Schwartz Explains Why AG Outsourcing is Detrimental to Public Interest

Shook, Hardy & Bacon Public Policy Group Chair Victor Schwartz explains why attorneys general outsourcing their role to private law firms is harmful to the public in an August 3 Law360 article, “AG Outsourcing is a Threat to Public Interest.”

Expressing that the fundamental purpose and goals of attorneys general and private lawyers are often in direct opposition to one another, Schwartz explains, “Government imposes checks and balances on attorneys general. They take an oath to uphold the U.S. Constitution and to faithfully discharge the duties of their office.” On the other hand, he states, “private lawyers brought on to do this work have none of these restraints; their goal is simply to obtain a settlement or judgment for as large of an amount as possible. They also have an incentive to pursue information that could potentially spawn more litigation.”

Schwartz illustrates his point by citing a case in which the Attorney General of the Virgin Islands hired “an aggressive class action law firm to go fishing in the Caribbean and pursue a highly controversial lawsuit against Exxon.” The contingency fee firm, he explains, “issued far-reaching subpoenas that included probing into 88 different organizations. This plaintiff lawyer fishing expedition is cloaked in the mantle of government authority. It has caused unjust angst and imposed unfair costs on those served. If successful, the tactic could also chill the freedom of speech of those organizations.”

Noting that 15 states have “enacted laws that shine sunlight on a state attorney general’s outsourcing of power to contingency fee lawyers and place reasonable constraints on such arrangements,” Schwartz states, “The threat to the public interest of delegating government power to self-interested private lawyers is one that has been considered by many thoughtful state legislatures.” He adds, “Many of these laws are supported by state attorneys general themselves.”