McCollum, Sink split on cap for lawyer fees in suits
By Marc Caputo, Times/Herald Tallahassee Bureau
In Print: Wednesday, January 13, 2010
A new flash point is emerging in the race for Florida governor: capping legal fees.
Attorney General Bill McCollum, a Republican candidate for governor, proposed Tuesday that the state limit the fees law firms earn in successful investor lawsuits filed on behalf of the state pension fund.
But state Chief Financial Officer Alex Sink, a Democrat also running for governor, said she would prefer that the state negotiate with law firms on a “case-by-case basis.” Sink wouldn’t say whether she opposed McCollum’s idea outright.
McCollum, Sink and Gov. Charlie Crist sit as the State Board of Administration, which oversees Florida’s $136 billion pension fund — the third-largest public-retirement system in the United States. Like other pension funds, Florida’s has lost big in the stock market and has been besieged by lawyers seeking to help out — for a price.
McCollum’s proposal would institute a sliding scale of fees based on the size of a lawsuit award. Maximum fee: $50 million in cases where the state recovers $1 billion. They didn’t take final action Tuesday on McCollum’s proposal, though a vote is likely in the coming months.
McCollum is pushing a similar measure through the Legislature targeting lawyers hired by the Attorney General’s Office. A House committee approved it Tuesday and a Senate committee is expected to take up the measure next week.
“This legislation takes aim at one of the most egregious forms of public corruption: pay-to-play politics,” McCollum said, noting that the proposal would set up a clear and “transparent” system designed to competitively award legal work to highly qualified firms.
Republican-leaning business groups support the measure as a way to rein in trial lawyers and end sweetheart deals with law firms. Democratic-leaning trial lawyers oppose the measure, saying it makes it more difficult for firms to spend the time working on complex litigation against powerful corporate interests that pollute the environment or rip off taxpayers.
McCollum’s push comes two weeks after the Times reported that Sink’s chief of staff, Jim Cassady, played a behind-the-scenes role in helping the now-defunct law firm of Scott Rothstein, who is accused of running a Ponzi scheme, seek legal work from the pension fund.
Asked if there were a connection between Rothstein’s financial support and Cassady’s involvement, Sink said: “Absolutely not.”
Along with 43 others, the Rothstein Rosenfeldt Adler firm landed on a list to negotiate with the State Board of Administration a few weeks after the firm contributed $200,000 to the Florida Democratic Party. It was a contribution Rothstein pledged at a fundraiser for Sink, who has begun returning Rothstein’s contributions amid a federal corruption investigation of the lawyer. Crist also has pledged to return money from Rothstein, who was primarily a Republican fundraiser.
Since 2007, at least two lawyers at Rothstein’s firm approached Sink’s office for work at the board of administration, according to e-mails. Cassady at one point e-mailed Ash Williams, the State Board of Administration executive director, and asked if he would meet with a representative of the firm.
Williams on Tuesday said he didn’t think there was anything untoward about Cassady’s e-mail and pointed out that Rothstein’s firm didn’t make the final short list of five firms seeking to perform the legal work.
One of the Rothstein lawyers who sought the government job, Gary Farmer, now works for the trial-lawyer lobby and filed a notice of opposition with the House Civil Justice and Courts Policy Committee, which approved McCollum’s legislation Tuesday on a 7-3 vote. All the no votes were from Democrats.
Asked if she would vote in favor of McCollum’s proposal, Sink said she would need to see the final proposal.
“I would take a businesslike approach to it,” Sink said. “I think when we make the decision about getting involved in a case, then we have to look at it on a case-by-case basis and we have to get the best deal for the taxpayer.”
Times/Herald staff writer Steve Bousquet contributed to this report. Marc Caputo be reached at firstname.lastname@example.org.