Attorney General No.

SA95RF0027

Secretary of State No.

680

Description

ATTORNEY-CLIENT FEE ARRANGEMENTS. SECURITIES FRAUD. INITIATIVE STATUTE. Prohibits restrictions on fee arrangements attorneys may make with clients, except those existing on January 1, 1995. Allows courts to prohibit illegal or unconscionable fees. Prohibits deceptive conduct in purchase or sale of securities resulting in loss to institutional or personal retirement funds, savings. Imposes civil liability, including punitive damages, for losses. Authorizes class actions, derivative suits; declares "fraud on market" doctrine applicable. Business entities cannot indemnify officers found liable for specified deceptive practices, but may purchase insurance covering such liability. Declares measure conflicts with ballot measures restricting attorney fees or securities fraud actions. Summary of estimate by Legislative Analyst and Director of Finance of fiscal impact on state and local governments: Possible increase in securities fraud lawsuits with an unknown increase in court related costs to state and local governments. Could result in additional revenue to the state from civil damages payable to state General Fund.

Proponents

Lois Wellington, Mary Alexander, Ramona Jacobs C/O: Joseph Remcho And Robin Johansen Remcho, Johansen & Purcell, 220 Montgomery Street, Suite 800, San Francisco, Ca 94104 (415) 398-6230 Fax (415) 398-7256

Date

11-21-1995

Document Type

Initiative

Qualified

Qualified

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