Mississippi Litigation Review & Commentary : Mississippi Personal Injury Lawyer & Attorney : Phillip W. Thomas Law Firm : MS Litigation Review & Commentary

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The book Kings of Tort, by Alan Lange and Tom Dawson, appears to disclose the terms of Ed Peters’ immunity deal with the government.

On page 199, the book states that in exchange for immunity, “Peters would surrender his law license, resign from the bar permanently, and forfeit all monies received from Scruggs and Langston, in addition to [throwing Bobby DeLaughter under the bus] testifying truthfully.” That’s it.

Ironically, while DOJ continues to refuse to disclose Peters’ agreement because there is “no public interest” in it, Dawson disclosed the terms of the agreement in a book that has garnered wide public interest.  

It appears that Dawson wrote the section of the book covering the Scruggs prosecution, including Peters’ role in the case. The book states that “immunity for Peters was a travesty of justice tough call.” The book justifies the decision by asserting that Peters corroborated Balducci’s information in the DeLaughter bribery case and caused Joey Langston to plead guilty and testify against Scruggs. It states that without Peters’ testimony, a Scruggs II [DeLaughter case] prosecution would not have been be possible.

This assertion, along with the decision to grant Peters immunity, does not make sense. The book provides little factual support for the conclusion and other facts cited in the book do not support the assertion that the Scruggs II prosecution depended on Peters. 

Elsewhere, the book suggests that Langston, who was not involved in the scheme to bribe Judge Lackey, did not trust Scruggs and was eager to reach a deal with the government before Scruggs turned on him. The book also states that the government was holding a RICO prosecution over Langston’s head, which could have led to a divestiture of much or all of Langston’s wealth earned from his law practice. Obviously, getting to keep his money would have been a huge motivation for Langston agreeing to plead guilty and cooperate.

In Scruggs I Balducci immediately confessed and cooperated, leading to the disclosure of the DeLaughter bribe in Scruggs II. Patterson and Backstrom also quickly agreed to play ball with the government, according to the book. Patterson was involved in the DeLaughter bribery and could corroborate Balducci’s testimony. Langston was approached next and was eager to cooperate as well, according to the book.  

The book does not cite facts that make it sound like the government needed Peters to get to Langston. Instead, it looks like they could have gotten to Langston with Balducci's and Patterson’s testimony. From there, they could have gotten to Peters with the testimony of Balducci, Langston and Patterson. Then, Peters would have had to turn on DeLaughter in order to reduce Peters’ prison sentence. Immunity to one individual was not necessary.

In addition, there are other reasons that the theory that granting Peters immunity was necessary does not make sense. If the Scruggs II prosecution depended on Peters, then Peters could have kept his protege Bobby DeLaughter out of jail and on the bench simply by keeping his mouth shut. And since there would have been no Scruggs II prosecution, Peters would have kept his law license and the money he was paid for bribing DeLaughter and kept Langston and everyone else from being prosecuted in Scruggs II.

Again, this does not make sense. If this were true, then Peters would have kept his mouth shut.  

My interpretation of this is that Dawson is making a poor attempt to justify a bad decision. If all these guys were so eager to plead guilty, then the government did not need to give anyone immunity. There were rumors that the government lawyers panicked and hastily agreed to grant Peters immunity. Conspiracy theorists will have more sinister explanations, but I do not buy an argument that the government lawyers were tainted in favor of Peters. It appears to have been either a poor decision made in haste, or there is more to the story than disclosed in the book.

I recognize that it’s easy to criticize a decision on the back-end when everyone knows what eventually happened. But Dawson should be able to justify the decision in the book and did not.         

The book spreads the blame for the admittedly bad controversial decision among the entire prosecution trial team, which included Dawson, Asst. U.S. Atty. Bob Norman and Asst. U.S. Atty. Dave Sanders, and U.S. Attorney Jim Greenlee.

For prior posts about my efforts to obtain the Peters immunity agreement from DOJ see here, here, and here.

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In my last post I talked about how bad it looked for Judge Bobby DeLaughter in his upcoming criminal trial. I was not alone in this assessment andtoday's announcement that DeLaughter will enter a guilty plea to lying to the FBI is not surprising. In fact, it would have been shocking if DeLaughter had not pleaded guilty given the lineup of former lawyers who were lined up to admit that they bribed DeLaughter.

DeLaughter's downfall is, in my mind, the worst part of the entire judicial bribery scandal. The trials of Whitfield and Teel were arguably political and everyone involved always denied any impropriety. But in the DeLaughter case everyone involved except for Trent Lott has admitted to wrongdoing. Before this mess started there were many lawyers who held DeLaughter in high esteem. I respected DeLaughter and have previously mentioned the fact that I thought his book Never Too Later was well done. I was not enamored with DeLaughter on the bench because I thought he was too unpredictable. That perception now casts a cloud over his entire judgeship. Many lawyers who lost on a questionable ruling by DeLaughter will wonder if there was any behind the scenes impropriety. At a minimum, DeLaughter's judgment, the very foundation of a judge, now appears flawed. 

If DeLaughter wants to truly make amends he should publicly come clean on any and all impropriety involving he and Ed Peters. It's hard to believe that DeLaughter and Peters got caught on the only case that they ever improperly conspired on. And while I am sure that DeLaughter still maintains that he didn't conspire with Peters in Scruggs v. Wilson, it is clear that at a minimum he allowed himself to be controlled by Peters. DeLaughter should publicly disclose every case that he and Peters discussed while DeLaughter was a judge. The files of those cases should be examined for any unusual rulings. 

The judicial bribery scandal has been a huge black eye for the Mississippi judicial system including the lawyers and judges in that system. If DeLaughter's plea brings the scandal to a close neither the public nor the legal community will believe that all the bad actors and illegal conduct has been exposed. So far the only person to publicly come clean is Tim Balducci and that is only because someone obtained a copy of his deposition in the Eaton v. Frisby case that was supposed to be sealed. We hear that all the lawyers in jail and Peters (who should be in jail) are cooperating with the government. But that does little to restore the public's faith in the judicial system because the government does not publicly disclose its investigation, which proceeds at a glacial pace. We need depositions or similar mechanisms to force all the principals in the Lackey and DeLaughter bribery scandals to publicly disclose everything that they know. If there are other lawyers or judges who committed illegal conduct, then they should be exposed, prosecuted and disbarred. We do not need this thing ending without knowing whether this was the tip of the iceberg or the whole iceberg.

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This is my first update in a week due to an ongoing trial in federal court in Jackson. I have another busy week ahead and will return to more regular blogging next week. Usually July is very slow in the legal world, but this year has been a notable exception. A huge story this week was the NAF completely pulling out of consumer arbitrations and the AAA pulling out of credit card consumer arbitrations. There is a clear indication that mandatory consumer arbitration will be dead soon. Other commentators who say that it's too early to tell are wrong. They remind me of people who go to the beach when a hurricane is about to hit to make sure it's for real. I saw the arbitration backlash coming several years ago, but it is arriving years before I expected. It appears that the NAF, and perhaps AAA, fear criminal investigations regarding the administration of arbitration claims. I expect there to be a lot more to come out about crooked arbitrations and people to go to jaiI. 

I give mandatory arbitration less than a year before Congress shuts it down. Mandatory arbitration is not popular with judges--even judges who enforce arbitration clauses. So don't expect the judiciary to rule that a Congressional ban on arbitration is unconstitutional. Any plaintiff lawyers with unfiled cases with arbitration clauses should sit on the cases as long as possible in order to allow arbitration's final demise.

On another subject, despite my trial I stayed up late one night this week reading Tim Balducci's deposition taken in Eaton v. Frisby. Balducci's deposition was fascinating. Chase Bryan at Forman Perry took the deposition and I do not think that was a coincidence. Bryan has been described as local counsel on the case for a Philadelphia firm and is below Alan Perry at Forman Perry in the defense pecking order. But Bryan and Balducci were law school classmates at Ole Miss in the early 90's and I could sense their familiarity in the deposition. One example is that Balducci repeatedly referred to Bryan as "Chase", but referred to Eaton lawyer Mike Wallace as "Mr. Wallace." It is rare for local counsel to receive such a marquee assignment and the move was a smart one. Bryan did a good job taking the deposition.

As for the deposition itself, I believe that Balducci was literally crying when he described his conduct as the biggest moral and ethical failure of his life. Two things lead to this conclusion: (1) the clearly emotional testimony and  (2) the fact that Bryan immediately said "lets take a break." It is customary in depositions to take a break to let a witness in tears compose themselves.

Balducci basically described himself as the brains of the operation in the Wilson v. Scruggs case. He made Joey Langston sound somewhat buffoonish. I don't completely buy the image of Balducci that he seems to have for himself. I get the impression that Balducci believes that he fell off the tracks morally when he got involved in the Wilson case. But I can't understand what he was doing working as an associate for Joey Langston at the time. Before going to Langston's firm Balducci had his own practice with Kent Smith for years. The two had been joined at the hip since law school and I've never heard an explanation for what led to their separation. Balducci apparently went back to work for Langston thinking that it would lead to a full partnership. If that was the case, Balducci should have known better.

Wealthy lawyers like Langston rarely ever cut someone in with a large piece of their practice. The state is littered with plaintiff lawyers who started working for a prominent plaintiff lawyer only to eventually go out on their own when partnership promises never materialized. Unlike in defense firms, it's extremely rare to see the same core group of lawyers at a plaintiff firm for years. Merkel and Cocke in Clarksdale is a notable exception.  

Balducci testified that he was the source of the $50,000 in cash that Langston first paid to Peters. What in the world was Balducci doing with $50,000 in cash sitting around the house? Keeping that much cash around is a bad idea for many reasons and wreaks of tax fraud.

As to the impact of Balducci's testimony on Eaton v. Frisby and the DeLaughter trial, it's hard to say. The vast majority of Balducci's testimony was based on hearsay that would not be admissible at trial. Mike Wallace skillfully established this point near the end of the deposition. But if Balducci's testimony is corroborated by Ed Peters, then I do not see how DeLaughter can be acquitted. And even if DeLaughter somehow escapes conviction, I don't see any path for his to return to the bench. It looks like the best case scenario for him is that he exercised terrible judgment in communicating with Ed Peters and was unwittingly used as a pawn by Peters, who he fawned over in his book It's Never Too Late.

As for Frisby,  Balducci didn't know anything about it or the lawyers in the case who he was asked about: Mike Allred, Rueben Anderson and Fred Banks. It's unclear what Judge Yerger is going to do in the case, but the longer he goes without dismissing the case for attorney misconduct the less likely that it will be dismissed.

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The Clarion-Ledger contained a story this week on the deposition of Tim Balducci in the Eaton v. Frisby case. Balducci was deposed in prison in June and the Clarion-Ledger obtained a copy of the deposition, despite the fact that the case was supposed to be sealed. The focus of the story was how Balducci's testimony will impact the upcoming criminal trial of Judge Bobby DeLaughter. According to Balducci, Judge DeLaughter became upset when he did not get a federal judge appointment after issuing rulings favorable to Richard Scruggs in the Scruggs v. Wilson litigation.

The Ledger ignored the large question of how Balducci's testimony will impact the huge Eaton v. Frisby case and the careers of some of the attorneys in that case. If it is determined that Ed Peters attempted to improperly influence Judge DeLaughter in the Eaton case, it could lead to state or federal criminal charges against Peters and others who he acted in concert with. It could also lead to the dismissal of the case and sanctions by the Court or Mississippi Bar against the lawyers who participated in any wrongdoing. The Eaton case is just as significant as the DeLaughter trial and the Clarion-Ledger should not ignore it.