Hood says hands are tied again, withdraws from suit against Gov. Barbour

By John O'Brien | Aug 26, 2008



JACKSON, Miss. (Legal Newsline) - Much like his decision not to file state charges against the attorneys who pleaded guilty to a pair of judicial bribery schemes, Mississippi Attorney General Jim Hood is claiming a conflict of interest prevents him from defending Gov. Haley Barbour in a Medicaid lawsuit.

Hood, a Democrat, told the Jackson Clarion-Ledger that he must protect the interests of other branches of the state's government, a stance Barbour, a Republican, called "absurd."

A group of hospitals are suing Barbour for attempting to increase the statutory Gross Revenue Assessment they pay. Barbour is trying to fix a $90 million Medicaid shortfall.

"I have to make sure that claims made by one branch of government do not violate the powers of the other two branches," Hood told the Jackson paper Monday.

"Due to the specific issues involved in this case, we would not be able to raise defenses that could conflict with the powers of my other two clients -- the legislative and judicial branches."

Hood received his share of criticism for not pursuing state charges against famed plaintiffs lawyer Richard "Dickie" Scruggs and another campaign contributor who pleaded guilty to a judicial bribery scheme in January, Joey Langston. Hood has said that prosecuting them would be like charging a member of his family with a crime and deferred to local district attorneys.

Scruggs was hired by then-Attorney General Mike Moore to pursue a case against tobacco companies on behalf of the state, and his work led to the 1998 Tobacco Master Settlement Agreement. It has an estimated worth of $246 billion for the 52 participating territories and states.

After 2005's Hurricane Katrina, he grouped together a handful of law firms to create the Scruggs Katrina Group. The group represented insurance policyholders who believed their insurance companies were misrepresenting the amount of damage done to their properties by wind (covered by the policy) and water (covered by a federal program).

More than 600 cases were settled early in 2007, earning the SKG $26.5 million in attorneys fees. At the same time, Hood, who had sued five insurance companies only weeks after Katrina, dropped a criminal investigation of State Farm Insurance Cos.

An FBI report released this year says Scruggs offered $500,000 to two of his alleged co-conspirators in the judicial bribery scheme to attempt to convince Hood not to indict State Farm on criminal charges regarding Hurricane Katrina claims because Scruggs feared it would put an end to a possible settlement with his Scruggs Katrina Group.

Scruggs pleaded guilty in March to attempting to bribe a state judge in a dispute over Katrina attorneys fees. He is serving a five-year prison sentence in Kentucky.

Hood had appointed Langston as a special assistant attorney general in a high-profile case against MCI that resulted in $14 million in attorneys fees.

Now, Barbour will have to hire a private attorney to fight the hospitals.

"Neither the legislative nor judicial branches are parties to the lawsuit, so it is absurd for Jim Hood to suggest some sort of conflict as his reason for begging off the case," Barbour said in a statement.

"Good lawyers do not turn their backs on their clients at the last minute. But this is not the first time Attorney General Hood has done so since I've been governor. It is a shame the taxpayers of Mississippi will have to pay extra to be represented because Jim Hood has changed his mind again about who he represents."

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

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