Cox
Alaska Attorney General Stephen Cox has fired Texas law firm Baron & Budd as outside counsel in the state’s PFAS lawsuit amid a backlash against a practice that critics say rewards political contributors with lucrative contingency-fee contracts.
Last year, Alaska also fired Motley Rice as outside counsel in its opioid litigation, following a similar move by Utah. In both cases, the states cited conflicts of interest, accusing the South Carolina law firm of using its role as state-appointed counsel to unearth evidence it then used to pursue litigation on behalf of other clients.
Alaska didn’t comment on its reason for firing Baron & Budd, but the law firm said it was because of an alleged conflict between the state and other clients.
The firings illustrate the tension between what some AGs promote as free legal advice and critics say is a corrupt system of rewarding politically influential law firms with contracts for work that state employees should be performing. While historically associated with Democratic AGs, Republicans like Texas AG Ken Paxton also have embraced the idea of hiring outside lawyers to represent the state.
Alaska hired Baron & Budd in 2021 to sue over PFAS-containing firefighting foam, joining many other states in accusing manufacturers including 3M and DuPont of promoting the product despite concerns it could pollute the water table. Baron & Budd represents scores of other plaintiffs in the same litigation and has bragged about its role in negotiating a $1.2 billion settlement with DuPont.
The law firm has contributed tens of thousands of dollars to politicians in the last three years, including $30,000 to the campaign of Oregon’s Democrat AG Daniel Rayfield in 2024 and $10,000 to Louisiana AG Liz Murrell, a Republican, in 2023, according to Followthemoney.org.
Supporters say the practice provides legal expertise at zero cost to taxpayers, because the outside lawyers operate on a contingency-fee basis and only collect if they win. Critics – including some Republican AGs – say it is fundamentally unfair to arm private lawyers with the power of state government to sue companies. The U.S. Chamber Institute for Legal Reform says contingency fees give private lawyers an incentive to “inflate the amounts sought in lawsuits to maximize their own potential take.”
Most of the recent firings have cited the basic conflict between representing a state and tens or hundreds of other clients who are all seeking a piece of a limited settlement pool. Montana AG Austin Knudson fired Motley Rice in 2021, saying the firm’s continued involvement in opioid litigation was “not in the best interests of Montana.”
Oklahoma’s attorney general Gentner Drummond fired Whitten Burrage, hired by his Republican predecessor Mike Hunter, in 2023 after the firm collected $34 million in fees from opioid suits.
"While your efforts under the Contract have certainly succeeded in enriching yourselves far beyond what you deserve, those efforts have fallen far short of delivering the results that Oklahomans are entitled to receive," Drummond wrote.
Iowa AG Brenna Bird and Kris Kobach in Kansas both fired Morgan & Morgan, one of the largest plaintiff law firms. Iowa acted after a judge dismissed a Morgan & Morgan-led lawsuit against tobacco companies over their payments under the 1998 master settlement agreement. Republican lawmakers in Wisconsin are also investigating Attorney General Josh Kaul for hiring an assistant funded by a Bloomberg charity to pursue climate litigation.
Sometimes the targets of outside firms fight back, although with little success so far. Two alternative electric companies sued Illinois AG Kwame Raoul in August over hiring Edelson PC and two other firms on contingency, calling it “a contingency-fee-incentivized quest to investigate and prosecute an entire industry, with the goal of profiting from enormous fines.” The law firms had already obtained more than $30 million in settlements, the companies said.
In California, opposition is coming from the left, with the union representing state lawyers repeatedly suing to block contracts with outside lawyers. California Attorneys, Administrative Law Judges, and Hearing Officers in State Employment (CASE), sued AG Bob Bonta last year after his office hired Lieff Cabraser to handle climate litigation against major oil companies. The union, as it has in other cases, argued the arrangement violated a California law prohibiting outside contracts for services state employees can perform.
Hiring contingency-fee private lawyers “sets a dangerous precedent that would allow the outsourcing of any legal work whenever OAG determines that it does not want to assign a sufficient number of its nearly 1,100 rank-and-file attorneys to perform the work,” CASE said in its complaint.
Judge Shelleyanne Chang dismissed the case in September, however, citing the AG’s description of the climate lawsuit as being of “once-in-a-generation magnitude.”
“The Court understands petitioner’s argument that this decision may open the proverbial floodgates for the DOJ to hire outside counsel for every `generational lawsuit’ even when the work could be performed by civil service attorneys,” Judge Chang wrote. “The Court’s determination is not altered by this speculative parade of horribles. The Court’s analysis is limited to the facts presented by this specific litigation.”
