LegalZoom has hit its Google-backed rival, Rocket Lawyer, with a lawsuit over its allegedly unfair business tactics.LegalZoom, which sells legal documents directly to customers, is accusing Rocket Lawyer of promoting its services as “free,” when in fact users still have to pay subscription and filing fees, Wall Street Journal’s Law Blog reported.
This is done “for the purpose of injuring LegalZoom,” the company claims.
Both companies provide essentially the same low-cost legal services, but their business models differ.
While LegalZoom sells legal documents — wills and trademark applications among others — at a cost, Rocket Lawyer gives users the forms for free but then offers prepaid legal plans costing from $10 to $40 per month, according to the Law Blog.
Charley Moore, Rocket Lawyer’s founder and executive chairman, told the Journal that LegalZoom has resorted to a lawsuit only because of his company’s growth.
In 2011, Rocket Lawyer received a healthy $18.5 million investment from Google after having raised $7 million earlier in the year, according to Forbes.
“[LegalZoom] is relying on litigation rather than innovation to compete,” Moore said.
Moore also released a statement saying Rocket Lawyer would “vigorously defend itself against LegalZoom’s false accusations.”
Business Insider reached out to LegalZoom for comment but did not receive an immediate response.
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