Planet Money - What's up with all the ads for law firms?

Episode Date: October 4, 2024

The lawyer commercial is almost an art form unto itself. Learned practitioners of the law doing whatever it takes to get your attention, from impressive dirt bike stunts to running around half naked. All so when you land in trouble, you don't have to think hard to remember their name. Odds are you can name one or two right now.This world of law ads did not exist fifty years ago. Then, lawyers were not allowed to advertise. Not by law, by the exclusive organization that decides who gets to be a lawyer: state bars.On today's episode, how that changed. How a couple of lawyers placing an ad in a local newspaper led to the inescapable world of law firm ads we know today. And, how the right to advertise got put on the same level as some of the most important, fundamental rights we have.This episode was hosted by Nick Fountain and Jeff Guo. It was produced by Sam Yellowhorse Kesler with help from Sean Saldana. It was edited by Jess Jiang. It was fact-checked by Sierra Juarez and engineered by Valentina Rodríguez Sánchez. Alex Goldmark is Planet Money's executive producer.Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

J.D. Vance and Tim Walz had their first and only debate on Tuesday. What happened? The NPR Politics Podcast has you covered with all the news and analysis from the vice presidential debate. Listen to the NPR Politics Podcast wherever you get your podcasts. This is Planet Money from NPR. Of all the homegrown American art forms, like jazz or tap dance or abstract expressionism, is there anything more quintessentially American than advertisements for lawyers? Talents of Justice! for lawyers. Yes, here is one for a lawyer in Texas. He's called the Texas Law Hawk. He's wearing a suit and tie trying to convince the citizens of Texas to call him when they

get in trouble, all while riding a mini dirt bike. Dude, pass this! Dude, wheelies! Another great one, it's from Lerner and Rowe Law Group out of Arizona. Every time you hit the road, your face with a lot of possible danger. This is two grown men, distinguished members of the bar, dressed up as Mario and Luigi,

driving around in like Mario Kart cars. If you're hurting a wreck and you don't call learner row, it's. It's a me, your lawyer. But my all time favorite is this one from a firm in Missouri that calls itself the Jungle Law Group. Lost in the legal jungle? Have no fear. The lawman is here. Yeah, here is a lawyer swinging across the screen

on a vine like George of the Jungle style, and he's like half naked. Case dismissed. Call me, 1-833-4-JUNGLE. The lawman never sleeps. But it wasn't that long ago that none of these ads would be allowed, not because they're tacky, but because for most of the 20th century,

lawyers were basically not allowed to advertise. Until a few of them did the unthinkable. They put this ad in a newspaper. This sounds so quaint now. Do you need a lawyer? Legal services at very reasonable fees. Divorce or legal separation, uncontested, $175 plus $20 court filing fee. Preparation of all court papers and instructions on how to do your loan on your... Hello and welcome to Planet Money. I'm Nick Fountain. And I'm Jeff Guo. There was a time back in the day when lawyers couldn't come out with clever TV ads or billboards or bus station ads. It was all forbidden. Today on the show, how that changed. How we went from a boring ad in a local

newspaper to lawyers who will do things like swing through a fake jungle on a fake vine. And how along the way the right to advertise got put on the same level as some of the most important fundamental rights we have. As election day approaches, NPR's Consider This podcast is zooming in on six states that could determine who wins the White House. Georgia, Nevada, Wisconsin, Michigan, Arizona, and Pennsylvania. We'll ask voters in these swing states what matters to them and which way they want the country to go. Follow along with new episodes this week

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Listen on Spotify. The story of how the U.S. got blanketed with advertisements for lawyers on billboards and bus stop ads and TV and radio starts in the 1970s in Phoenix, Arizona. Two young attorneys had just started a new firm. Their names were John Bates and Van Osteen. The first decision they had to make, according to John Bates, what to call their new firm? Bates and Osteen or Osteen and Bates? So he said, okay, here's what we'll do. We'll flip a coin and the person who wins has the choice of even have their name first or they can have the nicest office because we had one office that was much better.

So I won and I said, okay, it's legal clinic of Bates and Osteen and he got the nice big office. So that's fine. That's, that's how that got started. The idea behind Bates and Osteen was to create a low cost law firm for the masses. This was kind of revolutionary at the time. The rich of course had access to lawyers. Absolutely no problem. They just go and ask their rich buddy at the golf course, you know, who do you recommend? And boom, they got somebody. And for the poor, there were public defenders and legal aid. But for the rest of the population, aka the vast majority of people, hiring a lawyer was an ordeal.

John says the middle class just didn't have that many options. There was nothing out there, nothing. There was not only an ability to find one, but there were no specialized law firms dealing with the problems of that segment of society. So you had that too. Bettenostein would not be like the other law firms. No! They were gonna be like an assembly line for everyday legal needs. They were gonna specialize in simple cases that they could get done quickly and that they could charge a small fee for.

Divorce, adoptions, name changes, bankruptcy, stuff like that. Maybe some landlord-tenant stuff. So you weren't creating just a workhorse law firm. Yeah, I mean, it was devoted to kind of common problems that people had. It was a volume business. Well, that's the problem. Yeah, pretty soon, John and Van realized they had a big problem. The classic problem of any volume business. When your margins are low in order to make a profit,

you need to get a lot of people in the door. But they couldn't find clients, or rather, clients couldn't find them. And the reason is, well, that is what this show is all about. They couldn't advertise. In the early 1970s, lawyers were essentially banned from advertising. I'm assuming you couldn't go out into traffic with a big sandwich board and say the legal clinic of Bates and Osteed. No? No. Can you put your name on a pencil and give that out? No. No. Can you advertise in a newspaper? No. Can you advertise on TV? On the radio?

Oh no, of course not. You would be disbarred for that, yeah. Disbarred is a pretty big deal in the law. Very serious thing. This anti-advertising rule came from the Arizona bar. The bar is like a professional guild. Every state has one, and they control who gets to call themselves a lawyer and practice the law. In fact, full disclosure, I'm a lawyer and I had to join a bar.

Yes. Now, every state bar at the time had rules banning lawyers from advertising. The reason they gave was that advertising was unprofessional, ungentlemanly, maybe even unethical. In their minds, advertising would lead to this race to the bottom quality-wise and create an industry full of skeevy lawyers. It was a slippery slope from advertising to ambulance chasing. Instead, the state bar expected lawyers to attract clients by getting referrals from other lawyers or, in the oldest-fashioned way, just waiting for clients to waltz into their offices.

But from John's point of view, the bars ban on advertising made it much harder for new law firms like his and Vann's to get clients. It was a barrier to them and to new entrants in general. Well, yeah, monopoly. Yeah, pretty much. Sure. Yeah. I mean, most attorneys who would never try to start their own firm, they say, wow, you're going to start your own firm? How are you going to make that happen? You're just a young guy at a law school. Nobody knows you're there. How are you going to start? That was exactly the problem that John and Van were running into. Without advertising, they couldn't get enough clients to make their business work.

And so they make a fateful move. They decide, screw it, let's risk getting in trouble with the bar and put an ad in the newspaper. The one we heard in the beginning. Divorce or legal separation, uncontested, $175 plus $20 court filing fee. And this right here, this is the ad that changed everything. Information regarding other types of cases furnished upon request, legal clinic of Bates and Husteates and hostene god anyway that's what it was John knew they'd

immediately get in trouble with the Arizona bar in fact he was kind of hoping they'd get some free publicity out of it so when the Arizona bar hauled them before a disciplinary committee they were ready they'd already lined up their own lawyer and they filed an appeal saying that the bar's ban on advertising was illegal, might even violate the Constitution. Their case went to the highest court in Arizona. They lost. But that meant they could take it all the way to the Supreme Court of the United States. That is after the break. People in Nevada are more racially diverse than a lot of swing states.

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excellence. This is NPR. So, it's a bitterly cold day in January in 1977. John and Van are headed to the Supreme Court. They put on their suits and ties, they walk up the marble steps, and they sit down on the long wooden benches. John says it kind of felt like going to church. Everybody who's ever visited the Supreme Court will tell you, it's a lot more intimate than you'd expect. The judges are pretty much in your face, all nine of them sitting in a row.

The Chief Justice announces the case. We'll hear arguments next in 76-316, Bates and others against the state bar of Arizona. The Chief Justice of the United States was saying your name. Yeah, I think that's right. Yeah. John and Van's lawyer gets up, he goes up to the lectern, and starts making their arguments. Mr. Chief Justice, may I please the court? John says you could hear every creak of the benches and cough from the audience. Yeah, it was so quiet that when John turned to Van to say something, one of the court police immediately noticed. John had violated the number one rule of being in the audience, which is don't talk. Right away, the guy, the guard said, pointed at me, he said,

you, one more time. And I was thinking, wait a minute, I'm the guy, it's me that this is all about, you can't throw me out. I'm the Bates. It's me, Bates. Yeah, yeah, yeah. That's the thought that went through my head. But I thought, boy, you better watch out. You know, you only get thrown out of your own case because I would have been thrown out. Now, the lawyer representing John and Van, he tried a couple different arguments that day. But the most interesting one and the controversial, was based on this brand new,

kinda wacky legal theory that advertising is protected by the First Amendment. You know, free speech. Yeah, John and Van had landed themselves in the middle of this huge revolution in how we think about the First Amendment. Up until this point, when people thought about the First Amendment, they were thinking like newspaper editorials or political cartoons, not ads for Kleenex or whatever. But in the courtroom that day, sitting on the benches, there was this guy, a guy who had been quietly working to change all of that. Alan Morrison. A-L-A-N.

Morrison. Gotta get that spelling right. Alan is the person who came up with that weird new legal theory about the First Amendment. I won't agree that it's weird. I'll say it's innovative. And that's what we tried to be. And we're going to spend some time with Alan because this idea that he came up with, it's become kind of legendary.

It's low-key changed how the economy works. The story goes like this. Back in the early 70s, Allen was this hot shot young lawyer working for the consumer rights crusader Ralph Nader. They ran this law firm that represented consumers and the public. They would sue big corporations, big government agencies. The ideology was we were little guys, we were going to sue the big guys. A big focus for Allen was ending this ban on lawyer advertisements. He had started looking into it years before John and Van got in trouble with the Arizona bar.

But Allen came at it from a different angle. Yeah, from the side of consumers. Allen thought that a lot of advertising was good for consumers, could give them valuable information about the market, even help drive down prices. And Allen had the perfect lawsuit to test this idea. He'd been cultivating a very interesting case in Virginia. It was about pharmacies. Right. Back in the 1970s, lawyers weren't the only ones who were banned from advertising.

There were statutes in Virginia, and I think 35 states, that made it illegal to advertise the price of prescription drugs. The pharmacist couldn't advertise that we'll sell this insulin drug for X and our competitors are selling it for X times two. Absolutely forbidden. And Alan, being the consumer rights lawyer that he was, he thought this was terrible for customers. Yeah. When pharmacists can't advertise their prices, it's much harder for customers to comparison shop.

This is where Alan came up with his revolutionary idea. His new idea was that advertisements were so important that they should be protected by the Constitution, by the First Amendment. And you have to understand, at the time, just how absolutely whackadoo this idea was. Yeah, because the way people had always thought about the First Amendment, it was about securing democracy. It was about giving people the right to criticize their government. It wasn't about commercial speech. It wasn't about advertising.

In fact, Allen's idea went directly against Supreme Court precedent. The court had literally said nobody has a First Amendment right to advertise. But that was not going to stop Alan. He was a hot shot young lawyer who wasn't afraid of any precedent. And one day he thought he might have found a workaround. I felt like, you know, And one day he thought he might have found a workaround. I felt like, you know, oops, we got an idea. You see, most of the time when courts talk about the First Amendment, they're talking about someone's right to speak, to say something. But Allen was like, hold on, there's this other side to the First Amendment.

The people who want to hear you, the listeners, they have First Amendment rights. Allen's idea was to focus on the listeners. So instead of arguing that pharmacists in Virginia have a First Amendment right to advertise, he argued that the pharmacist's customers, the people of Virginia, had a right to listen, to receive and have access to information about drug prices through advertising. And yeah, that was a controversial idea. I remember I had a conversation with a neighbor of mine. It was a lawyer at a big firm, nice guy, very smart.

And I told him about the case. He said, ah, you have no chance of winning. I said, well, I don't know about that. And I was right and he was wrong. Yeah, this Virginia pharmacy case went all the way to the Supreme Court. And Alan won! He got the court to basically overturn its own precedent. And you know, in the end, what really seemed to convince the justices was this economic argument that Alan had made. The Federal Trade Commission had done a study, and the study showed that in the states where advertising

of prescription drugs was permitted, the price of those drugs dropped dramatically as compared to the states where it wasn't permitted. Basically, free speech through advertisements equals lower prices. Allen had convinced the court that free speech wasn't just important for politics or democracy. It was also important to the economy, that the free flow of economic information was essential to having a free market society. Alan's weird legal theory had become the new Supreme Court precedent. Advertising or commercial speech, That was now protected under the First

Amendment. Which brings us back to John and Van's argument at the Supreme Court. Remember, their goal was to make it possible for lawyers to advertise. And their lawyer gets up there and he basically says if pharmacy ads are protected by the First Amendment, then lawyer ads should be protected too. I submit that all of the elements which the court found commanded First Amendment protection in Virginia State Board of Pharmacy are present in this case. And it works! The justices vote 5-4 and the majority felt like these

advertisements were protected speech because they spread useful information about prices and legal services. John and Van had won their case. Lawyers were now allowed to advertise. And initially, ads for lawyers were kind of quaint. But they soon spread from newspapers to billboards to the radio and to television. These days, to be a successful lawyer, it's often not enough to just be good at, you know, the lawyering part. You also have to be good at selling yourself.

Maybe, you know, even swing on a vine half-naked. The lawman never sleeps. Every time you hit the road, you're faced with a lot of possible danger. Challens of Justice! At the same time, advertising has created a world where there are just much more low-cost legal services out there. People have more access to lawyers. There's more competition in the market.

And that commercial speech doctrine that Allen pioneered and John and Van pushed forward where the government has to tread lightly when regulating advertising, it kind of took on a life of its own. Yeah, Alan's Virginia Board of Pharmacy case went way beyond just pharmacists or even lawyers. This is a case that is taught in every law school because it completely changed how companies are allowed to talk to their customers. Yeah, it has been used to defend ads for liquor and cigarettes and gambling. It's one of the reasons we have so many drug ads on television these days. Alan's case opened up a kind of Pandora's pillbox.

So are you the person who is responsible for, like, all of those prescription drug commercials we see on TV now? Like, Cylanta Mom may give you heartache and dizziness. That's you. You opened the door to that. Yep. I guess. I guess. now like, Sylanta Mom may give you heartache and dizziness. That's you. You opened the door to that. Yep. I guess.

I guess. But one of the great inventions of modern times is the mute button. Alan says, yeah, when he's watching TV nowadays, he does find some of those ads distasteful. But in the end, he has no regrets. Should we do the credits double speed, triple speed like in the pharma ads? We can try it, Nick. This episode was produced by Sam Yellahorse Kessler with help from Sean Saldana, edited by Jess Jang and packed by C.R. I'm going to do that again slow because they deserve it. They deserve it!

This episode was produced by Sam Yellowhorse Kessler with help from Sean Saldana, who was edited by Jess Jang and back checked by Cierra Juarez. Engineering by Valentina Rodriguez Sanchez. Alex Goldmark is our executive producer. Special thanks to Van Osteen, he declined a recorded interview, but he kindly talked to me about the story. The Supreme Court audio you heard today comes from Oye, a free law project at the Legal Information Institute at Cornell. I'm Jeff Glow.

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