Gov. Bobby Jindal has inserted income from the privatization of public agencies that weren’t yet privatized in order to make the numbers in his Executive Budget more palatable to legislators.
He has included revenue from the sale of state buildings that were not yet sold—indeed, some of which came back with appraisals far below his projected sale price—in order to make that budget more realistic.
To be sure, he caught considerable flak from those fiscal hawks in the legislature for his repeated use of one-time money for recurring expenses—something by the way, he was openly critical of and which he vowed never to do during his 2007 gubernatorial campaign.
Now LouisianaVoice has learned that Jindal has apparently attempted to execute an end run around state contract attorneys and the attorney general’s office in an attempt to negotiate a settlement of an outstanding judgment in favor of the state against a major pharmaceutical company.
It should be noted here that any negotiations between parties in any litigation without involving attorneys would be considered a breach in legal ethics.
The object of Jindal’s efforts is to generate a quick up front settlement of $50 million in order that he might plug holes in the upcoming annual ritual of mid-year adjustments to the state budget, one observer said.
Fifty million? Pretty good windfall for the state, wouldn’t you say?
Not necessarily—not when you consider that the amount of the original judgment was $257 million.
That’s correct. Two hundred fifty million dollars. Plus $3 million in costs, plus another $70 million in attorney fees.
Attorney fees? Didn’t we say the attorney general’s office was involved in the litigation?
Well, yes, then-Attorney General Charles Foti initiated the lawsuit way back in 2004 in 27th Judicial District Court in St. Landry Parish but heavy hitters were needed in this matter so several outside firms were contracted to steer the litigation through the courts. Those included the firms of Kenneth DeJean of Lafayette, Robert Salim of Natchitoches and Bailey, Perrin & Bailey and Fibich, Hampton, both of Houston.
On the other side of the ball were lawyers from the firms of Irwin, Fritchie, Urquhart & Moore of New Orleans, Guglielmo, Lopez & Tuttle of Opelousas, Drinker, Biddle & Reath of Florham Park, N.J., and O’Melveny & Myers of Washington, D.C.
After six years of legal back and forth sparring, discovery, depositions and various other means of keeping attorneys’ meters running the matter finally went to trial Sept 28-30 and Oct. 12 and 14, 2010. When the dust had settled, the jury made a determination that the “aggressive marketing campaigns” of Janssen Pharmaceutical, a Johnson & Johnson company, had violated the Louisiana Medical Assistance Programs Integrity Law (MAPIL) no fewer than a whopping 35,542 times with each violation subject to a civil penalty of $7,250, bringing the total damages to $257,679,500.
(Don’t ask us what “aggressive marketing campaigns” were employed by Janssen or how they violated the state’s MAPIL; we’re not privy to that information. All we know is what we read in the Third Circuit Court of Appeal’s affirmation.)
Janssen, of course, appealed the award as anyone might expect, but the Third Circuit upheld the lower court judgment and Janssen has applied for writs to the Louisiana Supreme Court where the matter is now pending.
Nine years of judicial interest (6 percent per year in simple interest) brings the current total judgment to just a shade under $400 million.
So now we have Jindal who, in typical fashion, is attempting to patch anticipated budget holes with $50 million in one-time money—all the while throwing the state under the bus to the tune of nearly $350 million.
Several legal experts knowledgeable about the case say the State Supreme Court could conceivably reduce the attorney fees but that there is little chance that the $257 million award ($400 million with interest, remember) will be overturned—a fact that would make Jindal’s tactics even more underhanded.
And were it not for Attorney General James “Buddy” Caldwell, Jindal’s efforts may have succeeded, according to sources who told LouisianaVoice that Caldwell stepped in and shut down the negotiations.
Neither Caldwell nor this top assistant, Trey Phillips, returned telephone calls seeking comments on the matter.
Attempts were likewise made to contact several of the plaintiff attorneys who argued the case on the state’s behalf but all such attempts failed.
Any such settlement would necessarily negatively impact attorneys’ fees. Accordingly, it would be reasonable to expect a maelstrom of protests from the attorneys under contract to the state if they were aware of Jindal’s efforts.
LouisianaVoice also emailed Gov. Jindal’s office for a comment but received no response.
One person who did comment was Public Service Commissioner Foster Campbell of Elm Grove in Bossier Parish.
“I was not aware of this,” he said, “but I certainly am not surprised. This is typical of this governor. He has complete and total contempt for the people of this state. It’s all about what he can do for little Bobby. He’s trying to settle this for about 13 cents on the dollar just so he can patch his budget deficit, the state be damned.”
Neither Johnson & Johnson nor Janssen has made any campaign contributions to Jindal since 2003 but six pharmaceutical companies contributed $34,500 to his campaigns in 2007 and 2008. One of those, Pfizer, Inc., of New York City, gave $15,000 in three separate contributions of $5,000 each while Pharmaceutical Research and Manufacturers of America in Washington, D.C., made two contributions of $5,000 each in 2007 and 2008.
State campaign finance records also show that pharmaceutical companies contributed more than $400,000 to candidates for state offices, mostly legislators, since 2003. Those contributions were for both Republican and Democratic candidates. Again, it was Pfizer ($170,000) and Pharmaceutical Research and Manufacturers ($150,000) that reported the bulk of those contributions.
Other contributors included Takeda Pharmaceuticals of Deerfield, IL, and Novartis Pharmaceuticals of East Hanover, N.J.
Louisiana Voice 
I wonder if somebody start a petition to vote him out office how long it will take to get enough signatures… GISsssh I’m so sick of him!!
Sent from my iPhone
Recall effort already fell way short. Recalls are virtually impossible.
They failed because they were not organized. People wanted to sign, but did not know where to go to sign.
It’s not so much that they weren’t organized but that the recalls were started by active teachers and some of them were intimidated into not signing the petitions in fear for their jobs. There were also some being sent around by endangered state employees. The time frame is so short and the requirements for the petitions so exacting that it is difficult to get them finished and sent in on time.
Impeachment would be more straightforward but we have had at least 3 Democrats to switch parties in the past few weeks thinking they are more likely to get elected to higher office as Republicans and creating a supermajority, so you know they are not likely to cooperate even if Jindal performed a human sacrifice in the legislative chamber.
I wonder if it would be possible to change the election laws so that an elected politician who switched parties during their term had to resign and run again in their new party based on the fact that they no longer represent their constituency.
That would be a great idea. I’ve always become angry and felt the same way twinkie1cat, when they changed parties in mid-term, whether it be local, state or national level. That would be the way to go, but how many of the politicians would vote for that?? Surely, not in Louisiana. Great thought, though.
Wasn’t he just re-elected last fall? Do we really have three more years to endure? And how much more of this can the state stand? He is one fast-talking con man and totally without any sense of ethics or morality.
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Time flies, even when enduring Jindal. He was re-elected in the fall of 2011. It was Obama who was re-elected last fall.
QUESTION: Wouldn’t the state be “caught on the hook” for the legal fees if an out of court settlement were reach? If so, the $50 million settlement wouldn’t be enough to cover the legal fees.
The attorney fees conceivably would be reduced proportionately. Also, bear in mind that the attorney fees are not part of the settlement amount; they would be separate and apart.
P.S. this is reminiscent of the tobacco bond refinancing where the state lost over $60 million dollars in anticipated savings/revenue. One can’t help but wonder if these losing “deals” are disguises/covers/camouflage designed to financially reward Jindal’s supporters. Much of Jindal’s actions point in just such a direction.
Wow! Maybe we ought to use Buddy Caldwell instead of Jimmy Faircloth to represent the state’s legal maneuvers more often. After all, as State attorney General he was elected to do just that and he is already on the payroll. All kidding aside, I am happy to see Caldwell do this rather than turning a blind eye as he usually does when Jindal gets the urge to circumvent the law which is becoming the norm for his administration.
Faircloth is a contract attorney for Caldwell!!
This mind boggling! This explains why Jindal won’t grant any interviews. Can someone tell me when is the last time Jindal granted a open question and answer interview so anyone might ask him a question? If this is proven to be what he was trying to pull off there has to be a way to call him out on this and be held accountable!!
Mr. Aswell,
You can delete this comment if necessary or even ban me from further commenting if this is offensive.
However, I don’t see any explanation other than the suit was against Big Pharma and Booby IS a member of the elephant gang. We all know that gang had long ago sold out to big money, yes the donkey gang has done so recently as well. OK, we have a Republican governor and the state is winning a law suit against big money, it follows that this governor would do all he could to lessen the “burden” against his pals of the big money class. As to his hind end covering of his budget shortage or in expectation of future campaign contributions or, failing any higher office, a nice cushy job as a senior VP of some big money firm/corporation. See? It actually does add up. He is feathering his own nest. Typical of nearly all US politicians in old (not so old really) ‘Merica of 2013. I wish I did not think along this line, but, anybody have a better idea as to why this seems to be the case?
Again, Mr. Aswell, delete this if I offended any, even banish me if that is deemed best for your site, I will understand, I know I can be very offensive and off base often.
Thank you for this web site and all that you do to keep us informed and educated about the devious state politicians. You ARE a real treasure sir.
I would never think of deleting such a rational observation nor would I ever banish its author. In fact, I make it a policy to open comments to all so long as they are not vulgar, racial, sexist, homophobic or libelous. I hope that cover everything.
To add insult to injury please read the following. Don’t get me wrong I’m all for helping out our youth have a safe place to play sports. But when you’re cutting millions of dollars from the sick and disabled of our state you would think our so called Governor would have better sense then to drop more than a cool million on a football field where the Mannings hold their football camp every year. Don’t get me wrong I have nothing against the Mannings but the Mannings could use $100.00 bills for toilet paper the rest if there lives and never even notice a dip in there nest egg. So please read the following and see what you think!!
http://theadvocate.com/sports/6497623-32/jindal-announces-funding-plan-for
http://www.houmatoday.com/article/20130712/ARTICLES/130719836
There certainly has to be more to this than meets the eye and your ideas would certainly seem a reasonable explanation. Since the Jindal administration has apparently erected a Chinese firewall between itself and the public it “serves,” we may never know the real reasons, but settling a suit this big that has been fully litigated for pennies on the dollar is patently ridiculous and a clear betrayal of the public trust.
Who will stop this egotistical maniac from completely destroying our state? He breaks laws with impunity, he fires anyone who refuses to comply with his plans whether said plans are legal or not, he simply ignores court rulings that have repeatedly declared his actions unconstitutional, & he continues to pillage public funds from every govt. department that he can access. Meanwhile, all of the local mainstream news media (including public TV) continues to be mute or even supportive of him & instead of reporting these issues of vital interest, their “news” consists of 15 teases about the top story coming at 10 o’clock, the latest murder, funeral or memorial, & viral you tube clips. When will the public at large wake up to what is happening? When will a majority of the powerful in government & the legislature decide that enough is enough?
This is to support and agree with the views expressed by “bear47” above.
http://theadvocate.com/home/6608447-125/drug-maker-agrees-to-45
“… Wade Shows, said the $45 million for Louisiana is part of a $229 million settlement with seven other states. Louisiana received more money from GSK than any of those states, he told state District Judge Janice Clark.”
Is the above a different case altogether?
Entirely different. Different company (Janssen as opposed to GlaxoSmithKline) and different award ($257 million versus $45 million).
Oh WOW … and thanks again for the great reporting.
Just saw on nola.com that Caldwell is trumpeting the 45 million settlement.
http://www.nola.com/health/index.ssf/2013/07/louisiana_reaches_45_million_s.html#incart_river_default
OOPS JR seems to be in a lot of trouble. Tom’s story today was preceded yesterday by seven negative stories that didn’t help our beleaguered Governor’s quest to scramble to the top of the heap of Republican national politics. The polling story which reported him dead last of nine candidates in the Republican Presidential Primary didn’t do him any good. C B Forgotston’s JINDAL IS WRECKING LOUISIANA pummeled dastardly Bob on the way down. WWL’s story on Jindal’s whining about the Levee Board’s lawsuit against the oil companies for damages to our coastal wetlands didn’t make any friends (that he didn’t already have) for Pyush, either. John Maginnis’ powerful story about Jindal’s chummy Tax commissioners spared poor Pyush no bruises, and the continuing Jindal travelogue of his new Colorado scouting trip must have raised the bile to Bobby’s bitter lips.
The great guns are thundering and they seem to have a common destiny, fortress Jindal. Take cover, Bob or your obit will be soon writ. Having failed for the Presidency, you can wrestle Dick Cheney to become the prince of hell.
OOPS!
I would have to have a degree in Biology from Brown University in order to understand the boy genius who wants to be king/president; and dumb me got a degree in business from a Louisiana University instead.
Unfortunately the State Workers are the Jews of the times with Jindal blaming them for all that is wrong with the State.
I agree with you that Jindal has blamed all of the States woes on the State workers . My Wife just so happenes to be in that number. DHH and all other departments that Jindal has privatized took a tremendous hit with their sick time alone!! The workers who showed up for work every day for years have lost every hour they had earned.
Although I agree with you as state workers took the brunt of his wrath, I hardly believe what has been done to the state workers is in no way on the level of the inhumane treatment the Jews suffered at the hands of Hitler.
Thank God we where all on the same side against Hitler. Here we have lots of the people we elected, working against us, whether poor, sick, invalids, helpless, etc., so there is little that can be done to fix the situation! Livelihoods have been lost, people are without jobs, little has been accomplished by the people we have put in charge and now we have Halliburton that has destroyed evidence, where will it end? We may not be Jews, but the treatment we are receiving is problematic and no relief in sight. Be sure the Allies are not going to come save or rescue us from the hands of the devil himself! All we can do is wait.
Thank you for your prayers, dlubrano8!
I am one of those former state workers who needed just 4 more years to retire! Always believe, “what goes around comes around”, and “what goes up, must come down”! My prayers extend to you and your family! My heart goes out to all state workers who have been harassed, intimidated, and discriminated against because they stood up to the wiles of misguided government!
Let’s not let the Legislators off the hook. I would like to say that they are the worst in the nation but they still might be better than Texas, South and North Carolina, and Wisconsin. But that’s damning with faint praise. Diogenes will still not shine a light on an honest one if ever he strolls through the Senate and Representative’s chambers. Were they men and women of integrity they would have long ago wrested power away from the petty tyrant in the Governor’s Mansion that wants to be king. And then set about to govern in the manner that was envisioned for our nation.
I strongly believe there is strength in numbers. We are the ones who put these people in office. We should yell loud enough for every state in this country to hear the truth about what damage Jindal has done to our State!
It is not by accident but by design that Jindal does not speak to the press openly—where embarrassing questions may be asked.
I can not thank Mr. Aswell enough for his tireless work in keeping the people if this state informed.