A former Florida attorney general and congressman said Monday that Missouri should limit the fees a private law firm can collect when it handles some cases for the state attorney general.
Republican Bill McCollum came to Jefferson City to testify before a Missouri Senate panel about legislation restricting the attorney general's ability to use outside lawyers on a contingency basis. The measure would also limit outside lawyers' fees in such cases and make their expense reports a public record.
Lawyers who are hired on a contingency basis receive a portion of a judgment made in favor of their client instead of - or sometimes in addition to - their hourly rate.
McCollum supported similar legislation in Florida because of the large fees that private attorneys there collected for their work in a $205 billion settlement the tobacco industry reached with 46 states in 1998. McCollum said Florida attorneys had collected about $3.4 billion in fees from the settlement - a sum he termed "outrageous."
"The governor and the people of Florida felt that this was a big, huge rip-off," he said. "There needs to be some protections and transparencies for when an attorney general uses this outside counsel."
Private attorneys who negotiated Missouri's tobacco settlement were paid $111 million. An attempt to reduce that figure failed in the state Supreme Court in 2003.
McCollum said Missouri could have won a large award through the tobacco settlement even without agreeing to give the private attorneys a large contingency fee.
Sen. Jolie Justus, D-Kansas City, said the attorney general's office had told her staff that the state had not hired outside lawyers on a contingency basis since the tobacco settlement. The state does routinely hire outside counsel for specialized cases, such as those involving Medicaid, but it pays them an hourly rate because the state is the defendant in those cases.
Before Monday night's hearing, McCollum told The Associated Press the bill would give Missourians confidence in the attorney general's ability to get the best outcome for the state. He said attorneys general often file lawsuits seeking a change in public policies - such as those in the tobacco settlement - rather than large monetary awards.
"When you turn this over to a private firm on a contingency fee, the motive is not the same as the public interest," he said. "Instead, it's trying to get the highest return on the dollar."
Sen. Brian Munzlinger, R-Williamstown, said the legislation he is sponsoring aims to increase transparency. Munzlinger, a farmer, compared it to selecting a tool for specialized work on his farm.
"I want to know what that tool costs and what benefit it gives to me," Munzlinger said. "I hope this bill has the transparency to show what that tool that the AG's office is using in these special cases is costing taxpayers."
The Missouri Chamber of Commerce and Industry, which supports the legislation, said in statement Monday that 10 states are considering bills similar to Missouri's. The group said similar laws have been enacted in nine other states this year.
Steve Gorny, an attorney from Kansas City and a member of the Missouri Association of Trial Attorneys, said lawyers generally support the bill's transparency provisions, saying citizens have a right to see the state's contracts with the attorneys. But he also said there shouldn't be limits on fees because law firms often dedicate large amounts of time and up-front financing to fighting such cases.
"A piece of legislation that size is going to take a tremendous amount of manpower and an enormous amount of money to prosecute," he said.
Private lawyers bill is HB432