Attorneys set to pull billions out of BP settlement with states, local governments

By Louisiana Record reports | Jul 10, 2015

NEW ORLEANS – Several attorneys are set to receive big paydays following last week’s $18.7 billion settlement between BP and five Gulf states along with more than 500 municipalities concerning damages stemming from the 2010 Gulf oil spill.

In what some have deemed the hidden cost of last week’s settlement, several law firms throughout the country representing hundreds of municipalities involved in the settlement stand to earn legal fees worth up to a quarter of the total settlement.

In Louisiana, the number of local governments in line to accept the settlement has grown. On Wednesday alone, the Orleans Parish School Board agreed to accept a $22.7 million award, the Lafourche Parish council voted to accept an $8 million settlement, Gretna lawmakers took $3.29 million offered to them and Slidell leaders received a $3 million award.

The names of the private law firms representing these municipalities have not been publicly disclosed, nor have the details of the contingency fee contracts used to hire the outside lawyers. However, in each instance it is expected that attorneys’ fees will eat up between 20-30 percent of these proposed settlements.

For example, in Jefferson Parish where the council voted Thursday to accept the proposed $53.1 million settlement from BP, nearly a quarter of the funds will go to the Gretna-based law firm Gaudry, Ranson, Higgins and Gremillion.

Under a contingency fee contract which allows the firm to receive 25 percent of the first $25 million, 20 percent of the next equivalent-size amount and 15 percent of the remainder, Gaudry Ranson will get $11.7 million, or 22 percent of that total.

In the state capitol, the “Visit Baton Rouge” tourism bureau received $65,000, of which, according to The Advocate, $19,500 is slated to got to attorneys and other expenses.

In addition to the plethora of attorneys who will benefit from municipal settlements, the team of private lawyers hired by Louisiana Attorney General James “Buddy” Caldwell to represent the state also stand to profit significantly.

“Eight of the eleven law firms working on the state’s case made political contributions to the Attorney General,” Melissa Landry, executive director of the legal watchdog group Louisiana Lawsuit Abuse Watch, said. “Over the last five years, they’ve submitted legal bills totaling more than $13.2 million. Now they want their money, but I hope auditors and state lawmakers will take a good long look at these bills before making any payouts.

“Some of the state’s lawyers were accused of sleeping in court, while others submitted invoices suggesting they worked 13 hours a day, every day for three months straight. There’s no question this is a runaway gravy train that needs to be stopped.”

Meanwhile, former Army Lt. Gen. Russel Honoré published an editorial yesterday entitled “BP settlement: Tens of millions for lawyers, not nearly enough for the coast” on the The Lens where he also decried the fees paid out to attorneys.

“BP’s payments to the state of Louisiana’s are far less than they should be. And yet the private lawyers hired by Louisiana Attorney General Buddy Caldwell to represent the state will be rewarded handsomely for this debacle,” Honoré said.

Honoré also touched on how the private attorneys were hired by the state.

“The no-bid process of using state money to pay private lawyers must be halted immediately. It is unseemly,” Honoré said.

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