Miss. Attorney Asks Judge to Dismiss Katrina-Related Contempt Case

February 11, 2008

Attorneys for Mississippi attorney Richard “Dickie” Scruggs asked a federal judge to dismiss criminal contempt charges that he ignored a court order to turn over documents about insurance claims after Hurricane Katrina.

Scruggs is accused of violating a federal judge’s order by giving State Farm insurance records related to Katrina claims to Mississippi Attorney General Jim Hood rather than returning them to E.A. Renfroe and Co. Inc. The Alabama firm, adjusting claims for State Farm, sued after the documents were given to Scruggs by two whistleblowers who had been handling claims for Renfroe and alleged fraud.

A defense lawyer told U.S. District Judge C. Roger Vinson that Scruggs hopes to put the Katrina case to rest and concentrate on unrelated federal charges filed in Oxford, Miss., where Scruggs is accused of conspiring to bribe a judge in a dispute over $26.5 million in legal fees.

“We just want to get out of here and go deal with the problems in Mississippi,” Scruggs attorney John W. Keker said during a hearing.

Special prosecutors said the contempt case in Alabama could be resolved in any possible plea deal in the bribery and conspiracy case in Mississippi, but there has been no word of an agreement. They urged Vinson to let the contempt charges move forward against Scruggs, one of the nation’s richest trial lawyers and a brother-in-law of former Sen. Trent Lott, R-Miss.

The judge did not indicate when he would rule. Vinson, of Pensacola, Fla., was appointed to hear the case after federal judges in Alabama stepped aside.

Charles Sharp, one of three special prosecutors appointed to handle the contempt case, said Scruggs purposely violated an order by U.S. District Judge William Acker of Birmingham to return purloined documents to Renfroe.

“He considered himself the owner of those documents, which were stolen,” said Sharp. Scruggs wanted to keep the documents to create the “crescendo of pressure” that led to a mass settlement of Katrina claims by State Farm, he said.

But Keker, the defense lawyer, said Scruggs complied with Acker’s order by giving the papers to Attorney General Hood since the judge said the documents could be given to law enforcement agencies.

“The evidence is overwhelming that he did not violate the injunction,” Keker said.

Keker also asked the judge to overturn the appointments of Sharp and another special prosecutor, Joel Williams. He argued the men had conflicts of interest because they had clients in litigation involving Scruggs. Sharp and Williams denied any conflicts and said they had not actively participated in any cases involving the prominent attorney.

Separately, Scruggs is set for trial March 31 in Oxford, Miss., in the bribery and conspiracy case. He is accused of scheming to give a judge $50,000 to rule in his favor in a legal dispute over the division of $26.5 million in attorneys’ fees. The fees stem from a settlement with State Farm over homeowner claims after Katrina.

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