Louisiana again tops annual Judicial Hellholes report; BP oil spill case Attorney General contingency fee cases noted

NEW ORLEANS – For five years running Louisiana’s legal system has been ranked among the worst in the country, according to a legal reform non-profit group.

The “Judicial Hellholes” report released today by the American Tort Reform Association (ATRA) measuring the legal environment nationwide placed Louisiana at No. 7 out of eight troubled legal jurisdictions largely based on the handling of the Deepwater Horizon oil spill case by U.S. District Judge Carl Barbier.

The 2014 “Judicial Hellholes” report is the 13th such released by ATRA and takes its results from ATRA members and other firsthand sources combined with research conducted by the organization.

The “Judicial Hellholes” report found that Deepwater Horizon oil spill case was beset by “blatant fraud” on behalf of plaintiffs’ attorneys. In particular, the report points out the appointment of Lafayette attorney Patrick Juneau to oversee the billions of dollars paid out by the claims program for the Deepwater Horizon case by Barbier, past-president of Louisiana’s trial lawyer association–the Louisiana Association for Justice. Juneau was later forced by a Circuit Court of Appeals to change the way claims were calculated so as to more appropriately match payments with proof payments that claimants' losses  were caused by the oil spill, which BP claims has cost it hundreds of millions of dollars later requested be returned but denied by Barbier.

BP’s motion to have Juneau removed from the case was partially based on his handling of the claims program, but also was due to the revelation of an alleged conflict of interest related to a contract Juneau’s law firm had with the state on oil spill related matters prior to his appointment. BP’s motions was denied by Juneau, but it currently awaiting an appeals court hearing.

Also noted in the ATRA report was the revelation that Attorney General James “Buddy” Caldwell had been contracting out much of the state’s legal work to politically connected plaintiffs’ attorneys who were getting a percentage of awards, sometimes worth hundreds of millions of dollars, and many of whom provided Caldwell with generous campaign contributions. Based on this information legislation was passed earlier this year requiring that contract attorneys working on behalf of the state be paid on an hourly basis.

One such case handled by Caldwell and his contract attorneys that resulted in a $258 million award against Janssen Pharmaceutical and Johnson & Johnson finding the companies did not fully disclose information about side effects of anti-psychotic drug Risperdal was overturned by the Louisiana Supreme Court. The fee for attorneys representing the state in the case would have reportedly been $70 million.

In addition to other issues the report also focused on the sometimes close relationships between judges and plaintiffs’ attorneys. Judge J. Robin Free of the 18th Judicial District Court who was last week suspended for 30 days for accepting an all expenses paid hunting trip from a Texas attorney who had just settled a person injury case in his court for $1.2 million a week prior to the trip.

However, the report did give some praise to the state, dropping its ranking from No. 2 last year to No. 7 overall this year which was partially based on the passage of legislation in the 2014 legislative session aimed at lessening the ability of attorneys to pursue abusive lawsuits.

Melissa Landry, executive director of grassroots legal watchdog group Louisiana Lawsuit Abuse Watch, said that while such harsh criticism can be hard to accept, Louisiana’s consistently poor rankings in the Judicial Hellholes report and in other surveys of state legal climates send a clear message that reform is necessary.

“It is encouraging that the Louisiana Legislature took some steps toward reform earlier this year, but in order to shed the ‘Hellholes’ label once and for all we have to continue challenging the status quo,” she said. “Judges who take lavish trips paid for by personal injury lawyers practicing before them and unique laws that drive excessive litigation are red flags that Louisiana’s civil justice system is still heavily weighted in favor of the powerful trial bar.”

John Baker Jr., LSU professor emeritus of law and current visiting professor of law at Georgetown University, said that dropping from No. 2 on the list to No. 7 is a positive sign for Louisiana, but that there is still more work to do.

“The report reflects that Louisiana has improved as far the American Tort Reform Association is concerned. That is likely due to legislative changes and changes in recent years in the state’s supreme court,” he said. “The real problem is at the lower court level where ex parte contacts between lawyers and judges concerning the merits of the case are much too common. This is the by-product of an elected judiciary.”

Baker, who with the Center for Legal Integrity put out a non-partisan radio ad in the past election cycle raising awareness about judicial ethics, singled out Free’s case as an indication that the Louisiana judicial system is still lacking.

“That case is what prompted me in large part to do those ads. The punishment was not nearly as strong as it should have been,” he said.

(Click on this link to read the entire report.)