Share “Oklahoma pays law firms $24M”

BY JULIE BISBEE and PAUL MONIES Published: March 22, 2009
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©2009, The Oklahoman

Out-of-state firms are among the top private law firms receiving contracts from state agencies, according to an analysis of reports from the attorney general’s office by The Oklahoman.

In the past three years, state agencies have paid private attorneys nearly $24 million for legal work, according to reports. Davis, Graham and Stubbs, a Denver firm that specializes in managing public employee pensions, was paid $945,852 — the most among private law firms with state contracts, according to payment records from the Office of State Finance.

"The revelation that taxpayers are footing the bill for outside attorneys to the tune of $24 million shows that the practice of overspending is not just confined to Congress; it’s happening at the state Capitol, as well,” said Brian Downs, executive director of the watchdog group Oklahomans for Responsible Government.

In many cases, state agencies hired private law firms because the state attorney general’s staff is overburdened with cases or doesn’t have the expertise to handle complex areas of law, said Susan K. Noland, assistant attorney general and chief of the litigation section.

Noland reviews agency requests to hire private attorneys. Agencies are required by law to submit a request to the state attorney general when requesting outside attorneys. Agency boards approve the contracts to hire private law firms.

"Our division has more than 1,000 open cases at one time and 17 attorneys,” Noland said. "A lot of times, we try to work with outside counsel to cut down on the cost. But sometimes our office doesn’t have the expertise or resources to handle the cases.”

Who is doing the work?
Law firms from Washington, Dallas and Denver, as well as firms that include former state officials, are among the top law firms receiving state contracts, according to The Oklahoman’s analysis.

The attorney general’s office tracks how much money each state agency spends on private legal services but does not track the dollar amount private firms are paid.

Agencies submit paperwork with a projected contract amount but are not required to list how much a firm is actually paid. In some cases, it can be less than the contract amount, depending on how much work is involved.

Some law firms are hired for their expertise.

Robert Jones, an attorney and the executive director of the Oklahoma Firefighters Pension and Retirement System, said the Denver-firm Davis, Graham and Stubbs is one of a few law firms that specializes in this sort of work. The law firm has three separate contracts to help manage pension funds for firefighters, police and other law enforcement officers.

"That’s what the board is paying for,” Jones said. The firm ensures that the multibillion dollar pension fund meets IRS requirements and holds its tax-free status.

"Nobody wants to think of our fund not qualifying,” Jones said.

The projected contract amount for the firm is often higher than the actual amount paid at the end of the year, he said.

"I do that so I don’t have to go back and adjust my budget with the Office of State Finance,” he said.

Law firms of former officials receive contracts
Former state officials also benefit from public contracts with private law firms. Over the past three state fiscal years, the law firm of Taylor, Burrage, Foster, Mallet, Downs & Ramsey has had four separate contracts with the Grand River Dam Authority. The law firm includes Stratton Taylor, a former state representative and former ranking Senate Democrat from the Claremore area. The firm also includes current Sen. Sean Burrage, D-Claremore.

Records from the attorney general’s office show the law firm had contracts totaling $1.4 million over the past three years.


Top five firms being paid by the state
Here’s a list of the firms and what they were paid by state agencies during the past three fiscal years, according to payment records from the Office of State Finance.

Davis Graham & Stubbs, $945,852

A Denver-based firm that worked with the state’s police and firefighters pension and retirement system tax documents and has represented the retirement system in court. The Oklahoma Police Pension and Retirement System does have staff attorneys, and assistant attorneys general did not have expertise in IRS law, the attorney general’s office said.

McAfee & Taft, $904,494

The law firm is one of the largest in the Southwest and has had several state contracts, including contracts with CompSource Oklahoma, Regents for Higher Education and the University Hospital Authority.

Riggs, Abney, Neal, Turpen, Orbison and Lewis, $785,547

The firm includes former Attorney General Michael Turpen and James Orbison, chairman of the Lottery Commission. The firm has had contracts with the Department of Human Services, state Banking Department, Transportation Department, Health Care Authority and others.

Phillips, McFall, McCaffrey, McVay and Murrah, $475,009

This Oklahoma City law firm, now named Phillips Murrah, has had contracts to do work for the law enforcement and firefighters retirement fund, CompSource Oklahoma and the Department of Environmental Quality over the past three years. Senate President Pro Tempore Glenn Coffee, R-Oklahoma City, is an "of counsel” member of this firm and does not receive compensation from the firm.

Ryan, Whaley, Coldiron, Shandy, $239,198

The Oklahoma City law firm has had contracts to do work for the Transportation Department, Grand River Dam Authority and the Tax Commission. The firm includes former U.S. Attorney Patrick Ryan, who prosecuted Oklahoma City bomber Timothy McVeigh and Terry Nichols.

Top 15 law firms getting state contracts for the past 3 years
The amounts are projected by the agency and may not reflect how much attorneys actually receive. The attorney general does not track the amount, just the total an agency spends on outside private counsel, said Susan Noland, who oversees the division of the attorney general’s office.

Slover & Loftus

The Washington, D.C.-based firm specializes in law that regulates transportation, energy and fuel supply. The firm had a contract with the Grand River Dam Authority. Private attorneys were hired because assistant attorneys general did not have legal expertise in this area, the attorney general’s office said.

Jenkens & Gilchrist

The now-defunct Dallas law firm did work on behalf of the Transportation Department, defending the agency in a contract claim of more than $4 million on a privatization maintenance contract investigated by the multicounty grand jury in 2006. The law firm went out of business in 2007 after being investigated for fraudulent tax shelters.

Holloway & Monaghan

The Tulsa-based law firm specializes in real estate, business litigation, condemnation and land-use litigation. The firm has worked for the Transportation Department on legal proceedings to buy private property for highway projects. The attorney general’s office said its attorneys did not have sufficient expertise for this work.

Conner & Winters

The Tulsa-based law firm specializes in energy, real estate, health care and aviation and airlines law. The firm did work for the Oklahoma Tax Commission and assisted commission attorneys at trial for the past three years.

Davis Graham & Stubbs

The Denver-based firm has worked on the state’s police and firefighters pension and retirement system tax documents.

Tom R. Gann

The Tulsa attorney has done condemnation work for the Transportation Department.

Taylor, Burrage, Foster, Mallett, Downs & Ramsey

The Claremore-based firm includes former state representative and Sen. Stratton Taylor and current state Sen. Sean Burrage, D-Claremore. The firm had a contract with the Grand River Dam Authority on condemnation proceedings in a floodplain in Ottawa County.

Fogg, Fogg and Handley

The El Reno law firm has worked on condemnation proceedings to acquire private property for a highway project.

William Bailey Cook, III

The Ada attorney has worked for the Transportation Department on condemnation proceedings.

Phillips, McFall, McCaffrey, McVay and Murrah

Riggs, Abney, Neal, Turpen, Orbison and Lewis

Ryan, Whaley, Coldiron, Shandy

The Oklahoma City law firm has had contracts to do work for the Transportation Department, Grand River Dam Authority and the Tax Commission.

Lynn A. Mundell

The Tulsa attorney has had contracts to do condemnation work for the Transportation Department.

McAfee & Taft

The law firm is one of the largest in the Southwest and had several state contracts, including contracts with CompSource Oklahoma, Regents for Higher Education and the University Hospital Authority.

Holladay & Chilton

Oklahoma City firm has done work on condemnation projects for the Transportation Department.

Julie Bisbee, capitol bureau and Paul Monies, database editor

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