Texas Tobacco Attorneys Get $3.3B
AUSTIN, Texas (AP) -- Five private lawyers will split $3.3 billion for negotiating a multi-billion dollar tobacco settlement for Texas.
The lawyers could have sought to receive even more money for their work, but agreed Friday to take the figure awarded by a national arbitration pane.
The money was compensation for their work on a settlement that gave Texas $17.3 billion from tobacco firms over 25 years.
Their decision amounts to a waiver of their contract with the state, which called for them to get 15 percent of whatever Texas receives from the tobacco industry.
The lawyers were under a federal judge's order to decide by Friday whether to accept that amount or try to collect under their original state contract.
The $3.3 billion that was awarded by the arbitration panel is to be paid by the tobacco companies. The private attorneys already have received about $364 million from the settlement, which reimbursed the state for the cost of treating tobacco-related illness.
A 1998 report by professors at Yale University and the University of California-Berkeley said tobacco industry payments to Texas should be adjusted annually for inflation and other factors. That would help boost the value of Texas' settlement as high as $105 billion, which could have allowed the lawyers to collect an additional $12.5 billion, said Texas Attorney General John Cornyn.
A lawyer for the attorneys said he couldn't confirm Cornyn's estimate, but he added that the decision will save Texas taxpayers billions of dollars.
The decision must be approved by U.S. District Judge David Folsom in Texarkana.
The attorneys are John Eddie Williams and John O'Quinn of Houston, Walter Umphrey and Wayne Reaud of Beaumont, and Harold Nix of Daingerfield.