Brief (1)
HR 6012 would require the Attorney General to prosecute an action to determine the reasonableness of attorney fees awarded to local outside counsel in the national tobacco settlement case.
Rationale
The resolution refers to hearings of the House Taxation Committee regarding the employment and effort of local outside counsel, including testimony suggesting that Kansas could have received a greater amount of revenue from the settlement if another law firm had been employed.
The resolution notes that a specific rule of "model professional conduct" (MRPC 1.5) adopted by the Kansas Supreme Court requires that fees received by Kansas lawyers be "reasonable and subject to judicial review." The resolution further states that the contract entered into by the state and local outside counsel in the national tobacco case also is subject to that rule.
One clause makes reference to the Tobacco Settlement Arbitration Panel finding that national counsel (as opposed to local) provided "most of the personnel power and resources for the Kansas effort."
The $27 million fee designated for local outside counsel thus would be deemed to be "unreasonable in light of the lack of expertise and effort by such counsel."
Specifics of Resolution
The Attorney General therefore would be directed to bring an action in an appropriate forum seeking judicial review pursuant to MRPC 1.5 relative to the reasonableness of the attorney fees. With regard to such action, the Attorney General would be further directed to (a) obtain a copy of the transcript and briefs submitted to the arbitration panel and submit such evidence to the forum or seek a subpoena directing production of same; (b) submit as evidence the entire record of proceedings of the House Taxation Committee from February 14-17, 1999; (c) seek an order making all evidence submitted to the forum available for review by any member of the Legislative Coordinating Council, as well as the chairperson, vice chair, and ranking minority member of the Taxation Committee.
The resolution directs the Attorney General in the event of a conflict regarding her ability to bring such action in the appropriate forum to hire special counsel to "aggressively pursue" the contention on behalf of the state that the $27 million fee is unreasonable and violative of MRPC 1.5.
Finally, if any portion of such fee would be found to be unreasonable and excessive, the Attorney General would be required to seek an order providing for that amount to be remitted from local outside counsel to the State Treasurer for deposit in the Children's Initiatives Fund.
Background
The original resolution would have required the Attorney General to bring the action regarding the reasonableness of the fees in Shawnee County District Court. The House Committee amended the resolution to allow the Attorney General discretion in the selection of a forum for initiation of the action.
1. *Supplemental notes are prepared by the Legislative Research Department and do not express legislative intent. The supplemental note and fiscal note for this bill may be accessed on the Internet at http://www.ink.org/public/legislative/bill_search.html