Federal Judge: "The justice system made you a rich man, yet you attempted to corrupt it.”

Judge sentences Scruggs to five years
The Oxford Eagle - Alyssa Schnugg, Staff Writer - June 27, 2008

OXFORD, MISSISSIPPI- Richard Scruggs walked into the courtroom with a smile and a handshake for many in the room. His smile quickly faded as U.S. District Senior Judge Neal Biggers Jr. berated the powerful trial attorney for his actions before sentencing him to five years in prison. Scruggs began to cry, and his body shook as he leaned against his attorney John Keker. A chair was brought over for him to sit while Biggers finished sentencing him.  “I couldn’t be more ashamed to be where I am today, to be mixed up in a judicial bribery scheme,” Scruggs said to the court prior to his sentencing. “I disappointed everyone — my wife, my family, my son, my friends ... I deeply regret my conduct ... There’s a scar and a stain on my soul forever.”

Scruggs was charged in November for attempting to bribe Circuit Court Judge Henry Lackey with $40,000 for a favorable ruling in a lawsuit against him. He pleaded guilty to one charge of conspiring to bribe a judge in March. Four others — his son Zach Scruggs, Timothy Balducci, Steven Patterson, and his former law partner Sidney Backstrom — were also charged and have since pleaded guilty. Backstrom’s sentencing was set for 2 this afternoon at the U.S. District Courthouse in Oxford. Biggers spoke to Scruggs for almost 10 minutes, reading parts of the oath lawyers take before becoming a lawyer and calling his crime “one of the worst crimes a lawyer could commit.” “This is very unpleasant for me,” Biggers said. “You not only attempted to bribe the court, but you violated the oath. ... You found out Judge Lackey is not a man to bribe. The justice system made you a rich man, yet you attempted to corrupt it.”

Scruggs was given a $250,000 fine and must report to prison by Aug. 4. He will afterward serve three years of supervised probation. Keker asked Biggers to recommend Scruggs serve his time at the Federal Prison Camp in Pensacola, Fla., since they have family there and it would make it easier for Scruggs’ wife, Diane, to visit him. Biggers obliged.  “Best of luck to you,” were Biggers’ final words to Scruggs. Part of Scruggs’ plea agreement he signed in March capped the possible prison sentence at 60 months. Backstrom is expected to receive a 30-month sentence, since his plea agreement stated he could receive up to half of whatever sentence Scruggs received. The younger Scruggs is set for sentencing on July 2. Balducci and Patterson have not yet received sentencing dates.

End of a career

After establishing his small practice in Pascagoula, Scruggs gained national attention for earning millions of dollars from asbestos litigation and for his role in a multibillion-dollar settlement with tobacco companies in the mid-1990s. His meteoric rise in the legal profession and his sudden wealth was a story that could have been scripted by Hollywood — a fact emphasized when his case against the tobacco companies was made a central part of the 1999 movie “The Insider,” starring Al Pacino and Russell Crowe. An actor portrayed Scruggs in the movie, and some scenes were filmed at Scruggs’ home in Pascagoula. Scruggs, whose brother-in-law is former U.S. Sen. Trent Lott, moved his home and his practice from the Gulf Coast to Oxford about three years ago. He invested hundreds of thousands of dollars in renovations to his office over looking the Square and in the new home he is building around the corner from William Faulkner’s Rowan Oak.

Scruggs sued State Farm Insurance on behalf of hundreds of policyholders whose claims had been denied by insurance companies after their homes were destroyed in Hurricane Katrina. Scruggs put together a legal team, called the Scruggs Katrina Group, to represent the policyholders in the court battle against the insurance companies. One of the firms brought in to work with Scruggs was Jones, Funderburg, Sessums, Peterson & Lee, a law firm based in Jackson.

After the legal team reached a settlement with State Farm Insurance Cos. in January 2007, a dispute over how the $26.5 million in legal fees would be distributed to the firms erupted between the Jones law firm and the other members of the Scruggs Katrina Group. The Jones firm was kicked out of the legal team and, after attempts to resolve the compensation dispute failed, the Jones firm took the unusual step of filing a lawsuit against the other members of the legal team. The Jones firm, led by attorney John G. Jones, filed a civil lawsuit, Jones, et all. v. Scruggs, et al, in the Lafayette County Circuit Court in March 2007. The Jackson firm hired the Tollison Law Firm in Oxford to represent them in the litigation. That’s when Scruggs and the other four men indicted in November 2007 allegedly hatched a plan to bribe Lackey to issue a ruling in this legal dispute in their favor, according to the indictment.

Not over yet

Scruggs is still being investigated in the alleged attempted bribing of Hinds County Court Judge Bobby DeLaughter.  According to court records, Scruggs used his influence with Lott to dangle the possibility of a federal judge appointment in front of DeLaughter if he ruled favorably in a lawsuit against Scruggs — Wilson v. Scruggs. Attorney Joey Langston has been indicted in that case and has pleaded guilty. He is awaiting sentencing. No other charges have been filed in that case thus far.