AREA ATTORNEYS DEFEND WEBSTER'S HANDLING OF FUND

Two Southeast Missouri attorneys drawn into a controversy over the way Attorney General William Webster has administered Missouri's second injury fund say the fray is politically motivated.

John Lichtenegger of Jackson called an article this week in the St. Louis Post-Dispatch "a planted story" by representatives of Roy Blunt, who is challenging Webster in the Republican primary for governor.

Lichtenegger and Steve Taylor of Sikeston defend the second injury fund in claims from Southeast Missouri as the attorney general's appointed assistants. Taylor also said he thought the charges against Webster were politically motivated.

The article quoted named and unnamed sources decrying conflicts of interest in the way the second injury fund is administered. Critics have said that law firms representing clients filing claims against the fund shouldn't also be allowed to defend the fund as an agent of the attorney general's office.

The story's sources also said a sharp increase in the past four years in the number of claims and the size of settlements has been a boon for lawyers, including several who've contributed to Webster's campaign.

Lichtenegger and Taylor were two of the attorneys named in the story who represented claims against the fund and defended it. Lichtenegger contributed $500 and Taylor $750 to Webster's gubernatorial campaign.

But Lichtenegger said complaints that lawyers have used the second injury fund as a "get-rich-quick scheme" are "so absurd as to not even justify a response.

"Everybody who knows Bill Webster knows that this is a false, politically motivated story," Lichtenegger said. "Bill Webster's integrity is unmatched in this state."

Taylor said: "It looks to me like it's a real attempt to assassinate politically the gubernatorial front-runner from people that weren't completely telling the whole story.

"I don't think Bill Webster, from the little bit I know of him, would ever do anything improper. Everything I've seen, it's always been what's in the best interest of the citizens of Missouri."

The second injury fund is financed by a premium tax on Missouri insurance companies. The fund is used to provide additional benefits to workers with permanent, partial disabilities, who are injured a second time while on the job.

Edwin Ragland of Cape Girardeau, a retired administrative law judge, said the fund was established shortly after World War II to encourage employers to hire disabled veterans.

"(The fund) would hold the employer harmless in the event that the worker would get a second injury that would totally disable him," Ragland said. "The state would assume the liability for that injury instead of the employer."

As guardian of the fund, the attorney general is authorized by statute to hire private law firms to assist him in the fund's defense.

Lichtenegger said there has been nothing improper in the way Webster has handled the fund, and he charged that Blunt trailing Webster in opinion polls in the governor's race ignited the controversy.

"Roy Blunt wants to be governor so bad that he will do anything plant any story in order to become governor," he said.

But Tom Deuschle, Blunt's campaign manager, denied the charge. He said all the information in the newspaper article and a similar article in the Kansas City Star are matters of public record.

"Obviously, the attorney general's record is open to public inspection, and I think the reporters should be commended for doing a great service in the state by reviewing those records," Deuschle said.

He said he'd like to see some type of federal or state investigation into management of the fund to see if attorneys representing the fund were given preferential treatment when they represented claims against the fund.

"I think it's quite unethical to have attorneys defending the state and suing the state on the same type of cases," Deuschle said. "It's obviously a conflict of interest, because you've got an attorney representing a claimant who has full and complete knowledge of the settlement strategy."

But Lichtenegger said every workman's compensation settlement must be approved by an administrative law judge for fairness.

"To imply that these attorneys had some special standing is to also imply that every administrative law judge was involved in some sort of scheme," he said. "That is absolutely preposterous."

Taylor said the reason a number of lawyers have represented claims against the same fund they later defended is because many lawyers have little knowledge of the fund.

"I've, in continuing legal education courses, given instruction to lawyers in the past on the fund," he said. "There are a lot of people in law that don't understand it."

He said he once represented a client who filed a typical workman's compensation claim against an employer only to discover he had a prior disability and was eligible for the second injury fund. Although he's defended the fund, Taylor represented the client in his claim against it.

"I wouldn't be representing him properly if I didn't take advantage of what's out there through the second injury fund," he said.

Ragland, who retired in 1990, also said he didn't think law firms who both defend and sue the fund are necessarily guilty of a conflict of interest.

"The administrative law judge is really in control of these cases," he said. "The law itself requires that all settlements be approved by the administrative law judge, and I know in my experience that settlements are closely scrutinized."

Lichtenegger and Taylor said claims that attorneys use the fund as a way to "get rich quick" aren't true. They said that in 90 to 95 percent of the cases in defense of the fund, the attorneys receive a flat fee of $30.

Taylor said the settlement amount generally is a matter of plugging information from the case into a known formula.

"I would think these firms probably lose money in many of these cases," said Ragland. "The state is not overly generous with these fellows. I do think in St. Louis, with the number of cases involved, it's quite a bit of money."

Taylor said the drastic increase in claims against the fund in the past four or five years is largely due to greater knowledge that the fund is available for disabled workers.

"I've been filing claims for 15 years, and I see other attorneys just recently filing because they didn't know of the availability of the fund," he said.