Cap on Anti-Tobacco Attorney Fees Killed

The incendiary and highly partisan issue of attorneys’ fees took center stage Tuesday as the Senate killed a first attempt to cap the fees of anti-tobacco lawyers.

As debate continued on sweeping tobacco control legislation, the Senate voted, 58 to 39, against an amendment by North Carolina Sen. Lauch Faircloth and other conservative Republicans. The measure would have imposed a ceiling of $250 per hour on payment to the lawyers whose class actions and lawsuits on behalf of state attorneys general forced Big Tobacco to the bargaining table.

However, supporters of the cap served notice that they expect to offer another amendment--perhaps to cap fees at $500 per hour.

The tobacco bill, sponsored by Sen. John McCain (R-Ariz), would create a panel of three arbitrators to set the fees of each law firm, so no one knows how much the lawyers would get.

But that did not stop cap proponents from giving alarmingly high--and highly variable--estimates of what the fees might be.

In a speech to Senate colleagues, co-sponsor Phil Gramm (R-Texas) put the payday for the lawyers at $100,000 per hour. At a press conference later, he gave their hourly take as $88,000. Soon after, Faircloth told the Senate the anti-tobacco lawyers will get $188,000 per hour.

Attorneys’ fees are a hot-button issue for many Republicans and business groups like the U.S. Chamber of Commerce and the National Assn. of Manufacturers, which supported the $250-an-hour ceiling.

Trial lawyers give generously to Democrats, and fat fees from the tobacco cases would enable them to give even more to favored politicians and to finance product liability assaults on other industries. Even so, 13 Republicans crossed over to vote with Democrats in killing the amendment.

The McCain bill would raise the price of cigarettes by at least $1.10 per pack. The increase is designed to discourage youth smoking, reimburse state health care costs and fund anti-smoking programs.

The bill would settle pending class actions and state attorney general lawsuits, with arbitrators setting the fees of the lawyers who brought the cases. The industry would also pay the legal fees, recovering them by additional price hikes on their products. Sen. Mitch McConnell (R-Ky.), co-sponsor of the fee ceiling amendment, said the prospect of billions of dollars in legal fees makes the McCain bill “the national lawyer enrichment deal.”

And Gramm called it “a sin to be taxing blue-collar Americans to buy Lear Jets” for rich attorneys.

But Sen. Richard Durbin (D-Ill.) defended the arbitration scheme, saying that while $250 per hour may seem like a lot, “we are talking about attorneys who are playing in the big leagues here.”

Faircloth and his allies, said Durbin, simply resent the lawyers for upsetting “the apple cart on Tobacco Road.”

Sen. Orrin G. Hatch (R-Utah) also defended the lawyers while conceding: “Most of them are Democrats. Most of them are liberal Democrats at that.”

But without their legal attacks on Big Tobacco, “we wouldn’t be here today,” Hatch said. And in a salute to his hometown Utah Jazz, who are leading the Lakers in their National Basketball Assn. playoff series, Hatch said it would be no more fair to cap the lawyers’ fees than to limit earnings of sports heroes like “my dear friend Karl Malone because he’s one of the greatest basketball players who ever lived.”