Competing Conflicts of Interest cause Gulf Coast Claims Facility to suspend payments: A periodic report from the gutter where its all going down.

Ladies and Gentlemen in the next MDL Wrestling Federation match we have a Fatal 4 way match! We have Barack Obama’s Wall Street shoe shine boy Ken Feinberg for the GCCF v Bobby “Piyush”  Jindal for BP v Buddy “Tickle my ass with a feather” Caldwell v Plaintiff Steering Committee (PSC)

If not for a conflict of interest, some would have no interest at all ~ Nowdoucit

There are too many pigs for the teats ~ Abraham Lincoln

Yesterday Anita Lee at the Sun Herald broke and then added to the story of a ruling by Judge Barbier yesterday which allowed the Plaintiff’s Steering Committee to recoup their expenses from those folks that have settled their claims with BP via the Gulf Coast Claims Facility involving a 4% holdback from Louisiana and Alabama originated claims and 6% for everyone else. Seeing Anita’s story, my Katrina Bro Editilla sent me a bat signal via twitter, Anita was kind enough to share the order and spare me the PACER charge when answering my email inquiry and I shook the tree.  I just about got pummeled by everything that fell out but today we’ll start by saying while we’ve favorably blogged on Judge Barbier’s rulings in post Katrina insurance litigation his latest ruling is way off base IMHO. In fact it stinks folks.

Luckily for everyone Rebecca Mowbray at the T-P joined the party today and advanced the discussion by disclosing a somewhat open secret that Louisiana Attorney General Buddy Caldwell is feuding with Gov Jindal and both have legal teams with snouts firmly entrenched in the BP trough supposedly representing the State of Louisiana by pissing on each other. What Mowbray left out was that Caldwell’s contract council, Allan “Show me the Money” Kanner and Judge Barbier have also been clashing repeatedly in the courtroom and it that was addressed in the Judge Barbier’s Order and Reasons:

The Louisiana Attorney General has objected to the creation of a hold-back account insofar as it applies to the State of Louisiana. Louisiana is one of only two Gulf Coast states that have filed claims in this MDL, the other being Alabama. Notably, the Attorney General for the State of Alabama long ago reached agreement with the PSC to work cooperatively to further their joint or aligned interests. Largely for this reason, the Court appointed Alabama Attorney General Luther Strange as Coordinating Counsel for the Gulf Coast States. The Court has on multiple occasions encouraged the State of Louisiana to cooperate with the PSC and the State of Alabama insofar as their interests are aligned versus the Defendants in this complex MDL. Rather than cooperate or attempt to work collaboratively, the State of Louisiana, through its retained private counsel, has instead often obstructed and frustrated the progress of the litigation.

In a way this paragraph lays out the entire problem in that part of the aftermath of the tobacco litigation is that private lawyers can not represent the state and collect their fee from state recoveries in Louisiana.  Alabama does not have such a stringent law regarding such payments. I’m a Johnny-come-lately to the Oil Spill MDL but I am wondering why there needs to be any holdback account at all as no class has been certified by the courts and the credit worthiness of BP should not be a question.  And since BP is the defendant why are they not paying the freight instead of  the fisherman and others that actually lost due to the spill and were able to successfully settle their claims without any help from the PSC. Finally WTF is Jindal doing trying to play State AG instead of being a Gov?  IMHO Jindal is playing both sides against the middle here and Magnum is lurking about.

Why isn’t Bobby Jindal representing the many people who will settled with GCCF instead trying to grab a portion of their money to fund the politically connected lawyers on the PSC instead of BP paying that freight?  I think we kinda pre-explained stuff like that right here on Slabbed. Our readers may recall we leaked Magnum’s contract with BP’s Mark Holstein dated October 28, 2010. The entire Slabbed Nation was tantalized by a leaked email from Magnum to BP’s General Council Holstein dated November 17, 2010 where Magnum was ” eager to begin working on this matter on BP’s behalf”. And then last July I date correlated a few political fundraisers held by trial lawyer Magnum J.D.:

Now before the oil spill the politicians that were owned by big oil locally could be pretty open about that fact as Mary Landrieu’s career campaign finance reports indicate. I strongly suspect sight unseen Bobby Jindal got a bunch of oil and gas ca$h too as he got lots as a congressman.  After the spill it just wouldn’t look so good for any politician that was excoriating BP to take campaign ca$h from them but it seems as if there is always willing middle man to spread the wealth and into our narrative enter Magnum JD, his partner and their nonrefundable $1.115 million dollar contract with BP to provide advice on how to deal with state officials. Let’s follow the money and take a looksie at a partial list of the fundraisers ol’ Mags held around that time period:

So if Jindal is playing cards for both sides is he the only one? Hell no folks not by a long shot. This is where our new friend and famed class action lawyer Calvin “Calhoun” Fayard comes into play as he hasn’t met a conflict of interest that he failed to exploit. Calhoun is supposedly a very wealthy guy after years of doing the class action thing. He sits on the PSC and as a bonus he also represented both the State and Jefferson Parish’s interest in the spill litigation as this suit filed literally the day of the blowout illustrates. In November when these motions were being filed a different set of lawyers representing Jefferson Parish filed opposition to the reserve fund, while Fayard and the PSC were agitating to wet their beaks. Simply put the Office of the Gov is at loggerheads with not only AG Caldwell but also impacted Parishes like Jefferson. But we’re not done folks as we must cross into wonderland.

In late November I capped off a series of posts on Calhoun’s bundling of campaign cash using straw men as fronts and how the Louisiana Board of Ethics was investigating such alleged activities related to the failed Lite Gov Campaign of Calhoun’s daughter Caroline. At the time Calhoun was trying to quash a set of subpoenas that would either prove or disprove the allegation and he has since successfully obtained a temporary stay from an appeals court of the lower court ruling we linked denying Calhoun’s motion to quash those subpoenas. Calhoun lawyered up big for the appeals court battle folks retaining Lewis Unglesby of Butt Call infamy for instance. I mention all this because one of the Calhoun’s lawyers in that fight against the State of Louisiana is a guy by the name of Wade Shows and my Gabby cousin Slabb O’Leak sent me a request for an advisory opinion to the State Ethics involving Shows’ representation of Calhoun in that fight. This is the salient part of the request:

According to the document attached hereto as Exhibit “1”, E. Wade Shows, Esq. and his law firm entered into a Contract for Professional Legal Services (“Contract”) with the Louisiana Department of Justice on July 30, 2010. According to this Contract, Mr. Shows and his law firm are to provide non-specified legal services on behalf of the Louisiana Department of Justice as requested by the Attorney General or his designee. The Contract is in effect for the period commencing July 1, 2010 and ending June 30, 2013. The amount of the Contract is limited at this time to a total of two hundred fifty thousand ($250,000) dollars.

In addition to the non-specific legal services Contract discussed above, Mr. Shows and his law firm has entered into the following Contracts for Professional Legal Services with the Louisiana Department of Justice (“DOJ”):

a. Contract to provide legal services on behalf of the Louisiana DOJ in any matters relating to the investigation of foreclosures, including relief mitigation and related programs. Exhibit “2”. The value of this contract is presently not to exceed seven thousand five hundred ($7,500) dollars. This Contract was in effect from November 1, 2010 through October 31, 2011.

b. Contract to provide legal services on behalf of the Louisiana DOJ in any matters relating to the Chinese Drywall Litigation. Exhibit “3”. The amended value of this contract is presently not to exceed four hundred fifty thousand ($450,000) dollars. This Contract is in effect from July 1, 2009 through June 30, 2012.

c. Contract to provide legal services on behalf of the Louisiana DOJ in any matters relating to the tobacco arbitration. Exhibit “4”. The amended value of this contract is presently not to exceed one million six hundred thirty three thousand ($1,633,000) dollars. This Contract is in effect from April 23, 2010 through March 31, 2013.

d. Contract to provide legal services on behalf of the Louisiana DOJ in any matters relating to the Deepwater Horizon Oil Spill Incident. Exhibit “5”. The amended value of this contract is presently not to exceed seven hundred thousand ($700,000) dollars. This Contract is in effect from August 23, 2010 through March 31, 2012.

In addition to these various legal services contracts with the State of Louisiana, Mr. Shows and his firm also represent private individuals in civil matters in various Louisiana courts. One of those private civil matters appears to seriously conflict with the ethical duties and obligations owed by Mr. Shows to the State of Louisiana.

On November 17, 2011, Mr. Shows and his law firm enrolled as counsel of record on behalf of Mr. Calvin C. Fayard, Jr. in the matter titled Louisiana Democrats f/k/a DEMOPAC, et al. v. The Louisiana Board of Ethics, et al., civil action number 603,810 in the 19th Judicial District Court for the Parish of East Baton Rouge, Louisiana (“the Ethics Suit”). Exhibit “6”.

The Ethics Suit was brought against the Louisiana Board of Ethics and its members by Calvin C. Fayard, Jr. and others. The Ethics Suit seeks a declaratory judgment on several legal issues, and specifically seeks to have La. R.S. 18:1505.2 declared unconstitutional. Exhibit “7”. Since the constitutionality of a Louisiana statute has been challenged, the State of Louisiana must be defended by the Louisiana DOJ and Attorney General Caldwell.

Mr. Shows’ is now representing a private litigant in a legal matter against Louisiana while he (Shows) is employed by the State through the various Contracts described above, particularly the non-specific legal services Contract. I sincerely and respectfully request an advisory opinion on whether or not this is a violation of the Louisiana Code of Governmental Ethics.

At this point I’ll mention that representing Team Jindal Caldwell in this 4 way pissing contest that resulted in GCCF claimants receiving a golden shower from Judge Barbier is none other than Wade Shows, who evidently sues Buddy Caldwell’s office when he is not working for them and shows up working for Jindal Caldwell while he is also Calvin Fayard’s personal lawyer in a case involving a state investigation.

And while we are on that subject of this state investigation into strawman political contributions it is worth noting others have been put in jail for doing such things though maybe not in Wonderland. I mention this because Calhoun has another problem besides the Louisiana Ethics Administration as Slabbed has learned that the Federal Election Commission is also now on the case as well. (Case # MUR 6519).

The self-proclaimed King of Torts Danny Bechnel has promised an appeal of Judge Barbier’s curious ruling and he is not alone there as Buddy Caldwell will also be appealing this terribly flawed decision.  The bottom line is if there is to be a reserve, then BP needs to fund it, not the little people getting settlements from the GCCF.  Barbier’s reasoning of the worth of the PSC’s contribution to the settlement process at the GCCF is suspect at best.  I hope it is not indicative of something far worse. My opinion is this whole MDL thing is FUBAR as this is a simple money grab folks and it appears Jindal wants his cut acting the part of waterboy for the PSC while taking positions that help BP financially.

sop

10 thoughts on “Competing Conflicts of Interest cause Gulf Coast Claims Facility to suspend payments: A periodic report from the gutter where its all going down.”

  1. Massive sums of money have a way of doing that.

    It is January folks, and no matter where on the hog you are making your home, chances are you are feeling a mite strapped after the holidays. I know you'll forgive me as I sigh a wistful little sigh that I, too, might be offered so much money that I'd have the chance to see if my current state of moral rectitude holds up under pressure.

  2. Brilliant coverage and information sources on this important issue, Sop.

    Judge Barbier's order seems to me to be imposing a surcharge on the defendants when they settle cases. Is anybody familiar with the term "fee shifting"?

    That's exactly what the PSC needs the court to do if they (the PSC) are going to collect any fees from any money settlements with the state of Louisiana – potentially the single-largest claimant in this tragedy.

    Jindal's legal memo reads like something drafted by the PSC, and I would wager that it is a document the PSC will waive in front of the Board of Ethics when complaints against them are filed. Is it a violation of the Louisiana ethics code to "attempt to violate" the ethics code?"

    It doesn't appear to me the entire PSC is double-dipping like Fayard is on the Parish District Attorney suits (DA suits) (Jefferson, Plaquemines, St. Bernard, St. Tammany, etc.).

    I believe the Parish DA's had to first convince the Department of Wildlife and Fisheries AND the Attorney General not to take the lead on prosecuting these suits (damage to wildlife) which will include losses to shrimp, oysters, birds, etc. Each of those DA suits was brought in the name of the state of Louisiana. Does that mean Fayard is also representing the State? The Parishes who oppose the hold-back?

    Judge Barbier order states, in part:

    "The PSC has advocated for a full and transparent audit of the GCCF and its claims handling practices, and together with the U.S. Department of Justice, has persuaded Mr. Feinberg to agree to such an audit which is now in progress."

    Pursuant to the "what's good for the goose is good for the gander" doctrine, Judge Barbier should require the time and expense reports of the PSC be subjected to a full and transparent audit by truly independent forensic accountants, etc.

  3. It absolutely makes the head freakin' spin…and yeah, I'm starting to wonder, especially after reading this if there is a hope in hell anyone who actually suffered at the hands of BP will be compensated throught the courts, or if the money hasn't already been spoken for and assigned behind closed doors by the very people who surely need no more of it…

    Thanks for the work you pit in at Slabbed

    -Drake

  4. "At this point I’ll mention that representing Team Jindal in this 4 way pissing contest that resulted in GCCF claimants receiving a golden shower from Judge Barbier is none other than Wade Shows, who evidently sues Buddy Caldwell’s office when he is not working for them and shows up working for Jindal while he is also Calvin Fayard’s personal lawyer in a case involving a state investigation."

    Wade Shows actually represents the State through Caldwell in the BP litigation ($700,000 contract).

    However, he is not the only member of the Louisiana AG's BP litigation team to currently represent Calvin Fayard in his declaratory judgment suit against the State. Allen Usry and his firm also enrolled as counsel for Fayard along with Shows.

    UPDATE: The Parish DA cases were dismissed by the court for "failure to state a claim" and something about preemption by federal law.

  5. A little more on the Parish DA suits.

    They were dismissed December 9, 2011 (a couple of weeks before the "reserve fund" order) with prejudice as to any claims for penalties for damages to birds, animals, aquatic life, etc. However, the court's order allows the DA's to bring claims for response and recovery costs.

    I presume the DA's can appeal that decision, but it's not likely. But, that does mean Fayard was representing the State of Louisiana and the Department of Wildlife and Fisheries, through the local DA, while his PSC was petitioning for the reserve fund.

    How did Alan Kanner and his co-counsel miss the fact that Fayard was also representing the State?

  6. "I presume the DA’s can appeal that decision, but it’s not likely."

    I was wrong on this as Fayard and his co-counsel have filed their notice of appeal on behalf of the St. Tammany DA..

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