September 3, 2008


REVISED

To the Editor:

Individuals working for and on behalf of the National Chamber of Commerce and its attack dog group, Citizens Against Lawsuit Abuse, have been misinforming your readers about the Attorney General's OxyContin lawsuit in particular and his pro-consumer litigation in general. Allow us to set the record straight in this letter, which is intended as a response to the articles and op-ed pieces that have run in your newspaper.

Fact: There were four plaintiffs in the OxyContin case, not three. The plaintiff which CALA never mentions in its assault against the Attorney General's office is the group of West Virginia citizens who became addicted to OxyContin as a result of its manufacturer's criminal conduct. It was this plaintiff which proved to have the vast majority of damages. The three other plaintiffs' share of the established damages were minimal in comparison. This fact is set out in a legal document filed with the court before the OxyContin settlement was reached.

Fact: Not one cent of the OxyContin settlement money was kept by the Attorney General's office for its own use. The Attorney General did not dole out fees for attorneys. The court determined the amount of the fee and ordered Purdue Pharma to pay it. Instead, settlement money was used to fund projects for the benefit of the main victims in the OxyContin case, namely, people who became addicted to OxyContin. Every penny of the OxyContin money has been spent in accordance with the court order. Most of the terms of the court order were insisted upon by Purdue Pharma as a condition of settlement. No one has alleged the money has been misspent or that the programs receiving the money were not worthwhile. The money given to counties for day report centers, in particular, has enabled those counties to save millions of dollars in regional jail costs for non-violent drug offenders. For every dollar spent on a day report center, a county saves seven dollars in regional jail costs. Money was provided to fund a pharmacy school at the University of Charleston. Pharmacists are the main line defense against people doctor shopping for pain medication.

Fact: Contrary to CALA's assertion, the Department of Health and Human Resources received funds from the OxyContin settlement money for behavioral health programs in the amount of $250,000. As a result of the Attorney General's work product, the Department of Health and Human Resources (since Darrell McGraw became Attorney General) has received over $250 million. Workers' Compensation has received approximately $32 million, and the Public Employees' Insurance Agency has received over $15.5 million. Eight hundred forty million dollars ($840,000,000) of the Attorney General's work product was dedicated to paying down the teachers' retirement debt.

Fact: Three years into the distribution of the OxyContin settlement, which was spread out over four years, the National Chamber of Commerce contacted the Center for Medicaid and Medicare Services (CMS), urging it to seek a majority of the settlement proceeds. CMS attempted to do this. Its efforts failed. The Appeals Board hearing the case determined the CMS's disallowance was "unreasonable on its face" and sent the case back to CMS to determine what an appropriate amount would be. The Attorney General's office has set aside a substantial amount of the money which it believes, based on the evidence, is what CMS may be entitled to receive.

Fact: The Attorney General appoints outside counsel to prosecute some consumer lawsuits because this arrangement allows the State to reap all the benefits of litigation while avoiding any of the risks. For example, expenses in the OxyContin case were over $400,000. Outside counsel are responsible for all expenses - which typically run to hundreds of thousands of dollars in a complex case - and the State is never required to repay those expenses, whether a case is won or lost. Outside counsel are responsible for prosecuting the cases - which typically requires thousands of lawyer hours - and the State is never required to pay attorney fees, whether a case is won or lost. If a case is won, outside counsel petition the court to require the defendants to repay the expenses and to pay the attorney fees. If a case is lost, outside counsel is simply out of luck; there's no reimbursement of expenses, and there are no attorney fees. Attorneys' fees are paid by the individuals or companies who break the law and not the taxpayers. Attorney General McGraw does not determine the amount attorneys are to receive. This amount is determined by the court. Outside counsel function under the supervision of the Attorney General.

Fact: Some of our outside counsel have never contributed a penny to the Attorney General's political campaigns, and many attorneys who have contributed to campaigns have never received an outside counsel appointment. Additionally, the campaigns for Attorney General are not big-dollar affairs, and contribution limits for individuals are very low. The big money in political campaigns comes from business interests and 527's, which always support pro-business candidates designated as "reformers" by the Chamber of Commerce. Attorneys are selected based upon certain criteria. Firms which do defense work and have represented some of the corporate interests that we sue or oppose cannot be appointed because of a conflict of interest. Experience doing plaintiff's work, consumer work or antitrust litigation is required. The lawyers appointed by the Attorney General's office must be able to access capital of at least a half million dollars. They also must have the technical and infrastructure support to handle litigation where a voluminous amount of documents are generated.

Fact: Since elected Attorney General, Darrell V. McGraw, Jr. has brought almost $2 billion dollars into this state at no cost to taxpayers. Of this money, 99.9% is or was under the control of the West Virginia Legislature. None of these settlement moneys went to the Attorney General's office to dole out to lawyers, contrary to the assertions of commentators such as Mr. Vic Sprouse and Mr. Steve Cohen on behalf of CALA.

Fact: The National Chamber of Commerce and Citizens Against Lawsuit Abuse have but one purpose: to take on any elected officials who regulate Chamber/CALA members, and to replace them with individuals who will not enforce consumer credit and protection laws. Your readers should consider this fact in determining the credibility of Chamber/CALA spokespersons and their submissions to your newspaper.

Very truly yours,

FRANCES A. HUGHES
CHIEF DEPUTY ATTORNEY GENERAL

BARBARA H. ALLEN
MANAGING DEPUTY ATTORNEY GENERAL