Are there any special rules concerning attorney fees in securities arbitration?

Yes, there are special rules concerning attorney fees in securities arbitration in California. Generally, the fee is based on a contingency fee arrangement, where the attorney is paid a percentage of the amount won by the client. The California Rule of Professional Conduct (Rule 3-300) requires that in securities arbitration proceedings, attorneys must not enter into any contingency fee arrangement for the representation of a client unless certain requirements are met. First, the attorney must discuss all legal fees and costs with the client and obtain the client’s written consent. The attorney must explain the advantages and disadvantages of such an arrangement to the client and provide the client with a written fee agreement. The fee agreement must be reasonable under the circumstances and must explain the attorney’s obligation to account for funds spent on behalf of the client and the manner in which the fee is to be calculated and when it is to be paid. Second, the attorney must provide the client with a written statement regarding the progress of the case on at least a quarterly basis. The statement must include, among other things, the execution of all responsibilities of the attorney, a summary of the current status of the case, and a statement as to the amount of time spent by the attorney on the case. Finally, the California Rules of Professional Conduct require the attorney to obtain the written consent of the client before entering into any settlement or withdrawal of the case. This provides the client an opportunity to consider any proposed settlement and to consult with the attorney before the settlement is entered into.

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