“What I would like to ask for is for the legislative auditor to review the contract, understand the context it is in, to sue oil companies, and tell us whether the terms are legal and evaluate the impact on our ability to conduct our statutory mission.” JOE HASSINGER, Southeast Louisiana Flood Protection Authority-East commissioner
Even as the battle over a lawsuit against oil and gas companies raged throughout the day at a local levee authority’s meeting, Gov. Bobby Jindal’s top coastal official hinted Thursday that the state might be readying its own coastal-erosion suit against a much different target — the U.S. Army Corps of Engineers.
In a presentation attacking the Southeast Louisiana Flood Protection Authority-East’s lawsuit, Coastal Protection and Restoration Authority Chairman Garret Graves spent nearly as much time blasting the corps for its alleged contribution to wetland losses as he did criticizing the authority’s contract with its attorneys. Asked about that focus after the meeting, Graves would not go into details, saying, “I don’t want to disclose our legal strategy.”
Saying that the corps has missed numerous deadlines for congressionally required plans aimed at mitigating the effects of its own projects in the New Orleans area, Graves suggested the corps was responsible for far more land loss than the oil and gas companies. He also suggested the time for action might be coming soon.
“Ultimately, if we can’t get the corps to do the right thing, we’re going to have to pivot to a stick approach,” he said.
The suggestion of yet another coastal erosion lawsuit came at the end of a raucous, day-long meeting that saw bitter wrangling between the authority members who authorized the suit and new Jindal appointees, backed by Graves, over the details of the suit and the authority’s contract with the attorneys pursuing the case.
The key question of whether to continue moving forward with the suit appeared more in doubt Thursday than it had before, with several of the longer-serving board members joining efforts to subject that contract to additional scrutiny.
However, there was no direct resolution to that issue at the meeting.
A motion that would have suspended the suit temporarily was taken off the table due to concerns about possible conflicts of interest from its sponsor, Commissioner Joe Hassinger, and the board voted to delay a competing measure that would have reaffirmed support for the case.
Hassinger withdrew his measure at the start of the meeting, noting questions raised in a WWL-TV report this week about whether his position as a director of the law firm Galloway, Johnson, Tompkins, Burr and Smith creates a conflict of interest that should prevent him from voting on motions related to the suit.
The firm’s website notes that it represents “several of the largest drilling contractors and pipeline transportation companies in the world,” but state officials have said Hassinger does not personally represent any of the defendants in the flood protection authority’s lawsuit.
Hassinger has requested an opinion from the state Board of Ethics on the issue. Because of his position at the firm, its involvement with oil and gas companies could potentially pose a conflict of interest for him even if he is not personally involved in those cases.
A different measure by Hassinger, which calls on the state Legislative Auditor’s Office to review the contract between the flood protection authority and its attorneys, passed by a slim margin.
Opponents of the suit have ramped up criticism of the contract, arguing against the significant fees the lawyers could collect if the suit succeeds, and questioning other aspects of the deal.
“What I would like to ask for is for the legislative auditor to review the contract, understand the context it is in, to sue oil companies and tell us whether the terms are legal and evaluate the impact on our ability to conduct our statutory mission,” Hassinger said.
Former Commissioner John Barry, who was not reappointed to the flood protection authority because of his support for the suit and who now leads a new nonprofit dedicated to supporting the case, has defended the contract, noting that the law firms involved are taking a significant risk: If they fail to win any money from the companies being sued, they would walk away empty-handed.
The Legislative Auditor’s Office could be influenced by lawmakers’ opposition to the suit, Barry said.
He said getting that office involved is “a terrible idea, and I think that’s why it was suggested as a way to inject politics more than ever into this process.”
Hassinger, however, denied the legislative auditor would act from political motives and said it was too late to avoid politics in the process anyway.
“Does anybody think we aren’t knee-deep — correction, neck-deep — in politics on this?” he asked.
A significant portion of the debate Thursday focused on a so-called “poison pill” in the attorneys’ contract.
Because the lawyers are taking the case on a contingency basis, the authority would not have to pay them anything under normal circumstances, with the firms taking their chances on a percentage of the awards if successful and getting nothing if they lose.
However, in an effort to stave off legislative attacks on the authority or the suit, the contracts also contain a provision that requires the levee authority to pay the attorneys’ fees and costs if the suit is dropped by the authority or because of political interference.
So far, the law firms have wracked up about $750,000 in expenses associated with hiring outside contractors, including experts, over the 13 months the firms have been building the case, lead attorney Gladstone Jones said. That does not include the cost of nearly 8,000 hours the lawyers themselves have worked on the case, he said.
Though questioned extensively on the cost of the attorneys’ time by Hassinger, Jones would not estimate how much that time was worth. He said that would be determined by a court based on the lawyers’ average rates at the time the case is dropped, if it is.
“I’m not going to engage in speculation about what our hourly rate will be when and if that termination occurs,” he said.
Graves also suggested the contract gives undue power to the attorneys, suggesting they could use it to launch suits against other industries without the flood protection authority’s consent. Graves has asked Attorney General Buddy Caldwell, whose office has to sign off on such agreements, to rescind approval of the attorneys’ contracts.
Responding that “never in the history of a legal practice has a contract been more public,” Jones argued that “there is nothing unusual about the contract.”
Although some board members objected to tallying up costs at this point, arguing the authority will never receive a bill if it lets the suit runs its course, the measure passed by a slim margin. The deciding vote came from President Tim Doody, who recused himself from a vote on the suit over the summer because the law firm where he works represents energy companies.
Hassinger and the other two new appointees also voted to defer action on a resolution that would have reaffirmed support for the case.
The fact that Doody, who is currently awaiting word on whether Jindal will replace him, and other commissioners who also initially supported the suit, sided with the new members of the authority could represent a weakening of support for the lawsuit among the longer-serving members of the board.
In criticizing the suit, though, Graves laid more of the blame for coastal damage on the corps, arguing that the Mississippi River levees and other corps projects were more to blame for coastal damage than oil and gas companies.
“If you’re worried about coastal restoration, if you’re worried about the sustainability of this area, I wonder why you’re worried about a scrape on a heart-attack patient,” he said.
Graves also took a harder line than he has in the past on the coastal-erosion suits Jefferson and Plaquemines parishes filed recently against oil and gas companies for alleged wetland damage in their parishes. He said they would do better to negotiate with the companies.
“The way the parishes are proceeding, I don’t think that’s the right approach,” Graves said.