Riley says fees for King's attorneys in BP suit not ideal

Jessica M. Karmasek Sep. 20, 2010, 2:41pm


MONTGOMERY, Ala. (Legal Newsline) - The war of words between Alabama Gov. Bob Riley and state Attorney General Troy King continues, with Riley now responding to King's comments made last week regarding BP's rejection of the state's claim for tax losses resulting from the Gulf oil spill.

Riley countered, in a statement late Friday, that King tried to get him to sign a contract to give his lawyers 14 percent of everything the oil company pays for a disaster the company admits it is responsible for.

"Of the $148 million claim the state filed, King believes his lawyers should get $20 million of that right off the top," Riley said. "Plus, King knows that $148 million is just the tip of the iceberg of what the state will file in claims.

"So under his plan, lawyers will be getting tens of millions of dollars -- possibly even more -- whether or not the litigation is actually required."

Riley goes on to vow that he will make BP pay for "everything it owes," but says he will never sign a contract that "enriches lawyers with tens of millions of dollars that instead should be going to the people of Alabama."

"I know he's very upset about my refusing to sign his contract and it sounds like he vented a little today," the governor said in his statement following King's Friday morning press conference.

On Thursday, BP decided -- in part due to pending litigation -- not to process the $148 million claim from the state for lost revenue.

Riley, following the announcement, issued a statement. In it, the governor pointed fingers at King and his lawsuit, saying he "had no choice" but to increase proration for the education budget by 2 percent because of BP's rejection.

The attorney general said at his press conference that's bunk -- "He and I both know, however, that this lawsuit did not produce proration."

Proration is when the state budgets have to be cut across the board because the state is spending more money than it is taking in.

King contends Riley put the state in its position long before the oil rig exploded.

Riley and other state officials submitted their claim directly to incoming BP CEO Bob Dudley on Aug. 12 during a meeting in Montgomery.

The same day that Riley met with Dudley, King filed two lawsuits against companies including BP for damages against the state.

King has said the oil giant has not acted in good faith, but that the lawsuit can be withdrawn if BP follows through on its promises to clean up the Gulf and make the state whole for damages and losses.

Meanwhile, Riley has expressed repeated concerns that the lawsuits could delay the state being compensated by BP because of lawyers becoming involved.

"Litigation is time-consuming and expensive. It is the threat of litigation that brings people to the table to try to resolve disputes, not actual litigation. Lawsuits are filed when every other effort has failed," he said.

"Troy King's lawsuit stopped the negotiations process cold. And if the lawyers he has hired are actually working for free, as he claims, then why does his lawsuit call for the payment of attorney fees?"

Riley continues, "The facts are clear. Troy King filed this lawsuit without consulting me or local officials on our coast or apparently anyone else but the lawyers who hope to reap millions of dollars off this disaster.

"BP said it is not paying the state's initial claim because of his lawsuit. I've said all along, litigation should never be taken off the table. It is an option the state should consider and ultimately may exercise. But it should never have been filed before we presented our first claim, and it should never be used as a vehicle for King's lawyers to walk away with millions that should go to the people of Alabama," the governor concluded.

From Legal Newsline: Reach Jessica Karmasek by e-mail at

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