Courts - Louisiana Focus of government contingency bill narrowed to spill-related cases Outside lawyers would get a part of the damages

By Sonia Smith

Associated Press Writer

BATON ROUGE, La. (AP) -- A House committee substantially reworked a bill Monday that would allow the state attorney general to contract outside lawyers who would collect a percentage of damages awarded but limited the proposal only to cases related to the Deepwater Horizon oil spill.

The measure, passed by the committee without objection, now heads to the full House.

The version passed by the Senate last week was more open-ended, giving Attorney General Buddy Caldwell the authority to use contingency contracts to hire outside counsel in a large range of cases.

A contingency fee system would let outside lawyers get a part of the damages, rather than an hourly fee. All states except Louisiana and Wisconsin have the ability to hire lawyers on contingency.

Fees would be capped at $50 million or 10 percent of the total settlement, whichever is smaller.

Senate President Joel Chaisson, D-Destrehan, said his bill would put Caldwell on equal footing with all the other attorneys general of the Gulf.

"We cannot leave this session without giving him authority to compete on a level playing field," Chaisson said.

Caldwell sought permission last year to enter into such contracts but scrapped the idea amid strong opposition from business lobbyists. He's made a renewed push this year, arguing he needs the authority for any oil spill litigation he'll file.

If his office has to pay all his lawyers hourly rates, Caldwell said the lawsuit could cost the state $100 million -- and Chaisson said the state's current budget troubles make it nearly impossible to come up with that chunk of cash.

John Sinquefield, special counsel to Caldwell, stressed that the contracts would be hammered out in a committee and approved by the Legislature's joint budget committee.

Critics of the bill argued the state would lose a large portion of any settlement it won to contingency fees.

Ginger Sawyer, vice president of the Louisiana Association of Business and Industry, said residents deserve every penny of the state's settlement.

"Enriching people should not be the goal," she said.

Sawyer said the oil spill was simply becoming a "cause celeb" for Chaisson to push through the proposal.

Chuck McMains, lobbying on behalf of the U.S. Chamber of Commerce, said instead of using contingency fees, Louisiana could come up with the $5 million to $10 million each year over the next decade to pay hourly attorneys.

"Contingency fee contracts send a cold chill up and down the spines of business," said Don Briggs, president of the Louisiana Oil and Gas Association.

Stephen Waguespack, executive counsel to Gov. Bobby Jindal, supported the measure, which he said was an important piece of the state's "multi-pronged approach" to tackling the spill litigation.

The state faces "a unique disaster that is monumental in its scope," Waguespack said. "We need to be armed and ready to defend the state."

Published: Wed, Jun 16, 2010