Lead Counsel

These lawyers could cash in big, but who hired them?

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When St. Louis Mayor Clarence Harmon picked a friend to handle the city's lawsuit against the lead-paint industry, his political rivals hit the roof. A clear payback to a financial contributor, they charged -- one that ran afoul of an ordinance requiring competitive bids for professional contracts.

Among Harmon's critics: Francis Slay, then president of the city's Board of Aldermen.

Under attack, Harmon backed away from his unilateral appointment of lawyer John Frank and agreed to take competitive bids.

Frank still got the job.

Not only was he a Harmon supporter, Frank was more than qualified to do the job. A plaintiffs' lawyer for about 40 years, Frank put together a team that included his firm, the John J. Frank Partnership, Houston-based Fleming & Associates and St. Louis lawyer Richard Banks of Banks & Associates.

That was January 2000.

Seven months later, Frank was found dead of natural causes in his condo, the Harmon administration was on political life support and Francis Slay was the odds-on favorite to become the city's next mayor.

Enter St. Louis lawyer Michael Garvin.

Just before Frank died, Garvin says, Frank asked him to join the lead-paint lawsuit. Garvin was hired as an associate in Frank's firm. At the same time, Garvin was a law partner to Tom Carnahan, son of Gov. Mel Carnahan. Their firm, Carnahan Garvin LLC, leased office space from Guilfoil, Petzall & Shoemake -- the firm where Slay practiced before he was elected mayor. Garvin says he's "always" been a supporter of Slay's, and his firm has been a campaign contributor.

After Frank died and just weeks before Slay won the primary, Fleming & Associates decided to keep Garvin, and Carnahan Garvin LLC officially entered the case. Appearing alongside Michael Garvin was another lawyer in his firm, Patricia Hageman. (Just a few months later, Slay named Hageman city counselor.)

Unlike John Frank's firm, Carnahan Garvin didn't have to go through any bid process to get a piece of the city's potentially lucrative lawsuit. And unlike John Frank's firm, Carnahan Garvin was hired without any controversy.

The reason?

The original contract with the city -- approved by a committee picked by Harmon, Slay and Comptroller Darlene Green -- allowed Frank and the other original firms to recruit additional lawyers without first getting permission from the city. Says Garvin: "I don't have a contract with the city because my arrangements are through the Fleming firm."

It's not clear whether Garvin and Carnahan have any particular legal experience that make the lawyers critical to the case. Asked why he was brought on board, Garvin says, "I used to work at the city counselor's office, and I had experience in complex and equity litigation with the city."

A spokesperson for the Houston firm says, in an e-mail, that Garvin was hired "because he was a good lawyer. He knows all the trial judges and he was the best man for the job." Having local counsel who also has ties to City Hall probably didn't hurt. And after Slay took office, Fleming & Associates made a contribution to Slay's campaign committee.

A spokesman for Slay did not return phone calls asking about Carnahan Garvin's involvement in the suit.

The city's lead-paint lawsuit names eleven defendants, including paint manufacturers; the Lead Industry Association, a trade association; and St. Louis-based Doe Run Company, the nation's number-one lead producer. The case claims that the companies -- and their predecessor firms -- knew as early as 1904 that lead paint is toxic and that even though study after study confirmed the hazards, the defendants continued to aggressively sell lead paint, especially in urban areas.

The city contends the defendants are responsible for creating a public nuisance that has poisoned thousands of residents, causing mental impairment and other health problems. The defendants, the city argues, should be held responsible for the costs of removing lead paint, poison testing and medical care.

The amount of damages being claimed isn't identified in the city's suit, and Rob Herring of Fleming & Associates refuses to give a ballpark figure. "It's substantial" is all he'll allow.

Garvin says the case could easily be worth more than $10 million to the city. "But the manufacturers say it isn't worth anything," he adds.

What is clear is that the lawyers stand to make lots of money if a jury sides with the city.

In the agreement signed by the city, the John J. Frank Partnership, Banks & Associates and Fleming & Associates, the attorneys agreed to a fee of 15 percent of the net proceeds if the case is settled before trial. If the case is settled after the trial starts, the fee jumps to 18 percent. If the city doesn't get anything, neither do the lawyers.

The agreement also requires the lawyers to front the expenses on the case. For a suit involving several defendants and decades of lead-paint exposure, the costs could reach into the tens of thousands of dollars. But if it's successful, the payout could be enormous.

Herring and Garvin won't say how the fees would be split among the lawyers if they win. Banks did not return phone messages.

"That part of the deal is somewhat confidential," Herring says. However, the firm that stands to gain the most from the St. Louis case is Fleming & Associates.

A private agreement between Fleming & Associates and the Frank Partnership, obtained by the Riverfront Times, states that the Houston firm gets 60 percent of the attorney fees and that "Frank and its affiliated counsel shall receive 40 percent of the attorney's fees net expenses."

The private agreement also says that Fleming & Associates was to have arranged a $500,000 line of credit for Frank's use on the lead-paint litigation and some other cases the firms were jointly working on at the time.

The law firms won't say how much they've already spent on the lawsuit, but one thing is clear: The case is not going anywhere fast.

That's been the story ever since Harmon first floated the idea of copying other cities and sticking it to lead-paint manufacturers. Richard Callow, a public-relations consultant and Slay backer, and Freeman Bosley Jr., a lawyer and former St. Louis mayor, were recruited by lead-paint companies to try to head off the city's lawsuit. And Slay, Garvin says, didn't hide his misgivings about suing the industry.

But once the ink dried on the contract between the city and the private attorneys, it became much more difficult to stop the lawsuit. The contract won't let the city get rid of the case without the consent of the private attorneys. The political fight was dropped and the legal fight began, but the city's attorneys don't seem to be in a hurry .

With the suit filed in the city, the companies face the most plaintiff-friendly venue in the state and the possibility that the jury pool includes the same people sitting in health clinics waiting for their children's test results -- one of four St. Louis kids has a too-high blood-lead level. So shortly after the case was filed, the companies attempted to move it to U.S. District Court, which draws jurors from the city and St. Louis, Jefferson, St. Charles and Franklin counties.

The attempt to take it out of state court was unsuccessful, but, with the stakes so high, it took a year of legal briefing, motions and memos to get it tossed out.

Once the case was sent back to the state court, the companies tried to get it dismissed, claiming that the novel lawsuit doesn't have a legal leg to stand on. The lead-paint litigation pending in St. Louis borrowed several pages from the tobacco-litigation playbook. The city and the lead-paint manufacturers filed reams of paper with the court, for and against the motion. In addition, the city voluntarily agreed to wait on depositions and other routine discovery requests until after St. Louis Circuit Judge Margaret Neill ruled on the motion to dismiss.

In November, the parties argued the case before Judge Neill.

But seven months have slipped by, and there still hasn't been a ruling from her.

In the meantime, the Lead Industry Association filed for bankruptcy. Although the state of Rhode Island dismissed LIA from its lead-paint case after the bankruptcy filing was announced in April, the city of St. Louis hasn't even advised the court of the latest development.

And just a few weeks ago, the city's attorneys showed up in Judge Neill's courtroom and asked for a continuance.

The case had been scheduled to go to trial last month, but it's been pushed back to March 2003.

By then, the future of the lawsuit is likely to be clearer: A similar case in Rhode Island is set for trial in September, and that case is likely to be a bellwether for copycat lawsuits across the nation.

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