The cases involve two of the country’s most prominent class-action lawyers, Melvyn Weiss and Dickie Scruggs. Over the past several decades, they have won billions in judgments against tobacco companies, asbestos companies, energy companies and other putative corporate villains. Both pleaded guilty this year to criminal abuse of the legal system — Weiss for paying kickbacks to clients who agreed to serve as instant plaintiffs, Scruggs for attempting to bribe a state court judge in Mississippi in a dispute over legal fees.
What destroyed Weiss and Scruggs was a system in which the money just got too big. The two had helped spawn an industry of class-action mega-cases that was so lucrative, the plaintiffs couldn’t bear the idea of losing. So the “good guys” began to cut corners.
Weiss and Scruggs got in trouble in part because they were especially aggressive in representing people they believed had been wronged. “They were the Daniel Boones, who cut through the Cumberland Gap,” argues Alex MacDonald, a prominent plaintiffs’ lawyer with the Boston firm MacDonald Rothweiler Eisenberg LLP.
“The money got intoxicating,” argues John Epps, a lawyer with Hunton and Williams in Richmond who has defended corporations in some of the asbestos cases. “They were making more money than any lawyer in history had made.”
The huge fees that Weiss and Scruggs were able to pocket stemmed from their technique of gathering very large groups of plaintiffs to sue corporations for damages. Weiss’s genius was getting in the door first as lead counsel, using a ready-made stable of clients who, it turned out, were receiving kickbacks in what a federal judge described this week as a “nationwide conspiracy that continued for decades.”
Scruggs was also adept at enrolling long lists of plaintiffs — whose damage claims were so sizable that corporations often settled rather than run the risk of multibillion-dollar payouts and possible bankruptcy. Scruggs’s special talent was working with politicians and elected judges in Mississippi and other plaintiff-friendly Southern states. As described by the New Yorker, Scruggs’s legal crusades were closer to turkey shoots than normal litigation. The elected judges looked to the plaintiffs’ bar for campaign contributions and rewarded it with friendly courtrooms that produced huge settlements.