CHARLESTON, W.Va. (Legal Newsline) - West Virginia Attorney General Darrell McGraw has been named by a legal reform group as the state's top lawsuit abuser in 2008.

As part of its Lawsuit Abuse Awareness Week, Citizens Against Lawsuit Abuse made the choice, calling it "indisputable." Last year, they chose attorney Timothy Houston, who had filed a lawsuit against McDonald's for putting cheese on a hamburger.

"McGraw's seemingly pay-to-play deals with campaign contributors who rake in millions of dollars at public expense is a scandal," said Steve Cohen, CALA's executive director.

"So too is his conversion of lawsuit settlement dollars into what is, essentially, his own political slush fund for shameless self-promotion."

Cohen pointed to a settlement this year with Visa and MasterCard that created a sales tax holiday on appliances with the Energy Star label. The settlement was valued at $12.2 million, but McGraw originally sought $306 million.

Four law firms hired by McGraw have motioned to be paid nearly $4 million in attorneys fees. McGraw campaign contributors work in two of those firms.

"(H)e settled for five cents on the dollar and then bought statewide advertising with public funds to crow about what a hero he is," Cohen said.

The four-term Democrat is up for re-election against Charleston attorney Dan Greear next month. CALA also mentioned McGraw's spending of the funds from a 2004 settlement with pharmaceutical company Purdue Pharma.

Every year since the settlement, the company, which manufacturers the painkiller OxyContin, has paid McGraw's office $2.5 million. Some goes to the attorneys McGraw hired (a total of $3.3 million), and the rest goes to substance abuse programs picked by McGraw.

His office admitted that it did not give the settlement funds to the state agencies it represented in the suit because the federal government could have staked its claim to the money. Nearly 75 cents of every dollar the state spends on Medicaid, the program alleged to be harmed, is federally funded.

The Centers for Medicare and Medicaid Services plans to withhold millions from its next appropriation to the state.

"(McGraw) is a major reason West Virginia's lawsuit system is broken -- and his actions make him the poster child of lawsuit abuse," Cohen said.

"What employer wants to create jobs in a state where the chief legal officer appears to be walking on dangerous legal and ethical ground, if not outright violating the law and legal precepts?"

McGraw's office has a similar disdain for CALA. Chief Deputy Attorney General Fran Hughes feels the group's grassroots image is a sham, and that it is funded by out-of-state corporate interests.

Hughes approached Cohen after a hearing in Wheeling and said it was dishonest to call his group a watchdog when it was a business group.

"One of these days you will be exposed, and you will get your due," she told Cohen.

Cohen had asked a state judge to demand information that showed the $3.9 million the attorneys in the Visa/MasterCard case is justified.

No decision on the fees has been made.

Last year, Hughes said CALA's objective is "to foster a legal environment that shields its contributors from accountability when they break the law."

"It works its sophisticated deception aimed at duping West Virginians into believing that only by giving up their rights to access to the courtroom can the State have economic development," Hughes wrote to lawmakers. "Unchecked and unfettered corporate power accountable only to shareholders is the real threat to fairness for all citizens."

In 2006, the Lawsuit Abuser of the Year award was shared by Bridgeport radiologist Ray Harron, who was paid nearly $10 million by personal injury lawyers to perform mass screenings on patients, many of whom were allegedly never seen by the doctor, and the lawyers who presented to a court one of his X-rays that was certified by a doctor who does not exist.

From Legal Newsline: Reach John O'Brien by e-mail at john@legalnewsline.com.