Governor signs bill to promote transparency in attorney general outside counsel contracts

PHOENIX – The Arizona Chamber of Commerce and Industry today applauded Gov. Jan Brewer for signing another important tort reform bill into law.

House Bill 2423, sponsored by Rep. Kimberly Yee (R-Phoenix), ensures an increased level of transparency in contingency fee contracts the Office of the Attorney General signs with outside counsel.

Over the past decade, state governors and attorneys general have dramatically increased the use of private legal services on a contingency fee basis. Under such arrangements, private attorneys are hired to take legal action on behalf of the state, and receive a percentage of any recovery as compensation. This practice is appropriate under certain circumstances, but the absence of adequate oversight and transparency creates the potential for abuse and conflict of interest.

This new law creates a policy framework that will safeguard Arizona citizens against private attorney hiring decisions that place political gain and personal profit above the public interest. The major reforms contained in H.B. 2423 include:

  • A required annual report by the attorney general to the Legislature that details the Office’s use of contingency fee contracts with outside counsel;
  • A requirement to, whenever possible, award contracts on a competitive bidding process;
  • Installs a $50 million cap on contingency fees; and
  • Increases oversight of private attorneys by granting veto authority by government attorneys over private attorney decisions.

“Once again Gov. Brewer has shown her commitment to ensuring that Arizona remains friendly to business by working to create a legal environment that ensures transparency, discourages frivolous lawsuits and protects taxpayers,” Chamber president and CEO Glenn Hamer said. “I applaud Rep. Kimberly Yee for her leadership on this bill and the Legislature for sending it to the governor’s desk with bipartisan backing. Attorney General Tom Horne deserves special credit for this bill’s passage, too. He and his legislative team worked with business community stakeholders to craft this important legislation. Without his engagement on this issue, this bill wouldn’t have made it across the finish line.”

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