Contingency fee bill passes in House
The Louisiana House voted 71-23 on Friday to pass a bill that allows the state to hire trial lawyers on a contingency fee basis.
It moved to the Senate for concurrence.
The version that passed the House limits contracts related to the oil spill and caps fees attorney fees. Also, a $1,000 per hour cap was written into the bill.
The Senate version of the bill, originally proposed by Senate President Joel Chaisson (D-Destrehan), would have allowed Attorney General Buddy Caldwell to hire private attorneys on contingency using a tier system with no cap.
Chaisson argued that contingency fee contracts are necessary to allow Louisiana "a fighting chance" against BP and other corporations that can afford the country's top defense firms.
The Senate version of the bill would not have restricted the contracts to the lawsuits regarding the oil spill in the Gulf of Mexico.
While the Senate version of the bill would have allowed the attorney general to pick the attorneys, the House version provides a five-person selection panel to include the governor, attorney general, state treasurer, House speaker and Senate president.
Another key difference in the House version was a stipulation that excludes any amount of a natural resource damage award in the contingency fee formula. Supporters of the provision argued that the Oil Pollution Act already provided for figuring those damages.
Both versions of the bill would allow law firms to recover costs before determining compensation.
The business lobby and other opponents of the bill argued that legislation was unnecessary because current law allows the attorney general the ability to hire private attorneys and pay them at a scheduled hourly rate.
"Louisiana's attorney general currently has authority to contract with private attorneys on an hourly fee basis when pursuing legal action on behalf of the state," states a letter to senators signed by several business groups.
"He can and does pursue litigation for a variety of actions. If he needs additional resources, the Legislature can appropriate; and the Legislature can also approve a higher fee schedule to pay for expertise. There is absolutely no need to authorize contingency fee contracts."
Jindal has already authorized $5 million to the attorney general's office to hire attorneys and experts to argue the state's case against BP.
The business lobby called out plaintiffs' attorneys for exploiting the oil spill for their benefit.
"The oil spill is simply another high-profile excuse to allow plaintiff attorneys to get contingency fees," said Ginger Sawyer, vice president of the Louisiana Association of Business & Industry.
Chaisson is expected to reject the House changes to his bill, forcing a high-profile compromise committee to figure out the differences before the session concludes Monday.