June 10, 2008

As readers know, the California courts are considering an issue of high importance: whether government entities can hire private counsel on contingency fee to pursue public nuisance cases, which these days include ambitious ventures in regulation through litigation such as public-entity lead paint suits. A trial judge agreed that a precedent known as Clancy bars allowing private lawyers to prosecute such cases in exchange for a share of the proceeds, an appeals court disagreed, and the issue now heads to the state's high court. Now the National Association of Manufacturers (which which co-blogger Carter Wood is associated) in conjunction with several other business groups (the American Chemistry Council, the Coalition for Public Nuisance Fairness, and the Association of California Insurance Companies) has prepared an amicus letter, which can be read at this link.

The brief points out that the exception the court carved out of Clancy, authorizing suits in which the government entity supposedly retains control over the course of the litigation, will be "virtually impossible" to enforce, at least absent extensive and ongoing court supervision of the internal workings of the public-entity litigation teams; indeed, the lawyers on those teams will have both motive and opportunity to simulate fictional city or county control of actions that are in fact steered and managed by the contingency-seeking outside counsel. Earlier here and here, etc.