JACKSON – Two Gulf Coast attorneys have accused former Oxford attorney Richard “Dickie” Scruggs and associated legal firms of racketeering surrounding the failure to pay them from the national tobacco settlement.
Lee Young and Charles Mikhail made their claims in a civil lawsuit in the Southern District of the U.S. District Court of Mississippi on Thursday.
They say Scruggs, plus 10 unnamed defendants, conspired to defraud them to pay former Booneville attorney Joey Langston to fund schemes to bribe elected officials, including judges.
They cite 17 counts of alleged legal violations against them and ask for a jury trial.
They also accuse the defendants of violating federal racketeering laws.
Scruggs’ attorney, Cal Mayo of Oxford, declined to comment Friday.
Langston is not named a defendant. He, Scruggs, former New Albany attorney Timothy Balducci, former Scruggs partner Sidney Backstrom and former state Auditor Steven Patterson are in federal prison for their guilty pleas associated with judicial bribery charges.
Former Hinds Circuit Judge Bobby DeLaughter also faces prison time for his admission he lied to FBI investigators in its probe of bribery charges against Scruggs.
In July 1999, Young and Mikhail say Scruggs – as Scruggs, Millette, Bozeman and Dent law firm – agreed to pay them for work in the tobacco lawsuit, saying each would get a percentage of the law firm’s net tobacco fees after deduction of expenses.
Meanwhile, SMBD withheld money from their quarterly payments to help pay attorneys’ fees to defend another lawsuit by Alwyn Luckey over legal fees he claimed were owed from national asbestos litigation. Ultimately, Luckey was awarded some $19.5 million.
Young and Mikhail protested, saying Luckey was owed for asbestos cases, not tobacco cases in which they were involved. And they claim they lost more than $1 million used by Scruggs to pay a bank loan to fund the Luckey judgment.
In 2006, Scruggs hired Langston to help defend another asbestos legal-fees case by W. Roberts Wilson. The Young-Mikhail lawsuit claims Langston was paid some $3 million for his work in the Wilson case.
Months later, they say they learned they also were contributing to another $1 million to Langston in the Wilson case.
Ultimately, Scruggs pleaded guilty to conspiring to bribe Judge Henry Lackey, who presided over a Katrina insurance legal-fees case against him, and to bribing DeLaughter, who presided over the Wilson case.
During this investigation, Langston told federal investigators he paid DeLaughter’s former boss, Ed Peters, $1 million to attempt to influence DeLaughter.
The deduction of their promised earnings was not a legitimate expense, they say, “but as payments made to further an illicit criminal scheme.”
Young and Mikhail ask the court for actual and punitive damages, as well as a constructive trust, or additional awards because of the defendants’ “fraud, abuse of confidence, unconscionable conduct, artiface and concealment.”
Contact Patsy R. Brumfield at (662) 678-1596 or email@example.com. Read Patsy’s blog, From the Front Row, on NEMS360.com or catch her on Twitter.com or Facebook.
Pasty R. Brumfield/NEMS Daily Journal