PROPOSED BILL GIVES MISSOURIANS VOICE IN TOBACCO DEAL

It's the biggest rip-off of public money in history. Without having to bid, a few politically connected trial attorneys will receive as much as $320 million -- $30,000 an hour -- for work on Missouri's tobacco settlement that was already virtually guaranteed. Believing this money should be used for health care and education for all Missourians, I have filed a bill to undo this scandalous arrangement.

Two years ago, attorneys representing more than 40 states reached an estimated $200 billion dollar agreement with tobacco manufacturers, the largest out-of-court settlement in history.

In the states' tobacco litigation, Missouri arrived late to the party. We were the 27th state to file suit. States that filed early had already made their cases, replete with exhaustive research and filings. Missouri Attorney General Jay Nixon hired outside counsel to help with the case less than five months before the settlement was proposed for ratification by the states. The attorneys picked by Nixon agreed to handle the case for an amount equal to 7.15 percent of the negotiated settlement.

The settlement was a masterful piece of negotiation for the tobacco companies: make annual payments to the states, the cost of which would be passed on to their customers, and the states would be placed in the uncomfortable position of having to protect the manufacturer's cigarette sales in order to preserve the stream of annual payments. It was an offer that no politician could refuse, a settlement generating billions of dollars in state revenue without raising taxes.

When the public began asking questions about the enormous fees being paid to the outside attorneys, the politicians got nervous about getting re-elected. And the attorneys became nervous about being paid. So, they collectively negotiated a side deal with the tobacco manufacturers allowing the outside attorneys to take their claims to arbitration and be paid directly by the tobacco companies. The politicians could trumpet they were saving the state money, and the lawyers could get paid.

Questioning the constitutionality of the contingency agreement between the attorney general and his hired lawyers, I filed a lawsuit. On Dec. 12, a unanimous Supreme Court agreed with my position that the people of Missouri were entitled to a voice in what attorneys handling the case were to be paid. And the Supreme Court ruled the General Assembly acting on behalf of the people could arrange to pay the attorneys.

Senate Bill 454 does precisely that. It requires the attorneys to submit their bills to a special panel of Missouri lawmakers, who are required to conduct public hearings. The maximum amount that could be awarded to the attorneys would be their expenses and up to $500 per hour for their time.

My bill further directs the attorney general to go to arbitration and collect the attorney fees for the state. The attorneys could not be paid more than the state receives through arbitration. The state is under no obligation to pay the attorneys the full amount awarded in arbitration, and the remaining amount could be used to address the state's most pressing needs.

More importantly, if approved by the Legislature, my bill would finally give the citizens in this state a voice in the tobacco litigation that has been denied for far too long.

~Peter Kinder is assistant to the chairman of Rust Communications and president pro tem of the Missouri Senate.