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DJ – A tangled web of legal cases...

DJ – A tangled web of legal cases continues

By: Magnolia Tribune - June 1, 2008

A tangled web of legal cases continues

When famed Oxford litigator Richard “Dickie” Scruggs, his son Zach and their legal associate Sidney Backstrom are sentenced on July 2, only part of a complicated legal drama will be resolved.

At least four related cases are proceeding, although they and other co-defendants Timothy Balducci and Steven Patterson have not been charged with any other crimes.

Here is a quick update of some of these legal situations:

The indictment case – Five men were indicted Nov. 28, 2007, accused of trying to bribe Circuit Judge Henry Lackey for a favorable ruling in a lawsuit over the division of Hurricane Katrina insurance-case legal fees.

The lawsuit – Jones Funderburg Sessums Peterson & Lee PLLC versus Richard Scruggs, Don Barrett and four law firms – sought a legal solution to dividing the $26.5 million in fees.

1. All defendants – Dickie Scruggs, his son Zach, Backstrom, former New Albany attorney Timothy Balducci and former state Auditor Steven Patterson of New Albany – pleaded guilty to varying degrees in the scheme. They have not been sentenced, although a July 2 date has been set for the Scruggses and Backstrom.

2. Balducci was disbarred. The Mississippi Supreme Court has not yet acted on a similar request from the state Bar Association for the Scruggses and Backstrom. Patterson is not an attorney.

3. The Jones case is still in court, now presided over by Special Judge William Coleman. A November court date has been set to determine what sanctions will be handed down to the Scruggs group because Scruggs’ illegalities toward Lackey fouled up the normal course of the litigation.

Hurricane Katrina victims, who were represented by The Scruggs Law Firm and its partners, and who still have legal issues with their insurance companies, have attorneys who are involved in their continued representation. But in some instances, a judge has dismissed the new lawyers, saying they were too close to the original lawyers.

The lawsuit at the heart of Case No. 1. In that case, Jones Funderburg Sessions Peterson & Lee PLLC law firm sued Scruggs and others, saying it was short-changed in the division of Katrina-related fees.

The Jones side, led by feisty Oxford attorney Grady Tollison, has won its argument that its case was fouled up by the bribery attempt. Appointed Judge William Coleman will reconvene the sides Nov. 12 to consider how much it will be worth for Jones and company.

In April, Coleman, who took over when Judge Lackey stepped aside, agreed that the Jones firm had been irreparably harmed by the bribery scandal and was owed reasonable attorneys fees and expenses incurred in the lawsuit after a July 2007 hearing over which Lackey presided.

Consequently, Coleman agreed to grant sanctions against The Scruggs Katrina Group, which also includes Jackson attorney Don Barrett and his law firm, as well as the firms of Nutt & McAlister and Lovelace Law.

Coleman also said he did not agree that everything Jones alleged was true, so Tollison and company must prove their claims to secure punitive damages.

This case has no name yet.

Joey Langston of Booneville, once one of Mississippi’s top trial lawyers, pleaded guilty to conspiring to bribe Hinds Circuit Judge Bobby DeLaughter. He told prosecutors he was helped by Balducci, Patterson, former Hinds District Attorney Ed Peters and sometimes Dickie Scruggs to secure a favorable ruling in another lawsuit over legal fees.

That lawsuit, Wilson et al versus Scruggs et al, sought a legal solution in dividing millions in legal fees after successful lawsuits against asbestos manufacturers.

Because this case was never legally wrapped up, Wilson’s attorneys have hinted strongly they will go back into court for a bigger share.

1. Everybody implicated by Langston, but especially Peters and DeLaughter, who in late March was suspended from the bench during the course of an investigation by the Mississippi Commission on Judicial Performance. The U.S. Department of Justice’s ethics squad reportedly is looking into this case, as is the FBI on possible racketeering charges.

2. Former Sen. Trent Lott – Dickie Scruggs’ brother-in-law and then one of Mississippi’s two senators who could have offered DeLaughter’s name to the White House for nomination to the federal bench. While Lott’s people insist that did not happen, others closer to the investigation say they believe otherwise, even though someone else got the judgeship. Lott resigned suddenly two days before Scruggs was indicted, saying he thought it was time to retire, although he was just in the early part of another six-year term.

3. Dickie Scruggs’ plea agreement does not shield him from any possible entanglements in this case.

DeLaughter insists he has done nothing wrong. Peters, Balducci and Patterson are believed to be working with prosecutors.

Although his presentence report has been complete since Feb. 21, Langston’s sentencing was formally delayed in recent weeks, undoubtedly as leverage for the government to get whatever else it wants from him about its investigations.

DeLaughter’s problems are spreading to other cases over which he has presided, with attorneys questioning his rulings against their clients.

Court-watchers continue to speculate about what and when something will erupt about this case, probably in the Southern District of the U.S. District Court in Jackson.

Langston was disbarred, and no one else has been officially charged in this case.

The lawsuit – Wilson et al versus Scruggs et al – sought to divide huge attorney fee awards after a national lawsuit against asbestos manufacturers.

With the January confession of one of Scruggs’ attorneys, Joey Langston, that he attempted to influence Judge Bobby DeLaughter presiding over Wilson’s attorney-fees dispute with Scruggs, this case seems back to life beyond its 2007 settlement.

Because of a DeLaughter ruling, Wilson was awarded only $1.5 million in payment, compared to attorney Alwyn Luckey, who won $17.5 million in his dispute with Scruggs over the same litigation.

Although Wilson’s attorneys didn’t return phone calls, court-watchers say they want what’s theirs from Scruggs and are strategizing about how to proceed with the case, still alive in Hinds Circuit Court.

When Dickie Scruggs pleaded guilty in the Jones-related attempted bribery of Judge Lackey, the government said their agreement with him would have no bearing on whatever happened in the Wilson case. That meant they weren’t giving him any immunity from further prosecution, as they had with Langston, Balducci and Patterson.

Meanwhile, the case is the basis of one of two misconduct allegations against DeLaughter under investigation by the Mississippi Commission on Judicial Performance. The state Supreme Court suspended him from the bench until MCJP reports.

And it’s one of at least three cases the FBI reportedly is examining involving DeLaughter and Peters as part of its investigation into alleged judicial bribery in Mississippi.

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This article was produced by Magnolia Tribune staff.