Angelos settles suit over tobacco fees

Boston expert sought share of money from Maryland settlement

February 25, 2003|By Scott Shane | Scott Shane,SUN STAFF

Baltimore attorney Peter G. Angelos has settled a lawsuit filed by a Boston tobacco litigation expert seeking a share of the $150 million fee Angelos' law firm earned for handling Maryland's lawsuit against the tobacco industry.

Richard A. Daynard, a law professor at Northeastern University and founder of the Tobacco Products Liability Project, had sought 5 percent of Angelos' fee for consulting work Daynard did for Angelos on the state's lawsuit. That would have come to $7.5 million.

Angelos, the Orioles' majority owner and one of the state's leading plaintiff's attorneys, had offered 2 percent, or $3 million.

The two sides confirmed the settlement yesterday, just before the case was to go to trial in U.S. District Court in Baltimore. They said they had agreed to keep the amount confidential.

A similar claim against Angelos by a New Jersey tobacco litigator, Marc Z. Edell, was settled last summer for an undisclosed sum.

The resolution of Daynard's fee claim apparently marks the end of a chain of litigation set off in Maryland by the national tobacco settlement of November 1998, which awarded the state about $4 billion over 25 years.

Maryland Attorney General J. Joseph Curran Jr. hired private counsel to sue Angelos in an effort to force him to collect his fee from the tobacco industry under an arbitration plan so that the fee would not come out of Maryland's money.

Angelos said he had no obligation to collect his fee from the industry and demanded that the state pay him the 25 percent fee called for in a contract that Curran and former Gov. Parris N. Glendening had signed. That fee would have been about $1 billion.

In March, after fighting in court and in the state bureaucracy for more than two years, the two sides agreed on a fee of $150 million, to be paid over five years. Most of that sum is being paid by the tobacco industry.

The claims by Edell and Daynard remained. Both had national reputations as pioneers of lawsuits against cigarette makers, and Angelos brought them in to strengthen his firm's position as it competed with other law firms to handle the state's planned tobacco lawsuit in 1995.

Angelos paid both lawyers substantial amounts in hourly fees, but they said he had also promised them a percentage of the fee his firm received. Neither received such a promise in writing.

C. Christopher Brown, an attorney for Daynard, said that might be the lesson.

"Here are all these lawyers making deals, and nobody wrote anything down," he said. "It's nice to live in a world where you can make an agreement with just a handshake. But I guess this shows that's not enough."

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