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LegalZoom GC Works to Make the Law Accessible
LegalZoom provides a way for consumers and small businesses to take care of their legal needs. The company, founded in 2001, says more than 2 million customers have created their own legal documents online. LegalZoom customers can start a business like an LLC or corporation, or create personalized living trusts, powers of attorney, wills and divorce papers via the LegalZoom website and also have access to a network of independent attorneys. The Glendale-based company, which employs more than 600 people, delayed plans last August for an IPO expected to raise as much as $96 million. The company is also testing international waters: Last fall LegalZoom announced a deal with QualitySolicitors, a network of independent U.K. law firms.
THE QUICK BIO
Before arriving at one of the nation's leading companies for online DIY legal services in 2003, Charles "Chas" Rampenthal, 45, had a full resume. By the age of 21, the Santa Ana native who grew up in St. Louis says he had become the youngest winged naval aviator in the nation. After a tour flying the P-3 Orion surveillance aircraft, he finished his undergraduate degree in economics and math studies at Southern Illinois University Edwardsville in 1994. He earned a Navy Achievement Medal for combat flight operations during the first Iraq war. After graduating from University of Southern California School of Law in 1998, he began his legal career at the now-defunct Thelen as an associate in construction and corporate litigation. In 2000, he joined the now-defunct Testa, Hurwitz & Thibeault in Boston as a corporate law associate specializing in private companies, M&A, private equity and public company compliance. In 2002, he left to form his own firm dedicated to serving small companies and then joined LegalZoom a year later as general counsel, adding the title of corporate secretary in 2007. From 2007 to 2009, Rampenthal served as the host of "Legally Bound," a weekly legal call-in advice talk show on KTLK and KFWB in Los Angeles.
Rampenthal's job at LegalZoom indicates a thorough comfort with consumers having the upper hand in the legal process, though he's watched much of the legal profession express dismay at this reversal. "My father started a small construction business, and he used the lawyer in town who wasn't necessarily a small-business expert, but it was all he knew and what he could afford. For the average family in the U.S., which has about $50,000 in disposable income, it's tough to afford even a few hours of a lawyer's time," says Rampenthal. On the profession and its view of LegalZoom, he is pragmatic. "There are always people who are going to be haters. You saw it in the travel, car sales and tax prep industries. People who are complacent don't like to see change, but consumers continue to push to do business virtually. That's going to be the case with the law as well. Lawyers who realize this and adapt are going to be ahead of the curve."
He heard about the LegalZoom opening through an ad. "The company was initially looking for a part-time GC. This was mid-2003, so a lot of the fly-by-night Internet companies had already disappeared," says Rampenthal. "I did my research and I really liked that LegalZoom was doing something novel in my own industry they were making the law accessible to the middle class and to small businesses. I think how much my dad's company would have saved if LegalZoom had been around in the '80s when he started." He also contacted LegalZoom board member Gary Culliss, who had been a fellow law student their first year at USC. "Gary told me to send in a resume and get on a plane to L.A., and I immediately did both!" The position has allowed Rampenthal to be involved in a wider variety of legal matters than most corporate GCs. Since LegalZoom offers legal products and services to its customers, he is closely involved in ideation and development.
INSIDE AND OUTSIDE COUNSEL
Rampenthal established LegalZoom's legal department and expanded it to its current staff level of 16, a group that includes 13 attorneys beside him. "We're involved not only in corporate-facing legal work, but also in the legal research and development required for LegalZoom's products and services." Dubbed the "Legal Architect" team, about one half of the in-house attorneys focus solely on product compliance and development. They ensure "that all of our documents are compliant, complete and up to date." He also manages the company's Legal Advisory Council and regularly speaks to legal and consumer groups about the company's mission and says, "It's one of the cool aspects of my job."
He handpicked every member of the department and applies a management model learned from his years as an officer in the Navy. "I was put in charge of teams of people who had technical skills I lacked, like fixing radios. I realized that true leadership doesn't come from barking commands and pulling rank; it comes from fostering a relationship of trust across the entire department. There is no place for micromanagement if you want to change the world you just can't do it on your own." Workload is divided between four VPs who report to Rampenthal, and then down to individual counsel or the legal architect team. As for outside firms, Rampenthal uses Sheppard Mullin Richter & Hampton for corporate work, a team led by partner C. Thomas Hopkins, who Rampenthal calls "a great attorney and savvy businessperson ... my go-to guy when I need a sounding board."
Rampenthal is using Patricia Glaser at Glaser Weil Fink Jacobs Howard Avchen & Shapiro as the company's lead counsel for its lawsuit alleging trademark infringement and unfair business practices against one of its fastest growing competitors, San Francisco-based Rocket Lawyer.
He works with Peter Kennedy at Graves Dougherty Hearon & Moody in Austin, Texas, where about half of LegalZoom's employees are located. They handle certain regulatory and litigation matters. "Pete was the first outside lawyer I hired. He was one of the lead lawyers who worked on a case for (legal publisher) Parsons against the Texas State Bar in the late '90s, and was instrumental in the decision of the Texas Legislature to exclude publishers and software from the definition of the practice of law," which further secured LegalZoom's business model, Rampenthal says. For other litigation matters, LegalZoom has used Robert Thompson at Bryan Cave and Alycia Degen at Sidley Austin.
Rampenthal keeps an eye on outside legal expenses by identifying repetitive tasks and keeping them in house. "Grooming top-notch in-house lawyers helps us retain institutional knowledge and build a knowledge base to make the department more efficient." As for what he looks for in an outside firm, he says, "If a firm doesn't get what we do, then there are plenty that do. I have to know that someone fighting for me believes in my company." As for fee arrangements, he adds, "Not all firms are cut out for alternative fees, and I respect that. However, the ones that are willing to take on some of the risk for a legal matter will generally get my attention."
The first years of Rampenthal's career at LegalZoom were devoted to getting state bar associations and practicing attorneys familiar with the business. "Too often they would hear about the company through a radio ad, or see a TV commercial, and make incorrect assumptions about our business model. I spent some time to ensure that they understood that LegalZoom was not engaged in the practice of law and did not provide any legal advice to customers."
Today, the company is expanding its services to offer access to attorneys. Customers can join a legal plan and receive business or personal legal advice on their LegalZoom documents and other legal matters. "Much of the regulation of the legal profession is directed toward attorney conduct, so we are taking the same care to ensure that all of our offerings, including access to attorneys and legal help, are legally and ethically compliant."
Rampenthal doesn't require in-house pro bono or volunteer work outside the company, but he has volunteered his own time to support entrepreneur-focused organizations like the SBA's SCORE program and the Founders Institute. "I maintain a budget to give to organizations that have a goal of increasing access to the law and giving consumers more choices." Outside of work, he's focused on being a "good dad" to his 19-month-old son with his wife, Yin Zhen, also a USC law grad. They are expecting a baby girl in April. When they have time, "we are big fans of food, and like to think that we are pretty adventurous eaters." Among recent L.A. favorites are Hatfield's and Bashan. Travel is also a priority. "We went to the Maldives on our honeymoon, and have traveled to China (Beijing for the Olympics, Guangzhou to visit family and Hong Kong to shop and eat), Singapore, Thailand, Hawaii, Mexico and all over the U.S. We hope to expose our children to other cultures through travel and food ... but mostly food!"
This article originally appeared in The Recorder.