ATLANTA (Legal Newsline) - A week after Mississippi added some transparency to contingency fee agreements between its attorney general and private lawyers, Georgia has done the same.
Georgia Attorney General Sam Olens announced Tuesday that he has signed an order that establishes rules for the retention of contingency fee counsel, if the need ever arises. Currently, outside counsel hired by the State is compensated with a contingency fee only in routine collection matters.
"Our goal is to serve as good stewards of taxpayers' money and always employ outside counsel on the most economical terms possible," Olens said. "The Administrative Order I signed today takes the necessary steps to ensure transparency and allows the public to hold us accountable for meeting that goal."
The attorney general must determine that the contingency fee agreement is in the best interest of the state, specifically when private lawyers possess the skill and resources needed to pursue the litigation when the AG's office does not.
Other factors to be weighed are geography and experience.
The attorney general must also request proposals from private attorneys for the contract. All contracts then will be posted on the AG's website within 15 business days.
On May 22, Mississippi Gov. Phil Bryant signed House Bill 211 into law.
In particular, the Sunshine Act allows state officials, agencies, boards, commissions, departments or institutions to hire their own outside attorneys over the state's top lawyer in cases where the attorney general declines to represent them, or where a state agency feels the attorney general cannot adequately represent its legal interests because of a significant disagreement over legal strategy.
HB 211 defines exactly when an outside attorney may be hired on a contingency fee basis.
But before making such an agreement, the attorney general or state official retaining the counsel must provide a written determination that the fee to be paid is both cost-effective and in the public interest.
The measure also requires the attorney general or any other state official make public contracts with outside lawyers. The contracts must be filed with a state board, and any contracts for more than $100,000 must be approved by that board.
Detailed time records for outside counsel also must be kept.
Also under the bill, the share of a verdict that would go to private lawyers hired on contingency will be limited, capped at $50 million.
HB 211 also creates a three-person panel called the Outside Counsel Oversight Commission. The commission includes the governor, lieutenant governor and secretary of state, and will deal with any related disputes.
Florida was the first to take up the issue in 2010. Its bill implemented a cap on attorneys fees and provided readily available public information on timesheets and bids.
The relationships between some state AGs and private lawyers who are given contingency fee contracts has been criticized by some, including the Manhattan Institute.
In October, the group probed the issue in an edition of its "Trial Lawyers Inc." series. Seven current AGs caught the group's attention:
-Louisiana's Buddy Caldwell, who gave state lawsuits over the Gulf oil spill to firms that had collectively donated $145,000 to his campaign;
-Mississippi's Jim Hood, who hired lawyers who contributed to $75,000 to one of his campaigns for a lawsuit against Eli Lilly & Co. and, according to federal prosecutors, worked closely with now-imprisoned attorney Richard "Dickie" Scruggs during litigation against insurance companies after Hurricane Katrina;
-New Mexico's Gary King, who hired the same firm that Hood picked for the Eli Lilly case to sue Janssen Pharmaceutica after it gave him $50,000 for one of his campaigns;
-West Virginia's Darrell McGraw, who, the report says "has made a habit of offering no-bid contracts to plaintiffs lawyers" like DiTrapano Barrett & DiPiero, which has given McGraw $37,800 since 2004 and has been hired for suits against five pharmaceutical companies;
-Iowa's Tom Miller, who was heading nationwide settlement talks with mortgage lenders and saw more than $170,000 in contributions from out-of-state plaintiffs and defense firms in the months surrounding his formal takeover of the negotiations;
-Utah's Mark Shurtleff, a Repubolican who hired Steele & Biggs to handle his lawsuit against Eli Lilly. The firm gave $58,000 to one of his campaigns and hired his daughter to work as a paralegal on the case; and
-Vermont's William Sorrell, who, the report says, pushed a bill through the legislature that retroactively changed state law to allow him to join the lawsuits against the tobacco industry that led to a $246 billion settlement in 1998.
From Legal Newsline: Reach John O'Brien by e-mail at email@example.com.