History of Legalshield

On July 11, 1969, former CEO and founder Harland C. Stonecipher of Ada, Oklahoma was involved in a motor vehicle accident and was hospitalized. Although the other party was cited for fault, they had filed a suit against him for the accident.[3] He hired a lawyer to defend himself in court, but in doing so, depleted his life savings. After researching the industry of European legal expense plans, Stonecipher created Pre-Paid Legal's predecessor, The Sportsman’s Motor Club, on August 8, 1972. The club offered legal expense reimbursement to its members. Pre-Paid Legal began utilizing "network marketing" (multi-level marketing or MLM) in 1983. Pre-Paid Legal went public on the NASDAQ National Market System in 1984, and is currently listed on the New York Stock Exchange.[4] In 2001, the Wyoming Attorney General issued a press release announcing "When we discovered that Pre-Paid was using prohibited income representations to promote their multilevel marketing program, we warned them that the representations were prohibited by Wyoming law". Pre-Paid paid $4,000 in lieu of civil penalties, reimbursed the state for $1,000 in costs, and refunded $2,000 to participants who claimed to have been misled.[5][6] In July the same year, the company was forced by the U.S. Securities and Exchange Commission (SEC) to stop counting the commissions they paid out to sales associates as assets, instead of expenses,[7] though they did not release their updated, halved, 2000 earnings figures until February 2002.[8] Pre-Paid Legal has faced ongoing troubles in Missouri. After the company settled complaints in 2001, a number of similar suits arose. The company won in a jury trial against two plaintiffs,[9] but after losing others, including one in which a former customer was awarded $9.9 million[7][10] settled with more than 400 others. The company, and the U.S. Chamber of Commerce of which Pre-Paid Legal CEO Harland Stonecipher is a director,[11] have described the lawsuits against