AUSTIN – The Texas House has passed HB 2826, which could curtail the growing trend of attorneys soliciting local governments to pursue litigation.
HB 2826 was introduced by Rep. Greg Bonnen, a Republican out of Friendswood, and seeks to bring transparency to how local governments hire law firms for civil lawsuits.
A sister bill has also been filed in the Senate. Both pieces of legislation relate to the “procurement of a contingent fee contract for legal services by a state agency or political subdivision.”
Proponents of HB 2826 believe the bill will bring transparency to the process, requiring state entities to negotiate a contract with qualified attorneys and not just the firms that solicit them.
Proponents also argue the bill would help local governments keep lion’s share of proceeds from a lawsuit – an issue that became quite pronounced last year as Texas attorneys began scrambling to sign up local governments for opioid litigation.
For the past few years, Houston attorney Mark McCaig, who openly supports the bill, has unearthed numerous contingency fee contracts Texas counties signed with law firms for representation.
McCaig found that in Harris County officials agreed to pay a contingency fee of 35 percent to three law firms for representation in an opioid suit, more than double what Dallas County’s elected representatives agreed to in their similar opioid suit.
"HB 2826 passed the Texas House with strong bi-partisan support because of the very real need to increase transparency in the way local governments hire outside lawyers on a contingent fee basis,” McCaig told The Record. “I am hopeful the Texas Senate will act quickly to get the bill passed and over to the governor so that it can be signed into law."
McCaig believes a lot of the litigation is driven by attorneys, saying that his research revealed attorneys were emailing and calling public officials and, on some occasions, even making in person visits.
If enacted, HB 2826 will move contingency fee contract approval out of the hands of the Texas Comptroller’s Office and into to lap of the attorney general.
HB 2826 would also give the attorney general the ability to reject a contingent fee agreement related to a matter that the state has already addressed or is pursuing and where litigation brought by the local government would not promote the just and efficient resolution of the matter.
The bill was passed on May 2 with a vote of 103 yeas and 39 nays.