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ACT No. 796
Regular Session, 2014
HOUSE BILL NO. 799
BY REPRESENTATIVE STUART BISHOP
AN ACT1
To amend and reenact R.S. 42:262 and R.S. 49:259(A) and (C), relative to legal2
representation of state entities; to prohibit the state entities from retaining any special3
attorney or counsel on a contingency fee basis in the absence of express statutory4
authority; to provide that attorney fees recovered by the state belong to the state; to5
provide for the deposit and use of attorney fees recovered by the state into the6
Department of Justice Legal Support Fund; to provide for record-keeping and hourly7
rates of a special attorney or counsel representing the state; to require certain entities8
to obtain approval prior to employment of any special attorney or counsel; to provide9
for certain requirements relative to the contract, application and resolution; to10
provide for exceptions; to provide for a preference in hiring certain attorneys; to11
provide transparency relative to approval and ratification of a contract by the12
attorney general and governor; to provide for prospective application; and to provide13
for related matters.14
Be it enacted by the Legislature of Louisiana:15
Section 1. R.S. 42:262 is hereby amended and reenacted to read as follows:16
§262. Special attorneys attorney or counsel17
A. In the event that the attorney general, or any state agency, board or18
commission, not including any public postsecondary education institution, is19
represented by a special attorney or counsel, the special attorney or counsel shall not20
be compensated for such representation on a contingency fee or percentage basis in21
the absence of express statutory authority, including R.S. 17:100.10, R.S. 23:1669,22
R.S. 37:2153, R.S. 41:724 and 922, R.S. 42:1157.3, R.S. 46:15, R.S. 47:1512,23
1515.3, 1516, 1516.1, and 1676. In retaining a special attorney or counsel,24 ENROLLEDHB NO. 799
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preference shall be given to private attorneys licensed to practice law in this state and1
law firms domiciled and licensed in this state.2
B. Any recovery or award of attorney fees, including settlement, in litigation3
involving the attorney general or any state agency, board, or commission, not4
including any public postsecondary education institution, belongs to the state and5
shall be deposited into the state treasury into the Department of Justice Legal6
Support Fund in accordance with R.S. 49:259. No payment of attorney fees shall be7
made out of state funds in the absence of express statutory authority, including R.S.8
17:100.10, R.S. 23:1669, R.S. 37:2153, R.S. 41:724 and 922, R.S. 42:1157.3, R.S.9
46:15, R.S. 47:1512, 1515.3, 1516, 1516.1, and 1676, except such payment of10
attorney fees as may be approved by the Joint Legislative Committee on the Budget11
during the interim between legislative sessions.12
C. Any special attorney or counsel retained or employed by the attorney13
general, or any state agency, board, or commission, not including any public14
postsecondary education institution, shall not accept nor demand as payment for the15
services rendered by the special attorney or counsel anything of economic value from16
any third party.17
D. All contracts with any special attorney or counsel shall require the18
keeping of accurate records of the hours worked and the expenses incurred in the19
representation of the public entity. In no case shall the attorney general, or any state20
agency, board, or commission, not including any public postsecondary education21
institution, incur fees in excess of five hundred dollars per hour for legal services.22
In the event of a settlement or final judgment which would result in an award of23
attorney fees in excess of five hundred dollars per hour, the fee amount shall be24
reduced to an amount equivalent to five hundred dollars per hour, or the maximum25
rate approved by the Attorney Fee Review Board, whichever is greater.26
E. The provisions of this Section shall not apply to attorneys or counsel27
retained pursuant to R.S. 39:1533(B) and R.S. 49:258 for purposes of defending the28
state, its agencies and its employees in tort litigation or other matters involving the29
Self-Insurance Fund as established in R.S. 39:1533.30 ENROLLEDHB NO. 799
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F. To the extent not otherwise prohibited by Subsections A, B, C, and D of1
this Section, the following provisions additionally apply to the retainer of any special2
attorney or counsel:3
(1) In the event it should be necessary to protect the public interest, for any4
state board or commission to retain or employ any special attorney or counsel to5
represent it in any special matter for which services any compensation is to be paid6
by it, the board or commission may retain or employ such special attorney or counsel7
solely on written approval of the governor and the Attorney General attorney general8
and pay only such compensation as the governor and the Attorney General attorney9
general may designate or approve in the written approval. The approval shall be10
given in their discretion upon the application of the board or commission by a11
resolution thereof setting forth fully the reasons for the proposed retention or12
employment of the special attorney or counsel and the amount of the proposed13
compensation.14
(2) The applicant shall include in its application all of the following:15
(a) A resolution that includes all of the following:16
(i) A statement showing that a real necessity exists.17
(ii) A statement fully providing the reasons for the action.18
(iii) A statement of the total compensation to be paid.19
(iv) The statutory authority for the contingency fee if the contract contains20
such a fee.21
(b) A copy of the proposed contract described in the resolution.22
(3) The governor and Attorney General attorney general shall not ratify or23
approve any action of a board, or commission, not including any public24
postsecondary education institution, in employing any special attorney or counsel or25
paying any compensation for special service rendered, unless all the formalities as26
provided by this Part as to resolutions and the like, have been complied with.27
Section have been complied with or if any of the following apply:28 ENROLLEDHB NO. 799
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(a) The terms of the resolution do not match the required terms of the1
contract.2
(b) The need is not sufficiently shown in the resolution.3
(c) The fee is unreasonable.4
(d) The governor or attorney general determines there is a valid reason not5
to ratify or approve the action.6
(4) The governor or attorney general shall respond to the application in7
writing by giving approval or rejection with reasons.8
G. The provisions of this Section shall not apply to any legal fees or attorney9
compensation made in connection with the issuance of bonds, notes, or other10
issuances of indebtedness when such legal fees or attorney compensation are11
approved by the State Bond Commission pursuant to R.S. 39:1405.4.12
Section 2. R.S. 49:259(A) and (C) are hereby amended and reenacted to read as13
follows:14
§259. Department of Justice Legal Support Fund15
A. There is hereby established in the state treasury a special fund to be16
known as the Department of Justice Legal Support Fund, hereinafter referred to as17
the "fund". The fund shall be comprised of a portion of proceeds recovered by the18
attorney general on behalf of the state from court judgments, settlements, fines, fees,19
forfeitures and penalties, from the recovery or award of any attorney fees as provided20
in R.S. 42:262, or from proceeds recovered by the attorney general from any other21
source from which revenues are designated by the attorney general for deposit into22
the fund, except those judgments and recoveries made on or pertaining to any office23
of risk management litigation or litigation involving the Department of Natural24
Resources and the Department of Environmental Quality as provided in Subsection25
ED of this Section.26
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C.(1) The monies in the fund shall be annually appropriated to the1
Department of Justice solely for the purposes of defraying the costs of expert2
witnesses, consultants, contract legal counsel, technology, specialized employee3
training and education, and public education initiatives. Monies in the fund may also4
be used to defray the expense of employees hired, including attorneys and support5
staff, and to pay related expenses to represent the state. Monies appropriated from6
the fund shall be used to supplement the Department of Justice budget and shall in7
no way be used to displace, replace, or supplant appropriations from the state general8
fund for operations of the Department of Justice below the level of state general fund9
appropriations for that department in the current fiscal year.10
(2) No employee salary or wages or other expenses, to be paid from the11
recovery or award of any attorney fees as provided in R.S. 42:262 shall be paid by12
the Department of Justice, until funding is approved by the Joint Legislative13
Committee on the Budget.14
(3) Each fiscal year, monies shall be deposited into the fund in an amount15
sufficient to bring the unencumbered balance in the fund to ten million dollars. 16
* * *17
Section 3. The provisions of this Act shall have prospective application only and18
shall not apply to contracts existing prior to the effective date of all sections of this Act nor19
shall this Act apply to subsequent renewals of those contracts.20
Section 4. The treasurer shall immediately notify the president of the Senate, the21
speaker of the House of Representatives, the attorney general, and the Joint Legislative22
Committee on the Budget when the balance in the Department of Justice Legal Support Fund23
reaches an amount which exceeds the Fiscal Year 2013-2014 balance by Two Million One24
Hundred Thousand Dollars. Upon such notification, the provisions of R.S. 42:262(B) and25
(C) as provided in Section 1 of this Act shall become effective.26
Section 5. The provisions of R.S. 42:262(A), (D), and (E) as provided in Section 127
of this Act, and Sections 2, 3, 4, and 5 of this Act shall become effective upon signature by28
the governor or, if not signed by the governor, upon expiration of the time for bills to29 ENROLLEDHB NO. 799
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become law without signature by the governor, as provided by Article III, Section 18 of the1
Constitution of Louisiana. If vetoed by the governor and subsequently approved by the2
legislature, R.S. 42:262(A), (D), and (E) as provided in Section 1 of this Act, and Sections3
2, 3, 4, and 5 of this Act shall become effective on the day following such approval.4
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: