LegalShield – Wikipedia, the free encyclopedia
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LegalShield is a privately held corporation that offers specialized legal service products in the United States and Canada. The original company, Pre-Paid Legal Services, Inc., was founded on August 8, 1972, and made its initial public offering in 1984. Pre-Paid Legal Services, Inc. was a member of the S P 600 SmallCap index and the S P 1500 Super Comp index, prior to being acquired by Mid Ocean Partners.
The company’s name changed to LegalShield after the acquisition.
LegalShield develops, and markets pre-paid legal service plans through a network of more than 50 independent provider law firms across the U.S. and Canada. The Company also markets an identity theft monitoring and restoration services through its partnership with Kroll Inc.
Products are also sold as an employee benefit through payroll deduction. The company has legal service plans for small businesses as well advertised with NFL Hall of Fame player Fran Tarkenton as spokesman.
Today, LegalShield has its headquarters in Ada, Oklahoma. The company owns several subsidiaries. Pre-Paid Legal Casualty, Inc. operates in Alabama, Arizona, Arkansas, Georgia, Illinois, Montana, Nebraska, Tennessee, Wisconsin.
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.
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.
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.
Pre-Paid Legal reported to the SEC that less than 25% of its sales representatives sold more than one insurance plan in 2005, but avoids reporting such information to prospective sales representatives.
that Pre-Paid Legal had been subpoenaed by the SEC for various documents including those pertaining to a stock repurchase program that Pre-Paid started in April 1999. (And in 2006, the company said it would repurchase $27.4 million of shares owned by executives.)
that it received a complaint from the Federal Trade Commission (FTC). The proposed draft complaint alleged that Pre-Paid’s “ADRS program and related materials violate Section 5(a) of the FTC Act regarding asserted misleading representations, express or implied.”
In January 2011, Pre-Paid Legal agreed to merge with entities formed by MidOcean Partners, a premier private equity firm headquartered in New York which it says is “focused on the middle market.” The transaction would result in the company becoming privately held. The deal closed on June 31, 2011.
that it would change its name to LegalShield. The new corporate name for the 40 year old company was said by the company to be part of an overall re-branding initiative following the acquisition of Pre-Paid Legal Services, Inc. by MidOcean Partners.
Bernick, Bob, Jr. (October 30, 2008). “Shurtleff’s Fundraising Trounces Hill’s Deseret News (Salt Lake City) Newspaper Find Articles at BNET”../p/articles/mi_qn4188/is_20081030/ai_n30951143. Retrieved October 23, 2009.
U.S. Chamber of Commerce – June 27 – U.S Chamber Reappoints Harland Stonecipher, CEO of Pre-Paid Legal Services, to Board of Directors”.. U.S.
Chamber of Commerce. June 27, 2005. . Retrieved October 23, 2009.