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   |  | Published Saturday, May 9, 1998 |
WASHINGTON, D.C. -- Amid criticism of the hefty fees lawyers have claimed in state tobacco cases, the law firm that did the most work and took the most risk accepted a comparatively modest share of the Minnesota settlement Friday.
That's not to say that the Minneapolis firm of Robins Kaplan Miller & Ciresi will be hurting.
The 225-member firm stands to collect $466.4 million as part of the settlement. But the firm gave up its contractual right to 25 percent of the award, $1.64 billion in this case, under a deal worked out at a time when no one anticipated such a huge payoff.
Minnesota Attorney General Hubert Humphrey III said the firm's fees amount to 7 percent of the settlement proceeds that its two clients -- the state and Blue Cross and Blue Shield of Minnesota -- will receive over 25 years. But the industry agreed to pay the legal fees in addition to the settlement proceeds.
Michael Ciresi, the lead attorney representing the state, has said his firm invested "tens of millions of dollars" in pursuing the tobacco industry in its win-or-nothing contingency arrangement with the state.
And members of his firm, who did not return phone calls Friday night, had reason to pop champagne corks. The six to 10 partners who did the most work on the four-year-old case probably will each receive enough money to retire.
Still, the fee arrangement drew praise.
"It sounds to me like a great deal for the state," said Sharon Reich, associate dean of the University of Minnesota Law School.
She and others praised the settlement for awarding the legal fees separately.
"The beauty of it is that the legal fees are not paid out of the settlement total but are being paid by the industry," Reich said. "This provides settlement funds for the state and a fair return for the lawyers."
The high fees provided to firms in previous suits have brought criticism, much of it from Republican politicians who have been encouraging tort-reform legislation.
Texas Gov. George W. Bush blasted his state's agreement to award outside attorneys $2.3 billion, or 15 percent, of its recently signed $15.3 billion settlement.
Likewise, Minnesota Gov. Arne Carlson had criticized Humphrey's agreement with Robins Kaplan, suggesting it could earn the firm $2 billion.
Miles Lord, a former federal judge in Minnesota, called the 7 percent attorneys fees "wonderful," predicting that "it will give some incentive for lawyers to get after these crooks."
Reich said the fees in this case are appropriate for a firm that took the risk of bringing the case years ago, when winning against the tobacco companies seemed a long shot. She said standard contingency fees in suits of this nature were 33 percent of the settlement total.
In a previous interview, Ciresi said 10 lawyers have worked on the case full time, supported by about 30 paralegals and as many as 35 more lawyers when needed.
"Some people may think we make too much money," he said. "The fact is, we don't get paid unless we prevail and get a result for our clients."
It was not the first time Ciresi has brought his law firm a big payday. In 1985, he settled 200 cases with the A.H. Robins Co., manufacturer of the Dalkon Shield intrauterine device (IUD), for $38 million.
In 1988, he won $8.75 million from G.D. Searle & Co. in a suit alleging defects with its Copper-7 IUD. That led to a confidential settlement between the company and Robins Kaplan covering 130 women who alleged they were injured by the device.
Ciresi and the firm also represented the government of India in the aftermath of the 1984 toxic gas leak at Union Carbide's plant in Bhopal, India, as part of litigation that led to a $470 million settlement with multiple parties.
-- Star Tribune staff writer Randy Furst contributed to this report.