Tobacco lawsuit sent back to state court
AUSTIN (AP) â€” A federal appeals court ruling Monday pushed Texas Attorney General John Cornyn a step closer to being able to question the five lawyers who negotiated the state's $17.3 billion tobacco settlement.
In a 19-page ruling, the 5th U.S. Circuit Court of Appeals in New Orleans reversed a lower court's ruling that Cornyn did not have a constitutional right to question the lawyers through state district court about alleged malfeasance in the tobacco case.
In addition to reversing U.S. District Judge David Folsom's ruling, the court also ordered him to send the case to state court in Harris County, where Cornyn had wanted to question the lawyers.
â€œI have consistently maintained that the federal courts have no authority to supervise the state's investigation into the ethical conduct of the state's outside tobacco lawyers,â€ Cornyn said in a statement.
Cornyn, a Republican, is attempting to investigate malfeasance allegations related to the hiring of private attorneys by Cornyn's Democratic predecessor, Dan Morales. The trial lawyers are receiving $3.3 billion in attorney's fees for the tobacco case.
The lawyers â€” Walter Umphrey and Wayne Reaud of Beaumont, John O'Quinn and John Eddie Williams of Houston and Harold Nix of Daingerfield â€” have denied wrongdoing. They wanted any questioning to be under Folsom's oversight, where the tobacco lawsuit was settled.
In an August ruling, Folsom, based in Texarkana, wrote that Cornyn was â€œgenerally underminingâ€ the state's settlement and if he were to prevail against the lawyers, damages the state received â€œconceivably would upset ... the settlement scheme.â€
The federal appeals court ruled Monday that federal courts cannot stop a state from investigating potential claims in Texas courts â€œunless and until such investigation poses an actual threat to the settlement agreement,â€ the court wrote. â€œPrivate counsel's claim that such a threat exists is premature.â€
Michael Tigar, the lawyer for the attorneys, was still reviewing the case and could not immediately comment, his spokesman Patrick Woodson said.