘a legal service organization,’’ this new Comment defines a legal service plan to specifically include prepaid and group legal service plans, and also to include ‘‘a similar delivery system that assists prospective clients to secure legal representation.’’ This clarifies that lawyers may pay the usual charges of not only traditional prepaid and group legal service plans, but also the usual charges of new hybrid plans that might undertake to provide a variety of services to prospective clients. Also by its definition of a lawyer referral service as an organization that holds itself out to the public as a lawyer referral service, the Comment precludes extension of the special regulatory regime governing lawyer referral services to prepaid or group legal service plans and other similar delivery systems. Finally the Comment articulates ABA policy with respect to the core characteristics of a qualified lawyer referral service. 145 [7] This new Comment alerts lawyers who accept assignments or referrals from legal service plans or referrals from lawyer referral services that they must act reasonably to assure that the activities of the plan or service are compatible with the lawyers’ professional obligations.