A state court judge has denied the State Bar of California's attempt to shut down an unregistered lawyer "matching" service and said he was disappointed in the agency's attorneys for their handling of the case.

During a telephonic hearing Thursday, San Francisco Superior Court Judge Ethan Schulman denied the state bar's motion for a temporary restraining order to halt the operation of LegalMatch.com until the company is registered with the bar.

LegalMatch's counsel at Litigation Law Group in Berkeley, California, argued that the temporary restraining order was unnecessary because the company had submitted a timely application to register as a lawyer referral service on March 31, three weeks after the California Supreme Court denied the company's petition to review a decision finding that LegalMatch was a lawyer referral service requiring registration.

In a declaration, Anna Ostrovsky, LegalMatch's chief operating officer, said the decision over LegalMatch's status as a certified lawyer referral service "is now entirely within the control of the State Bar of California." The receipt of the application was not apparent in the state bar's reply briefs.

"I'm disappointed with the state bar for failing to fully disclose the factual background leading to this application," the judge said. "I expect better of counsel representing the state bar."

The state bar's Office of General Counsel filed the suit against LegalMatch on Monday, asserting the bar's duty "to protect the public from unqualified and unscrupulous lawyers." The suit followed the California Supreme Court's decision declining to review Jackson v. LegalMatch.com. In the November decision, the First District Court of Appeal ruled in favor of the plaintiff in that case, attorney Dorian Jackson, who stopped paying his LegalMatch subscription because it was an unregulated lawyer referral service.

Under normal circumstances, Schulman said a court ought to give heavy deference to a public agency empowered to protect the public to seek injunctive relief.

"Here, however, we have a very unusual situation, where a statutory scheme that has been in place for many years was construed for the first time in a matter of first impression in November  2019 that did not become final until April 7," he said. "We also have the application of that scheme to a company that, so far as the record before me reveals, has operated in the same fashion for many years. I have no factual showing before me by the moving party that any member of the public was ever harmed by the operation of that company before the statutory scheme was interpreted to mean something different."

Schulman said that since the bar has the ability to act promptly on the application, it has not meet its burden of showing the need for a temporary restraining order.

Schulman said his order was without prejudice and that if the state bar finds that LegalMatch is not qualified for registration, then it can bring a motion for a temporary restraining order or injunctive relief.

"We look forward to the opportunity to work closely with the State Bar to ensure our submitted application is approved by summer," LegalMatch's Ostrovsky said in an email. "We encourage all other companies in the legal space to reach out to the State Bar and take proactive steps toward registration."

Vanessa Holton, state bar general counsel, said that the agency takes seriously its responsibility to protect the public from harm caused by uncertified lawyer referral services.

"LegalMatch is unlawfully operating as a lawyer referral service under the California Business and Professions Code and a recent California appellate court decision," Holton said in a statement.