Whether these services are worthwhile depends on a person’s budget, the stage of his/her company’s development, and the type of service needed.

For example, if you need to set up a company in a vanilla fashion (no special provisions in the incorporation or formation documents), then using a legal document service could be an economical alternative to hiring a lawyer.  (You should be aware however that most state corporation divisions provide easily accessible forms and straightforward processes by which you can set up a company on your own without using an attorney or a legal document service.)

Likewise, if you have already been through the trademark registration process with your attorney, and are comfortable with registering a new mark on your own, a flat-fee trademark registration service might be suitable for you.

So, when should you not use online legal document services?

When you need legal advice.  Simple — but true.

Review the fine print:  Your use of an online service may be subject to a disclaimer that states that the online service provider is not acting as your attorney or providing legal advice.  The disclaimer may even recommend that you consult an actual attorney.   I do not knock these services, since the administrative solutions that they provide for certain complicated forms may be just what you seek.   But you should know what you are receiving for your fees, so that you are not surprised if you later discover that you did not get what you wanted (or needed).

Anticipate future circumstances:  if you envision offering stock options, or foresee raising money from venture capitalists, for example, then you should consider consulting with an attorney, who can draft appropriate provisions to include in your formation documents in order to prepare for these events (well, forget the VC bit, as VC’s will insist on changing whatever provisions you initially include, regardless!).

The point is that legal document services are sometimes, but not always, helpful for the budget-conscious, do-it-yourself individual.  Certain matters are more complex, and really should be addressed with the advice of experienced counsel, who will be conversant about your business and its goals (and who will have professional liability insurance).

What do I say about the cost disparity between a legal document service and a real attorney?  When you pay for a service, then later have to pay to correct an oversight or error relating to that service, have you really saved any money?