Florida's massive tobacco settlement was especially sweet for the trial bar. Lawyers took home $3.4 billion in contingency fees after securing $13.6 billion for the state, with some attorneys putting in relatively little work compared to the riches received. At the time, then-Gov. Jeb Bush called the fees awarded "obscene" — and he was right.
Using private lawyers on cases instigated by the state when there is potential for big contingency fee awards is a balancing act. Handing lucrative cases to attorneys in private practice who walk away with a fat percentage of any recovery opens the door to favoritism and political payback. Yet there are instances where the state Attorney General's Office does not have the expertise or capacity to bring a highly complex case to trial.
Since being elected in 2006, Attorney General Bill McCollum has not outsourced any legal matters. But because he is sensitive to the abuses that can occur, McCollum is supporting legislation (SB 1370, HB 215) sponsored by Sen. Mike Fasano, R-New Port Richey, and Rep. Eric Eisnaugle, R-Orlando, that would put reasonable limits on contingency fee arrangements in state-sponsored cases. Despite complaints by the Florida Justice Association, the group that represents the interests of the state's trial lawyers, the legislation is generous and should not unduly tie the hands of the state in hiring outside lawyers for long, difficult cases.
The contingency fee schedule established in the legislation is somewhat lower than the schedule created by the Florida Supreme Court for all contingency fee cases. But when attorneys take cases on behalf of the state they have the advantage of the government's influence, which often helps to secure settlements more quickly. The aggregate contingency fee would be capped at $50 million, with attorneys able to keep 25 percent of any recovery up to $10 million, then 20 percent of the next $5 million, 15 percent of the next $5 million, and so on. These fees would be paid to the winning attorneys on top of reimbursement for expenses.
The amounts are large enough to entice plenty of lawyers to offer their representation when the need arises. But the schedule should be indexed for inflation so that the value of the fees does not erode.
The legislation also requires competition in the awarding of these contract cases, and it directs that all contingency-fee contracts be posted on the attorney general's Web site.
The tobacco settlement demonstrated — no surprise, really — that some attorneys will line up to cash in a fee-jackpot even when it bears little relationship to the amount of legal work performed. This legislation offers fair compensation to lawyers representing the state and curbs the risk of indefensible windfalls to the best-connected lawyers.