Texans for Public Justice

Austin—Governor Bush's Legislative Director, Terral Smith, is one of the notorious Hopwood plaintiff attorneys who recently set a new record for billing outlandish attorney fees to taxpayers.

Even after a U.S. District judge, citing padded billings, cut in half the $1.5 million that the Hopwood attorneys claimed¹, the Hopwood fees still make those of the attorneys in Texas' tobacco lawsuit industry look like pro bono work.

A comparison of what attorneys in these two high-profile cases won for their clients versus what they pocketed for themselves reveals that Hopwood attorneys thoroughly smoked the tobacco plaintiff lawyers. Judge Sam Sparks' March 20 judgment awards $1 to each of the four Hopwood plaintiffs, even as their attorneys took $776,000 for themselves.

By contrast, the tobacco plaintiff lawyers won $15.3 billion for their client, the State of Texas, and $2.3 billion for themselves. Had the tobacco plaintiff lawyers sought fees at the same 4:776,000 client-to-attorney ratio that Terral Smith and the other Hopwood lawyers got, their fees would have ballooned to almost 3 quadrillion dollars—or $2,968,200,000,000,000 (410 times the U.S. GDP).

On the other hand, if the Hopwood lawyers had accepted 15 percent of what they won for their clients—as the tobacco attorneys did—they would have been compensated 60 cents for their efforts to dismantle affirmative action at the University of Texas.

This comparison is not entirely fair. U.T. and Texas taxpayers—including the one-time beneficiaries of U.T. affirmative action programs—must foot the bill for the Hopwood lawyers' fees. But the tobacco plaintiff lawyers' fees are to be paid by an industry that has lied to Congress and which is responsible for the preventable deaths of 26,427 Texans a year.

News of the outrageous Hopwood fees is rippling like a shockwave through the Texas capital, where outspoken critics of the tobacco attorneys fees are said to be mounting a devastating attack on the Hopwood lawyers' greed. Governor George W. Bush was said to be outraged to discover that his own legislative director was one of the lawyers who won the "Hopwood lottery."

Rumors of Smith's ouster circulated Wednesday, with insiders speculating that legislators who have criticized excessive attorney fees will be unable to work productively in the future with the governor's current legislative director.

Judge Sparks' judgment concluded that Terral Smith, who performed the bulk of the Hopwood trial preparation, overbilled U.T. 25 percent for his work on the Hopwood trial and 35 percent for his work on the Hopwood appeal. Smith and the other crafty Hopwood lawyers padded their billings with "duplicative" and "excessive" billings, Sparks found, even attempting to bill taxpayers for the time they spent spinning the Hopwood case for the media.

"The fee applications submitted by Gibson, Dunn & Crutcher, Wallace Harris & Sims and Terral Smith were so vague and uninformative that the Court seriously considered not awarding attorneys' fees to these individuals at all," Judge Sparks' decision concludes.

Austin insiders say tort reforming Governor Bush is eager to file suit to block U.T.'s payment of the outrageous Hopwood fees. First, however, he must either locate an attorney willing to take the case on a 15 percent contingency basis or wait for the Legislature to appropriate the requisite litigation expenses when it reconvenes in January, 1999.

¹See Judge Sam Sparks' March 20, 1998 judgment, U.S. District Court, Western Division of Texas, Austin. Attorney fees are discussed at the end of the judgment.

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