Gary King’s Pay-to-Play (Pay-to-Sue) Scheme Revisited
New Mexico Attorney General Gary King supports ‘pay-to-sue’. What is ‘pay-to-sue’? Pay-to-sue is the practice of giving no-bid contracts to sue on behalf of a state to certain trial lawyers who wrote big checks for campaign contributions. It’s a pay-to-play practice.
According to an April 16, 2009 Wall Street Journal article ( http://online.wsj.com/article/SB123984994639523745.html) Governor Ed Rendell, D-PA, was involved in a pay-to play scheme with Houston trial lawyer F. Kenneth Bailey. Mr. Bailey received no-bid, contingency-fee contracts to sue private companies on behalf of the state of Pennsylvania. Mr. Bailey used Governor Rendell because the Attorney General of Pennsylvania rebuffed Mr. Bailey. Mr. Bailey was a major campaign contributor to Governor Rendell’s campaign.
BUT, there’s more….
The Wall Street Journal article also found that Mr. Bailey was running a nationwide ’pay-to-sue’ operation involving several Democrat state attorney generals. The article cited campaign records that showed that Mr. Bailey or his law firm donated large contributions to several Democrat state attorney generals. They are as follows:
1. $75,000 to Mississippi AG Jim Hood;
2. $50,000 to NEW MEXICO AG GARY KING;
3.$20,000 to a political action committee in Louisiana that ran ads for Attorney General Buddy Caldwell.
4. $60,000 to the Arkansas Democratic Party, in two $30,000 installments; (Note: In September 2007, Arkansas Democrat Attorney General McDaniel announced that Mr. Bailey’s firm would represent Arkansas on a contingency-fee basis in a lawsuit against the Janssen drug company and two other drug firms.)
According to the article, Mr. Bailey also gave about $85,000 to the Democratic Attorneys General Association, which gave campaign contributions to several Democrat state attorney generals including $63,000 to NEW MEXICO ATTORNEY GENERAL GARY KING.
Pay-to-sue operates in that the lawyers hired by the state are paid from 15% to 25% of any judgment or settlement. They get nothing if the state loses. The problem is that by suing private companies on behalf of multiple states they increase the odds that those companies being sued will settle rather than pay for multiple trials in multiple states. Both the lawyers involved and the state governments get large settlements of cash.
The New Mexico Independent reported on Gary King’s connection to F. Kenneth Bailey in an article from April 28, 2009 ( http://newmexicoindependent.com/26103/timing-of-ag’s-contracts-with-law-firm-raises-questions). In fact, the New Mexico Independent’s article shows that New Mexico Attorney General Gary King did sign two contracts with F. Kenneth Bailey’s law firm. The first contract expired June 30th of 2008 but the second contract didn’t take effect until late November of 2008.
In a follow up interview with the Wall Street Journal from April 29, 2009 ( http://online.wsj.com/article/SB124087457455161273.html) King told the Wall Street Journal that the original contract with Bailey’s law firm was arranged by his predecessor, Patricia Madrid. Bailey’s firm gave $25,000 to Patricia Madrid in 2005 by the way. However, Gary King STILL RENEWED the contract in 2007 without soliciting bids. When asked this, Gary King replied that the automatic renewal was done for ‘continuity’.
Looks like New Mexico now has a twin to play-to-play run rampant in Santa Fe…it’s called pay-to-sue.
