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CL – Scruggs’ downfall...

CL – Scruggs’ downfall remains baffling

By: Magnolia Tribune - June 29, 2008

Scruggs’ downfall remains baffling

Scruggs received the maximum under the plea agreement, despite hundreds of letters from the poor and the powerful detailing his generosity to institutions such as the University of Mississippi, where he has contributed millions.

Defense attorneys called Scruggs’ guilty plea “an aberration in an otherwise exemplary life.”

Hollywood director Michael Mann, in his letter to U.S. District Judge Neal Biggers, said Scruggs “is simply not a boastful man.”

Mann directed the 1999 movie, The Insider, about the secrets of the tobacco industry that led to the record $206 billion nationwide settlements Scruggs helped negotiate. Scruggs was a consultant.

“Dick never talked himself up to be more than a hero than was accurate,” Mann wrote.

So how did Scruggs, who made up to $800 million in legal fees on tobacco litigation, get involved in a scheme to pay a seemingly paltry $40,000 bribe to a judge?

Scruggs’ friends say they’re baffled. Scruggs’ attorney, John Keker of San Francisco, suggested it might take an author along the lines of a William Faulkner or Walker Percy to explain it all.

Jones has no answer. “It is something I haven’t been able to answer after eight months of real searching.”

Like Jones, two former law partners, Alwyn Luckey and Bob Wilson, sued Scruggs, in 1994, saying he never paid them their share from asbestos and tobacco litigation.

Convinced Scruggs was being “shaken down” by others, Jones said he poured all his might into defending Scruggs.

The case bounced from court to court until both sides agreed to let U.S. Magistrate Judge Jerry Davis arbitrate the case involving Luckey in 2005. Davis ordered Scruggs to pay Luckey $17 million.

“The irony is the bulk of the majority of the award was interest because Dickie had litigated it for 12 years,” Jones said.

Jones viewed the ruling as a victory since he had successfully protected Scruggs’ interests with regard to any legal fees earned from the tobacco litigation.

But Scruggs saw it as an unacceptable defeat, Jones said.

From that point on, Scruggs decided to stop trusting the system that had made him a multimillionaire, Jones said. “I was dealing with a different man emotionally and psychologically.”

Jones had been assisting Oxford lawyer Jack Dunbar, who was serving as lead counsel, but Jones said Scruggs now remarked that he should have listened to “his friends” – lawyers Joey Langston of Booneville and Tim Balducci of New Albany.

Although Scruggs, a former fighter pilot, exudes confidence, he suffers from some insecurity, Jones said. “He is extremely influenced by the people around him. He would adopt whatever he thought was the best argument by the people in the crowd, not just on the law but on whether a book was good. He wasn’t sure enough of his own view.”

In January 2006, special master Bobby Sneed, appointed by the Hinds County Circuit Court to evaluate the evidence in Wilson’s lawsuit, made recommendations that largely sided with Wilson, leading his lawyers to seek $15 million in legal fees.

Three days afterward, Scruggs replaced Dunbar. Jones quoted Scruggs as remarking, “Hinds County Circuit Court is a snake pit, and I need a snake.”

Scruggs installed Langston as lead counsel, assisted by Balducci.

In the end, Hinds County Circuit Judge Bobby DeLaughter ruled entirely in Scruggs’ favor, saying Scruggs owed nothing more than the $1.5 million he’d made in belated payments.

Langston has since pleaded guilty to a bribery scheme to influence DeLaughter, who has denied any wrongdoing.

Scruggs has not been charged in the case, but the Justice Department’s Public Integrity Division continues to investigate.

After the Wilson case ended, Jones said he eagerly joined Scruggs in Hurricane Katrina litigation – only to find himself in the kind of legal fees dispute with Scruggs he had defended Scruggs on.

After the $40,000 bribery attempt was discovered, Jones’ lawsuit was transferred to another judge, who ruled in Jones’ favor.

Scruggs is heading to prison.

“I never meant to bring down that thunder on him,” Jones said. “He brought that down on himself.”

He hopes the sentences will “end the lesson, and the lesson sticks. It’s just been an unbelievable nightmare, not only to the people involved, but to my profession. At the end of the day, it’s the little guy who will pay all of this cost in terms of our ability to represent these people in court.”

He worries the judicial system has been permanently damaged by this scandal.

“Dickie got a lot of bad advice and took it,” Jones said. “It’s time to stop pointing fingers and time to salvage what he almost broke.”

Clarion Ledger

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Magnolia Tribune

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