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Bailey's contributions at issue in Pennsylvania case

By John O'Brien | Jul 22, 2008

Mike Perrin, Ken Bailey's law partner

PHILADELPHIA (Legal Newsline) - Attorney Kenneth Bailey has inspired a lot of headlines by making money, and a few more by giving it out.

A renowned plaintiffs attorney whose Houston-based firm Bailey Perrin Bailey has taken on the biggest companies in the world, Bailey's largest campaign contributions are often handed to the state officials who hire BPB on a contingent-fee basis.

Janssen Pharmaceutica, a subsidiary of Johnson & Johnson that is the defendant in a suit brought by BPB and Pennsylvania Gov. Ed Rendell, thinks it is time for that practice to stop.

"The contingent fee contract whereby the (Governor's Office of General Counsel) retained Bailey Perrin was not the subject of any competitive bidding or legislative authorization," Janssen claims in its June Motion to Disqualify Counsel.

"Rather, the contract appears to be the product of private negotiations between the (OGC) and (BPB) over a period of several months in 2006.

"In the precise time period during which the contract was negotiated and executed ... F. Kenneth Bailey ... made repeated and significant contributions, totaling more than $100,000 to Gov. Rendell's re-election campaign and to the Democratic Governors Association."

Between Feb. 23 and Oct. 30, 2006, Bailey gave $75,000 directly to Rendell's campaign, more than $16,000 in airplane travel and $25,000 to the Democratic Governors Association, which contributed more than $1.2 million to Rendell's $27 million total. He easily defeated former Pittsburgh Steelers great Lynn Swann.

Bailey also gave $50,000 to Mississippi Attorney General Jim Hood, who hired BPB to pursue a claim against Eli Lilly & Co.

In Louisiana, another state BPB is representing in litigation, Bailey gave $20,000 to the state's Democratic Party last year. In Arkansas, which hired BPB for a suit against Janssen, he gave $70,000 to the Democratic Party in 2006.

Bailey's response: So what?

"Janssen's gratuitous identification of campaign contributions are no more relevant to the resolution of this matter than political contributions (Janssen counsel) Drinker Biddle & Reath's Political Action Committee made to various candidates presumably aligned with Drinker's and/or its clients' interests, which totaled nearly $120,000 during the 2004-06 election cycles," BPB's answer says.

Drinker Biddle even contributed $10,000 to Rendell in 2006, as well as a little more than $10,000 to state Attorney General Tom Corbett. Corbett was not running for re-election that year. The firm and one of its attorneys have given Corbett $8,000 for his 2008 campaign.

In its reply, Drinker Biddle's attorneys argued that contribution history is relevant to the case, calling Bailey's generosity "extraordinary and extraordinarily well-timed."

"Janssen's identification of these contributions was not, as plaintiff says, 'gratuitous,'" the reply says.

"Rather, and as Janssen explained in its opening memorandum, Mr. Bailey's contributions of more than $100,000 to the Governor and the Association just as the Governor's General Counsel negotiated and executed its no-bid contingent fee contract with Bailey Perrin are relevant because they give rise to a distinct notice of impropriety, thereby making it unlikely that litigation decision-making by Bailey Perrin will be perceived as fair and impartial and solely in the public interest.

"The contributions are further relevant because they are indicative of the sort of abuse of executive power that the doctrine of separation of powers was meant to check."

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.

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