DENVER – Colorado Attorney General John Suthers today announced a consumer protection lawsuit against Broomfield-based Legal Aid U.S. (http://legalaidus.com), and its owner, Dan Ketelsen. The lawsuit alleges that the defendants failed to deliver the “paralegal and attorney services” they advertised nationally on the Internet.
According to the Attorney General’s lawsuit, Legal Aid U.S. misrepresented to consumers that it was licensed to provide legal services and advice, including representation in court. The complaint alleges that the company actually employs only non-attorneys to draft legal documents for consumers to file in court. These documents are frequently rejected by the court or fail to achieve any results. The complaint also alleges that Legal Aid employs non-attorneys to act as “intake specialists,” who answer calls and dispense legal advice, despite the fact that they are not authorized or properly trained to do so.
Legal Aid allegedly required up-front payments from an estimated 400 consumers that averaged between $399 and $1,000. Rush jobs for legal services increased the price by as much as $300. Only after the defendants received consumers’ money via credit card or MoneyGram, did they send a written agreement that disclosed to consumers that they were not attorneys and did not represent consumers in court.
According to the complaint, the company’s most effective marketing tool was simply its misleading name. The defendants knew from experience that their use of the term “Legal Aid” frequently misled consumers into believing they were contacting a local, government-subsidized legal services organization staffed by attorneys.
The Attorney General sued another legal services company, Legal Aid National Service, for whom Dan Ketelsen formerly worked, in January of 2008, resulting in closure of the company and a default judgment of $1.3 million in August of last year. In today’s lawsuit, the Attorney General is seeking more than $300,000 in consumer restitution, fines, and penalties.