Lots of consumer bankruptcy lawyers have been caught up in the Zelotes v. Chern matter.  The case, if you haven’t been following it, speaks to whether a pay-per-lead online advertising business model is tantamount to paying illegal referral fees.

You can take a look at some of the articles from around the blogosphere here, because I’m not inclined to go into it in full again.

Is TotalAttorneys Complaint A Total Joke?

Ethics Complaint Tests Internet Marketing Method

One of the things that Mr. Zelotes relied upon was the Virginia State Bar Standing Committee on Legal Ethics draft Legal Ethics Opinion 1851, which

generally addresses whether a lawyer may ethically participate in a third party Internet website or organization that invites a prospective client to submit case information and then automatically forwards that information to a very limited number of participating lawyers if the service: 1) charges a fee based upon either an agreement to an exclusive geographical listing for the lawyer; 2) charges a fee based upon very strict limitations on the number of participating lawyers in each geographical practice area; or 3) charges a set fee per referrals or client contact.

Well, looks like the good guys have scored a victory, as least in part.  The Virginia State Bar has announced that is has withdrawn proposed legal ethics opinion 1851, Participation in a Third-Party Internet Website for future consideration.

I know this isn’t the end of the case, but it’s a ray of sunshine – and proof that at least one state bar association recognizes that online legal marketing demands a dose of reality rather than more heavy-handed regulation.

Thanks to Ben Glass for the heads up.  A copy of the opinion case be found here.