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The New York attorney general’s office is challenging New York Justice Charles E. Ramos’ appointment of counsel in the wake of the office’s refusal to defend the judge’s decision to examine a $625 million fee award to the attorneys for the state’s case against the tobacco industry. In papers filed Monday with New York’s Appellate Division, 1st Department, the attorney general’s office asked for permission to appeal Ramos’ sua sponte Jan. 7 order appointing two lawyers as “independent counsel” for the state and a class consisting of 57 counties and New York City. Citing “adversarial interests” in the $625 million in fees awarded to the six law firms that handled the state’s tobacco case, Justice Ramos appointed Jack Hoffinger of New York’s Hoffinger Stern & Ross and Harvey Fishbein of New York’s Gould, Fishbein, Reimer & Gottfried as counsel because the “interests of the plaintiff-class are not presently represented.” Ramos went on to state in his appointment order that he was invoking his power to appoint independent counsel only after the attorney general’s office had advised him that it would not “represent the class in opposition to the award of fees.” The underlying decision, which is on appeal in the 1st Department, is Ramos’ Oct. 22 ruling that he had jurisdiction to inquire into whether the $625 million fee award was reasonable because the case had been certified as a class action. Ramos reached that result on his own motion and over the opposition of all interested parties, including the tobacco industry, the attorney general’s office and the six firms that received the fees. The named plaintiffs in State v. Philip Morris, 400361/97, are the state and New York Attorney General Eliot L. Spitzer. The suit raised 16 causes of action against the tobacco industry, including a class action raising antitrust claims, which only the attorney general is authorized to bring under General Business Law � 342-b. The class, which was certified before the case was assigned to Justice Ramos, consisted of 57 counties, plus New York City, which covers the remaining five counties in the state. In its motion papers in the 1st Department, the attorney general’s office asserted that it should be permitted to appeal the order appointing counsel because it is based on Ramos’ “apparent desire to secure this Court’s [the 1st Department's] affirmance of his October 22 Order,” which found that he had jurisdiction to conduct an inquiry into the fee award. Reversal is required, the attorney general’s brief asserted, because otherwise “every judge would have the authority to appoint new counsel for a class any time that the representative of the class seeks appellate review of one of that judge’s orders.” In an interview Tuesday, Hoffinger countered that Justice Ramos appointed independent counsel because all the lawyers involved in the case, including the attorney general’s office, were aligned against Ramos. As a consequence, he added, without independent counsel, there was no one available to represent “the interests of the people of the State of New York” on two vital questions: whether Ramos had jurisdiction to review the fee awards, and if he ultimately finds them excessive, whether the state can retain the improperly awarded fees. The attorney general’s brief, which was written by Assistant Solicitor General Sachin S. Pandya, argued that the terms of the national settlement with the tobacco industry bar any such reduction in the fee award from being added to sums that the state would receive. “Despite repeated attempts by all the parties in this case to explain this crucial fact, Justice Ramos still does not appear to understand it,” they wrote in their brief. Hoffinger said in the interview that he disagrees with the attorney general’s analysis of what would happen with any disallowed fees, and added that he would set forth the specifics of his arguments in court papers he will file shortly. The six firms were awarded $625 million in fees after an arbitration held pursuant to the nationwide settlement entered into in November 1998 between the tobacco industry and 46 states. The settlement provided for $208 billion to be paid out to the states as compensation for public expenditures for the treatment of smoking-related illnesses under the Medicaid program and for state employees. New York’s share of the settlement is $25 billion, to be paid over 25 years. Three of the six firms sharing in the fee award are located in New York state: Schneider, Kleinick, Weitz & Damashek, and Sullivan Papain Block McGrath & Cannavo, both with offices in New York City, each received $98.4 million; and Albany-based Thuillez, Ford, Gold & Johnson was awarded $84.3 million. Three national firms were award a total of $343.8 million. They were Ness, Motley, Loadholt, Richardson & Poole in Charleston, S.C., the Scruggs firm in Pascagoula, Miss., and Hagens & Berman of Seattle.

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