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An attorney may obtain a client’s authorization to endorse and negotiate an instrument given in settlement of the client’s claim, but only after the client has approved the settlement.(l) While lawyers are associated in a firm, a prohibition in the foregoing paragraphs (a) through (k) that applies to any one of them shall apply to all of them.

The Louisiana Supreme Court adopted this rule on January 20, 2004.

Nothing in this rule shall require client consent in those matters in which a court has certified a class under applicable state or federal law; provided, however, that the court must have accepted and exercised responsibility for making the determination that interest and fees are owed, and that the amount of interest and fees chargeable to the client is fair and reasonable considering the facts and circumstances presented.(vi) In every instance where the client has been provided financial assistance by the lawyer, the full text of this rule shall be provided to the client at the time of execution of any settlement documents, approval of any disbursement sheet as provided for in Rule 1.5, or upon submission of a bill for the lawyer’s services.(vii) For purposes of Rule 1.8(e), the term “financial institution” shall include a federally insured financial institution and any of its affiliates, bank, savings and loan, credit union, savings bank, loan or finance company, thrift, and any other business or person that, for a commercial purpose, loans or advances money to attorneys and/or the clients of attorneys for court costs, litigation expenses, or for necessitous circumstances.(f) A lawyer shall not accept compensation for representing a client from one other than the client unless:(1) the client gives informed consent, or the compensation is provided by contract with a third person such as an insurance contract or a prepaid legal service plan;(2) there is no interference with the lawyer’s independence or professional judgment or with the client-lawyer relationship; and(3) information relating to representation of a client is protected as required by Rule 1.6.(g) A lawyer who represents two or more clients shall not participate in making an aggregate settlement of the claims of or against the clients, or in a criminal case an aggregated agreement as to guilty or nolo contendere pleas, unless each client gives informed consent, in a writing signed by the client, or a court approves a settlement in a certified class action.

The lawyer’s disclosure shall include the existence and nature of all the claims or pleas involved and of the participation of each person in the settlement.(h) A lawyer shall not:(1) make an agreement prospectively limiting the lawyer’s liability to a client for malpractice unless the client is independently represented in making the agreement; or(2) settle a claim or potential claim for such liability with an unrepresented client or former client unless that person is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel in connection therewith.(i) A lawyer shall not acquire a proprietary interest in the cause of action or subject matter of litigation the lawyer is conducting for a client, except that the lawyer may:(1) acquire a lien authorized by law to secure the lawyer’s fee or expenses; and(2) contract with a client for a reasonable contingent fee in a civil case.(j) [Reserved].(k) A lawyer shall not solicit or obtain a power of attorney or mandate from a client which would authorize the attorney, without first obtaining the client’s informed consent to settle, to enter into a binding settlement agreement on the client’s behalf or to execute on behalf of the client any settlement or release documents.

Paragraph (c) is nearly identical to Model Rule 1.8(c) (2002), with one substantive change.

The Louisiana Rule excludes language found in the ABA Model Rule that attempts to sweep within the rule an unspecified class of relatives, namely, “other” relatives or individuals “with whom the lawyer or the client maintains a close, familial relationship.” The LSBA was concerned that this language was too indeterminate to give lawyers fair notice regarding which relatives are included within its scope.

Overhead costs include, but are not necessarily limited to, office rent, utility costs, charges for local telephone service, office supplies, fixed asset expenses, and ordinary secretarial and staff services.

(a) A lawyer shall not enter into a business transaction with a client or knowingly acquire an ownership, possessory, security or other pecuniary interest adverse to a client unless:(1) the transaction and terms on which the lawyer acquires the interest are fair and reasonable to the client and are fully disclosed and transmitted in writing in a manner that can be reasonably understood by the client;(2) the client is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel on the transaction; and(3) the client gives informed consent, in a writing signed by the client, to the essential terms of the transaction and the lawyer’s role in the transaction, including whether the lawyer is representing the client in the transaction.(b) A lawyer shall not use information relating to representation of a client to the disadvantage of the client unless the client gives informed consent, except as permitted or required by these Rules.(c) A lawyer shall not solicit any substantial gift from a client, including a testamentary gift, or prepare on behalf of a client an instrument giving the lawyer or a person related to the lawyer any substantial gift unless the lawyer or other recipient of the gift, is related to the client.

For purposes of this paragraph, related persons include a spouse, child, grandchild, parent, or grandparent.(d) Prior to the conclusion of representation of a client, a lawyer shall not make or negotiate an agreement giving the lawyer literary or media rights to a portrayal or account based in substantial part on information relating to the representation.(e) A lawyer shall not provide financial assistance to a client in connection with pending or contemplated litigation, except as follows.(1) A lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter, provided that the expenses were reasonably incurred.

Paragraph (h) is identical to Model Rule 1.8(h) (2002).

As to prospective waivers, the ABA in 2002 deleted language in the former Model Rule allowing such agreements when “permitted by law.” It did so because it believed that the phrase had no significant role in addressing these conflicts.

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