LegalZoom Files Antitrust Lawsuit Against North Carolina Bar,Inc. has filed an antitrust lawsuit against the North Carolina State Bar. The Wall Street Journal reports:

The company, which sells do-it-yourself wills and other legal documents online, is suing over the bar’s refusal to register its prepaid legal plans marketed to individuals and small businesses.

Offered in 42 states, the plans connect customers to LegalZoom-contracted attorneys, who provide phone consultations and yearly “legal check-ups” as part of a package and can be retained at a discounted rate.

“LegalZoom has been compelled to file this lawsuit because the Defendants are illegally and unreasonably restraining trade in the market for legal services,” says the complaint, which was filed Wednesday in federal court in North Carolina.

A spokesperson for the state bar didn’t respond to a request for comment.

The litigation marks the second time that LegalZoom has sued the state bar, accusing it of refusing to register its prepaid plans. A judge dismissed a claim filed in state court in 2011 because the company hadn’t gotten a “final decision” from the bar regarding its registration request. The lawsuit also triggered a counterclaim by the bar.

I have expressed reservations in the past regarding the quality of documents obtained from automated document generation services like LegalZoom.  See, for example, my interview with Family BusinessCast last year.  This lawsuit is of critical importance and may have implications nationwide for the self-regulation of the legal industry.  As Ben Barton succinctly puts it in his Instapundit post today:

An antitrust suit is a horse of a different color, however, since it challenges the very structure of American lawyer regulation.  S**t just got real.  In my book I talk a bunch about what a tight spot the ABA and state bars find themselves in.  They could try to shut down LegalZoom and Rocket Lawyer through new regulations or even prosecution for the unauthorized practice of law, but the public outcry would be LOUD and the downside risk – an antitrust suit or other attempts to strip lawyers of self-regulation – is very real.  Bar associations have been cursed to live in interesting times indeed.