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The battle between the Provost Umphrey law firm and former associate Brent Coon over attorney's fees from a multi-billion dollar tobacco settlement has outgrown its current arena and spilled over into another Jefferson County courtroom.
On Monday, Nov. 16, a hearing on whether the Provost Umphrey Tobacco Partnership (PUT) should be allowed to intervene and deposit tobacco funds into a case over attorney's fees in an asbestos lawsuit was held in Judge Milton Shuffield's 136th District Court.
At the conclusion of the hearing, Judge Shuffield denied PUT's plea in intervention and said he would wait to rule on whether or not PUT can deposit funds in the court's registry.
Over the past two years, the Record has reported on the struggle between Coon and Walter Umphrey, two of Texas' most influential plaintiff's lawyers, and their legal war over millions in attorney's fees stemming from the state's mega-billion dollar tobacco settlement.
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A settlement has been reached in a fraud lawsuit filed against Richard Scruggs, the anti-tobacco lawyer, a lawyer says.
William Roberts Wilson Jr. first sued Mr. Scruggs in 1994, saying he cheated him out of millions of dollars in fees from lawsuits that they worked on together. Mr. Wilson claimed Mr. Scruggs used the money to finance landmark anti-tobacco litigation in the '90s.
A federal judge in Texas will hear a lawsuit claiming that disgraced former trial attorney Richard "Dickie" Scruggs and several others conspired to defraud a former colleague of millions of dollars in legal fees.
Chief Judge Edith Jones of the 5th U.S. Circuit Court of Appeals on Friday ordered the case be reassigned to U.S. District Judge David Hittner in Houston, Texas.
The lawsuit against Scruggs was filed by William Roberts Wilson Jr. of Tuscaloosa, Ala. He and Scruggs, who currently suits in federal prison, once worked together suing asbestos companies.
Two of disgraced plaintiffs attorney Richard "Dickie" Scruggs' former business partners are suing him, claiming part of the money owed to them from a tobacco settlement was used to further one of Scruggs' judicial bribery schemes.
Lee Young and Charles Mikhail filed their suit in Mississippi federal court Sept. 9 seeking compensation for what they feel is being withheld unfairly from their quarterly payments. Scruggs agreed to pay the two 5 percent of his firm's net gain from a national tobacco settlement in 1999.
Scruggs has pleaded guilty to two judicial bribery schemes, receiving 7 1/2 years in prison. He reduced Young's and Mikhail's payments as he fought lawsuits from former asbestos litigation partners William Roberts Wilson and Alwyn Luckey, who made a claim on Scruggs' tobacco earnings, the suit says.
"On information and belief, Plaintiffs were forced, through a deduction from their Jan. 2007 quarterly payments, to contribute money which, unbeknownst to them, was not represented to be by Defendants (a legitimate tobacco-related expense) but as payments made to further illicit a criminal scheme to unethically and illegally influence a judge," the suit says.
Lawyers and their clients, seemingly regardless of the merits of their legal claims, got rich in the bargain. It was a self-sustaining system – widely bragged about by plaintiff lawyers and lamented by defense teams.
The mastermind of that system was Richard “Dickie” Scruggs. The now disgraced and jailed tort baron was a political force moving elected political pawns on the chessboard around like a Grand Master. . . .
Scruggs is most widely known for reportedly taking home almost $800 million in the $250 billion landmark tobacco settlement. This was his reported take from Mississippi’s settlement alone. The political and PR strategies that he employed and the issues that arose in the wake of the tobacco settlement were virtually mirrored in the State Farm litigation. He was working his proven blueprint.
His greed and this post-Katrina debacle proved to be his downfall.
First, let’s look at the tobacco case.
Dickie Scruggs had made several million dollars prosecuting asbestos cases on the Mississippi Gulf Coast, just as others had done around the country. In the mid-1980’s, Scruggs’ longtime friend and political beneficiary Mike Moore was the Attorney General for the state of Mississippi. Moore’s longtime friend, attorney Mike Lewis of Clarksdale, comes up with the idea to sue the tobacco companies on behalf of the State to recoup the medical costs incurred by the state for caring for those with tobacco related illnesses. Moore contacts the now-well-funded, Pascagoula-based Scruggs about the litigation and the lawsuit begins.
There were really three parts to this plan. . . .
One other thing was left in the tobacco settlement’s wake . . . unhappy lawyers. Though many Mississippi attorneys in Scruggs’ tobacco consortium became multi-millionaires, others in that consortium believed they were “shut out” and not paid fees that they were due. One of those, Alwyn Luckey, sued Scruggs in one of the most contentious lawsuits that those involved in the case report they had ever seen.
This case eventually landed in the courtroom of Judge Bobby DeLaughter and became central to the scheme that brought the downfall of Scrugss and his cohorts.
For the past two years, two of Texas' most influential plaintiff's lawyers have been embattled over millions in attorney's fees stemming from the state's mega-billion dollar tobacco settlement.
And with that much money on the table, Brent Coon is apparently unwilling to allow his old boss, Walter Umphrey, to select an arbitrator of his pleasing to mediate the dispute. Coon alleges the prospective arbitrator may be biased toward Umphrey.
Coon has filed a motion for a writ of mandamus with the Ninth Court of Appeals of Texas, asking justices to revoke Umphrey's selection of Frank Newton as his firm's arbitrator. The case has been set for submission on briefs on Aug. 6.
The crux of the dispute arose in November 2007, when Coon, once a partner at the Provost Umphrey Law Firm in Beaumont, claimed he never received his share of the more than $3 billion in attorneys' fees from the $17.3 billion tobacco settlement with the State of Texas.
An appellate court has handed a partial victory to the widow of prominent Palm Beach, Fla., litigator Robert Montgomery in a dispute with her late husband's former law partner, reversing a trial court order that would have required Montgomery's estate to pay more than $100,000.
The 4th District Court of Appeal reversed a trial court order against the estate that required it to pay around $100,000 in attorney fees to former partner Christopher Larmoyeux of West Palm Beach. The appellate court found that Larmoyeux filed his claims too late and ruled they were time-barred.
But the 4th DCA affirmed an order requiring the estate to pay more than $80,000 in attorney fees to North Palm Beach attorney Eric Hewko, whom Larmoyeux brought in as co-counsel in a case originating in Montgomery's firm that Larmoyeux handled afterward. The 4th DCA also found there was no credibility to fraud claims in a suit filed by Montgomery and his counsel against Hewko. The trial court had ordered both Montgomery and the West Palm Beach law firm of Beasley Hauser Kramer Leonard & Galardi to pay fees to Hewko and Larmoyeux.
"The trial court's finding that the claims were not made in good faith was supported by competent, substantial evidence," Judge Fred Hazouri wrote. He was joined in the opinion by Judge Gary Farmer and Judge Carole Taylor.
P.L. Blake, the mystery man attorney Dickie Scruggs agreed to pay $50 million from the 1998 settlement of tobacco litigation, has hired four attorneys to represent him in an ongoing judicial bribery investigation.
Oxford attorney Tom Freeland is representing Blake, whose name surfaced in the investigation as the person to call about securing $40,000 from Scruggs. Scruggs has admitted he used the money in an attempt to bribe Circuit Judge Henry Lackey.
Lost in the uproar last month over a federal judge's decision to go easy on Fast Eddie Vrdolyak was another piece of information to emerge from his sentencing that was nearly as outrageous.
Vrdolyak, come to find out, was the recipient of a multimillion-dollar legal fee paid from the big 1998 tobacco settlement -- and he's still collecting on it.
You remember the tobacco settlement: hundreds of billion of dollars paid by cigarette makers to state governments to make all those pesky liability suits go away, billions in turn directed to state-hired law firms that brought the cases. . . .
That calculates to a $6.25 million total fee for Vrdolyak using the prosecution's number or $9 million using the judge's. I couldn't get clarification. The U.S. attorney's office declined to clarify. Monico wouldn't return my calls. Pre-sentence investigations reports aren't public records.
Did this involve pal-in-crime Levine?
People want to write off Vrdolyak as a quaint relic from yesteryear, yet even though long retired from public office, he still was able to find a way to latch on to the sweetest litigation jackpot in U.S. history -- and keep it secret. That's impressive, as well as suspicious.
What, you may wonder, did he do to earn his fee, and who agreed to pay him?
I don't have the answers, but I'll fill you in as best I can.
For what little we do know, we can thank U.S. District Judge Milton Shadur.
Federal authorities who have been investigating judicial bribery cases in Mississippi are interested in the trail of money that leads from tobacco settlement expenses.
Dickie Scruggs, who pleaded guilty in two judicial bribery schemes, is cooperating with federal authorities. He earned $1 billion as chief negotiator of the tobacco settlement.
Scruggs' attorney, John Keker of San Francisco, denied federal authorities are exploring the matter.
Last week, a federal grand jury questioned witnesses regarding P.L. Blake, who earned $50 million from tobacco settlement expenses.
Five years ago, two attorneys, Alwyn Luckey and Bob Wilson, raised questions about some of those tobacco settlement expenses in their litigation against Scruggs, their former law partner.
Their attorney, Charlie Merkel of Clarksdale, said what they found in documents detailing the payments for tobacco settlement expenses was a veritable maze.
An Alabama attorney has filed a federal lawsuit against imprisoned attorney Richard "Dickie" Scruggs and several others, alleging they conspired with a former U.S. senator to bribe a state court judge and defraud him of millions in legal fees.
The former senator is not identified by name in the federal lawsuit filed Monday by William Roberts Wilson Jr. However, one of Wilson's attorneys, Vicki Slater of Jackson, said the unnamed senator is Scruggs' brother-in-law, Trent Lott, a Republican power broker who retired in 2007. . . .
Scruggs and Wilson, of Tuscaloosa, Ala., once worked together suing asbestos companies. Wilson claimed Scruggs cheated him out of money and used it to fund a batch of landmark anti-tobacco lawsuits of the 1990s, in which Scruggs reportedly earned as much as $848 million. Wilson sued for a cut.
Wilson now accuses Scruggs and the others of racketeering by conspiring to bribe a judge presiding over the dispute dealing with the asbestos fees.
Former U.S. Sen. Trent Lott is an unnamed co-conspirator in a civil lawsuit filed in federal court against his brother-in-law, imprisoned ex-attorney Dickie Scruggs, said Vicki Slater, an attorney for the plaintiff.
The suit has been brought by attorney Roberts Wilson.
"Anybody who acts to further the conspiracy is a co-conspirator," Slater said. "He called (Circuit Judge) Bobby DeLaughter at Dickie's request."
DeLaughter has not been charged with a crime but is being accused of ruling in Scruggs' favor in exchange for a potential appointment to the federal bench.
Lott has acknowledged he called DeLaughter about a judgeship, but decided along with Sen. Thad Cochran to nominate someone else. Lott declined to discuss the lawsuit Tuesday, but longtime associate Bret Boyles said Scruggs was not the only attorney who suggested Delaughter for a judgeship. . . .
Wilson and Scruggs enjoyed success with asbestos litigation in the 1980s. Wilson contends Scruggs cheated him out of asbestos fees, then used the money to help finance litigation against tobacco companies in the 1990s. Tobacco fees to Scruggs topped $800 million.
DeLaughter's 2006 ruling for Scruggs in the asbestos-fee dispute killed Wilson's chance of recovering tobacco fees, the lawsuit says.
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. . . .
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."
For almost a week, Missouri's TV airwaves have been smoking with a set of nasty back-and-forth ads launched by the state's two major candidates for governor, Democrat Jay Nixon and Republican Kenny Hulshof.
The first shot, fired by Hulshof, accuses Nixon -- the state's attorney general -- of running a "gravy train" to funnel $111 million to "liberal trial lawyers."
The counter volley, lobbed by Nixon, asserts that he "took on Big Tobacco and won," and then takes after Hulshof.
Both ads have flaws and at times mischaracterize their target. But the biggest problem is the TV viewer likely has no idea what either ad is talking about.
Lots of fury, but not many facts. For those interested, here they are: Both ads refer to Missouri's participation in a long-running multistate lawsuit against the tobacco companies. (Hulshof's ad doesn't even mention the word "tobacco.")
As attorney general, Nixon oversaw the state's legal case, which began in 1997. . . .
In a statement Wednesday, Nixon campaign spokesman Oren Shur said: "Attorney General Nixon took on the big tobacco companies and won billions for the state. As part of the settlement, Attorney General Nixon made the tobacco companies pay the legal fees, so the taxpayers paid nothing."