Suit against Scruggs implicates 'former U.S. Senator'

By John O'Brien | Jan 13, 2009


OXFORD, Miss. (Legal Newsline) - A new lawsuit against incarcerated plaintiffs attorney Richard "Dickie" Scruggs accuses a state judge and a former U.S. Senator of teaming with Scruggs in a judicial bribery scheme.

The suit, filed Monday by Scruggs' former asbestos litigation partner William Roberts Wilson, alleges a conspiracy that involves Scruggs, his lawyers in a dispute with Wilson over attorneys fees, Hinds County Circuit Judge Bobby DeLaughter, former state Auditor Steven Patterson, former Hinds County District Attorney Ed Peters and an unnamed former U.S. Senator.

Former Senate Majority Leader Trent Lott is Scruggs' brother-in-law. Joey Langston, one of Scruggs' attorneys, has already pleaded guilty to the scheme, which he said involved using Lott to help DeLaughter get appointed to a federal judgeship in Mississippi by President Bush.

After what has been described as a courtesy call, however, Lott gave his support to another candidate.

Wilson attorney Charles Merkel told Legal Newsline nearly a year ago that he wanted to have all of the information before he made his next move. Since then, Scruggs has been sentenced to five years in prison for participating in a judicial bribery scheme in Lafayette County.

"There are new developments everyday," Merkel said in February. "We want to know all of the facts before we act precipitously with only half of the knowledge."

Wilson, Alwyn Luckey and Scruggs each had their own stake in a group Scruggs started to file asbestos cases. Wilson had sold his interest in more than 2,300 asbestos cases in an agreement that was interpreted differently by the two sides, and he filed suit against Scruggs in 1994.

Luckey was awarded $17.5 million in his dispute with Scruggs after a trial in front of U.S. Magistrate Judge Jerry Davis, but Wilson received only a $1.5 million payment because Hinds County Circuit Judge Bobby DeLaughter's interpretation of the contract showed no remaining balance owed to Wilson, and that a trial would have been merely for bragging rights.

He determined this despite a recommendation by a special master that Wilson was owed $15 million. The alleged bribery is said to have taken place in Feb.-March 2006.

Wilson claims Scruggs used those ill-gotten funds from the asbestos settlement to fund the landmark tobacco litigation that resulted in billions of dollars for plaintiffs attorneys hired to represent their respective states.

Scruggs represented Mississippi, hired by then-Attorney General Mike Moore. His work led to the 1998 Tobacco Master Settlement Agreement, which has an estimated worth of $246 billion for the 52 participating territories and states. The case, and Scruggs' work, was depicted in the Al Pacino/Russell Crowe film "The Insider."

Wilson had filed suit in federal court, asking for a share of the tobacco fees because it was his money Scruggs was using to fund the litigation. When DeLaughter ruled that Wilson was not owed anything, that argument died.

"Scruggs, along with defendants Timothy Balducci, Edward J. Peters, Steven A. Patterson, David Zachary Scruggs (his son and law partner) and non-parties Joseph C. Langston and others did enter into a conspiracy to illegally and feloniously influence and corrupt (DeLaughter) to render a zero judgment on asbestos fees in Scruggs' favor against Wilson so that the U.S. District Court would be thwarted and defrauded out of its intention to hear evidence supporting the imposition of a constructive trust over the tobacco settlement proceeds," the complaint says.

"As a result of the scheme, Wilson was defrauded out of his cause of action in the U.S District Court, his claims for constructive trust over tobacco proceeds and the corpus of his trust in the asbestos fees and other relief."

Scruggs is currently incarcerated for attempting to bribe Lafayette County Circuit Judge Henry Lackey with $50,000 for a favorable ruling in a dispute over Hurricane Katrina attorneys fees.

Days before the indictment was filed, Lott resigned his post in the Senate and began work as a lobbyist.

According to court records, State Farm attorney Jim Robie once asked Scruggs, "Has it been your custom and habit in prosecuting litigation to have Sen. Lott contact and encourage witnesses to give false information?'"

In response, Scruggs invoked his Fifth Amendment right not to comment.

"Clearly, the record couldn't be more plain that Sen. Lott and his associates were talking to people that were key advisers to Mr. Scruggs, paid consultants and those who were creating an illusion that simply doesn't have any basic fact," Robie told Legal Newsline in July.

Wilson is seeking actual damages (asbestos and tobacco fees), and feels they should be tripled because of the defendants' conduct.

He's also seeking punitive damages, attorneys fees, sanctions, pre-judgment interest, post-judgment interest and his costs of litigation.

The unnamed U.S. Senator is not listed as a defendant, but John Does 1-10 are.

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

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