LSUC Finally Fights Back Around Legal Advertising

Legal marketing has begun to run amok in many major cities in Canada.

I raised attention to this nearly 2 years ago in National Magazine, and since then the mainstream media has picked up on it as well. In particular, the Toronto Star has run a series of articles, focusing primarily on the personal injury bar. There were apparently 604 complaints about licensee advertising in Ontario between 2011-2015, over half of which were initiated by the Law Society of Upper Canada itself.

In response to this, Convocation last Friday introduced a number of changes. The first was to implement caps for referral fees, ostensibly in response to law firms structured to primarily generate revenue through referrals. The actual quantum of these caps will be determined at a later date.

The second set of changes also focused on advertising, but provide further clarification about what is appropriate. The Advertising & Fee Arrangements Issues Working Group of the Professional Regulation Committee tabled amendments to the Rules of Professional Conduct which would prohibit bait and switch marketing, as well as other practices which have been subject to complaints over the past few years, especially the use of awards and rankings by fictitious or dubious organizations that appear to be intended to mislead the public.

Although these are both positive moves, likely to stem the tide of frenzied legal advertising that was quickly taking a hold, there are still many outstanding concerns. Many critics within the legal community suggest that all that LSUC needed to do was enforce their existing rules.

Indeed, it’s quite puzzling to note that not a single lawyer has ever been disciplined for a contravention of the Rules on marketing. To date, the law society has disciplined 4 paralegals on advertisements, typically involving apparent misleading information about status or scope of practice.

Instead, the law society has relied on compliance once a complaint has been made, meaning law firms only remove the offending material once they’ve been put on notice by the regulator. Given the proliferation of advertisements, law firms, and professionalism issues though, there are usually multiple infractions on different components of advertisement at any given time, and the law society only deals with a narrow aspect of it with a firm in question.

To understand why there hasn’t been more formalized discipline, we need only look at the backlash in the Groia case. Lawyers don’t take kindly to regulation by the law society, especially where the basis for the discipline is subjective, ambiguous, and open to interpretation.

For this reason alone, the changes to the Commentary in Rule 4-2 will help draw a line for what is acceptable, and what is not. In order for it to be effective though, there will also have to be some form of consequences for those who deliberately or repeatedly offend.

One area which has not yet been weighed upon is on the use of Google Adwords for a competitor, something which has been a hot issue in other jurisdictions. The new Rules and Commentary are unclear as to whether this would be included in the definition of “bait and switch.”

The use of competitor Adwords is certainly occurring in Canada, as Cameron Addison-Huff points out here in 2013. Keyword advertising disputes come up relatively frequently in business contexts outside of the law as part of trademark disputes.

For example, the Supreme Court of British Columbia decided in Vancouver Community College v Vancouver Career College (Burnaby) Inc. that the use of a competitor keyword did not constitute passing off. In doing so, they applied the following test,

[180] To impose liability on the defendant for the tort of passing off the plaintiff must satisfy me that:

a) it enjoys goodwill attached to the educational services it provides;
b) its services have acquired a distinctiveness in the marketplace;
c) the defendant has caused confusion by intentionally or otherwise misrepresenting its services as those of the plaintiff; and
d) the plaintiff is likely to suffer damage as a result of the defendant’s misrepresentation.

The Court of Appeal for British Columbia recently released a decision that allowed the appeal, on the basis that the trial judge incorrectly applied these principles on the record before him. The Court of Appeal clarified that the confusion that occurs by the person searching the web occurs at the time of the search results, and not when they arrive at the landing page.

[71] I conclude the second component of passing off, confusion, is fully established by proof that the respondent’s domain name is equally descriptive of the appellant and contains the acronym long associated to it. In my view, it was an error for the judge to discount the likelihood of confusion before the searcher arrives at the landing page of the website. Adopting the language of Masterpiece at para. 24, the judge “should have limited his consideration to how a consumer, upon encountering the [“VCC”] would have reacted”, and on that question, the necessary likelihood of confusion is established.

The Court of Appeal in Vancouver Community College did not extend this further to include the use of bidding on keywords as sufficient to satisfy passing off,

[72] …Merely bidding on words, by itself, is not delivery of a message. What is key is how the defendant has presented itself, and in this the fact of bidding on a keyword is not sufficient to amount to a component of passing off, in my view.

In 2013, the Court of Appeals in Wisconsin in Habush v. Cannon rejected the plaintiff’s claim under publicity rights, not passing off, for the defendant using keywords of their name to attract web traffic. Although the court agreed that the defendant’s strategy was to take advantage of the flow of people seeking out the plaintiff based on the value of their names, they likened it to a competitor who opened a branch office next door. This decision was notably decided under a very particular statutory regime, and a rather unique civil remedy that was ultimately rejected.

However, the regulatory context of lawyers engaging in this type of conduct is markedly different than the application of civil liability. Lawyers in other jurisdictions have been subject to discipline for engaging in it.

The Grievance Committee of the North Carolina State Bar provided a censure in 2013 to a lawyer who had participated in an Adwords campaign for his competitors. The court stated In re David J. Turlington that the censure was appropriate because in 2012, the North Carolina State Bar published a formal ethics opinion, Use of Search Engine Company’s Keyword Advertisements, which indicated it was a violation of their rules to use these keywords for this purpose. The lawyer in this case continued with his Adwords campaign even after the release of this opinion.

The 2015 decision by The Supreme Court of South Carolina,  In the Matter of Zachary Steven Naert, gives further context to where these adds are used to add a negative context to a competitor. The court provided a public reprimand for a lawyer who paid for search results for lawyers on the other side and their client, suggesting that the other side may have ripped off members of the public searching for their names.

But there are states which have decided the opposite way, or at least haven’t provided blanket prohibitions on keyword advertising. In fact, Goldman & Reyes argue in the Illinois Law Review that the North Carolina rule is an anachronism which needs to be changed.

The Professional Ethics Committee for the State Bar of Texas released an opinion last year that states that it is normally acceptable to use a competing lawyers name as part of a keyword ad strategy,

Recognizing that many potential clients search for a lawyer by using internet search engines, Lawyer A uses various search-engine optimization techniques to try to ensure that his name appears on the first page of the search results obtained when a potential client uses a search engine to seek a lawyer. One way Lawyer A seeks to achieve this goal is by participating in internet search-based advertising programs offered by search engines that are in widespread use by many types of businesses.

These search-based advertising programs allow a business to select specific words or phrases (“keywords”) that will cause the business’s advertisement to pop up in the search results of someone using that keyword in a search. The advertiser does not purchase exclusive rights to specific keywords; the same keywords can be used by a number of advertisers.

The Florida Bar has also released an opinion last year that stated,

…the purchase of ad words is permissible as long as the resulting sponsored links clearly are advertising based on their placement and wording, and because meta tags and hidden text are outdated forms of web optimization that are penalized by search engines and can be dealt with via existing rules prohibiting misleading forms of advertising.

In doing so, they withdrew their previous Proposed Advisory Opinion from 2013, which had a completely opposite position.

Although the new Commentary to Rule 4-2 in Ontario states, “It is important that there be no “bait and switch” aspect to marketing, it also provides a definition for this as “marketing by which clients are attracted by offers of services, prices or terms different from those commonly provided to clients who respond to the marketing.” These examples are not an exhaustive list though of advertising which may be “misleading, confusing, or deceptive, nor likely to mislead, confuse or deceive.”

The expansive nature of legal advertising is steadily moving from billboards to online. In the Wild West of the Internet though, lawyer marketing is still subjective, ambiguous, and open to interpretation, meaning it’s unlikely we will get either clarification or discipline from the law society on these issues.

One guideline might be that it’s okay to have a proliferative name online, just avoid making or implying disparaging remarks about particular lawyers or firms for the purposes of marketing.

A better one would be that the online context provides us greater opportunities to meet our broader professional responsibilities, including promoting access to justice (R 4.1-1), encouraging respect for the justice system (R 5.6), and exhibit the fundamental values of honour and integrity (R 2.1).