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Portion of Tobacco Settlement Fees Go to S.D. Firms

Portion of Tobacco Settlement Fees Go to S.D. Firms

David Sherman Earns Top Prosecutor Title

LAW by Rene’e Beasley Jones, Staff Writer

Two San Diego law firms are among the 60 or so to divvy $1.25 billion in fees from the national tobacco settlement.

The local firms are Casey, Gerry, Reed & Schenk LLP and Dougherty Hildre Dudek & Haklar. They represent two of only four in California , the others are in Los Angeles and Newport Beach , to share the award.

The case netted California $25 billion to be paid over a 25-year period. In 1998, the tobacco industry settled with 46 states that received a total of $206 billion.

David Casey Jr., senior partner at Casey, Gerry declined to disclose how much of the $1.25 billion his firm would receive. A national arbitration panel, created as part of the settlement, decided how much law firms would receive.

According to a July 15 Los Angeles Times article, “no firm would get more than 10 percent of the total , meaning $125 million would be the top share.”

The Civil Justice Association of California is one organization speaking out against such large awards, saying they encourage predatory lawsuits.

” It turns out (attorneys) are making an obscene $3,125 an hour,” John Sullivan, CJAC president, said of the tobacco settlement legal fees.

Casey, who has lost friends to lung cancer, sees things differently.

“The tobacco industry was paying $500 million a year to its lawyers to defend these cases, and this award is going to be paid out over 27 to 28 years and shared among 63 firms,” he said.

Casey pointed out the now-famous case’s accomplishments.

For one thing, it stopped the tobacco industry from targeting children in its advertising. And the attorneys’ fees , which tobacco companies pay separately from the states’ awards , and settlements paid to states drive up the cost of cigarettes.

“The single biggest reason people don’t smoke is the higher cost of cigarettes,” Casey said.

Fewer smokers is a good thing.

The lawsuit started in 1994. Casey, Gerry was invited to participate in 1996.

The group of 60 or so firms from across the nation became known as the “Castano group,” Casey said. The name came from Peter Castano, a 47-year-old man who died of cancer in 1993 after spending 31 years of his life addicted to cigarettes.

Castano’s best friend was a civil lawyer , the late Wendell Gautier of New Orleans.

Gautier knew the tobacco industry financially clobbered every lawyer who ever took it to task.

“One or two firms taking the risk would have been suicidal,” Casey said.

However, Gautier reasoned a large group of lawyers from world-class firms sharing the risk might stand a chance.

“This was probably the riskiest litigation imaginable,” Casey said. “Nobody prior to this litigation had ever succeeded against the tobacco industry.”

When Casey signed on, he never dreamed the case would become such a landmark suit.

He thought the litigation would never be resolved. The turning point came, he said, when the Castano group discovered documents that proved the tobacco industry targeted children in ads.

Casey remains proud of the work his firm did in the lawsuit.

“Hundreds of thousands of children will not be targeted and won’t smoke thanks to this litigation,” he said.

Lawyers from Doughtery, Hildre, Dudek & Haklar were not available for comment.

– – –

Prosecutor Of The Year: David Sherman earned the title of 2001 Prosecutor of the Year in the San Diego City Attorney’s Office.

Sherman is the supervising trial deputy in the criminal division. He began his career with the City Attorney’s Office in 1999 and has successfully tried cases including manslaughter, hate crimes, grand theft and embezzlement.

– – –

Appointments: The San Diego County Bar Association reappointed attorneys Mauricio Flores, Russ Rasmussen, Jan Stiglitz and Tom Warwick to the Legal Aid Society of San Diego, Inc.’s board of directors.

They will serve another three-year term.

Flores is a founding partner of Campbell & Flores of San Diego. Rasmussen is a founding partner of Rasmussen & Styers of San Diego.

Stiglitz teaches at California Western School of Law.

Warwick is a partner at Grimes & Warwick of San Diego.

The deadline for the next law column is Aug. 2. Beasley Jones can be reached at (858) 277-6359, Ext. 109, or via e-mail at

rbeasley@sdbj.com.

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