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Decisions Affecting the Powers and Duties of State Attorneys General

Emily Myers, Antitrust and Special Projects Counsel

This is another in our series reporting on recent decisions from across the country affecting the powers and duties of state Attorneys General.

Connecticut–Limits on Campaign Contributions to Attorney General Candidates

Dean v. Blumenthal, 577 F. 3d 60 (2d Cir. 2009)

This case involved enforcement of a contractual provision included in all contracts for legal services entered into by the state Attorney General. The provision prohibited contributions to candidates for Attorney General of Connecticut from private counsel who were under contract with the state for legal services. This provision was said to have been included “in order to avoid the appearance that the contracting law firm was being awarded a contract in exchange for future campaign contributions.” Plaintiff was a candidate for Attorney General who challenged the provision on the grounds that it deprived her of a First Amendment right to receive political contributions. Shortly after the suit was filed, Attorney General Blumenthal suspended enforcement of this contractual provision, and sent notice to all law firms under contract with the state notifying them of the suspension of the provision. The suit was unresolved through the following election, and Attorney General Blumenthal continued the suspension of the provision until the legislature superseded it with a more general statutory provision covering contributions by state contractors. The suit was dismissed by the District Court on the grounds that plaintiff lacked standing because there existed no constitutional right to receive campaign contributions.

The Second Circuit first determined that much of the case was moot, because the office policy that was originally challenged had been superseded by legislation. Although the plaintiff argued that the Attorney General could re-institute such a policy at any time, the court decided that the Attorney General’s assertion that he had no intention of re-instituting the policy, coupled with his voluntarily declining to enforce the policy for six years, was sufficient to render plaintiff’s claims for injunctive and declaratory relief moot. Turning to her claim for damages, the Court of Appeals applied a two-pronged test to determine if the Attorney General was entitled to qualified immunity[1]: 1) is there a clearly-established Constitutional right; 2) did the government actor’s conduct violate that right. The court concluded that there was no clearly established right to receive campaign contributions during the relevant period. Even if the Supreme Court’s decision in Randall v. Sorrell, 548 U.S. 230 (2006), could be said to recognize such a right, it was decided long after the Attorney General suspended enforcement of the contractual provision. The Attorney General was therefore entitled to qualified immunity, and the case was dismissed.

Idaho–Different Deputies Do Not Require Notice of Substitution of Counsel

Idaho State Tax Commission v. Beus, 2009 Ida. App. Unpub. LEXIS 307 (Id. Ct. App. Sept. 10, 2009)

In the context of a tax case, the taxpayers challenged the default judgment against them on the grounds that a different deputy attorney general appeared at the hearing on the motion for default than had previously represented the state tax commission. The court held,


By statute, it is the attorney general who represents the Tax Commission in court, . . . and though the attorney general may assign deputy attorneys general and special deputy attorneys general to assist in such representation, . . . it is still the attorney general who technically serves as the Commission's representative. Here, though a different deputy was present on the Commission's behalf during one of the hearings than had previously been present, no change in representation had actually taken place since it was the attorney general who represented the Commission at all times. Because the attorney general is the one who represented the Commission at all times, albeit through different deputies, the rules do not require that a notice of change of counsel be filed.

Michigan–Attorney General Not Disqualified–

People v. Waterstone, No. 09-015867-01-AR (Wayne Cty. 3rd Cir. Ct., Crim. Div., Sept. 29, 2009)

In the course of the drug trafficking trial of Alexander Aceval, the assistant prosecuting attorney (APA) allegedly suborned perjury in order to protect the identity of a confidential informant. Judge Waterstone became aware of this perjury and knowingly allowed it to occur. After Aceval was convicted, and the perjury was discovered, Aceval sued Waterstone and others, alleging civil rights violations. The general counsel of the Michigan Supreme Court requested that the Attorney General’s office represent Waterstone, and an assistant attorney general (AAG) from the Public Employment, Elections and Tort Division did so, speaking with Waterstone three times. The case was dismissed.

The Michigan Prosecuting Attorneys Coordinating Council asked the Attorney General to appoint a special prosecutor to investigate the alleged subornation of perjury. The Attorney General, apparently unaware that Waterstone had already been represented by an AAG in the civil rights case, assigned two attorneys from the office’s Criminal Division. In March 2009, the Attorney General issued a multi-count felony indictment against Waterstone and others, alleging judicial misconduct with regard to allowing presentation of perjured testimony and ex parte communications with the prosecutor. Waterstone sought to disqualify the Attorney General’s office, claiming that its representation of her in the civil rights case and the current investigation were an inherent conflict of interest. The court stated the question presented as “Should the AG be disqualified because one attorney in the Public Employment, Elections and Tort Division represented defendant in a civil matter which involved the same set of operative facts for which the defendant is currently being prosecuted by the Criminal Division?”

The court first looked at Michigan Rules of Professional Conduct. Rule 1.9(a) provides, “A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client consents after consultation.” Rule 1.10 provides “While lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rule . . . 1.9(a).” Reading the two sections together, the court determined that while the Rules of Professional Conduct apply to the Attorney General’s office, in this case, there was “no knowledge of the previous representation at the time of the criminal investigation of defendant.” When it became known, the criminal division immediately took steps to erect a conflict wall.

The court stated, “Furthermore, the attorneys in question were acting independently from one another and did not exercise authority over each other. They were in fact in different divisions, with different chains of command and located in geographically different offices.” The court was persuaded by the reasoning of a Hawaii decision that discussed the unique nature of the Attorney General’s office, and held “the AG may represent a state employee in civil matters while investigating and prosecuting him in criminal matters, so long as the staff of the AG can be assigned in such a manner as to afford independent legal counsel and representation in the civil matter and so long as such representation does not result in prejudice in the criminal matter to the person represented.”[2]

The court also noted that the Attorney General’s office, as soon as it became aware of the previous representation, had implemented a conflict screening policy to ensure that confidential communications protected by the attorney-client privilege did not inadvertently contaminate the rest of the AG’s office.

Ohio–Attorney General Has Standing to Obtain Writ of Prohibition Against Judge

State ex rel. Cordray v. Marshall, 123 Ohio St. 3d 229, 2009 Ohio 4986; 915 N.E.2d 633; 2009 Ohio LEXIS 2690 (2009)

Defendant Rawlins shot and killed his wife’s lover, was convicted of murder and in 1997 received a sentence of 15 years in prison. He appealed his conviction on the grounds that the jury was not instructed on involuntary and voluntary manslaughter. The Ohio Court of Appeals and Ohio Supreme Court rejected his appeal. In 2003, Rawlins filed a motion with Judge William Marshall for relief from judgment of conviction and sentence, alleging the same grounds as his appeals. In March 2005, Judge Marshall, who had not presided over the original trial, held a hearing and granted Rawlins’ motion, based on Rawlins’ argument that the jury should have been instructed on the lesser charges. The prosecuting attorney, who had not been in office when the original trial took place, stated that the state had no objection. Judge Marshall accepted Rawlins’ plea of voluntary manslaughter, reduced his sentence to 10 years and released him from prison. In May 2005, the Attorney General sought from the county court of appeals a writ of prohibition to compel Judge Marshall to vacate his entries granting Rawlins’s motion for relief from judgment, convicting him of voluntary manslaughter instead of murder, and releasing him from prison. The court of appeals granted the writ, and Rawlins was returned to prison.

On appeal, Rawlins argued that the Attorney General had no standing to seek a writ of prohibition. Ohio’s Attorney General is a constitutional officer, and the Attorney General’s duties are specified by statute. Among other things, Ohio statutes provide: “When required by the governor or the general assembly, the attorney general shall appear for the state in any court or tribunal in a cause in which the state is a party, or in which the state is directly interested.” Rawlins argued that the Attorney General had no standing to seek the writ of prohibition because he had not been asked to do so by the governor or legislature.

The Ohio Supreme Court has held “when these constitutions were adopted (both state and federal), they were adopted with a recognition of established contemporaneous common-law principles; and…they did not repudiate, but cherished, the established common law.” State v. Wing, 66 Ohio St. 407, 420, 64 N.E. 514 (1902). In this case, nothing in the statute abrogates the Attorney General’s common law powers, which would allow him to bring this type of action. Nor did the fact that the local prosecutor did not object preclude the Attorney General from bringing this suit, separate from the prosecution, to prohibit a court from acting where it lacks jurisdiction. Citing the National Association of Attorneys General Powers & Responsibilities book, the court held, “The exercise of this authority under the unique, limited facts of this case is consistent with the common-law powers of the majority of state attorneys general.”

South Carolina–Contingency Fee Contracts Permissible

State v. Eli Lilly, 2007-CP-42-1855 (S.C. Ct. Comm. Pleas 7th Jud. Dist. 2009)

The Attorney General of South Carolina retained private attorneys to pursue a claim against Eli Lilly in connection with its marketing of the drug Zyprexa. The attorneys were hired on a contingency fee basis, under which they would bear all risk of the lawsuit and would receive payment, if any, only if they were successful in the case. The Attorney General retained supervisory authority over the private attorneys. Eli Lilly challenged the state’s retention of counsel on a contingency fee basis on the grounds that it violated the separation of powers in the South Carolina constitution because the legislature did not appropriate funds to pay the private attorneys who were representing the state. Eli Lilly also challenged the arrangement on the grounds that it violated the due process clause of the U.S. and South Carolina constitutions because it gave the state’s counsel a personal financial interest in the outcome of the case.

The court first addressed the due process claim. It rejected the notion that attorneys representing the government must be neutral, “even in the context of litigation against an alleged wrongdoer.” The court cited Marshall v. Jerrico, 446 U.S. 238 (1980) for the proposition that “Prosecutors need not be entirely neutral and detached. In an adversary system, they are necessarily permitted to be zealous in their enforcement of the law.” The court continued,

The lawyers representing the State of South Carolina in civil tort cases, whether in-house or outside counsel, have a duty to represent the State of South Carolina’s interests to the fullest, advocating the State of South Carolina’s position in the litigation brought to vindicate the State of South Carolina’s rights and recover the funds expended because of a private party’s alleged wrongdoing.

The court cited numerous decisions from other states rejecting the argument that government lawyers in a non-judicial role must be neutral, and cited many decisions approving contingency fee arrangements entered into by state governments. The court stated, “[I]f the practice of hiring private lawyers in special cases by States’ Attorneys General was actually unconstitutionally improper, one would have expected that some authoritative court would have definitively ruled that way by now.”

Turning to the separation of powers argument, the court noted that the South Carolina statute specifically authorizes payment of “the costs of litigation” out of litigation proceeds. The only case in which the separation of powers argument was successful was a Louisiana case in which the statute required that “all sums recovered” be paid to the state treasury. The court also determined that Lilly was arguing that the Attorney General might, if Lilly lost, act in a way that violates the separation of powers doctrine. The claim is not yet ripe, according to the court.

Finally, the court addressed Lilly’s allegations that the state’s private counsel should be disqualified because they have violated S.C. Code §08-13-1342, which provides, “No person who has been awarded a contract with the State, a county, a municipality, or a political subdivision thereof, . . . may make a contribution after the awarding of the contract . . .” The court held that because the Supreme Court, rather than the legislature, has authority over attorney ethical rules, the only constitutional way to construe the statute is to conclude that the legislature did not intend it to cover lawyer-client relationships. As a further example of the problem with Lilly’s claim, the court noted that local counsel for Lilly had also made contributions to the Attorney General’s campaign. “A statute which prohibits a government official’s litigation allies from contributing to him, but permits his litigation adversaries to do so, is inordinately unfair.” Finally, the court noted the Attorney General’s broad constitutional and common law powers to retain attorneys to represent the state, and stated, “There are numerous huge differences between retainer agreements between Special Counsel and the Attorney General and commercial contracts between a municipality and its vendors. Supreme Court rules thoroughly regulate the former relationship not the latter.”

Ohio–Attorney General Power to Represent State

State ex rel. Merrill v. State Department of Natural Resources, Case No. 2008-L-007, Ohio Ct. App., 11th App. Dist., 2009

Landowners on the south shore of Lake Erie sued the state, the Ohio Department of Natural Resources (ODNR) and its director, disputing the rights asserted by ODNR to land up to the high-water mark. The Attorney General’s office, representing the state, decided to litigate the case separately from ODNR, and the Attorney General retained outside counsel for ODNR. Before the lower court’s ruling on motions for summary judgment, ODNR filed a response stating that it would “adopt or enforce administrative rules and regulatory policies with the assumption that the lakefront owners’ deeds are presumptively valid.” The court of common pleas ruled that the limit of the territory regulated by ODNR was the water’s edge, wherever that boundary may be at any given time on any given property. The Attorney General appealed that ruling, ODNR did not.

The court of appeals first addressed the standing of the state to participate in the case. The court held that the Attorney General (representing the state) no longer had standing to participate in the case:

The Ohio Attorney General may only act at the behest of the governor, or the General Assembly. R.C. 109.02. In this case, the attorney general represented the state due to the activities of the ODNR, which department is under the authority of the governor, in whom the constitution vests the “supreme executive power.” Section 5, Article III, Ohio Constitution. The governor has ordered ODNR to cease those activities that made it a party to the action. We find no authority for the attorney general to prosecute this matter on his own behalf. We conclude that the state of Ohio no longer has standing in this matter, and order its assignments of error and briefs stricken.

Calling the court of appeals ruling “mistaken and harmful,” the Attorney General has appealed the decision to the Ohio Supreme Court, including the issue of the Attorney General’s standing to continue the suit. Among other issues, the Attorney General noted that the state was a defendant, rather than a plaintiff, in this case, and the court of appeals ruling thus limits the state’s ability to defend itself from suit. The Attorney General also argued that the state’s interests in this case “go far beyond the narrow question of how ODNR should administer its various duties.”

[1]Qualified immunity protects state officers “from liability for civil damages insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known.” Pearson v.Callahan, 129 S. Ct. 808, 815 (2009)

[2]State v. Klattenhoff, 801 P.2d 548 (1990).

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