On The Case

House Judiciary Committee targets lawyer ads, mass torts marketing

(Reuters) - Bob Goodlatte, the Virginia Republican who chairs the U.S. House Judiciary Committee, isn’t yet done kicking plaintiffs’ lawyers in the gut.

In the midst of a week in which the House of Representatives passed a series of bills to curtail class actions and mass torts litigation, Rep. Goodlatte issued a press release signaling his next target: lawyer advertising and marketing for personal injury clients. The Judiciary chairman sent letters to the American Bar Association and the bar associations of all 50 states and the District of Columbia, urging them to require all legal advertisements to include a disclaimer advising patients to consult a doctor before discontinuing their use of supposedly dangerous medication. Goodlatte cited a resolution adopted last June by the American Medical Association, which said patient care is jeopardized by ads from personal injury lawyers prowling for clients. “The legal profession, which prides itself on the ability to self-regulate, should consider immediately adopting common sense reforms,” the Goodlatte letter said.

Advertising by personal injury lawyers, as you probably know, is a particular bugaboo for the Chamber of Commerce. The Chamber’s Institute for Legal Reform issued a 2015 report claiming that trial lawyers were projected to spend nearly a billion dollars that year on legal ads, nearly twice what they spent in 2008. Tort reform groups have even started their own ad campaigns spoofing over-the-top spots by plaintiffs’ lawyers.

Alas for defendants, the U.S. Supreme Court said in 1977’s Bates v. State Bar of Arizona that the First Amendment allows lawyers to advertise for personal injury clients. Without lawyer ads, Justice Harry Blackmun wrote in the majority opinion, “the not-quite-poor and the unknowledgeable” might not be informed of their legal rights. “Although advertising might increase the use of the judicial machinery, we cannot accept the notion that it is always better for a person to suffer a wrong silently than to redress it by legal action,” Blackmun wrote. The Bates opinion is a giant obstacle for any legislation to restrict lawyer ads, which is presumably why Goodlatte is prodding for self-policing from the ABA and state bar associations.

Goodlatte also sent a potentially more consequential letter to a legal advertising firm called the Relion Group. Based on its website and the website of its parent company, Lead Generation Technologies, Relion seems to be a mass torts client generator. It runs advertisements about supposedly dangerous drugs and medical devices, advising prospective clients to call toll-free telephone numbers. Prospects are presumably screened by call center telemarketers and referred to plaintiffs’ firms in Relion’s legal network. (“You pay only for the qualified leads you receive that are pre-screened to meet your lead criteria,” the Relion site promises.)

I’ve spent a lot of time learning about the far-flung – and unregulated – industry of helping plaintiffs' lawyers find and sign up mass torts clients. My reporting focused on the vast litigation over pelvic mesh, in which the defendant American Medical Systems has alleged some extremely shady behavior by a mass torts lead generator called Law Firm Headquarters. According to AMS, Law Firm HQ improperly solicited clients to file mesh claims and worked with a medical funding outfit to lure mesh plaintiffs into unnecessary surgery in order to obtain bigger settlements. Law Firm HQ’s sister company, Excelium, filed for bankruptcy last August and is under investigation by a federal bankruptcy trustee. It has denied all of AMS’s accusations of misconduct.

To be absolutely clear: There is nothing in Rep. Goodlatte’s three-page letter to Relion to suggest Relion is engaged in illegal or unethical practices. Nor is there any indication of why the congressman chose to write to this particular company, which is certainly not the only mass torts lead generator in the business. Goodlatte’s letter, in fact, includes references to anti-Xarelto ads by the Sentinel Group, another mass torts marketer, and by the since-dissolved law firm Pulaski & Middleman, which specialized in signing up mass torts clients for referral to other law firms that actually litigate cases.

But Goodlatte demanded responses from Relion on some very pointed questions, not just about legal advertising but about its marketing tactics as well. Congress wants to know which plaintiffs firms Relion works with, how it acquires names of potential direct marketing leads, what information it collects from prospective clients, where its call centers are located and how it vets telemarketers. Goodlatte also asked Relion to provide copies of all of the company’s active contracts with plaintiffs’ lawyers. The letter, addressed to Relion executive Brendon Condon, orders the company to respond by March 21.

Mass torts marketing doesn’t get much attention from the outside world, even though it’s a crucial cog of the machinery of big personal injury litigation. If you look at the roster of sponsors for just about every conference of trial lawyers, you’ll find legal marketing shops that promise to help lawyers find clients. The ABA model rules allow lawyers leeway to use these services, though at least some state bars prohibit lawyers from paying referral fees to for-profit lead generators.

Goodlatte’s letter to Relion could be the beginning of significant federal scrutiny of the way plaintiffs’ lawyers obtain clients. That’s not going to be an inquiry the plaintiffs’ bar will welcome.

I emailed Relion and Lead Generation Technologies for comment on the House Judiciary Committee’s letter but didn’t get a response.