[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2740 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 2740

          To limit attorneys' fees in the tobacco settlement.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 24, 1997

   Mr. McInnis (for himself, Mr. Cox of California, and Mr. McHale) 
 introduced the following bill; which was referred to the Committee on 
                             the Judiciary

_______________________________________________________________________

                                 A BILL


 
          To limit attorneys' fees in the tobacco settlement.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. FINDINGS.

    Congress makes the following findings:
            (1) Under the proposed settlement between the tobacco 
        industry and the various State Attorneys General, the attorneys 
        involved in negotiating the settlement are entitled to 
        reasonable fees.
            (2) Under the proposed settlement, the tobacco companies 
        would pay $368,500,000,000 to be allocated among various public 
        health programs.
            (3) It is expected that of the total tobacco settlement of 
        $368,500,000,000 as much as $111,000,000,000 could be taken 
        away from public health programs for attorneys' ``contingency 
        fees''.
            (4) Since no national settlement can take effect without 
        Congressional action to change existing law, the approval of 
        Congress is necessary for the terms of the settlement, 
        including the part relating to attorneys' fees, to take effect.
            (5) While the average annual gross receipts for the 100 
        top-grossing law firms in America last year was $18,000,000, a 
        30 percent contingency fee would yield an average of 
        approximately $925,000,000 per law firm involved in the 
        litigation pending prior to the settlement.
            (6) A casual decision at a young age to use tobacco 
        products often leads to addiction, serious disease, and 
        premature death as an adult. Nearly 90 percent of adult smokers 
        began smoking at or before the age of 18. Smoking rates among 
        youngsters are at their highest levels in 16 years. Every day 
        another 3,000 children and adolescents become regular smokers. 
        Therefore, the epidemic of youth addiction has enormous public 
        health consequences.
            (7) While attorneys are entitled to be paid for their time 
        and effort, the maximum possible amount of moneys from any 
        tobacco settlement should go directly to benefit public health, 
        with the highest priority being given to efforts focused on 
        persuading children not to smoke rather than to awards leading 
        to unreasonable attorneys' fees.

SEC. 2. LIMIT ON DIVERSION OF PUBLIC HEALTH FUNDS TO ATTORNEYS.

    (a) General Limitation.--Notwithstanding any other provision of 
law, any attorneys' fees paid in connection with the settlement of an 
action maintained by a State against 1 or more tobacco companies to 
recover tobacco-related medicaid expenditures or for other causes of 
action involved in the settlement agreement dated June 20, 1997, shall 
not exceed $150 per hour, together with reimbursement of actual out-of-
pocket expenses as approved by the court in such action.
    (b) Fee Arrangements.--Subsection (a) shall apply to attorneys' 
fees provided for or in connection with an action of the type described 
in such subsection under any--
            (1) court order;
            (2) settlement agreement;
            (3) contingency fee arrangement;
            (4) arbitration procedure;
            (5) alternative dispute resolution procedure (including 
        mediation); or
            (6) other arrangement providing for the payment of 
        attorneys' fees.
    (c) Requirements.--No award of attorneys' fees shall be made under 
any national tobacco settlement until the attorneys involved have--
            (1) provided to the Congress a detailed time accounting 
        with respect to the work performed in relation to any legal 
        action which is the subject of the settlement or with regard to 
        the settlement itself; and
            (2) made public disclosure of the time accounting under 
        paragraph (1) and any fee arrangements entered into, or fee 
        arrangements made, with respect to any legal action that is the 
        subject of the settlement.
    (d) Effective Date.--The limitation on the payment of attorneys' 
fees contained in this section shall become effective on the date of 
enactment of any Act enacted in connection with the national tobacco 
settlement.
    (e) Report.--Each attorney whose fees are subject to this section 
shall, within 30 days of the date of the enactment of this Act, submit 
to Committees on the Judiciary of the House of Representatives and the 
Senate a comprehensive record of the time and expenses for which the 
fees are to be paid. Such record shall be subject to section 1001(a) of 
title 18, United States Code.
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