A recent Sun Herald story, “High Court: Legal Fees are Public Funds,” reports that the Mississippi Supreme Court ruled last today in two cases that legal fees paid to private lawyers to represent the state are public funds.  Justices said because the money belongs to the public, it should’ve been paid out to lawyers from the attorney general’s contingent fund or from other money appropriated to the attorney general.

In 2010, a Hinds County judge ruled the $14 million in attorney fees paid to two attorneys for handling a state lawsuit against telecommunications giant MCI was properly handled.  Another Hinds County judge ruled the same case in 2010 involving $10 million in attorney fees paid to lawyers for handling a state lawsuit against computer software maker Microsoft.

The Supreme Court rejected arguments from Mississippi Attorney General Jim Hood and the attorneys involved in the cases that the attorney fees were property of the lawyers, not the state.  The Supreme Court said the settlement funds paid by MCI and Microsoft belong to the state.  The court said state law clearly “mandates that outside retained by the attorney general can be paid only from the attorney general’s ‘contingent fund’ or from funds appropriated to the attorney general by the Legislature.”

“That is where it must be paid – and distributed,” wrote Presiding Justice Jess Dickinson.  “The statute does not allow direct payment of attorney fees.”  But Justice Jim Kitchens said the law firms had a valid contract with the state and were entitled to their fees being paid from the settlement.  Kitchen said a better approach would have been to submit all of the settlement proceeds to the attorney general, have him deposit them into his contingency account and then write a check to the law firms.

Hood said the private attorneys’ fees are part of the settlement of the lawsuit and should not be counted in the money the state receives.  Hood enters into contracts with private attorneys when his office does not have the expertise, resources, or staff to pursue the litigation.

CLICK HERE to read the Miss. Supreme Court decision