AUSTIN – For every hour Mark Lanier spends litigating an antitrust lawsuit against Google, he stands to make as much as $3,780 per hour – thanks to a potentially lucrative deal the Houston attorney signed with the state of Texas.
Back in December, Attorney General Paxton announced Texas was leading a multistate coalition in litigation against Google, alleging the company monopolized products and services used by advertisers and publishers in online-display advertising.
To help the state break up the alleged monopoly, Paxton’s office hired two notable law firms, Keller Lenkner (a Chicago firm) and The Lanier Law Firm.
Houston attorney Mark McCaig was the first to post the details of the contingency fee contracts the attorneys signed with state, calling into question the legitimacy of the agreements.
In his article on Big Jolly Times, McCaig made the case the contracts may not comply with Section 2254 of the Texas Government Code – a reform passed in the wake of the 1998 tobacco settlement that netted a handful of attorneys billions of dollars.
The section requires Paxton’s office to notify the Legislative Budget Board when entering into contracts for outside counsel.
McCaig unearthed the letter Paxton sent to the LBB, which listed the AG’s findings:
- There is a substantial need for legal services;
- The legal services cannot be adequately performed by the attorneys of the OAG (Office of the Attorney General); and
- The legal services cannot reasonably be obtained from attorneys in private practice under a contract providing only for the payment of hourly fees.
Paxton’s letter raises a couple questions – questions his office declined to answer when called upon to comment.
First, Paxton’s office employs more than 4,000 people, including nearly 750 attorneys. On top of that, nine other states have joined Texas in the suit against Google.
So, with all that taxpayer-funded manpower, why did the state have to hire two outside law firms? And is Texas the only state footing the bill for the additional help?
Secondly, and perhaps more importantly, could Paxton really not find any decent lawyers willing to work on the Google litigation for an hourly fee?
Since Paxton appears unwilling to answer those questions, many are left to speculate, including the attorney who exposed the contracts and letter to the LBB.
Based on the information he’s reviewed, McCaig says he’s “concerned” the OAG did not provide the LBB with all of the information they were required to provide under the law prior to entering into the contracts.
“If I was one of the outside lawyers hired by the Attorney General's office, I'd want to make sure everything was done correctly so I can get paid,” McCaig said.
The Record also reached out to Texans for Lawsuit Reform to see what they make of OAG’s deal with the outside law firms.
“While we would always prefer that the Attorney General’s Office itself pursue litigation on behalf of the state, it can be appropriate for the (OAG) to contract with outside attorneys to conduct complicated or specialized state litigation,” said Lucy Nashed, TLR’s communications director.
Nashed says that as a result of TLR’s advocacy, Texas law ensures the state’s contingency fee contracts with outside counsel are monitored and reasonable, preventing the “outrageous fees” granted by former Attorney General Dan Morales in the state’s tobacco settlement.
“Fees are instead based on a reasonable hourly rate for time actually worked by the lawyers representing the state, ensuring they are fairly compensated and that Texas taxpayers receive the greatest share of any settlement or judgment,” Nashed said.
When Paxton announced the Google on Dec. 16, the press release stated that the OAG’s contracts with the law firms comply with Section 2254, which requires that outside counsel in cases like this be compensated by a “lodestar” method derived from their hourly billing rates.