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Ol’ Sitemeter Sue whispers that y’all are as interested in this Dickie Scruggs bust as I am, so welcome to folo, new readers! There’s a new Wall Street Journal story on Tim Balducci, Google sez, but since I won’t be able to get at it until later, let’s see what else we can find out this morning . . .

“I feel like I’m sitting on top of a barbed-wire fence,” Dickie Scruggs’ neighbor and client Lyman Cumbest tells the Los Angeles Times, describing his worry that their lawsuit against State Farm may not get the push it’s had previously. He’s got reason to worry, since the bob-war fence Dickie’s sitting on no doubt feels even sharper — so sharp, in fact, that he’s seems to have ditched Mississippian Joey Langston and reached all the way to San Francisco for a lawyer.

But neither John Keker’s big-city persona nor his high legal profile (he prosecuted Ollie North in Iran-Contra, defended Andy Fastow in Enron) explains the utter tone-deafness of his attack on Judge Lackey in the WSJ yesterday: more reason for David Rossmiller to tell LAT that he wonders “whether people would begin reevaluating ‘how this amazingly successful man got to be so amazingly successful.’”

Meanwhile back in Oxford, Zach Scruggs’s lawyer Tony Farese may have a word with the li’l ol’ Oxford Eagle about that photo caption identifying him as an indictee. But make no mistake, the Eagle‘s reporter Alyssa Schnugg has been nailing some good stuff. On Thursday, she and Jonathan Scott reported the Scruggses’ arraignment:

U.S. Attorney Tom Dawson asked [U.S. Magistrate Judge S. Allan] Alexander to set a $5 million bond on the Scruggses, saying they were a flight risk with the family having a home in the Bahamas and owning a private jet.

"These two have access to airplanes that are capable of international flight, " Dawson said. " … Remaining a fugitive is extremely expensive and only those who have the means can do so. "

Attorney Tony Farese … told the judge that his client as well as his father, are by no means, flight risks.

"These men have no intention of fleeing, " Farese said. "And anyone who knows them would know that. They are no more a flight risk to leave this country than they are to go to the moon. "

Alexander grounded the Scruggs’ plane and demanded all three men turn over their passports. Any travel out of Mississippi would have to be approved by the court. The judge did allow the plane to be used for medical reasons with prior permission from the court.

In the end, Alexander ordered Zach Scruggs and Sid Patterson released on $50,000 bonds and Dickie Scruggs on a $100,000 bond, but all three had to put up their homes as collateral.

“If convicted,” Schnugg and Scott write, “Scruggs’ legal downfall will be forever associated with Hurricane Katrina.” They retrace how Dickie, having lost his own home to the hurricane, sued on behalf of hundreds of policyholders whose claims had been denied by insurers, putting together the Scruggs Katrina Group to represent the policyholders against the insurance companies. One of the firms brought into SKG was Jackson’s Jones, Funderburg, Sessums, Peterson & Lee.

After the legal team reached a settlement with State Farm Insurance Cos. in January, 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 Jackson Clarion-Ledger adds that Dickie

has won major league enemies as a result of litigation he filed in the wake of the worst natural disaster in U.S. history, Hurricane Katrina …

That litigation includes secret records obtained by two sisters that he intimates is a “smoking gun” to prove a giant insurance company manipulated engineering reports to deny claims to storm victims and overbill the federal government for flood damage.

A federal judge has found the lawyer in contempt of court for not returning the records copied by the sisters, but he gave them to the state’s attorney general.

Attorney General Jim Hood, in turn, used the records in part to sue the major Katrina insurers for refusing to cover at least $2 billion in damages.

Yesterday, Alyssa Schnugg covered one of the consequences Dickie and the four other lawyers face if convicted:

"Nothing happens until an attorney is convicted of a felony, " [general counsel for the Mississippi Bar Association Adam] Kilgore said Thursday. "If found guilty and we receive a certified copy of the judgment, we file it with the Supreme Court who will in turn suspend the attorney. Once the matter is concluded, that attorney is disbarred. " …

If any attorney is disbarred due to a felony conviction, the Mississippi Rules of Discipline state that they are also barred from applying for reinstatement.

"They are forever barred, " Kilgore said.

In fact, any of them who plead guilty for a lesser sentence will also face disbarment, Kilgore said. And even if they’re found not guilty, their licenses still may not be safe. If someone has filed an ethics complaint against any of them with the Mississippi Bar, it could go to a Committee on Professional Responsibility, which would either dismiss the complaint, publicly reprimand the attorney, or file a formal complaint with the state supreme court. The SCOM would hold a hearing to decide whether to dismiss the matter or impose any of several disciplines, up to and including disbarment. But unless or until the Supremes receive a complaint, it isn’t public record, so no way to know whether one or more Scruggs complaints have been filed yet. (Hard to imagine someone won’t give it a good try, though, isn’t it?)

Of course, if they are convicted, practicing law again may not even be an option if they are in jail. If found guilty on all counts, the men could be sentenced to as many as 75 years in prison and be fined $1,500,000.

But that’s a bridge not to cross yet. According to Alyssa Schnugg, Mississippi criminal court ain’t no rocket docket: cases can “take at least two years before even getting a court date” — so yesterday was back to bidness for both Dickie Scruggs and Judge Lackey.

"The unfortunate events of yesterday do not necessarily mean there’s going to be a change in the team that’s prosecuting (Scruggs’) cases, " said attorney Joey Langston, who represents Scruggs’ firm but isn’t an employee ["prosecuting"? Ewww, Joey, watch your mouth].

"They have invested an enormous amount of time and effort in these cases, " Langston said. "Just because they have to contend with this difficult matter doesn’t mean their clients should suffer from it. "

Scruggs, whose legal team currently represents more than 1,000 policyholders and has roughly 300 active lawsuits against insurers over Katrina damage, was at his Oxford-based office Thursday but declined to comment. …

Lackey, the judge who reported the "bribery overture " to federal authorities, assisted investigators in an "undercover capacity. " He refused to comment on his involvement in the case this morning [ahem, maybe to you, Alyssa, but when the Wall Street Journal comes a-callin' . . . ] because he said he didn’t want to say anything to jeopardize the prosecution’s case or appear to be seeking notoriety. But the judge who has been hailed "a hero " in the last few days said nothing will change for him and he continue to do the job he was elected to do.

"It’s business as usual, " he said. "I have a hearing (in Oxford) next Thursday. " [emph. mine]

Schnugg did find more volubility on some of her phone calls, though. John G. Jones, head of the law-firm plaintiff in the case that generated this mess, told her:

"I am really saddened by this. I hate it, frankly. My firm represented Dickie, his firm and his family for two years in defense of suits filed by other lawyers, and then he asked us to help in the Katrina litigation. I gave the guy two and half years of my law practice, and these guys were my friends — or so I thought. I regret it for their families as well. There are some good people who will suffer greatly because Dick and his gang never learned how to control their greed.

Grady Tollison, Jones’s lawyer, said he was "sickened " over the indictments. "I believe in the system and these men are presumed innocent, " he said. "However, Judge Lackey’s integrity has never been questioned. If he says it, you can bank on it. "

Both Tollison and Jones bemoaned to Schnugg the damage inflicted on the reputation of their profession in Mississippi. “An indictment like this,” Jones said, “if proven true — and I don’t see how they can defend against the truth of the indictment — fulfills every wrong impression and justifies every cynical victim of the justice system, and every prejudice people have ever had about plaintiff lawyers specifically but all lawyers really. "

Schnugg also reached Lyman Cumbest in Pascagoula. "I’m disappointed in " Dickie, he told her. "With all the money he had, he didn’t have to bribe a judge. He’s got more money than he could ever spend. "

Yessirree bob-war, that’s the biggest puzzlement of ‘em all, Mr. Cumbest.

lotus

P.S. If you think your town’s media are crappy, wait’ll you see Meridian’s WTOK.