Former AG's name comes up during Lackey testimony

Victoria Johnson Hoggatt Apr. 17, 2008, 1:55pm



OXFORD, Miss. (Legal Newsline) - Not one, but two Mississippi attorneys general, seem inextricably linked to famed fallen tort attorney Richard "Dickie" Scruggs.

When former Attorney General Mike Moore played himself in the Russell Crowe movie "The Insider" after Scruggs and Moore took on the giant tobacco industry and won, and the association was all good.

Now that Scruggs has pled guilty to federal conspiracy charges for participating in the attempted bribery of Lafayette County Circuit Judge Henry Lackey, those links are proving embarrassing.

The attorneys general that shared in Scruggs' glory have lately shared in Scruggs' problems in Mississippi and Alabama, which have helped spawn proposed legislation in Mississippi to limit the Attorney General's power to utilize outside attorneys, often campaign contributors, to help in state business.

In Oxford hearings Tuesday and Wednesday, specially appointed Circuit Judge William Coleman granted a motion for sanctions against Scruggs and other former members of the Scruggs Katrina Group in Jones v. Scruggs et al, in favor of attorney John Jones. Jones was a joint venture partner who claims he was unfairly cut out of SKG's litigation and filed suit in Lafayette County, hoping to increase his share of SKG attorney's fees.

After Scruggs was indicted for the attempted bribery in the Jones v. Scruggs case in November, Jones' attorneys filed a motion for sanctions for the judicial bribery.

They asked Lackey's replacement, Coleman, to impose the most severe penalties possible, that the court strike the former SKG partners' motion to compel arbitration and strike their answer to Jones' complaint, which would have the practical effect of entitling Jones to an entry of default.

All that would remain for the Jones lawsuit would be a determination of actual damages, including whether punitive damages are warranted.

Discovery and a hearing on Jones' motion to strike the pleadings of the defendants had been delayed pending outcome of the Scruggs federal criminal trial.

Lackey came off the bench where he was presiding over an armed robbery trial in the adjacent courtroom to testify Tuesday and served as the plaintiff's most material witness, as he gave his first testimony in open court of the role of the FBI and former attorney Timothy Balducci in the judicial bribery scheme.

No trial was held on the federal criminal charges due to guilty pleas of Scruggs and all co-defendants, including Balducci.

Though Lackey's testimony was the stuff of novels -- "I felt like a lost ball in tall weeds," he said -- perhaps his most dramatic testimony concerned current Mississippi Attorney General Jim Hood and predecessor Moore, who was in the audience as counsel for Zach Scruggs.

Dickie Scruggs, Zach's father, was the first witness called, and invoked Fifth Amendment protection against self-incrimination at least 19 times.

Moore, who was a University of Mississippi law school student with Dickie Scruggs, involved himself in the representation of Zach Scruggs at the risk of his own political detriment, and is currently representing the country of Nigeria in an anti-tobacco lawsuit similar to the one he won with Dickie Scruggs for Mississippi. The lawsuit there seeks, among other things, to limit tobacco companies from giving free cigarettes to children, a practice common in the third world.

Lackey stated under oath that after Balducci, who represented Scruggs in another attorneys fees dispute, had offered him a job and asked "a personal favor" on behalf of his "mighty good friends," Lackey spoke with other colleagues and Assistant Third Circuit District Attorney Lon Stallings about the matter.

Stallings recommended reporting the improper overture to John Hailman, then Chief of the Criminal Division of the U.S. Attorney's Office in Oxford. Lackey said he didn't report the overture to Hood because Moore had said that if Hood didn't help Scruggs, possibly a reference to dismissing criminal charges against State Farm Insurance Cos., then Scruggs would find and support another candidate for attorney general.

The audience was shocked, as was Moore, who quietly let out a denial. The audience included the chief federal prosecutor on the Scruggs criminal trial, and most thought that the elderly white-haired judge had misspoke. Not so.

Later, Lackey seemed intent on clarifying Moore's relationship to Scruggs and Hood. Lackey related that when he reported the egregious ethical violation to a district attorney that he intentionally did not inform Hood, because Stallings told him that Moore had been sent by Scruggs to relay to Hood that if Hood did not cooperate with action favorable to Scruggs in Katrina litigation, that Scruggs and friends would recruit and support another candidate for attorney general, like they were doing "for insurance commissioner".

Lackey spoke of his recusing himself because he couldn't bring himself to ask Balducci, his friend, for money, like FBI Agent Bill Delaney was asking him to do. After notifying Hailman of his decision to quit presiding over the case and participating as a wired informant for the FBI, Delaney was waiting in Lackey's office after lunch the next day.

The conversation that ensued convinced Lackey that he didn't realize "the monster we were dealing with" and Lackey re-entered the case and cooperated, "hoping against hope" that Balducci would not accept his overture for money. The federal target was obviously Scruggs. Lackey testified that he told Balducci, "I don't want your money. I want Scruggs' money."

Lackey became emotional after defense counsel questioned his use of "monster" and turned to address the audience, "Don't you think it is a monster, that has destroyed young men's lives, and their families' lives?"

One had to believe that Judge Lackey was referring not only to promising attorneys Balducci and Joey Langston, who is so beloved in his home town of Booneville, that the local newspaper featured an article on the grief of the community over the Langston and Balducci pleas to judicial bribery, but perhaps the engaging and personable young attorneys general whose reputations have been tarnished by the Scruggs association.

Langston and Balducci, campaign contributors of Hood's, were given state contracts by Hood before their downfalls.

Now, the state legislature is debating how to limit the attorney general's heretofore hugely successful practice of appointing mass tort lawyers as special assistant attorneys general to prosecute state business, fueled by a growing suspicion that an unholy combine that joins state prosecutorial power to civil lawsuits is being used to twist the arm of big business to settle huge civil tort and tax cases.

Former Gov. Kirk Fordice criticized Moore during the tobacco litigation for hiring supporters like Scruggs to pursue the case.

"Any idiot can see it's all about lawyers' fees," Fordice said.

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