Insurance Law

Scruggs Nation, Day 54

By David Rossmiller

An excellent story in the New York Times this morning by Nelson Schwartz on P.L. Blake's connections with Dickie Scruggs and how many people who've been targeted by Scruggs over the years are now lining up to whack him like he's pinata.  Click here for a copy of the story (free registration required to read it).  Here's an excerpt:

Rather than courtroom victories against the tobacco makers, legal experts say, it was Mr. Scruggs’s ability to put together a coalition of state officials and Washington politicians, while adeptly courting the news media, that ultimately forced cigarette makers to pay up in the landmark $248 billion national settlement.

Mr. Scruggs declined to comment for this article. But his lead defense lawyer, John Keker, says Mr. Scruggs was unaware of any bribery attempts and is completely innocent.

Now, the fate of Mr. Scruggs is being watched closely by advocates of tort reform as well as lawyers and industry leaders, who have all found themselves in his cross hairs over the last two decades. “He stands for the proposition that the halls of justice can become the arena for pressing public policy goals,” says David M. Bernick, a partner at the firm Kirkland & Ellis, who has represented the tobacco industry. “People want to know the reality of how he came to be so influential.”

This is natural, and it's just going to intensify.  Scruggs' enemies are going to seek to make his name one of opprobrium, synonymous with one who claims to be protecting the public good but instead manipulates and undermines public institutions for his own good and the good of a gang of outlaws and thugs along for the ride.  And they'll seek to paint the whole big-time tort bar with the same brush.  Remember that interview I gave the LA Times back in November, about how people would begin to re-evaluate how his amazingly successful man got to be so amazingly successful? It's not such a hard call to make -- even though this was before I heard of P.L. Blake or Joey Langston's confessed involvement in a scheme to influence the judge in the Wilson attorney fees case.  

Back to Blake.  The story mentions Steve Patterson's plea agreement hearing, where the government said it had evidence Blake served as some kind of intermediary in the Lackey bribery scheme.  While I was out of the office last week, I asked my secretary to get the transcript of the hearing from the court reporter, and it arrived yesterday afternoon.  Here's a copy, and here's the relevant passage about Blake (sorry for the small type, but importing from Abobe Acrobat is unpredictable -- I think it's readable enough):

On September 27th, 2007, Timothy Balducci delivered a

first installment, consisting of Patterson Balducci, PLL C ' s

$20,000 to Circuit Judge Henry Lackey. On September 28th,

2007 , Steven A . Patterson and Timothy R . Balducci spoke by

telephone; and unbeknownst to either, the call was being

recorded pursuant to Court order.

Patterson told Balducci that his wife had just gotten off

the phone with " P . L . " - - that being known to the Government as

P . L . Blake - - who had just gotten out of the meeting that

Patterson had asked him to have. Balducci asked Patterson to

call P . L . for details. Patterson called back and related to

Balducci that P . L . had in fact met with Dick Scruggs, and "he"

knows it' s going to be "40. " Patterson assured Balducci that

P . L . was confident that Scruggs would take care of Patterson

and Balducci. "We got your horse sold" or words to that

effect.

On October 7th, 2 0 0 7 , Timothy Balducci called Steven A .

Patterson at approximately 5 :48 p . m . Patterson told Balducci

that he had just talked to P . L . , and that he - - Steve

Patterson - - would be calling "the guy in Oxford tomorrow. "

Patterson assured Balducci that "the guy in Oxford" was

expecting a call. And on the following day, October 8th, at

approximately 8 :17 a . m . , Balducci called Patterson. Patterson

indicated that he was about to call Scruggs.

In a second telephone conversation that same date, Timothy

Balducci and Steven Patterson discussed the firm' s financial

problems; and Patterson reassured Balducci that, "We've got 40

coming from Scruggs" or words to that effect.

On October 10th, 2007, at approximately 8 :55 a . m . , Steven

Patterson called Timothy Balducci and informed Balducci that he

needed to find out when "that order" was going to be signed.

Patterson stated that P . L . needed to know.

Timothy Balducci is expected to testify that on

approximately the 16th of October, 2007, Timothy Balducci and

Steven Patterson were in Oxford to meet with Richard "Dickie"

Scruggs on other matters. When they entered the office,

Richard "Dickie" Scruggs stated, " I know y 'all have talked to

P . L . , and I 've talked to P . L . Everything' s fine. Y 'all are

going to be covered, " or words to that effect. Patterson and

Balducci assured Scruggs that they were there for other

reasons.

Later that day, after leaving the Scruggs Law Firm,

Patterson and Balducci went their separate ways. However, at

approximately 7 :30 p . m . , Timothy Balducci called Steve

Patterson and told Patterson that he had just spoken with the

judge and that the order would be available the next day. It

was actually two days later, on October the 18th, when Timothy

Balducci met with Circuit Judge Henry Lackey, paid him an

additional $10,000; and picked up a proposed order from Judge

Lackey.

In the meantime, a Court-authorized intercept picked up a

phone call from Richard "Dickie" Scruggs to Steven Patterson at

Patterson' s residence. Scruggs was inquiring about the

whereabouts of Balducci and the order. Patterson assured

Scruggs that Balducci had gone "south" - - meaning to Judge

Lackey' s chambers in Calhoun County - - but would hand-carry the

order to Oxford. Scruggs told Patterson to have Balducci put

it on his desk and pick up a package which was ready.

Balducci was surveilled entering the Scruggs Law Firm and

leaving Judge Lackey' s chambers. Balducci left the order and

picked up a check for $40,000, together with documents designed

to conceal the true nature of the payment. On November 1st,

2007, Timothy Balducci made the final payment of 10,000 to

Judge Henry Lackey.

This part of the transcript quoted above appears to validate this paragraph in the Times story:

At his 2004 deposition, Mr. Langston provided what might be a clearer version of just how Mr. Blake fit into Mr. Scruggs’s operation. “I know that Mr. Blake seemed to be Dick Scruggs’s — his switchboard, I call it, you know. Everybody, not everybody, but a lot of people wanted to be involved with Scruggs on tobacco, and I got the impression that P. L. Blake was kind of a filter for a lot of those people. I also got the impression he was Dick Scruggs’s listening post.”

There is a lot, lot more to learn about all this. 

Another story I saw in the Times, from yesterday, is this Associated Press story  about Judge DeLaughter recusing himself earlier this month from a number of cases to, he said, avoid even the appearance of impropriety. Dickie Scruggs was involved in at least one of the cases, it's not known for sure how many.

Full post as published by Insurance Coverage Law Blog on January 20, 2008 (boomark / email).