Attorneys General for Sale?

by Andrew Wheat

A handful of conservative state legal officials devised a highly marketable idea in 1999. They decided to raise lots of money to elect more attorneys general who — like themselves — are reluctant to sue big business.

Alabama Attorney General Bill Pryor said that he conceived the Republican Attorneys General Association (RAGA) as a way to combat the alliances that some state attorneys general formed with private lawyers to sue the tobacco industry.

“Two years ago, I warned … that the lawsuits filed by my fellow state attorneys general against the tobacco industry threatened the entire business community,” Pryor told the Civil Justice Reform Group in Washington, D.C. in December 1999.

“Since then, the legal landscape has deteriorated to the point that, with municipalities and states suing the firearms and paint industries and the federal government suing the tobacco industry,” Pryor said, “there are a growing number of novel government suits against entire industries. No industry is safe.”

To curb such “lawsuit abuse,” Pryor said, “the business community must be engaged heavily in the election process as it affects legal and judicial offices.”

Toward that end, Pryor plugged RAGA, the organization that he helped found and currently leads.

Legal Defense Fund

RAGA’s founders have found ready support among industries that fear state lawsuits. Along the way, RAGA has sparked controversy because it appears to set its members up for conflicts of interest and because it launders its money through a much larger Republican PAC to conceal the identities of its donors.

Other RAGA founders share Pryor’s concern about trial lawyers (who are major Democratic donors) suing tobacco companies (which are big GOP donors). One factor that may have spurred the formation of this partisan group in 1999 was the fact that the non-partisan National Association of Attorneys General was then headed by Democratic Mississippi Attorney General Mike Moore. Moore launched the once-quixotic state tobacco litigation that is now paying states around the nation $246 billion.

RAGA’s first chairman, South Carolina Attorney General Charlie Condon, was an early critic of the tobacco litigation, though he eventually hopped on to the gravy train when it became clear how much money was available. Condon also dropped South Carolina’s Microsoft case in December 1998 — just months after Microsoft gave $20,000 to that state’s Republican PAC. That donation was one of the largest that Condon’s state party had ever received. Microsoft also gave Condon’s campaign $3,500 after he dropped the Microsoft suit.

Nebraska Attorney General Don Stenberg is another latecomer to the tobacco lawsuit who has experience with money scandals. Before he joined RAGA, Stenberg received $15,000 from Nebraska’s Vopnford family — including $1,000 from 12-year-old Leif Vopnford. Stenberg was not among five state attorneys general who sued the Vopnford’s company, Thousand Adventures, in the mid-1990s. After Thousand Adventures took $420 million from people who bought into a time-share camping scheme, the company closed two-thirds of its 58-campground empire and let others go to seed, eventually prompting the attorneys’ general suit.

Texas Attorney General John Cornyn also is a harsh critic of the $17 billion tobacco lawsuit that his Democratic predecessor filed. Cornyn wrote in a fundraising solicitation last year that RAGA “was born out of concerns arising out of the industry-wide lawsuits that seek to promote public policy changes via the courthouse rather than the statehouse.” Cornyn added, “Some of the attorneys general of other states in the wake of the tobacco litigation, have created a wish list for future mass state lawsuits — car rental companies, pharmaceutical firms, makers of lead paint and gun manufacturers.”

“Don’t Do This”

Reflecting this marketing strategy, RAGA has won the financial support of such state lawsuit targets as tobacco interests, the gun industry, HMOs and Microsoft. Critics have charged that RAGA effectively sells protection from state litigation.

“This is absoltely an effort by people with special interests to stop attorneys general from pursuing their traditional role as protectors of the public interest,” says Scott Harshbarger, the former Democratic attorney general of Massachusetts who now heads Common Cause.

Democrats are not alone in their criticism of RAGA. “I try to keep politics out of my business as attorney general,” Pennsylvania’s Republican Attorney General Mike Fisher told the Washington Post when asked why he did not join RAGA.

“We’re a family, and families can disagree,” Grant Woods, a former Republican attorney general of Arizona told the National Association of Attorneys General convention last year. “But don’t do this.”

It is hard to pin down exactly who is a member of RAGA. Executive Director Tim Barnes insists there is no formal membership roll, but that all Republican attorneys general are members.

However, when questioned, many Republican attorneys general insist that they are not members. Current RAGA officers are Bill Pryor of Alabama, John Cornyn of Texas, Mark Earley of Virginia, M. Jane Brady of Delaware, Charlie Condon of South Carolina, Don Stenberg of Nebraska and Gay Woodhouse of Wyoming.

Corporate Support

RAGA’s funding base has generated much of the controversy surrounding the group. Tobacco lobbyist Ed Rogers of Barbour Griffith & Rogers attended RAGA’s kick-off fundraiser in Washington, D.C. in 1999. Also present was National Rifle Association spokesperson Bill Powers, whose industry faces an antitrust investigation launched last year by six state attorneys general. The NRA also volunteered to host a skeet shoot for participants in the RAGA conference that Cornyn hosted last year in Austin.

Microsoft, which is defending itself from antitrust charges filed by the attorneys general of the United States and 23 states, also sent representatives to the Austin RAGA conference. It has acknowledged contributing at least $10,000 to RAGA’s war chest.

Austin RAGA conference participants who contributed at least $5,000 were originally scheduled to attend an opening reception at then-Governor George W. Bush’s governor’s state mansion. But this event was cancelled the day that reporters questioned Bush’s office about RAGA’s stealth fundraising tactics.

Money Laundering

It is impossible to know the full extent of the support that RAGA receives from industries that face state lawsuits because RAGA does not disclose its donors. Instead, it directs individuals, PACs and corporations to make stealth contributions to RAGA in the name of the Republican National State Elections Committee (RNSEC).

This much larger PAC does report its expenditures and contributions. But neither RNSEC nor RAGA will reveal which of the $162 million in contributions that RNSEC received in the 2000 election cycle belong to RAGA. Philip Morris and the National Rifle Association are two of RNSEC’s top donors. Georgetown University election law specialist Roy Schotland has said that RAGA’s fundraising scheme is practically akin to money laundering.

Well over a year after he mailed his RAGA fundraising solicitation, Cornyn was asked at the University of Texas Law School about why the RAGA donors that he solicited have not been disclosed.

“The organization that you are referring to solicits money, and I’m really not sure who that is that’s solicited,” he said in April 2001.

Reminded that he himself had done the soliciting, Cornyn replied, “It was a very broad-reaching letter. The fact is that the receipt of those funds is duly recorded in compliance with all applicable laws and so I don’t understand your point about nondisclosure.”

Cornyn also defended the practice by saying, “No one can point to a single example in which that [RAGA fundraising] has compromised my professional judgement.”

In fact, questions have been raised about Cornyn’s RAGA fundraising and his professional judgment. In April 2000, Cornyn settled a lawsuit, filed by his predecessor, alleging that Aetna U.S. Healthcare offered doctors incentives to withhold medically necessary care. Cornyn allowed Aetna to settle the suit without paying a dime. In the year prior to the Cornyn’s settlement, Aetna contributed $75,000 to the PAC that launders RAGA’s money. None of the parties involved would disclose if Aetna had earmarked these funds for RAGA.

Lead Paint

Additional questions surfaced in April 2001, after a state judge ruled that Rhode Island Attorney General Sheldon Whitehouse could go to trial with his lawsuit against eight lead paint manufacturers. The lawsuit, which alleges that the defendants knowingly sold a product that poisons children’s brains, seeks to recover the state’s costs to remove lead paint from buildings where children can be exposed to the toxic paint.

The U.S. Centers for Disease Control calls lead the nation’s top environmental health threat to kids. Four percent of all pre-schoolers have high enough blood-lead levels to reduce intelligence and cause brain damage. Most of this exposure occurs when kids ingest dust from deteriorating lead paint, which the government banned for residential use in 1978.

While numerous local governments have filed such lawsuits, Rhode Island is the first state to do so. Whitehouse’s office says that it has been contacted by 15 other states that are exploring similar suits. Citing standard protocol, Whitehouse’s office would not identify which attorneys general have called.

Given RAGA’s condemnation of industry-wide lawsuits, it would be interesting to know if any RAGA members were among those investigating the possibility of a suit against the lead paint industry.

The actions — or inactions — of Alabama’s Pryor and Texas’s Cornyn are particularly intriguing since both of these attorneys general specifically have cited lead-paint lawsuits as an example of the kind of litigation that prompted them to found RAGA in the first place.

Cornyn’s position is even more interesting because a leading defendant in Rhode Island’s lawsuit is NL Industries, which is controlled by Dallas corporate raider Harold Simmons. Simmons is a major donor to Republican PACs and candidates. He gave $90,000 to George W. Bush’s two gubernatorial campaigns and has given Cornyn $31,000 since 1998.

As the producer of the lead pigment that was added to many brands of paint, NL Industries has lobbied to limit its potential liabilities. Prior to joining Bush’s cabinet, Interior Secretary Gale Norton lobbied state and federal officials on lead paint issues for Simmons’ NL. In fact, visitor logs reveal that Norton lobbied Cornyn’s office on this issue on May 19, 1999.

In another eye-popping link, since RAGA’s creation in 1999, Simmons’ two main holding companies, Contran and Valhi, have contributed $350,000 to the Republican PAC that launders RAGA’s money. RNSEC received another $211,000 since RAGA’s creation from other companies that are defendants in the Rhode Island suit. This includes $201,000 from ARCO (and ARCO chairman emeritus Lodwrick Cook) and $10,000 from DuPont.

The lead industry’s potential liability is far greater in Texas than Rhode Island. An Environmental Defense report ranks Texas seventh nationally in the number of its housing units that face elevated lead risks (180,000 units). Texas has eight times more of these housing units than does thirty-seventh ranked Rhode Island.

A Cornyn spokesperson told the Dallas Morning News in April 2001 that his office is monitoring the Rhode Island litigation and will decide in the future whether or not to follow suit.

Noting that he had not discussed the case with Cornyn, Harold Simmons said, “I would certainly hope he wouldn’t join the suit, because it is a bad case.”

Multinational Monitor Contributing Writer Andrew Wheat works for Austin-based Texans for Public Justice, a non-partisan, non-profit organization that follows money in Texas politics.