South Carolina Says LegalZoom is Not Practicing Law

The online legal document site, LegalZoom, recently defended a claim that its business constituted the unauthorized practice of law. LegalZoom reached a settlement agreement, in which they agreed to pay plaintiff’s attorneys $500,000 and asked the court for findings of fact, including that LegalZoom is not practicing law. LegalZoom claimed that it simply provides forms that are available to the public through government agencies, and its software inputs information directly from the client word for word into the form.

In Medlock v. LegalZoom.com, Inc., Special Referee Judge Clifton Newman recommended the settlement and found that LegalZoom’s business model is not the unauthorized practice of law. The South Carolina Supreme Court approved the recommendation. LegalZoom’s business practices have also been challenged in North Carolina.

See Terry Carter, LegalZoom Business Model OK’s by South Carolina Supreme Court, ABA Journal, April 25, 2014.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.