Judge says ‘nothing improper’ with MCI case fees

By Patsy R. Brumfield/NEMS Daily Journal

JACKSON – A Hinds County circuit judge says the state auditor is wrong to insist attorneys’ fees in the state MCI lawsuit are public funds.
The court order, dated Feb. 10, became public Friday.
The current auditor, Stacey Pickering, said he expects his office to appeal the ruling.
“Our position has been that we fully expect this matter to be resolved by the Mississippi Supreme Court,” he said.
In his order, Judge Winston Kidd wrote, “This matter has lingered on for far too long. The court finds that there is a nothing improper or illegal about MCI’s payments of attorneys fees to the Langston Law firm.”
In 2004, Attorney General Jim Hood hired the Langston firm of Booneville to help recover lost taxes from the bankrupty of MCI/WorldCom communications company.
When a settlement was reached, the state wound up with some $110 million in cash and downtown Jackson property.
Separately, MCI agreed to pay the lawyers $14 million for their work in the case.
Kidd ruled that the attorney general has the authority to retain special attorneys general in situations like this and to enter into retention agreements with them.
He also confirmed that the lawyers’ fees were paid separately by MCI and were not part of the state’s settlement.
In a statement after the order, Hood said, legal fees in the MCI case, and in every case that uses outside counsel, “are paid in strict accordance with state law and the guidelines and procedures of the office of attorney general.”
Opposition to the legal fees deal came in 2007 when Phil Bryant was auditor, then was picked up by Pickering after Bryant was elected lieutenant governor.
“The court finds that the state auditor’s arguments have no merit,” Kidd added.
But Pickering said that throughout the case, which worked its way through New York bankruptcy court, his office has argued that it is a Mississippi matter to be handled by Mississippi courts. He expects to announce a formal appeal early next week.
Former Langston associate William M. Quin II, now a Ridgeland attorney, was a key player in the state’s push on MCI and the settlement.
Friday, he termed the Bryant-Pickering lawsuit “nothing more than a political exercise for a Republican auditor.”
Quin also noted that early in the process, the State Tax Commission calculated that the state probably wasn’t owed anything in income taxes from MCI and perhaps no more than $3 million in franchise taxes.
“This has always been a great deal for the state,” Quin added. “The right party won.”

Contact Patsy R. Brumfield at (662) 678-1596 or patsy.brumfield@djournal.com.