State’s attorneys Of the state's $20 million legal settlement with five oil companies, just under $4.4 million will go to the attorneys who have fought the state's case for the past three years, according to federal court documents. The state keeps the rest.
to pocket $4.4 million
of oil settlement
The leftover money is likely to go
to the state highway fund rather
than to isle consumersBy Tim Ruel
truel@starbulletin.comThe San Francisco law firm hired to argue the case, Hosie Frost Large & McArthur, receives 22 percent of any settlement for its fees, after expenses are deducted, under a contract with the Attorney General's Office. The firm, hired on a contingency basis, works locally with Galiher DeRobertis Nakamura Ono Takitani.
The total amount of expenses the attorneys incurred to fight the suit is not yet clear, but the amount is likely to be small, compared with the overall settlement.
After the fees are paid, money that is left over is likely to go to the Hawaii state highway fund, not to consumers, because the state doesn't think local residents would have kept receipts from all the gas they purchased between 1987 and 1998. The state is concerned about potentially fraudulent claims to the money, court filings show.
The state highway fund, paid for by taxes, fees and the federal government, spent $70 million on highways and services between June 1999 and June 2000. At the same time, about $11 million was transferred to the state's general fund, according to the Highways Division. Albert Chee, a spokesman for defendant Chevron Corp., has accused the state of relying on proceeds from the lawsuit to avoid raising taxes to pay for highway maintenance. "Who do you sue next?" he asked rhetorically.
The state and the oil companies -- Chevron, Tosco Corp., Shell Oil Co., Texaco Inc. and Unocal Corp. -- have agreed in principle to settle the federal lawsuit, although no details of the settlement have been released publicly yet.
The state is dropping its lawsuit in exchange for a payment of roughly $20 million, or 1 percent of the $2 billion the state had been seeking from a trial, said a person familiar with the deal, who wished to remain anonymous.
In 2000, BHP Hawaii Inc. and Tesoro Petroleum Corp. settled the case by paying the state $15 million. Of that amount, $1.23 million went to costs and attorneys received about $3 million. The state also set aside $3 million for future litigation costs. The remaining money, estimated around $6 million by state Attorney General Earl Anzai, has been held in an interest-bearing account and may also end up in the highway fund.
The state sued in October 1998, alleging that the oil firms colluded to pump up Hawaii's gas prices, which have long been among the highest in the nation.
State Web Site
