A law firm’s Internet alter ego
A web site called mymeso.org, looks like it’s probably run by a nonprofit, 501(c)(3) group devoted to providing dispassionate information about the dreaded, fatal, asbestos-linked cancer known as mesothelioma. Or possibly by a concerned citizen whose close relative has contracted the disease.
It’s neither. It’s an alter ego of Beasley Allen Crow Methvin Portis & Miles, a plaintiffs law firm in Montgomery, Alabama, that brings asbestos suits, among other things. (Somewhat ironically, another Beasley Allen specialty is consumer fraud class-actions.)
Anyone can obtain a “.org” top-level domain name from the Public Interest Registry, which promotes itself as “the registry of choice for organizations dedicated to serving the public interest.” Though its use ordinarily connotes a noncommercial outfit of some kind, the registry does not bar for-profits from using it.
As of this writing, if you closely examine the mymeso.org homepage, and scroll down a ways, eventually in the right-hand margin you’ll detect two light-gray-on-white boxes whose typeface is so faint that they almost look like watermarks.
One box says “POWERED by HOPE and Supporters Like You,” and the other says “PUBLIC AWARENESS web site sponsored by BEASLEY ALLEN.” (When the page is printed out, these messages are invisible, at least using my printer.)
If you click on the “POWERED by HOPE” box, you get to a “mission statement” that finally acknowledges that mymeso.org is not just sponsored by Beasley Allen; it is Beasley Allen, or, as BA puts it, “a community outreach effort” of that firm. The site was set up by BA on January 16, 2008, according to its Whois data.
Most of the posts on the site are signed by Wendi Lewis, who is not further identified. Some of Lewis’s posts refer to verdicts won on behalf of mesothelioma victims, and some of those offer links to Beasley Allen’s main web site for the “full story.” The site also has an email “contact” feature that provides no indication of where it leads.
For comment I called Thomas J. Methvin, a name partner at Beasley Allen, who also happens to be the president-elect designate of the Alabama State Bar.
Methvin acknowledges that Wendi Lewis is a Beasley Allen employee, but says that the identification of the site as “sponsored by” the firm is sufficient to avoid any confusion. He says that those who have written to the site so far have not been seeking legal assistance; it’s just been about “awareness.”
Ethics professor Stephen Gillers, of New York University Law School, says that he did not know whether mymeso.org met the Alabama’s bar regulations, since rules on advertising vary greatly from state to state. “The disguised nature of the web site would not allow it to survive challenge under the New York rules,” he noted, however.
Professor Robert Kuehn of the University of Alabama School of Law said that Alabama’s rules on lawyer advertising are “not very stringent” and that it was not clear to him that what they do require - primarily inclusion of certain disclaimer language - would come into play here, since the site does not outwardly appear to solicit clients. He also noted that the firm might have First Amendment protections that could override whatever regulatory provisions were implicated.
Assistant general counsel Samuel Partridge of the Alabama State Bar said that, under longstanding policy, he was not allowed to give an opinion over the phone as to the permissibility of a specific lawyer’s conduct.
Incidentally, when first asked to look at the site, none of the experts I contacted initially understood what legal ethics question I wanted to ask them, since none realized that the site was run by a law firm until I told them.
Beasley Allen is not the only law firm with a dot-org avatar. The New Haven, Connecticut, plaintiffs law firm of Early, Ludwick, Sweeney & Strauss also uses one, called the Mesothelioma & Asbestos Awareness Center, at maacenter.org. The home page uses a popular symbol of medicine as its emblem - the two serpents wrapped around a winged staff - and its “about us” blurb says: “Our organization is staffed entirely by volunteer writers and other contributors who recognize the importance of building awareness.”
But at the bottom of the home page there is also a notice in faint gray typeface stating that the site is sponsored by Early Ludwick. It contains a hyperlinked disclaimer which, when clicked upon, finally does state, with refreshing candor, “Attorney Advertising.”
Jim Early, the New Haven firm’s managing partner, initially said he didn’t think his firm was associated with the Mesothelioma and Asbestos Awareness Center, and that he’d never heard of that group before. But then he added, “I’ve got people that do my Internet stuff and I’m not sure what they’re doing. I think we make it clear on all our web site stuff that we’re a law firm.”
I then used the “contact” device on the maacenter.org site, identifying myself as a reporter, and asking if the site was affiliated with Early Ludwick. Jim Early emailed me back as follows: “I have received the inquiry you posted on the web site our firm sponsors. As I indicated, I do not believe the web site is ‘deceptive’ as our name appears on the bottom of the home page as a law firm. . . . I am sorry I did not have complete familiarity with the name of the web site as you listed it to me yesterday as i was in the middle of several other projects and had not seen it beforehand. However I have since looked at it and compared it to other web sites and feel that it would be in compliance with appropriate attorney advertising standards. Emails to that web site do reach my office and we do sponsor that site.”
UPDATE: (March 28, 2008): As of this morning the mymeso.org web site had been revised. It now has a legible “Website sponsored by BEASLEY ALLEN” notice at the top, right-hand side of the home page, a second legible message at the bottom, and its “contact” device indicates that Wendi Lewis works at Beasley Allen. These seem like good revisions to me.
Dickie Scruggs’ incredible shrinking wallet
It appears that the drain of paying for criminal defense attorneys is having an impact even on mega-plaintiffs lawyer Dickie Scruggs, whose share of fees from the late 1990s tobacco settlements is thought to have approached $1 billion.
Since September 2006, Scruggs had been paying all fees and expenses for two “whistleblowers” who had been sued by their employer due to actions they’d taken to assist Scruggs in his assault on the insurance industry over its post-Hurricane Katrina claims-handling practices. (Basically, they stuck their necks out for him, so he was covering their back-sides.)
But on Tuesday, one of the two law firms defending the whistleblowers - Cori and Kerri Rigsby - asked to withdraw, citing “the inability of the Rigsbys and others” to pay its fees going forward or to even “adequately satisfy existing fee and expense obligations.” The motion is here.
The withdrawing firm is Washington, D.C.’s Zuckerman Spaeder, and its team was led by William W. Taylor, III, who is also the lead criminal defense lawyer for indicted class-action firm Milberg Weiss (or, as of today, Milberg LLP, see here). I have a call into Mr. Taylor, but given today’s activity in the Milberg case - founding partner Mel Weiss’ expected guilty plea, see here - I suspect I may be low down on his call-back list. Scruggs’ counsel, John Keker, declined to comment on Zuckerman’s motion and what it might mean.
The Rigsby sisters’ employer, E.A. Renfroe & Co., sued them in September 2006 for allegedly violating their employment contracts by photocopying confidential documents belonging to State Farm (to whom Renfroe was supplying supplemental claims-adjusters) and giving them to Scruggs. In addition to paying the Rigsbys’ costs of defending the suit, Scruggs had also taken on at least an oral commitment to indemnify the sisters for any judgment they might ultimately incur, according to a statement filed by the Rigsbys’ lawyers last December. See here.
Scruggs pled guilty Friday to conspiring to bribe a Mississippi state judge in Oxford in 2007, but his legal problems are not over. Prosecutors in Oxford contend he was involved in attempting to bribe a different state judge in Jackson in 2006, and a different set of prosecutors in Birmingham, Ala., are pursuing him on a criminal contempt charge, arising from Scruggs’ alleged defiance of a December 2006 court order. (The contempt charge was dismissed on February 29, but the Alabama prosecutors are contemplating an appeal.)
Scruggs is also likely paying the criminal defense costs of his son and co-defendant, Zach Scruggs, who faces trial March 31, and currently has at least 7 lawyers at 4 firms representing him, according to electronic court records. One would also expect that Scruggs would be footing the bills for his law partner Sid Backstrom, who also pled guilty Friday.
According to the withdrawal motion, the Rigsbys will continue to be represented by Birmingham’s Battle Fleenor Green Winn & Clemmor, who were also previously paid by Scruggs.
Scruggs guilty plea - but will he cooperate?
The surprise guilty plea this morning of mega-tort lawyer Richard F. “Dickie” Scruggs leaves a huge unanswered question: will Scruggs cooperate?
The unusually short plea agreement says nothing one way or the other about cooperation. (Scruggs’ law partner Sid Backstrom also pled guilty today, and his specifies that he will cooperate. The Clarion-Ledger is reporting that Scruggs’ son, David Zachary Scruggs, will get deferred prosecution, though he’ll have to surrender his law license. [CORRECTION/UPDATE: The C-L did briefly report that, but it turned out to be inaccurate, and they quickly deleted it from their web site article. Evidently Zach Scruggs is heading for trial, as things stand.--RHP 3/18/08]
A great many people in Mississippi and national politics are undoubtedly waiting with bated breath to learn whether Scruggs plans to cooperate. A lawyer in the office of John Keker, Scruggs’ lead counsel, declined all comment.
Earlier this year, federal prosecutors in Los Angeles concluded a plea deal with class-action impresario Bill Lerach which did not require him to cooperate–a deal also negotiated by Keker–but such deals are rare.
In this morning’s plea, Scruggs admitted conspiring to pay a $40,000 to bribe to state circuit judge Henry Lackey of Oxford last year, who was presiding over a fee-dispute case filed against him by a law firm that had once been part of his Scruggs Katrina Group. That was a joint venture that brought cases for policyholders who suffered damage in Hurricane Katrina.
But Scruggs has not yet revealed what, if anything, he knows about another alleged attempt to corruptly influence a judge, which prosecutors contend occurred in early 2006. That incident involves a still sitting judge in Jackson, a former district attorney there, and, in a bit part, Scruggs’ brother-in-law Trent Lott, the former U.S. Senator. None of those individuals has been charged with wrongdoing and all have denied committing any.
But if Scruggs were to ever start talking, the area of greatest interest to any historian, certainly, would be the unexpurgated story of his most famous case–the assault upon the tobacco industry in the mid-90s. Scruggs’ multifaceted campaign in that case–including lawsuits, public relations campaigns, and political pressure– culminated in a series of settlements under which cigarette makers agreed to pay the states about $246 billion over 25 years, and to pay the plaintiffs attorneys more than $13 billion. Scruggs’s share of the fees reportedly came to more than $850 million.
On the other hand, even if Scruggs witnessed anything untoward in that campaign, and even if he were willing to tell prosecutors about it, prosecutors might be barred from pursuing it at this point by statutes of limitations.
Why would anyone think something untoward might have occurred? As a result of fee-dispute litigation relating to the tobacco case, it has come to light that Scruggs is still paying significant shares of his attorneys fees from that case to farmer and grain storage businessman P.L. Blake, whose role in the litigation remains unclear. (Under the tobacco settlement, attorneys fees are parcelled out over about a 25-year period, at a rate of between $500 million and $750 million a year.)
Scruggs and Blake testified in 2004 and 2005 that Blake provided oral political intelligence to Scruggs, though neither could recall concrete examples. From 1993 to 1998 Scruggs had paid Blake loans totalling about $785,000 in increments of $5,000 to $25,000 per month.
In the first year after the tobacco settlements were concluded, Scruggs paid Blake $10 million, out of which Blake paid back Scruggs’ earlier loans with interest. (Scruggs wired the $10 million to his friend Joey Langston, who then wired the money to Blake, though neither Scruggs, Langston, nor Blake could recall why they did it that way in their depositions).
Scruggs then started paying Blake $468,450 per quarter, at which rate the total paid out to Blake would eventually approximate $50 million. (Stories about the Blake payments have previously appeared in David Rossmiller’s Insurance Coverage Blog, the New York Times, and the Wall Street Journal.)
Correction: Earlier version had spelling error, caught by commenter Ed of Topeka, KS. Thanks, Ed.
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