High-flying Missouri trial lawyer faces billing fraud charges
A wealthy Kansas City-area trial lawyer with ties to Missouri Attorney General Jay Nixon stands accused of padding a client's expenses bill.
Two former employees of well-known Independence, Mo.-based law firm Humphrey, Farrington & McClain (HFM) allege that star lawyer Ken McClain "illegally" charged a client about $274,000 in extra expenses.
HFM was one of five law firms signed on by Nixon to Missouri's Medicaid-based tobacco lawsuit just five months before a $6.7 billion settlement was awarded in 1998. Their appointment and the subsequent fees they garnered drew charges of political favoritism.
The two former employees have sued HFM claiming wrongful termination "in violation of public policy whistle-blowing" over McClain's billing, according to today's Kansas City Star.
The two allege they were fired last year for pointing out concerns that McClain had assigned expenses incurred on other accounts to the account in question. The bill allegedly padded was from a tobacco-liability suit, McClain has confirmed.
McClain has recently won jury verdicts of $50 million for popcorn-factory workers sickened by factory fumes and $20.5 million in a tobacco-liability suit.
A year before Nixon signed HFM onto the Missouri tobacco case, McClain had scored a $120 million settlement in an asbestos suit in West Virginia on behalf of workers, reported the Kansas City Business Journal (KCBJ).
HFM and the other four originally claimed $480 million in fees on the Missouri case but after an outcry reduced it to $111 million. A five-year battle to reduce this amount ended in 2003 when the state's Supreme Court refused to hear an appeal against the fee award.
The original legal challenge to the fees stated that the firm should be paid the maximum annual salary for a "state assistant attorney general" of $99,000. The district court held that the law firms were, in fact, "special assistant attorneys general."
Allegations swirled at the time that the firms' appointment by Nixon was political payback. All five had made political contributions, mostly to Missouri Democrats, totaling more than $500,000 over eight years, reported blogsite Overlawyered.com.
Nixon himself received $139,000 from the firms, while former Governor and fellow Democrat Mel Carnahan (now deceased) scored $113,000 of the $561,000 the five made in total donations, according to Overlawyered.
McClain began proving himself a rainmaker in 1985 when he joined Humphrey and Farrington fresh out of law school and immediately established the firm as an asbestos-lawsuit specialist. He most recently won a $19.7 million award in an asbestos suit in Minnesota.
McClain has invested some of the millions he has made in contingency fees over the years into the Independence retail property market. He currently owns several million dollars worth of restaurants and shops in the city.