More Mississippi Mud on Scruggs' Judicial Fixin' (MORE, CLICK HERE)

The Legal Trail in a Delta Drama
The New York Times By NELSON D. SCHWARTZ - January 20, 2008

OXFORD, MISS. — ON a crisp, sunny morning last week, Mississippi’s political elite gathered in Jackson for a day of celebration. They began with a gospel prayer breakfast before proceeding to the state Capitol to witness the swearing-in of Haley Barbour for a second term as governor.

At the same moment on Tuesday, 170 miles north of Jackson, a very different kind of political theater was unfolding at the federal courthouse here. A former Mississippi state auditor, Steven A. Patterson, stood before a rapt courtroom and pleaded guilty to a charge of conspiracy. Prosecutors said he had worked with Richard Scruggs, arguably the country’s best-known plaintiff’s lawyer, to bribe a local judge to rule in Mr. Scruggs’s favor in a fee battle with another lawyer.

Mr. Patterson’s plea — and his agreement to cooperate with prosecutors — significantly ratchets up the pressure on Mr. Scruggs, who was indicted on federal conspiracy and bribery charges in November.

To make matters worse, one week earlier, a former lawyer for Mr. Scruggs, Joseph C. Langston, pleaded guilty after prosecutors alleged that he had tried to influence a different judge on Mr. Scruggs’s behalf in a separate, earlier dispute with another lawyer over money.

Linking Mr. Scruggs, Mr. Patterson and other figures in the case is an obscure former college football star, farmer and politically well-connected adviser to Mr. Scruggs named Presley L. Blake. At the hearing on Tuesday, prosecutors described Mr. Blake as a key go-between in an elaborate bribery plot, and they are now examining his ties to Mr. Scruggs. No charges have been brought against Mr. Blake.

The story of Mr. Blake, who has received at least $10 million from Mr. Scruggs, threatens to reveal just how Mr. Scruggs worked the political back rooms of Mississippi — and Washington — to win a huge settlement with cigarette makers that garnered him approximately $1 billion in fees as well as a role in “The Insider,” the 1999 movie about the battle with Big Tobacco.

Mr. Scruggs’s connections have never been a secret: his brother-in-law is former Senator Trent Lott, Republican of Mississippi. But the expansion of the investigation is especially significant because for Mr. Scruggs, law and politics have been closely intertwined.

Indeed, prosecutors plan to cite the political influence brought to bear by Mr. Scruggs, who once boasted that lawsuits are “won on the back roads long before the case goes to trial,” when his own trial begins on March 31.

Rather than courtroom victories against the tobacco makers, legal experts say, it was Mr. Scruggs’s ability to put together a coalition of state officials and Washington politicians, while adeptly courting the news media, that ultimately forced cigarette makers to pay up in the landmark $248 billion national settlement.

Mr. Scruggs declined to comment for this article. But his lead defense lawyer, John Keker, says Mr. Scruggs was unaware of any bribery attempts and is completely innocent.

Now, the fate of Mr. Scruggs is being watched closely by advocates of tort reform as well as lawyers and industry leaders, who have all found themselves in his cross hairs over the last two decades. “He stands for the proposition that the halls of justice can become the arena for pressing public policy goals,” says David M. Bernick, a partner at the firm Kirkland & Ellis, who has represented the tobacco industry. “People want to know the reality of how he came to be so influential.”

THE cast of characters in the case against Mr. Scruggs may seem like a tableau of the small-town South — Mr. Patterson, for example, resigned after trying to evade automobile taxes, and was recently criticized by the local bar association when it suggested that he was trying to pass himself off as a lawyer in New Albany, Miss.

While Mr. Patterson has been a well-known political figure in Mississippi for years, his friend and duck-hunting buddy Mr. Blake has kept a much lower profile. Better known as P. L., Mr. Blake has political roots as thick as the soil of the rural Mississippi Delta region, where he grew up along the banks of the Tallahatchie River in Leflore County.

Over the last three decades, he aided the campaigns of some prominent Mississippi politicians, getting out the vote for Mr. Barbour and Mr. Lott, among others, and has retained his political influence despite a bank fraud indictment in the 1980s. Represented in that case by Fred D. Thompson, then a prominent Tennessee lawyer and now a candidate for the Republican presidential nomination, Mr. Blake eventually pleaded no contest to a misdemeanor.

In a 2004 deposition taken in a lawsuit over legal fees that involved many of the same players as the current criminal case, Mr. Scruggs confirmed that he paid Mr. Blake at least $10 million in fees from the tobacco settlement, but precisely what Mr. Blake did to earn that money is now emerging as an important question. In his own deposition in the same lawsuit, Mr. Blake suggested that the money was for collecting newspaper clippings on the tobacco case for Mr. Scruggs.

Michael C. Moore, the former attorney general of Mississippi who worked closely with Mr. Scruggs on the tobacco settlement, says he was “astounded” when he learned of Mr. Blake’s payday. “It doesn’t surprise me that Dick would pay him some money, but it’s hard for me to believe that much money would go to P. L. Blake,” says Mr. Moore.

In interviews, other Mississippi political figures suggest that Mr. Blake has played a key role for Mr. Scruggs over the years. “P. L. essentially has done all the back-room negotiating for Dickie, but you’ll never see his tracks,” says Pete Johnson, a former state auditor who is now co-chairman of the Delta Regional Authority, a federal agency with headquarters in Clarksdale, Miss. Mr. Johnson, who lobbied the Mississippi Legislature on Mr. Scruggs’s behalf when he was gearing up for the tobacco fight, recalls that his first introduction to Mr. Scruggs came through Mr. Blake in the early 1990s.

“He was the outside confidant that Dickie needed,” Mr. Johnson says. “He was the nexus of his political network.”

Mr. Blake, who now lives in the Birmingham, Ala., area, did not return repeated calls to his home there.

Although Mr. Scruggs has known Mr. Blake for more than two decades, the hearing last Tuesday was the first time prosecutors had publicly linked the two. And the role they suggest that he played echoes Mr. Johnson’s description.

On Oct. 16, six weeks before the indictment, Mr. Scruggs met with Mr. Patterson and Timothy R. Balducci, a local lawyer who had represented Mr. Scruggs in several past cases. When they entered Mr. Scruggs’s office on Courthouse Square in Oxford, according to an account presented in court by Robert H. Norman, an assistant United States attorney, Mr. Scruggs stated: “I know y’all have talked to P. L., and I have talked to P. L. Everything’s fine. Y’all are going to be covered.”

Mr. Blake’s name also popped up in an earlier phone call between Mr. Patterson and Mr. Balducci that was taped by investigators. In that conversation, from which prosecutors quoted in court, Mr. Patterson told Mr. Balducci that Mr. Scruggs and Mr. Blake had met and that Mr. Blake “knows it’s going to be 40,” apparently a reference to the $40,000 bribe they are accused of planning to give the judge. In the recording, Mr. Patterson told Mr. Balducci that Mr. Blake was confident that Mr. Scruggs would “take care” of them, adding, “We got your horse sold.”

The state judge, Henry L. Lackey, alerted federal prosecutors in Oxford after he was initially approached by Mr. Balducci last spring, and he worked closely with them during the investigation in the summer and early fall. Like Mr. Patterson, Mr. Balducci has pleaded guilty and has agreed to cooperate with prosecutors. Along with Judge Lackey, both are likely to testify at the trial.

Mr. Norman, and Thomas W. Dawson, the lead prosecutor on this case, declined to discuss Mr. Blake beyond the information presented in court. But lawyers close to the investigation, who asked not to be identified because the investigation was under way, confirm that prosecutors are examining Mr. Blake’s ties with Mr. Scruggs and have already subpoenaed documents from past court battles linking the two men.

UNTIL his name surfaced in the Scruggs case last week, Mr. Blake rarely made the local papers, despite his vaunted political connections. Much of what is known about him is drawn from the depositions in a long-running dispute over asbestos fees that Mr. Langston recently admitted trying to influence, a dispute that now threatens to further complicate Mr. Scruggs’s legal worries.

Mr. Blake first drew public attention four decades ago, as a football star at Mississippi State University. After graduating in 1959, he played professionally in Canada before returning to the Delta to farm, raising catfish and crops while also prospering in grain storage and real estate.

At the same time, Mr. Blake also cultivated political connections, becoming a local political ally of James O. Eastland, a onetime Delta planter who became a Mississippi political legend and served as a United States senator for 36 years before his retirement in 1978. In a 2004 deposition, Mr. Blake said he also had known Senator Lott for 25 to 30 years, stating “I would classify him as a friend.”

Despite these political alliances, Mr. Blake soon ran into a series of legal and financial troubles. In the mid-1980s, he declared bankruptcy and faced foreclosure of his farmland. In 1987, he was indicted on charges that he had paid money to officials of a local bank in order to obtain loans. Although the original six counts were later dismissed, he eventually pleaded guilty to a single misdemeanor charge.

But in a lucky turn of events, Mr. Blake turned to Mr. Scruggs for help in the bankruptcy case. (Mr. Thompson and a Mississippi lawyer, Tommy McWilliams, handled the criminal charges.)

In the 2004 deposition, Mr. Blake recalled that during this time he became “very close friends” with Mr. Scruggs, who in turn lent him $750,000. As Mr. Scruggs’s asbestos caseload increased and settlement proceeds rolled in, he began to rely on Mr. Blake for political advice on how the asbestos litigation was viewed in the Mississippi and Louisiana legislatures.

Mr. Blake was soon consulting on tobacco as well, but here more political expertise was needed than it was for the asbestos claims. Instead of suing companies on behalf of individual plaintiffs, Mr. Scruggs’s novel legal approach called for the state of Mississippi to recover from the tobacco industry a portion of what it had spent treating smoking-related illnesses. After an introduction by Mr. Blake, Mr. Scruggs hired Mr. Johnson, the former state auditor, to lobby Mississippi legislators and shaped a bill to allow him to represent the state; the legislation quickly passed.

By his own account, Mr. Blake simply kept his ear to the ground for Mr. Scruggs while also monitoring press reports. “I got those articles or information or anything else and passed them on to him and gave him my opinions about it because he would always ask,” he explained in a deposition in August 2004.

The work may have been simple, but the rewards were swift. After the settlement with the tobacco industry in 1998, Mr. Blake said, he began to receive quarterly payments of $468,000. Since the fees are expected to be paid out over a two-decade period, Mr. Blake could ultimately receive $50 million.

AT his 2004 deposition, Mr. Langston provided what might be a clearer version of just how Mr. Blake fit into Mr. Scruggs’s operation. “I know that Mr. Blake seemed to be Dick Scruggs’s — his switchboard, I call it, you know. Everybody, not everybody, but a lot of people wanted to be involved with Scruggs on tobacco, and I got the impression that P. L. Blake was kind of a filter for a lot of those people. I also got the impression he was Dick Scruggs’s listening post.”

According to depositions, a $10 million payment to Mr. Blake was funneled to him via the bank account of Mr. Langston, the former lawyer for Mr. Scruggs who pleaded guilty on a separate judicial bribery charge this month.

But Mr. Blake’s contacts weren’t limited to Mississippi or to the South. According to a deposition by Mr. Moore, the former Mississippi attorney general, Mr. Scruggs told him, “Blake would call and provide, usually, political information, especially when we were dealing with Congress.”

Even more impressive, Mr. Moore said, “it seemed that he was talking directly to the tobacco industry or directly to the Republican Party, because every time he gave us information, it was right-on, and we were able to react on it and be ahead of what those guys were doing. So it was pretty valuable.”

Mr. Patterson, whose plea on Tuesday brought Mr. Blake’s name into the limelight, is a longtime friend of Mr. Blake, according to his 2004 deposition. And in a second deposition of Mr. Blake in 2005, which has not been made public but was reviewed by The New York Times, Mr. Blake states that he lent Mr. Patterson “a lot of money.”

“And I have donated to his campaigns,” he added. “Steve is a friend.”

IN court last week and at his office, Mr. Scruggs said he could not comment on the case or on his history with Mr. Blake, adding, “I hope you’ll understand.” Despite the legal threat — he faces a maximum of 75 years if convicted — Mr. Scruggs’s Southern hospitality was in evidence, as he welcomed a reporter to his spacious workplace and inquired into how he liked Oxford.

Like much of the rest of Mississippi, Oxford has a small-town feel. Mr. Scruggs’s office is just a five-minute walk from where F.B.I. agents are examining about 150 recorded conversations while following other leads, including allegations that Mr. Scruggs is connected to an effort to bribe a second state judge. Just as close are the courthouse where Mr. Scruggs will be tried and the Greek Revival bed-and-breakfast where his lead lawyer, Mr. Keker, is staying.

That kind of small-town proximity once benefited Mr. Scruggs enormously. Just down the street, at the University of Mississippi, he first got to know Mr. Moore, as well as Governor Barbour, who was then a fraternity brother of Mr. Scruggs at Sigma Alpha Epsilon.

“The governor doesn’t have a dog in that hunt,” says Pete Smith, Mr. Barbour’s press secretary, of the case against Mr. Scruggs.

At Ole Miss, says Johnny Morgan, another former fraternity brother and college roommate of Mr. Scruggs who is a now a local county supervisor, “he was the one person in the frat I considered beyond reproach.”

“He made sure everybody else was doing the right thing,” Mr. Morgan adds. “Down deep, I know he’s a good person.”

Last Wednesday, one day after Mr. Patterson’s guilty plea in the same courtroom, Mr. Scruggs’s legal team provided the first detailed blueprint for his coming defense. In a pretrial motion, the team argues that the idea to bribe Judge Lackey came not from Mr. Scruggs, but from Judge Lackey himself. “There’s no question that Judge Lackey solicited the monetary bribe after six months of talking to Balducci without any suggestion of a monetary bribe from Balducci,” Mr. Keker says.

He adds that the government did not disclose evidence from the tapes on which Mr. Balducci makes it clear Mr. Scruggs didn’t know of Mr. Balducci’s attempt to bribe Judge Lackey. At the same time, Mr. Keker argued that it was Judge Lackey who was determined to draw Mr. Scruggs’s name into the bribery allegation, despite protestations from Mr. Balducci.

Judge Lackey declined to respond directly to Mr. Keker’s account but said, “It will all come out at trial.”

FOR prosecutors, it will be crucial to link Mr. Scruggs to the actual bribery attempt, which is why proving Mr. Blake’s role as a go-between will take on more significance when the trial begins March 31.

In the deposition four years ago, Mr. Scruggs described Mr. Blake as “a very valuable” resource, who helped him figure out “who might be for me, who might be against me.” When the jury is eventually forced to figure out whether it’s for or against Mr. Scruggs, the word of P. L. Blake might help determine Mr. Scruggs’s fate.