Attorney general seeks help on tobacco suit

Rachael Levy

Monday, June 2, 1997 | 11:59 a.m.

Strapped for money and manpower, Nevada Attorney General Frankie Sue Del Papa is searching for a few high-powered product liability lawyers to represent Nevada in its lawsuit against the cigarette companies.

Del Papa's turn to private attorneys to help Nevada recoup about $20 million in Medicaid coverage of ill smokers is rare. The last time the attorney general turned to a private law firm was in the early 1990s when she sought about $30 million in long-term Medicaid care, her office said.

But in the fight against the tobacco industry, reliance on liability lawyers is commonplace. All 29 other states that have sued also are relying on private counsel, said Nevada Assistant Attorney General Brooke Nielsen.

"It makes more sense for a state to utilize a private firm," Nielsen said. "They hit the ground running.

"We're a small office and a small state. We're not in a position, resource-wise, to litigate this."

Other than the costs associated with assigning three staff attorneys to the case, Nevada does not expect to pay a penny in its pursuit of the tobacco companies. Private attorneys will pay all costs and, if successful, will get a percentage of Nevada's winnings.

The size of the spoils for private attorneys has been dropping as bidding wars have broken out. Last summer, Arizona agreed to pay attorney Steve Berman of Seattle 18 percent of any winnings. By February, Indiana agreed to pay Berman a maximum of 13 1/2 percent.

Berman and two others have bid on Nevada. Each bid is made up of a consortium of law firms and the attorney general is expected to select one this week, Nielsen said.

State officials would not release the proposed splits, but said the amounts were based on a sliding scale and ranged from 1 to 15 percent.

One of the bidding groups -- Richard Scruggs of Pasagoula, Miss., and Ronald Motley of Providence, R.I. -- reportedly represent more than 15 states in the settlement talks.

Since Nevada filed suit last week, Nielsen said the state has joined in the negotiations.

Private attorneys have a great deal of influence in this litigation that may set public policy for years to come. The talks address not only compensation for victims but advertising bans and cigarette companies' financial liability from individual smoking claims.

Elsewhere, critics within the legal community and health-care advocates have warned that the use of private attorneys creates potential conflicts of interest. They said private attorneys may be looking for the highest return on their investments when they sit down at the negotiating table, while states should be guarding public health.

But Nevada American Cancer Society Program Director Mandy Kanales-Salazar said she is confident Del Papa will protect the public's interests.

Another potential conflict arises when private attorneys, who already represent individual smokers, begin to represent states. One of the bids includes the Las Vegas law firm of Robert Gerard, who is representing four Las Vegas smokers against the cigarette companies.

Nielsen said state officials are considering those potential conflicts as they attempt to find the sweetest deal for Nevada. Besides the amount of money, the attorney general's office is evaluating the bidders' ability to communicate with state prosecutors and their skill in handling massive product liability cases.