Star of cases against insurance, tobacco and asbestos industries faces prison, fines and loss of lawyer’s license
Mississippi attorney Richard “Dickie” Scruggs used a mix of bare-knuckle tactics and country-lawyer charm to extract billion-dollar settlements from cigarette makers, asbestos companies and other big industries.
On March 14, he admitted he crossed the line.
Scruggs pleaded guilty to conspiring to bribe a judge $50,000 in a dispute over legal fees. Prosecutors are seeking a five-year prison sentence, and the giant of the plaintiffs’ bar will lose his law license.
For months, the supremely confident former Navy pilot appeared intent on fighting the charges. But Scruggs folded after two of his co-defendants turned on him, one of them secretly tape-recording him for the FBI.
In return for Scruggs’ guilty plea, prosecutors agreed to recommend that the judge drop several other counts against him, including fraud. No sentencing date was set during the hearing in Oxford.
Another lawyer in his firm, Sidney Backstrom, pleaded guilty to the same charge as Scruggs. Scruggs’ son and law partner, Zach, also is charged in the case but did not enter a plea and is expected to go to trial.
Scruggs was a chief architect of the $206 billion nationwide tobacco settlement in the 1990s, working with whistleblower Jeffrey Wigand, a former tobacco company scientist. The actor Colm Feore played Scruggs in the 1999 movie about the case, “The Insider.”
After Katrina struck in 2005, Scruggs sued insurance companies on behalf of hundreds of homeowners whose claims were denied.
Many industries that have tangled with Scruggs regard him as a buccaneer, a shakedown artist with a law degree.
Scruggs has been “the bane of Wall Street,” and leaders of some of the companies he sued might take satisfaction in his downfall, said Stephen Gillers, a New York University law professor and authority on legal ethics. He described Scruggs as “an exceptionally prominent American lawyer with astonishing success and wealth from law practice.”
It was the second time in three days that a lawyer who achieved national prominence battling big business fell in disgrace. New York Gov. Eliot Spitzer, who as the state’s attorney general built his reputation as a crusader against shady Wall Street practices, announced his resignation in a prostitution scandal.
Scruggs, his son and three associates were indicted in November. They were accused of conspiring to bribe Lafayette County Circuit Judge Henry L. Lackey, who was overseeing a dispute between Scruggs and other lawyers over $26.5 million in legal fees from a mass settlement of Katrina insurance cases. Lackey reported the bribe overture to the FBI and worked undercover.
Two of the men indicted, attorney Timothy Balducci and former Mississippi State Auditor Steve Patterson, pleaded guilty and began working with the prosecution. Balducci admitted to the FBI that he paid Lackey $50,000 in cash and said he did so at the behest of the Scruggses and Backstrom. Balducci also wore a wire and recorded incriminating statements from Scruggs.
Scruggs flies to and from legal engagements around the South in his personal jet. The Mississippi native is also well-connected politically as the brother-in-law of former Sen. Trent Lott, R-Miss., and a major contributor to Democrats.
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