Louisiana Legislature Considers Bill to Allow State to Pay Attorneys Using Contingency Fee Arrangement
By Kelly Becker
The Louisiana legislature is currently considering House Bill 758 which would allow the Attorney General to pay up to a twenty-five percent contingency fee to outside attorneys to represent the State in litigation. Several industry groups, including the Louisiana Association of Business and Industry and the Louisiana Oil and Association, oppose the bill on the basis that it would lead to “frivolous” suits and target certain industries within the State. In the past, the State hired outside counsel to pursue claims for allegedly underpaid royalties and severance taxes and paid those outside lawyers on a contingency basis. Challenges were often raised to the contingency fee structure in those cases as violating the Louisiana Supreme Court’s decision in Meredith v. Ieyoub, 96-1110 (La. 9/9/97), 700 So. 2d 478, which held that through the terms of those contingency fee contracts, the Attorney General unconstitutionally usurped legislative authority by alienating to outside counsel State-owned property – a portion of any funds recovered in the litigation.
For more information on the proposed legislation, see www.nola.com/business/t-p/index.ssf/base/money-2
