JACKSON, Miss. - After receiving letters to the contrary, four judges in Mississippi received word Thursday that Richard "Dickie" Scruggs would not be dropping his law firm out of all Hurricane Katrina-related suits.
The so-called "miscommunication" is the latest in the chain of events that has occurred since Scruggs and four associates, including his son Zack, were indicted by a federal grand jury Wednesday on charges they attempted to bribe a state judge.
"I am afraid that there is a misunderstanding," Scruggs wrote. "My firm and I do not intend to let down or hinder any of the families, many of whom we have known all of our lives.
"Obviously, anyone who wishes other counsel may simply ask, and we will honor their agreement. I am sorry for the miscommunication."
U.S. District judges William Barbour and L.T. Senter and federal Magistrate judges Robert Walker and Linda Anderson had received a letter from Don Barrett of Barrett Law Office in Lexington, Miss. The letter stated that the Scruggs Law Firm would be excusing itself from the Scruggs Katrina Group, a group of several firms dedicated to litigating against insurance companies over allegations that they misrepresented to policyholders the amount of wind damage (covered by the policies) and water damage (covered by a federal program) done by Katrina.
"In light of what has happened in Oxford, the Scruggs Law Firm will be withdrawing from all Katrina-related litigation," Barrett wrote. "The remaining firms in what was the 'Scruggs Katrina Group' are re-forming and will continue to prosecute these cases. I will be overall lead counsel."
Barrett, like Scruggs, was hired as outside counsel to help the State of Mississippi bring lawsuits against tobacco manufacturers, culminating in 1998's Tobacco Master Settlement Agreement.
The MSA requires participating companies to make annual payments as compensation for the health care costs 46 states and six territories say they incur because of tobacco use. According to a report by the Competitive Enterprise Institute, trial lawyers hired to negotiate on behalf of the states earned $13 billion. The settlement was worth a total of $246 billion.
Barrett had asked the judges for their patience during a transitional period.
"Our group has the financial resources to handle this litigation," he wrote. "We are moving to associate additional attorneys to assist our group, so that the cases can move smoothly."
Scruggs allegedly attempted to bribe a state judge with $40,000 to compel arbitration in a dispute over $26.5 million in attorneys fees earned when Mississippi Attorney General Jim Hood settled part of his lawsuit against State Farm Insurance Cos.
Other firms that make up the Scruggs Katrina Group are the Lovelace Law Firm and Nutt and McAlister. The group has approximately 180 lawsuits still pending against State Farm.