A lawyer for a Columbia private law firm that received a $75 million fee from Attorney General Alan Wilson for legal work in a $600 million plutonium settlement told a state circuit judge on Wednesday that, under the law, no one can stop Wilson from paying out any size fee he wants to.
“The statute is clear: the attorney general can pay litigation costs, including attorneys’ fees,” said Rep. Todd Rutherford, D-Richland, who represented Columbia law firm Willoughby & Hoefer in a Wednesday hearing before state circuit Judge Alison Lee.
The only oversight to check Wilson’s payments to private lawyers to help with legal work is the will of the voters every four years who, if they don’t like what he’s doing, “can go to the polls and un-elect him,” Rutherford said.
But Jim Griffin, a lawyer for citizen activists who have brought a lawsuit questioning whether Wilson had the authority to pay $75 million in fees to a private law firm — fees taken out of a $600 million settlement in public money — told Judge Lee that it is nonsensical to think that Wilson has an unrestricted right to award law firms huge fees of any size.
“Under their theory, Attorney General Wilson could have agreed to pay these law firms $580 million out of the $600 million settlement,” Griffin told the judge. “And there would be nothing your honor could do about it, or the citizens of South Carolina, other than wait until he’s up for re-election.”
At hearing’s end, Lee kept the freeze in place preventing lawyers from spending $75 million. She said she would issue a ruling by Oct. 14 as to whether the freeze should stay in place.
On Sept. 25, Griffin, representing the citizen ethics activists, filed a lawsuit in Richland County state court seeking to stop Wilson from paying the $75 million fee to Wilson’s private lawyers.
A few days later, at the direction of Wilson’s office, state officials wired $75 million to Willoughby & Hoefer. Griffin then modified the lawsuit to include that firm and Davidson, Wren & DeMaster, another firm that worked with the Willoughby firm on the plutonium settlement and presumably will be paid some of the $75 million.
Griffin also won a order from Lee preventing the law firms from spending the money at least temporarily until she has a chance to review issues in the case.
The $600 million settlement, announced by Wilson Aug. 31, was to compensate South Carolina for economic damages resulting from the federal government’s years-long failure to remove some 9.5 tons of weapons grade plutonium from Barnwell County’s Savannah River Site. It was not a court-ordered lawsuit, and the money came a U.S. Department slush fund and was approved by Attorney General William Barr.
Wilson, who worked for Willoughby & Hoefer before becoming attorney general in 2011, has said the law firms worked hard and earned their fee, and he will turn the rest of the $600 million settlement — $525 million — over to the General Assembly.
The lawsuit was filed by longtime government ethics watchdog John Crangle, a Columbia lawyer, and the S.C. Pubic Interest Foundation, a non-profit that has brought numerous lawsuits against various government agencies questioning a lack of transparency and accountability about what is done with public money.
In his arguments to the judge, Rutherford said the law doesn’t allow Crangle and his foundation the “standing” to file a lawsuit because they themselves have suffered no personal injury.
But Griffin told the judge that ample precedent exists for citizens to bring lawsuits questioning official expenditures of public money if the matter is in the public interest.
And in this case, the $600 settlement agreed upon by the federal government and South Carolina said nothing about lawyers’ fees and the money was only to go for “economic assistance,” said Griffin. “They (the funds) weren’t intended to pay lawyers,” he said.
The lawyers do deserve a fee for their work but not $75 million, Griffin said. Griffin also said his clients aren’t looking for any money in the case, just seeking at least a court review of issues in the case, such as whether the fee is too large and whether Wilson has a right to pay lawyers huge fees without any oversight.
No one knows how much work the lawyers have actually done, Griffin told the judge, asserting it could be 2,000 hours or 10,000 hours. And said Griffin, he has scoured the court records and found no traces of discovery, interrogatories, documents or other time-consuming expensive work that normally run up legal bills.
It is unfair and unreasonable to freeze the $75 million that the lawyers earned and have a right to, money that they could be investing and making money on, Rutherford said.
If the lawsuit goes forward, Rutherford said, he would ask for a bond to be put up by Crangle and the Pubic Interest Foundation in the amount of $75 million, plus another $7.5 million. Lee said she would not set a bond at this time because she will be ruling fairly quickly.
Although over the years, attorneys general have hired private law firms and awarded them fees from amounts they won, the issue about the size of fees has never come up before because “frankly, there’s never been a $75 million attorneys’ fee payment before,” Griffin said.
Lee asked whether the size of the $75 million fee was a major factor in the lawsuit.
“That is what has gotten everybody’s attention, your honor,” Griffin replied.
Crangle and the Public Interest foundation have also filed a petition in the S.C. Supreme Court asking the high court to take up the case without going through the lower courts.
“We need the Supreme Court to set precedents to guide future attorneys general,” Crangle said after the hearing.
Gov. Henry McMaster has also objected to the size of fee, saying he and Sen. Lindsey Graham, a Seneca Republican, also helped get the $600 million.
Besides Griffin and Rutherford, lawyers in the case include John Simmons and State Sen. Gerald Malloy, D-Darlington, for Willoughby & Hoefer; Ken Wittington for the Davidson law firm, and Emory Smith, a top lawyer in the Attorney General’s case, for Wilson.
Griffin’s co-counsel include Badge Humphries and Jim Carpenter.