ATRA PROPOSES 'TRANSPARENCY CODE' FOR STATE AGS

As Contracting with Private Sector Attorneys Increases, Greater Public Accountability Is Needed

Washington, DC, September 17, 2007 -- In a commentary published today in the National Law Journal, American Tort Reform Association president Sherman "Tiger" Joyce proposed new voluntary standards designed to improve government transparency and accountability when state attorneys general hire outside counsel to litigate on behalf of state residents.

"With increasing regularity, state attorneys general are hiring personal injury lawyers from the private sector to perform legal work for the state, and hundreds of millions of dollars in contingency fees are sometimes at stake," explained Joyce. "Yet often enough, some state AGs award such lucrative contracts to their political supporters without competitive bidding and with little or no oversight from the public or state legislatures.

"As ATRA issues its Transparency Code today," Joyce continued, "we urge all attorneys general to adopt it so their respective states' citizens, taxpayers and legislators can more readily understand the value of outsourced legal work."

Joyce said the Transparency Code comprises the good-government principles of public disclosure, competitive bidding, oversight and fiscal accountability.

"We hope all attorneys general will closely examine these principles and begin a constructive dialogue about the merits of a uniform process for hiring outside counsel," Joyce said. "If AGs are to be successful in pursuing and protecting the public interest, they must have the full confidence of the citizenry. Transparency and accountability are the foundation of such confidence."

Joyce pointed out that at least seven states have already enacted legislation that aligns closely with ATRA's proposed code, but there is no uniform transparency standard for attorneys general in all states. Research shows, however, that there is strong public support for such standards.

In April, ATRA released results of a five-state survey in Alabama, California, Ohio, West Virginia and Wisconsin that showed strong majorities in favor of posting attorney general-outside lawyer contracts on the Internet for public inspection and requiring those outside lawyers to keep detailed records of their hours and specific work performed, among other things.

Full results of that survey and the detailed Transparency Code are posted on ATRA's AGAgendaWatch Web site at www.agwatch.org. The code also is detailed below.

ATRA Attorney General Transparency Code

State attorneys general need the discretion and independence to enforce the laws of their respective states free from the influence of parties that may have a private interest in the outcome of litigation.

Litigation can be sufficiently complex, time consuming and expensive that at certain times, and on certain occasions, it may be necessary for state attorneys general to retain the services of outside legal counsel to perform work on behalf of the state.

To ensure transparency in these contracting processes and relationships, these five principles should be followed:

1. DISCLOSURE: All contracts with vendors, including outside counsel, who provide services to the state or perform legal work in the name of the state, should be posted on the Internet for public inspection.
2. VALUE: In every instance, the attorney general should seek to provide the highest quality services at the best value to state citizens when contracting with outside counsel. Unless an extraordinary situation requires assistance from a specific legal expert with technical or scientific experience not generally available, every effort should be made to competitively bid contracts for outside counsel.
3. OVERSIGHT: Given that contingent fee-based contracts are often used when attorneys general are pursuing litigation that potentially has a significant public policy or regulatory impact, such contracts should be subject to review by the Legislature.
4. REPORTING: Outside counsel providing services to the attorney general on behalf of a state's citizens and taxpayers on a contingent fee basis shall be required to disclose detailed information on the hours worked, services performed, and fees received from the state, as long as this reporting does not undermine the attorney-client privilege.
5. ACCOUNTABILITY: All monies recovered by the attorney general in excess of $250,000 as a result of lawsuits won or settled by the state should be deposited in the state treasury for appropriation by the legislature unless a settlement with the attorney general's office stipulates that the funds shall be allocated to a specific entity. At no time, shall an attorney general enter into a settlement that allows the office of the attorney general to disseminate funds at its discretion.

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The American Tort Reform Association (ATRA) is the only national organization dedicated exclusively to tort and liability reform through public education and the enactment of legislation. ATRA's membership includes non profits, small and large companies, as well as state and national trade, business, and professional associations.

© 2007 American Tort Reform Association