LegalZoom.com Inc v. Rocket Lawyer Incorporated

Filing 37

OPPOSITION re: MOTION for Summary Judgment 31 filed by Defendant Rocket Lawyer Incorporated. (Attachments: # 1 Memorandum of Evidentiary Objections, # 2 Separate Statement of Undisputed Material Facts, # 3 Declaration of Paul Hollerbach with Exhibits A-C)(Jones, Michael)

1
2
3
4
5
6
7
8
9
10
11

Forrest A. Hainline III (SBN 64166)
[e-mail]
Hong-An Vu (SBN 266268)
[e-mail]
GOODWIN PROCTER LLP
Three Embarcadero Center, 24th Floor
San Francisco, California 94111
Tel.: [phone]
Fax.: [phone]
Michael T. Jones (SBN 290660)
[e-mail]
GOODWIN PROCTER LLP
135 Commonwealth Drive
Menlo Park, California 94025-1105
Tel.: [phone]
Fax.: [phone]
Attorneys for Defendant
ROCKET LAWYER INCORPORATED

12

UNITED STATES DISTRICT COURT

13

CENTRAL DISTRICT OF CALIFORNIA

14

WESTERN DIVISION

15
16
17

LEGALZOOM.COM, INC., a Delaware
corporation,
Plaintiff,

18
19
20
21

v.
ROCKET LAWYER
INCORPORATED, a Delaware
corporation,
Defendant.

22
23
24
25
26
27
28

LIBA/2435103.2

Case No. 2:12-cv-09942-GAF-AGR
DEFENDANT ROCKET LAWYER,
INC.’S SEPARATE STATEMENT
OF UNDISPUTED MATERIAL
FACTS IN SUPPORT OF ITS
OPPOSITION TO LEGALZOOM’S
MOTION FOR SUMMARY
JUDGMENT
Date:
Time:
Judge:
Courtroom:

9:30 a.m.
October 21, 2013
Judge Gary A. Feess
740
255 East Temple Street
Los Angeles, CA 90012
Action Filed: November 20, 2012

Pursuant to Rule 56 of the Federal Rules of Civil Procedure and Local Rule

1
2

7.1 of this Court, Defendant Rocket Lawyer Incorporated (“Rocket Lawyer”) hereby

3

submits the following statement of material facts in support of its opposition to

4

LegalZoom’s motion for summary judgment:
MATERIAL FACTS

5
6

LEGALZOOM’S ALLEGED

7

UNCONTROVERTED FACT

8

1.

9

EVIDENTIARY SUPPORT

both providers of online legal products.

LegalZoom and Rocket Lawyer are Rocket Lawyer’s Answer to Amended
Complaint and Amended Counterclaims

10

(“Rocket Lawyer’s Amended

11

Counterclaims”), ECF No. 17, 12:2-3.

12
13

Undisputed.

14

2.

15

compete with one another in the online

16

legal products industry.

Rocket Lawyer’s Amended

LegalZoom and Rocket Lawyer

Counterclaims, ECF No. 17, 12:2-3.

17

Undisputed.

18

3.

19

both offer incorporation and formation

20

services and other online legal products.

Rocket Lawyer’s Amended

LegalZoom and Rocket Lawyer

Counterclaims, ECF No. 17, 12:2-3.

21

Undisputed.

22

4.

23

touts to provide affordable legal services

(“Nguyen Decl.”), ¶ 3, Ex. A (Rocket

24

to individuals, families and business

Lawyer’s “About Us” webpage).

25

owners.

Declaration of Mary Ann T. Nguyen

On its website, Rocket Lawyer

26

Undisputed.

27
28
1
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
5.

Nguyen Decl., ¶ 4, Ex. B (Screen grabs

At least in 2011, 2012 and 2013,

of Rocket Lawyer’s Advertisements).

Rocket Lawyer advertised “free”
incorporation and “free” limited liability
companies (LLCs).

Undisputed.

6.

Nguyen Decl., ¶ 4, Ex. B (Screen grabs

Rocket Lawyer has advertised

of Rocket Lawyer’s Advertisements).

“Zoom Charges $99. Rocket Lawyer is
Fast, Easy, & Free. Incorporate Your

Business Today,” “Incorporate for Free… Undisputed.
Pay No Fees $0,” “Incorporate Your
Business at Rocket Lawyer Free,” “Form
Your LLC Free at Rocket Lawyer” and
“Free… LLCs.”
7.

Nguyen Decl., ¶¶ 2, 5, Ex. C (Screen

Rocket Lawyer’s customers are

required to pay the state fees associated

grabs of state filing options through

with incorporation and formation.

Rocket Lawyer’s services); Declaration

18

of Mary Ann T. Nguyen (“Nguyen

19

Decl.”)

20
21

Undisputed.

22

Objection: Misleading (Fed. R.

23

Evid. 403).

24
25
26
27
28
2
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
8.

Nguyen Decl., ¶ 6, Ex. D (Screen grabs

Customers who access the Rocket

Lawyer link to the “Incorporate for

of Rocket Lawyer’s “Interview” for

Free… Pay No Fees $0,” “Incorporate

“Company Set-Up” and “Company

Your Business at Rocket Lawyer Free,”

Details”)

“Form Your LLC Free at Rocket Lawyer”
Disputed.

or “Free… LLCs” do not discover that

they must actually pay the state filing fees Vu Decl., ¶ 3, Exs. 9, 10, 11.
until after they have accessed the Rocket

Objections: Incomplete (Fed. R.

Lawyer website, completed a “company

Evid. 106); Misleading (Fed. R.

setup” and filled out information relating

Evid. 403).

to the “company details.”
9.

Rocket Lawyer’s Answer and Amended

Rocket Lawyer subsequently

changed the language of these

Counterclaims, ECF No. 17, 2:26-3:1

advertisements after LegalZoom filed its

(“Rocket Lawyer admits that it has

original Complaint.

produced new advertisements regarding

18

its business and a variety of services it

19

offers since the service of the original

20

complaint….”).

21
22

Disputed.

23

Rocket Lawyer’s Answer and Amended

24

Counterclaims, ECF No. 17, 2:26-3:2

25

(“Rocket Lawyer . . . denies that Rocket

26

Lawyer changed its advertisements in

27

response to allegations in the

28
3
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT

3

Complaint.”).

4

Objections: Irrelevant (Fed. R. Evid.

5

401, 402); Subsequent Remedial

6

Conduct (Fed. R. Evid. 407);

7
8
9
10

Misleading (Fed. R. Evid. 403).
10.

Nguyen Decl., ¶ 7, Ex. E (Screen grabs

At least in 2012, Rocket Lawyer

of Rocket Lawyer’s Advertisements).

advertised “Free help from local
attorneys” and “Free legal review.”

11

Disputed.

12

Nguyen Decl., ¶ 4, Ex. E p. 44;

13

Hollerbach Decl., ¶ 23.

14

Objection: Misleading (Fed. R.

15
16
17
18
19
20
21
22
23

Evid. 403).
11.

Nguyen Decl., ¶ 8, Ex. F (Rocket

Rocket Lawyer’s customers could

access “help from local attorneys” or

Lawyer’s On Call Terms of Service,

“legal review” for free only if they were

dated July 2012, as printed on

“Eligible Members” who had either (a)

November 27, 2012).

purchased three consecutive months of
Rocket Lawyer’s monthly Legal Plan, or

Disputed.

(b) purchased a Rocket Lawyer annual

Vu Decl., ¶ 3, Exs. 12, 13; Hollerbach

Legal Plan.

Decl., ¶¶ 22, 23.

24
25
26
27
28
4
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7
8

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
12.

Nguyen Decl., ¶ 9, see

The paid-membership requirement

for access to the purported “free help

http://www.rocketlawyer.com/on-call-

from local attorneys” and “free legal

terms-of -service.rl.

review” was not disclosed in close
proximity to the advertisements on

Disputed.

Rocket Lawyer’s website.

Vu Decl., ¶ 3, Exs. 2, 3, 7, 12, 13.

9

Objections: Irrelevant (Fed. R.

10

Evid. 401, 402); Misleading (Fed. R.

11
12
13
14
15
16
17
18

Evid. 403).
13.

The paid-membership requirement

Nguyen Decl., ¶ 9, see

was only disclosed in Rocket Lawyer’s

http://www.rocketlawyer.com/on-call-

“On Call Terms of Service,” which was

terms-of -service.rl.

accessible to customers on a separate link
found at

It is undisputed that the paid

http://www.rocketlawyer.com/on-call-

membership requirement for legal

terms-of -service.rl.

review of documents was disclosed in

19

Rocket Lawyer’s On Call Terms of

20

Service. However, Rocket Lawyer

21

disputes this statement to the extent it

22

implies that free legal help was only

23

available through a paid membership.

24

Nguyen Decl., ¶ 7, Ex. E; Hollerbach

25

Decl., ¶ 23.

26

Objection: Misleading (Fed. R. Evid.

27

403).

28
5
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7
8
9
10

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
14.

Nguyen Decl., ¶ 10, Ex. G (Rocket

Rocket Lawyer subsequently

changed the language of its “On Call

Lawyer’s On Call Terms of Service,

Terms of Service” to provide that

dated November 2012, as printed on

“Customers who enter into a one week

November 29, 2012).

(seven (7) calendar days) free trial are
eligible to receive one (1) free legal

It is undisputed that Rocket Lawyer

matter consultation…” after LegalZoom

changed the language of its “On Call

filed its original Complaint.

Terms of Service.” However, Rocket

11

Lawyer disputes this statement to the

12

extent it implies that free consultation

13

was not provided in connection with

14

free trials prior to the change.

15

Vu Decl., ¶ 3, Ex. 13; Hollerbach Decl.,

16

¶ 23.

17

Objections: Irrelevant (Fed. R. Evid.

18

401, 402); Misleading (Fed. R. Evid.

19

403); Subsequent Remedial Measure

20

(Fed. R. Evid. 407).

21
22
23
24
25
26
27
28
6
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
15.

The access to “free help from local

Nguyen Decl., ¶ 10, Exs. F and G

attorneys” and “free legal review” during

(Rocket Lawyer’s On Call Terms of

a “free trial” was not available before

Service, dated July 2012, as printed on

LegalZoom’s filing of the original

November 27, 2012; Rocket Lawyer’s

Complaint.

On Call Terms of Service, dated

8

November 2012, as printed on

9

November 29, 2012).

10
11

Disputed.

12

Vu Decl., ¶ 3, Ex. 14; Hollerbach Decl.,

13

¶ 18.

14

Objection: Misleading (Fed. R.

15
16
17
18
19
20
21
22

Evid. 403).
16.

Access to the advertised “free help

from local attorneys” and the “free legal

Lawyer’s On Call Terms of Service,

review” was still conditioned upon

dated November 2012, as printed on

customers actively enrolling in Rocket

November 29, 2012).

Lawyer’s trial membership and providing
Rocket Lawyer with their credit card

Undisputed.

information.

Objection: Misleading (Fed. R.

23
24
25
26
27

Nguyen Decl., ¶ 11, Ex. G (Rocket

Evid. 403).
17.

Nguyen Decl., ¶ 12, Ex. H (Rocket

At least in 2012 and 2013, Rocket

Lawyer “Try It Free” Advertisement).

Lawyer advertised on its website “free”
trials of its “Basic Legal Plan” and “Pro

Undisputed.

Legal Plan.”

28
7
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
18.

Nguyen Decl., ¶ 13, Ex. I (Rocket

Customers who sign up for a one-

week free trial membership under the

Lawyer’s “Free” Trial Enrollment

“Basic Legal Plan” or “Pro Legal Plan”

Page).

must first provide Rocket Lawyer with
their credit card information and enroll in

Disputed.

Rocket Lawyer’s “negative option”

Vu Decl., ¶ 3, Exs. 5, 6; Hollerbach

program – i.e., a program in which

Decl., ¶¶ 16, 17.

customers are automatically enrolled and

Objections: Misleading (Fed. R.

billed and must contact Rocket Lawyer to

Evid. 403); Legal Conclusion (Fed. R.

opt out of.

Civ. Proc. 56(c)(4); L.R. 7-7).

19.

Nguyen Decl., ¶ 13, Ex. I (Rocket

A disclosure of Rocket Lawyer’s

negative option is found in standard font

Lawyer’s “Free” Trial Enrollment

only upon the customer being directed to

Page).

enroll in the “free trial,” and no further
acknowledgement regarding the negative

Disputed.

option is provided.

Vu Decl., ¶ 3, Exs. 5, 6.

19

Objections: Incomplete (Fed. R.

20

Evid. 106); Misleading (Fed. R. Evid.

21

403); Legal Conclusion (Fed. R. Civ.

22

Proc. 56(c)(4); L.R. 7-7); Irrelevant

23
24
25
26

(Fed. R. Evid. 401, 402).
No further acknowledgement

Nguyen Decl., ¶ 13, Ex. I (Rocket

regarding the negative option (other than

Lawyer’s “Free” Trial Enrollment

as described in 19.) is provided.

Page).

20.

27
28
8
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT

3

Disputed.

4

Vu Decl., ¶ 3, Exs. 5, 6.

5

Objections: Incomplete (Fed. R.

6

Evid. 106); Misleading (Fed. R.

7

Evid. 403); Legal Conclusion (Fed. R.

8

Civ. Proc. 56(c)(4); L.R. 7-7); Irrelevant

9
10
11
12
13
14
15
16

(Fed. R. Evid. 401, 402).
21.

On October 13, 2011, LegalZoom’s Nguyen Decl., ¶ 14, Ex. J (E-mail

Chairman, Brian Liu, contacted Rocket

Exchange Between Brian Liu and Dan

Lawyer’s CEO, Dan Nye, stating that

Nye, dated October 13, 2013).

there were “important issues that
[LegalZoom’s] legal department has

Undisputed.

brought up regarding [Rocket Lawyer’s]

Objections: Incomplete (Fed. R.

advertising.”

Evid. 106); Irrelevant (Fed. R.

17

Evid. 401, 402); Hearsay (Fed. R.

18

Evid. 801, 802); Misleading (Fed. R.

19
20
21
22
23
24

Evid. 403).
22.

Nguyen Decl., ¶ 14, Ex. J (E-mail

Dan Nye responded by stating that

Liu should discuss this issue with Charley Exchange Between Brian Liu and Dan
Nye, dated October 13, 2013).

Moore, Rocket Lawyer’s founder and
Chairman, and copied Moore on the email

Undisputed.

exchange.

25

Objection: Incomplete (Fed. R.

26

Evid. 106).

27
28
9
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2
3
4
5
6
7
8
9
10

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT
23.

Nguyen Decl., ¶ 15, Ex. K (E-Mail from

On October 14, Brian Liu had a

Brian Liu to Charley Moore, dated

telephone conversation with Charley

Moore, stating that LegalZoom took issue October 14, 2011).
with Rocket Lawyer’s ads, which
promised “Set up a Free LLC… Totally

Undisputed.

Free,” and “100% Free,” since state filing

Objections: Irrelevant (Fed. R.

fees must always be paid when setting up

Evid. 401, 402); Hearsay (Fed. R.

an LLC through Rocket Lawyer.

Evid. 801, 802); Legal Conclusion (Fed.

11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

R. Civ. Proc. 56(c)(4); L.R. 7-7).
24.

Nguyen Decl., ¶ 15, Ex. K (E-Mail from

Brian Liu also asked Charley

Brian Liu to Charley Moore, dated

Moore to read and follow the Federal

Trade Commission’s guidelines regarding October 14, 2011).
the use of the word “free” in advertising,
which requires, among other things, that

Undisputed.

“all terms, conditions and obligations

Objections: Irrelevant (Fed. R. Evid.

upon which receipt and retention of the

401, 402); Hearsay (Fed. R. Evid. 801,

“Free” item are contingent should be set

802); Misleading (Fed. R. Evid. 403);

forth clearly and conspicuously at the

Legal Conclusion (Fed. R. Civ.

outset of the offer so as to leave no

Proc. 56(c)(4); L.R. 7-7); Best Evidence

reasonable probability that the terms of

(Fed. R. Evid. 1001, 1002).

the offer might be misunderstood.”
25.

Nguyen Decl., ¶ 15, Ex. K (E-Mail from

Brian Liu requested that Rocket

Lawyer immediately take down these and

Brian Liu to Charley Moore, dated

other misleading advertisements.

October 14, 2011).

27
28
10
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

LEGALZOOM’S ALLEGED

2

EVIDENTIARY SUPPORT

UNCONTROVERTED FACT

3

Undisputed.

4

Objections: Misleading (Fed. R. Evid.

5

403); Hearsay (Fed. R. Evid. 801, 802);

6

Legal Conclusion (Fed. R. Civ.

7
8
9
10
11

Proc. 56(c)(4); L.R. 7-7).
26.

Nguyen Decl., ¶ 16, Ex. L (Liu’s

In November 2011, Rocket

November E-mails to Rocket Lawyer).

Lawyer’s advertising regarding “free”
trials and services still had not been

Undisputed.

changed or removed.

12

Objections: Hearsay (Fed. R.

13

Evid. 801, 802); Best Evidence Rule

14
15
16
17
18
19

(Fed. R. Evid. 1001, 1002).
27.

Beginning November 15, 2011, in a Nguyen Decl., ¶ 16, Ex. L (Liu’s
November E-mails to Rocket Lawyer).

series of emails, Brian Liu repeatedly
requested that Rocket Lawyer discontinue
its false advertising and unfair

Undisputed that the email exchange

competition practices.

occurs, but disputed as to the

20

characterization of Rocket Lawyer’s

21

conduct.

22

Objections: Misleading (Fed. R.

23

Evid. 403); Hearsay (Fed. R. Evid. 801,

24

802); Legal Conclusion (Fed. R. Civ.

25

Proc. 56(c)(4); L.R. 7-7).

26
27
28
11
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

ADDITIONAL MATERIAL FACTS

1
2

ROCKET LAWYER’S STATEMENT

3

OF MATERIAL

4

UNCONTROVERTED FACTS IN

5

SUPPORT OF ITS OPPOSITION

6

28.

7

business model whereby it would sell

8

legal products to consumers on the

9

EVIDENTIARY SUPPORT

Internet, but only deliver final documents

Vu Decl., ¶2, Ex. 1, ¶ 7, Ex. 20; ¶ 7, Ex.

In 2000, LegalZoom developed a

21.

10

in hard copy by mail.

11

29.

12

to approximately two million customers.

13

30.

14

has offered users various online legal

15

services, many for free or included in a

16

subscription plan.

17

31.

18

a number of legal forms, letter templates,

19

and informative articles about many areas

20

of law.

21

32.

22

provide access to all of Rocket Lawyer’s

23

legal software, enabling users to create,

24

edit, store, e-sign, download, print, or

25

share with an attorney for review all legal

26

documents created on Rocketlawyer.com.

27

33.

LegalZoom has provided services

Vu Decl., ¶ 2, Ex.1.

Beginning in 2007, Rocket Lawyer

Vu Decl., ¶ 3, Exs. 2, 3, 4; Hollerbach
Decl., ¶ 3.

Free to all Rocket Lawyer users are Hollerbach Decl., ¶ 4.

Rocket Lawyer’s subscription plans Hollerbach Decl., ¶ 5.

The Rocket Lawyer service has

Hollerbach Decl., ¶ 6.

28
12
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
always been built on a cloud-computing
platform that helps consumers to satisfy
their legal needs without waiting for
delivery of a physical document by mail.
34.

Hollerbach Decl., ¶¶ 7, 8.

Rocket Lawyer has served

approximately nine million customers,
over 90% of whom have never paid
anything to Rocket Lawyer for use of its
services.
35.

Hollerbach Decl., ¶ 9, Ex. A.

Rocket Lawyer’s service is

constantly progressing in support of its
mission to make legal help affordable to
everyone.
36.

At the time LegalZoom’s complaint Hollerbach Decl., ¶ 10.

was filed, Rocket Lawyer offered two
types of subscription plans—a Pro Legal
Plan with premium access to all Rocket
Lawyer functionality, and a Basic Legal
Plan, which excluded only the
functionality related to forming or
running a business.
37.

Similar to free trials offered by

Vu Decl., ¶ 3, Exs. 5, 6, 7; Hollerbach

many consumer businesses, any consumer Decl., ¶ 11, Ex. B.
13
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25

EVIDENTIARY SUPPORT

ROCKET LAWYER’S STATEMENT
OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
could try a Basic or Pro Legal Plan and all
services available under the selected plan,
for seven days at no cost, provided that
the consumer canceled the plan by the end
of the seventh day.
38.

Vu Decl., ¶ 3, Exs. 5, 6, 7, 8.

If a consumer chose not to cancel

their trial plan by the end of the seventh
day of the plan, the trial converted to a
paid version of the plan on the eighth day.
39.

Vu Decl., ¶ 3, Ex. 7; Hollerbach Decl., ¶

Even if a consumer canceled the

12.

free trial, he would continue to have full
access to Rocketlawyer.com for the
remainder of the trial period, and have
post-trial access to any documents created
during the trial.
40.

Hollerbach Decl., ¶¶ 13, 14.

A typical user would enroll in a

free trial by clicking on a search engine
ad, such as an ad for a legal document;
the link would direct the user to an
interactive interview for the document.

26
27
28
14
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
41.

At the end of the interview, the user Vu Decl., ¶ 3, Ex. 8; Hollerbach Decl., ¶

had the option to enroll in a free trial or a

14; ¶ 15, Ex. C; ¶ 16.

paying plan; if the user elected to enroll in
a free trial, the user would be taken to a
web page explaining the Pro or Basic
Legal Plan.
42.

Hollerbach Decl., ¶ 17.

The explanatory web pages were

also available through Rocket Lawyer’s
homepage and other channels.
43.

Vu Decl., ¶ 3, Exs. 5, 6; Hollerbach

By toggling between the Pro and

Decl., ¶ 16.

Basic plan options, a consumer could
choose which type of plan he or she
would like to try.
44.

Vu Decl., ¶ 3, Exs. 5, 6.

The explanatory pages for both

plans contained information regarding the
free trial and conversion to subscription
plans, and included a toll free phone
number the user could call to cancel the
free trial plan; the toll free number was,
and still is, at the top of the registration
pages.

27
28
15
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
45.

Vu Decl., ¶ 3, Ex. 7.

In addition, to ensure that

customers have answers to questions
about the free trial, Rocket Lawyer has an
FAQ section devoted to them, which also
details the different ways a customer can
cancel any plan—through the customer’s
account page, via chat, email, or
telephone.
46.

Customers can access the terms and Vu Decl., ¶ 3, Exs. 5, 6; Hollerbach
Decl., ¶ 17.

conditions for the website in general on
each page of Rocketlawyer.com, and must
acknowledge the same terms and
conditions before acting to enroll in any
Rocket Lawyer subscription plan.
47.

Vu Decl., ¶ 3, Exs. 9, 10,11; Hollerbach

All members enrolled in a free or

Decl., ¶ 19.

paying Pro Legal Plan receive free
incorporation services; Rocket Lawyer
charges no fee for its services in assisting
in the filing and processing of
incorporation or entity formation papers
submitted by free trial or paying Pro
Legal Plan members.

27
28
16
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
48.

Vu Decl., ¶ 3, Exs. 9, 10, 11.

Members enrolled in a free or

paying Pro Legal Plan who require
incorporation services only pay the statemandated filing fees, which Rocket
Lawyer discloses at various stages of the
incorporation interview prior to requiring
any payment information.
49.

Vu Decl., ¶ 3, Exs. 9,11.

Members enrolled in a free or

paying Pro Legal Plan who require
incorporation services may also add
services not required, though commonly
preferred, related to incorporation or
entity formation—such as a federal tax
ID, a registered agent, etc.—which
Rocket Lawyer provides at a discount
over its competitors.
50.

Rocket Lawyer’s subscription plans Vu Decl., ¶ 3, Exs. 12, 13; Hollerbach
Decl., ¶ 22.

include access to Rocket Lawyer’s On
Call attorneys who can provide legal
advice or live consultations, answer
written questions, and/or review legal
documents.

27
28
17
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25

EVIDENTIARY SUPPORT

ROCKET LAWYER’S STATEMENT
OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
51.

Hollerbach Decl., ¶ 23.

Outside of the On Call program,

Rocket Lawyer registered users, whether
on a free trial or a legal plan, can contact
an attorney for a free consultation at any
time.
52.

A search on Google.com for “legal

Vu Decl., ¶ 4, Ex. 14; ¶ 5, Ex.15; ¶ 6, Ex.
16.

documents” generates information for
over a dozen companies on the first page
of the search alone; many of these
companies offer services similar to
Rocket Lawyer’s and advertise such
services in a similar fashion.
53.

Vu Decl., ¶ 7, Ex. 17.

LegalZoom now offers packaged

documents, such as real estate leases, and
allows customers to edit and download
these forms electronically; however,
LegalZoom charges $29 for the forms
about one area of law and only allows
customers to edit the forms for one week,
unless they pay an additional $20 for
unlimited revisions.

26
27
28
18
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
54.

Vu Decl., ¶ 7, Exs. 21, 22, 23.

LegalZoom also began to offer

Hollerbach Decl., ¶ 21.

incorporation services; however, unlike
Rocket Lawyer or other competitors such
as Law Depot, Incforfree, and
Mycorporation, LegalZoom continues to
charge a fee for its assistance with the
filing process.
55.

Vu Decl., ¶ 7, Exs. 18, 19; ¶ 12, Ex. 30.

LegalZoom also began offering

subscription plans with attorney
consultation time in 2011; however,
LegalZoom still adheres to the postal mail
business model and does not appear to
offer any single plan comparable to
Rocket Lawyer’s Pro Plan (i.e. a plan that
combines business and personal support).
56.

Vu Decl., ¶ 7, Ex. 19.

Legal Zoom only discounts

attorney services outside of the
subscription plans by 25%.
57.

Rocket Lawyer’s On Call attorneys

Vu Decl., ¶ 3, Exs. 12, 13.

agree to discount services by 40% or
charge $125 an hour.

27
28
19
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
58.

Vu Decl., ¶ 7, Exs. 21, 22.

LegalZoom has advertised its

incorporation services without disclosing
the additional state-imposed fees in the
same way Rocket Lawyer has.
59.

Vu Decl., ¶ 7, Exs. 21, 22, 23.

LegalZoom and Rocket Lawyer

each have published advertisements in
which state fees are not referenced;
whereas the Rocket Lawyer ad provides a
link with more information regarding
pricing, where state fees are disclosed,
when a consumer clicks on the referenced
LegalZoom ad, they are brought to a
LegalZoom webpage that displays
incorporation pricing with no reference to
state fees.
60.

Vu Decl., ¶ 7, Ex. 23.

In a direct comparison,

LegalZoom’s prices are higher than
Rocket Lawyer’s even if state fees were
listed, because LegalZoom always
charges for the incorporation service it
provides.

26
27
28
20
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
61.

Rocket Lawyer’s disclosure of state See Vu Decl., ¶ 14, 32; ¶ 15, Ex. 33.

incorporation fees has been described as
clearer than LegalZoom’s disclosure.
62.

LegalZoom does not disclose in its

Vu Decl., ¶ 7, Ex. 24.

own advertisements the third party costs
associated with using LegalZoom.com
identified in its Supplemental Terms of
Use.
63.

Vu Decl., ¶ 7, Ex. 25; ¶ 8, Ex. 26.

LegalZoom has published and

continues to publish advertisements
claiming that it has an ‘A’ rating with the
Better Business Bureau (“BBB”).
64.

LegalZoom has not had an ‘A’

Vu Decl., ¶ 9, Ex. 27; ¶ 10, Ex. 28; ¶ 11,

rating with the BBB since March of 2013. Ex. 29.
65.

Hollerbach Decl., ¶ 19.

Rocket Lawyer charges no fee for

its assistance in processing and filing
incorporation papers for trial and paid Pro
Legal Plan Members.

24
25
26
27
28
21
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27

EVIDENTIARY SUPPORT

ROCKET LAWYER’S STATEMENT
OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
66.

Rocket Lawyer does not retain any

Vu Decl., ¶ 3, Ex. 11; Hollerbach Decl., ¶
20.

portion of the state fees charged in
connection with incorporation; all such
charges are assessed by the state, and thus
are entirely passed on to the state through
a third party.
67.

Nguyen Decl., ¶ 7, Ex. E; Hollerbach

“Free legal help” has always been

available to registered users in the form of Decl., ¶ 23.
free consultations with On Call attorneys.
68.

Each Rocket Lawyer advertisement Nguyen Decl., ¶ 4, Ex. B

at issue contains a link to
Rocketlawyer.com or is published on
Rocketlawyer.com.
69.

Vu Decl., ¶ 3, Exs. 9, 10, 11.

Rocket Lawyer discloses the state

fees on the incorporation and entity
formation page of its website, and at other
points prior to the customer inserting any
credit card information.
70.

Rocket Lawyer does in fact provide Hollerbach Decl., ¶ 23.

the “free legal help” advertised by making
attorney consultation available to all
registered users.

28
22
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1

ROCKET LAWYER’S STATEMENT

2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

EVIDENTIARY SUPPORT

OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
71.

Vu Decl., ¶ 3, Exs. 5, 6, 7.

All of the details of Rocket

Lawyer’s free trial plan are disclosed on
Rocketlawyer.com.
72.

Vu Decl., ¶ 7, Exs. 22, 23.

Regarding the Rocket Lawyer

advertisement which states that “Zoom
Charges $99, We’re Free,” LegalZoom’s
incorporation services start at $99; the
advertisement therefore fairly references
the lowest price offered by LegalZoom.
73.

Vu Decl., ¶ 4, Ex. 14; ¶ 5, Ex.15; ¶ 6, Ex.

All competitors offer low-cost

16; 13, Ex. 31.

services, neutralizing the materiality of
price, and customers differentiate among
them based on speed, quality, ease of use,
and breadth of services.
74.

Hollerbach Decl., ¶¶ 24, 25.

After March 2013, when Rocket

Lawyer began to mention state fees in all
of its incorporation advertisements, the
average number of incorporations
performed using Rocket Lawyer services
each month remained basically
unchanged.
75.

Rocket Lawyer’s free trial is not

Vu Decl., ¶ 3, Exs. 5, 6, 7.

contingent upon the purchase of any item.
23
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT

1
2
3
4
5
6
7
8
9
10
11
12
13

EVIDENTIARY SUPPORT

ROCKET LAWYER’S STATEMENT
OF MATERIAL
UNCONTROVERTED FACTS IN
SUPPORT OF ITS OPPOSITION
76.

Vu Decl., ¶ 3, Ex. 8.

The incorporation services

webpage conspicuously discloses that the
service is available for free trial and
paying Pro Legal Plan members and the
price of these plans – free and $39.95 per
month.
77.

Hollerbach Decl., ¶ 26.

The FTC has never initiated an

action nor contacted Rocket Lawyer about
any of its advertisements.

14
15
16
17
18
19
20
21
22
23

Dated: September 23, 2013

GOODWIN PROCTER LLP
By: /s/ Michael T. Jones
Forrest A. Hainline III (SBN 64166)
[e-mail]
Hong-An Vu (SBN 266268)
[e-mail]
Michael T. Jones (SBN 290660)
[e-mail]
GOODWIN PROCTER LLP
Attorneys for Defendant
ROCKET LAWYER INCORPORATED

24
25
26
27
28
24
DEFENDANT’S SEPARATE STATEMENT OF UNDISPUTED FACTS ISO ITS OPPOSITION TO PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT