HB678 Alabama 2012 Session

Summary

Primary Sponsor

Todd Greeson

Republican

Co-Sponsors

Allen FarleyPaul BeckmanWayne JohnsonMary Sue McClurkinRon JohnsonArthur PayneAllen TreadawayHoward SanderfordPaul DeMarcoMike BallJim Carns

Session

Regular Session 2012

Title

Attorney General, state litigation, contingency fee contracts with private attorneys, regulated, Transparency in Private Attorney Contracts Act, Sec. 41-16-72 am'd

Summary

This bill creates the Transparency in Private Attorney Contracts Act to regulate and disclose contingency fee contracts between state agencies and private lawyers for litigation, with fees capped and oversight by the Governor and Attorney General, and requires online posting of contracts and related records.

What This Bill Does

It establishes a structured process for selecting private lawyers to represent the state in lawsuits, using a listing maintained by the Attorney General. Agencies must choose from that list based on skill, experience, and cost, and any contingency fee must be justified in writing as cost-effective and in the public interest. It sets fee caps by recovery amount and requires Governor and Attorney General approval, along with a standard contract addendum and online posting of contracts, determinations, and payments. It also requires private attorneys to keep detailed records and time sheets for several years and to provide records on request.

Who It Affects

• State agencies and other state entities that hire private lawyers for litigation, who must use the AG-maintained listing, justify contingency fees in writing, and publicly post contracts and payments.
• Private attorneys and law firms seeking to represent the state in litigation, who must apply to be on the listing, meet selection and fee rules, and maintain detailed records and time entries for audit.

Key Provisions

• Designates the act as the Transparency in Private Attorney Contracts Act and amends Section 41-16-72 to regulate contingency fee contracts.
• Requires procurement of professional services by agencies entering litigation to be through a listing maintained by the Attorney General; selection based on skill, experience, and cost.
• Fees for contingency representations must be negotiated and approved by the Governor in consultation with the Attorney General; maximum fees may be set by the Governor via executive order.
• Preserves the exclusive authority of public higher education governing boards to direct litigation and employ their own counsel, and clarifies that this article does not modify that authority.
• Before entering a contingency fee contract, the contracting agency must make a written determination that the arrangement is cost-effective and in the public interest, with specific factors considered (resources, time/labor, complexity, geography, and experience).
• If the determination is made, the agency must request proposals from private attorneys to represent the department on a contingency basis, unless feasible alternatives are unavailable.
• Contingency fees cannot exceed structured percentages of recoveries: up to 25% of the first $10M, 20% of $10-15M, 15% of $15-20M, 10% of $20-25M, 5% of $25-50M, and 1% of amounts over $50M.
• Written Governor approval is required to enter into contingency fee contracts, and contracts must meet ongoing requirements such as government attorney control, supervisory involvement, and veto power over outside counsel decisions; settlement decisions remain with government attorneys.
• All executed contingency fee contracts, determinations, and payments must be posted online, and a standard contract addendum will be developed for use in all such contracts.
• Private attorneys must maintain detailed records for at least four years after contract expiration, including all expenses and time records in 1/10 hour increments, and must make these records available for inspection on request.
• Fees paid under contingency fee contracts are paid from the State Treasury from funds recovered as a result of the contract.
• The act also includes related provisions for procurement of nonlitigation professional services, diversity requirements, emergency exceptions, and several exemptions (e.g., Legislature, Port Authority, and some higher education and education-related entities), with effective date specified as the first day of the third month after passage and governor approval.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Attorney General