Video summary:
In this transcript from a video by Gale & Vallance, Andy Gale, a corporate attorney in Orange County, explains the scope and limitations of LegalZoom incorporation services. He breaks down what LegalZoom does, what it doesn’t do, and the potential risks of relying on automated, fill-in-the-blank forms for your business incorporation.

Please note that this video does not constitute legal advice. For guidance on your specific situation, we strongly recommend consulting a licensed attorney.

Transcript

Introduction & Background (00:00:02 – 00:00:15)

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Should you use LegalZoom to incorporate your business? Well, that kind of depends. First, you need to understand exactly what LegalZoom is. By their own description:

What LegalZoom Does (00:00:15 – 00:00:48)

LegalZoom is an online legal portal to give the visitor a general understanding of the law and they provide you an automated solution to those people who want to prepare their own legal documents. Essentially, they will give you a simple legal form, one that’s fill-in-the-blank. You type in your name and address, you print out the form, and you use it. If it works for your situation, you’re in luck; if it doesn’t, you’re out of luck. The only problem with that is that you don’t find out until the documents fail.

Source & Verification (00:00:48 – 00:01:20)

Now, am I just sort of making this up out of thin air or am I getting this from a real source? I would suggest that I’m getting it from a real source, and the real source is the LegalZoom site itself. First, they take you to the homepage where they entice you with the idea that you’re going to get a personalized, affordable legal solution. Well, it’s personalized because you’re the one who’s filling in the blanks. It’s affordable because they’re offering these fill-in-the-blank forms to you for as little as $99.

Limitations & Legal Protection (00:01:20 – 00:02:08)

Of course, the legal protection is sort of up to debate now whether or not you’re actually getting what you have bargained for. You need to figure that out by going to what they call the Terms of Use. If you click on this link, it will take you to this page, which is the beginning of about 12 pages of legal exclusions, waivers, and fine print as to what they will and will not do for you.

What you really need to understand is:

  • They will do the simple stuff. They’ll review your answers to make sure that it’s complete for spelling and internal consistency of names and addresses.

  • What they won’t do: they won’t review your answers for legal sufficiency, draw legal conclusions, provide legal advice, opinions, or recommendations about your legal rights, remedies, defenses, options, selection of forms or strategies, or apply the law to the facts of your particular case.

In essence, they’re doing nothing for you.

Why LegalZoom Isn’t a Law Firm (00:02:08 – 00:02:56)

Why is that? It’s because they’re not a law firm. They’re required by law to inform you of this. More importantly, they may not perform the services performed by an attorney. Essentially, all they can do is be a legal document preparation service providing a simple fill-in-the-blank form, and you are, in essence, your own lawyer.

Disclaimers & Risks (00:02:56 – 00:03:46)

They will further tell you that LegalZoom and its services are not substitutes for the advice of an attorney. Lastly, they tell you that they will do their best to keep the legal documents accurate, current, and up to date. However, as they recognize, the law changes rapidly. So they’re telling you that they can’t guarantee the information on the site is completely current. Furthermore, the legal information contained on the site is not legal advice and is not guaranteed to be correct, complete, or up to date.

Basically, what you’re going to do is put your personal assets and your family at risk by using fill-in-the-blank forms that have no guarantees. You have no idea whether they’re correct, complete, or up to date.

Advice & Recommendation (00:03:46 – 00:04:28)

So, what’s my advice? My advice is to tell you what they ultimately tell you on the site themselves: if you need legal advice for your problem, or if your specific problem is too complex to be addressed by their tools, you should consult a licensed attorney in your area. That’s the best thing that this site does for you. Unfortunately, it’s buried in the Terms and Conditions. Take it upon yourself that if you’re going to use this site—or encourage someone else that you care about to use the site—spend some time in the Terms and Conditions and understand what you’re getting. I would submit to you it’s not what you think you’ve bargained for.

Outro (00:04:33 – 00:04:40)

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Conclusion: LegalZoom Incorporation Services

This video highlights the limitations and potential risks of relying solely on LegalZoom incorporation services for your business. While the platform provides fill-in-the-blank forms and basic document preparation, it cannot replace professional legal advice. For any complex or unique legal matters, it is strongly recommended to consult a licensed attorney to protect your business and personal assets.