ATRA urges AGs to seek bids for outside counsel

Legal News Line Sep. 17, 2007, 5:00am

ATRA President Sherman Joyce

When state attorneys general hire outside counsel to pursue legal actions on behalf of their state, those contracts should be awarded through competitive bidding and every aspect of the contract should be available for public viewing on the Internet, according to a proposal announced today by the American Tort Reform Association. ATRA President Sherman "Tiger" Joyce said a voluntarily "transparency code" for state attorneys general would improve government accountability and transparency. The proposal was announced in a commentary Joyce wrote for the National Law Journal. "With increasing regularity, state attorneys general are hiring personal injury lawyers from the private sector to perform legal work for the state, and hundreds of millions of dollars in contingency fees are sometimes at stake," Joyce said. "Yet some state AGs award such lucrative contracts to their political supporters without competitive bidding and with little or no oversight from the public or state legislatures." The voluntary contract would include five principles:

  • All contracts with outside vendors who perform legal work on behalf of the state would be posted to the Internet for public inspection.
  • Contracts for outside counsel should be awarded through competitive bids unless a situation requires the help of someone with specific legal, technical or scientific expertise.
  • Contracts should be subject to review by state legislatures.
  • Outside counsel working on a contingency fee basis should disclose their hours worked, services performed and fees received from the state unless those disclosures violate attorney-client privilege.
  • If those legal actions allow the state to recover more than $250,000, the money should be placed in the state's treasury unless the settlement stipulates that the funds be allocated in a specific way. Attorneys general should not be permitted to spend those funds at their own discretion. "We hope all attorneys general will closely examine these principles and begin a constructive dialogue about the merits of a uniform process for hiring outside counsel," Joyce said. "If AGs are to be successful in pursuing and protecting the public interest, they must have the full confidence of the citizenry. Transparency and accountability are the foundation of such confidence." At least seven states have enacted similar legislation but Joyce called for a uniform national standard. According to an ATRA news release in April, a survey in five states – Alabama, California, Ohio, West Virginia and Wisconsin – found majorities in favor of posting such contracts to the Internet and requiring outside counsel to keep detailed records of their work on behalf of the state. ATRA, based in Washington, D.C., is dedicated exclusively to tort and liability reform through public education and legislation.

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