The U.S. Chamber and Pharmaceutical Research and Manufacturers of America urged the U.S. Court of Appeals for the Ninth Circuit to hold that the due process protections of the Constitution categorically bar the government from using contingency-fee counsel in quasi-criminal enforcement lawsuits.
The amicus brief explains that increasingly, state attorneys general and other government officials are delegating quasi-criminal enforcement powers to private attorneys who are litigating multiple claims against corporate defendants. In nearly every such case—including the civil lawsuit brought by the Trinity County District Attorney that gave rise to this action—the private attorneys enter into a contingency-fee agreement with the state, under which they are to be paid only if they win; and if they do win, they are paid more and more for each additional dollar they recover. The brief argues that such arrangements entrust the government’s duty to impartially administer justice to attorneys with an overwhelming economic incentive to “win” the case—even if it is entirely bereft of merit. As a result of these pressures, the neutral forum assured to defendants by basic principles of due process is incurably tainted. Given the personal interests of counsel, defendants have no hope of persuading them to abandon a meritless case because the quest for a high-dollar recovery becomes the paramount consideration. The result is guaranteed litigation and, when the state prevails, highly inflated penalties.
John H. Beisner, Geoffrey M. Wyatt, and Jordan M. Schwartz of Skadden, Arps, Slate, Meagher & Flom LLP served as counsel for the amici.