By Thomas B. Edsall
Washington Post Staff Writer
Sunday, September 6, 1998; Page A20

The nation's most influential and aggressive trial lawyers stand to win billions of dollars in fees from lawsuits against the tobacco industry and plan to use those sums in part to fund Democratic candidates and battle business in the courts, Congress and state legislatures.

If trial lawyers follow their recent pattern of contributions, the money will rival even the amount spent by organized labor, traditionally the Democrats' most important source of campaign funds.

Conservative analysts warn that the anticipated flood of cash could be particularly potent on the state level. Plaintiff's lawyers "will, unless checked, literally overwhelm the politics of many states and many, many political races, and will cause a strategic debacle for conservatives, Republicans and New Democrats seeking to rescue their party from the special interest grip of the tort bar," argued Michael J. Horowitz, director of the Hudson Institute's Project for Civil Justice Reform.

Horowitz and others also note the money is an ironic and unintended consequence of the GOP's move to kill federal tobacco legislation, which sought to impose a cap on fees lawyers could collect. They say that now the wallets of trial lawyers will be fattened from the host of state suits against tobacco companies that will be settled privately or in the courts.

Plaintiff's lawyers readily acknowledged that they stand to make larger profits as a result of the failure of Congress to act, and planned to plow significant sums back into the political process.

"They should have thought of that a few months ago when they shot down the tobacco deal," said Richard Scruggs, a Mississippi lawyer who is in line to make hundreds of millions of dollars on tobacco cases. "I am not going to get money-whipped by tobacco and the insurance industry."

"We undertook a hell of a war five years ago, and we should be fairly compensated if we win that war," said Joe Rice, a Charleston-based plaintiff's lawyer who is involved in many of the cases. The plaintiff's bar, Rice contended, "has tried to stand up for the rights of individuals and will continue to do so. They need that protection, particularly from corporate America. There needs to be a check and balance."

The four states that have settled so far -- Texas, Mississippi, Florida and Minnesota -- have already reached agreements with tobacco companies for total payments of about $38 billion. Legal fees include more than $440 million to go to one Minnesota law firm over two years, as much as $2.3 billion to go to five Texas law firms over 25 years, and about $500 million in legal fees in Mississippi; the fee in Florida still in litigation.

Trial lawyers are now pulling out the stops to help mostly Democratic candidates in the November elections. Major beneficiaries include Sen. Ernest F. Hollings (D-S.C.), a leading supporter of their interests in the Senate, Sens. Patrick J. Leahy (D-Vt.), Barbara Boxer (D-Calif.), John Breaux (D-La.) and Harry M. Reid (D-Nev.).

Peter Angelos, a Baltimore plaintiff's lawyer whose asbestos cases made him rich enough to buy the Orioles baseball team and who represents Maryland in the tobacco litigation, has already given $93,000 to Democratic candidates and party committees in the 1997-98 election cycle, according to the Center for Responsive Politics. He donated $50,000 to the Democratic Senatorial Campaign Committee and $25,000 to the Democratic National Committee, the center reported.

The principal lobbying arm of the plaintiff's bar, the American Trial Lawyers Association through early 1998 had given $1.52 million to federal candidates. Of that, $1.36 million went to Democrats, and $148,500 went to Republicans, a ratio of 9 to 1 in favor of the Democrats, according to the center.

While it is too early to get comprehensive numbers for this year's campaigns, those early indications of generosity fit a pattern of increasing contributions by lawyers over the past several years. In a series of studies financed by such opponents of the plaintiff's bar as Philip Morris and the National Association of Manufacturers, the Campaign Data Research Co. found that from 1989 to 1996 the lawyers gave $55.1 million to federal candidates and political parties.

Similarly, the business-financed American Tort Reform Association found that in the shorter period from 1989 through 1994, plaintiff's lawyers gave $30.9 million to federal candidates, about the same as the five largest labor organizations combined.

Some Republicans are seeking to make the best of a bad situation by using the large fees as campaign issues in contests against Democratic attorneys general, many of whom negotiated the fee arrangements with private, often politically influential, lawyers.

In Missouri, for example, Sen. Christopher S. Bond (R-Mo.) recently accused his Democratic challenger, Jay Nixon, the state attorney general, of authorizing as much as $300 million in fees to roughly 30 lawyers, many of whom had contributed to Nixon's campaigns.

"The plaintiff's attorneys are a bigger liability for the Democratic Party than the labor unions ever were," contended GOP pollster Fred Steeper, who said surveys show the public adamantly opposed to the legal fees.

The plaintiff's bar is already a mainstay of Democratic Party giving, particularly in southern states where they have been engaged in a bitter struggle with local chambers of commerce and other business associations for control of legislatures and judiciaries.

"They are the only ones left. We don't have any unions down here, and the teachers can only give so much," said one Democratic strategist in Mississippi who asked to remain anonymous.

While attention in Washington focuses on House and Senate races, the battle between business and the plaintiff's bar has become a full-scale war in some southern states where campaign contribution rules are not strict.

George Burger, a Washington-based Democratic operative who works for business groups in Alabama, said the war there began when "a pro-business legislature was elected and in 1987 passed stringent tort reform." The trial lawyers counterattacked, first persuading a sympathetic state Supreme Court to throw out the tort reform in 1989, and then followed up "in 1990, doing well in state Senate races, and solidifying their position" in the Senate.

Business then initiated a drive "to try to take back key legislative seats. In state Senate races where candidates were used to spending $75,000, we spent $300,000 in four or five" to oust leaders sympathetic to the trial lawyers.

Since then, he said, business has successfully defeated a pro-trial lawyer chief judge of the state Supreme Court, the membership of which is now split roughly evenly. And this year, he added, there is an "epic battle" between business and lawyers in the race for the powerful post of lieutenant governor.

In Alabama politics, business and the lawyers have shown little reluctance to put money on the table. A business-financed study of trial lawyer contributions in the state from 1990 through 1996 showed members of the plaintiff's bar giving $12.03 million.

Corporations and business leaders "have been able to muscle their way in elections," said Mississippi's Richard Scruggs. "Trial lawyers are not sitting back and letting that happen any more."