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Program D: Risk Litigation

Program Authorization: Act 448 of 1988; R.S. 36:701(D); 36:704(F); R.S. 39:1533(B)

PROGRAM DESCRIPTION

The mission of the Risk Litigation Program (which is organizationally expressed as the Litigation Division) is to provide legal representation for the Office of Risk Management, the Self-Insurance Fund, the State of Louisiana and its departments, agencies, boards and commissions and their officers, officials, employees and agents in all claims covered by the State Self-Insurance Fund, and in all tort claims whether or not covered by the Self-Insurance Fund.

The goals of the Risk Litigation Program are:

1. Develop extensive expertise in the defense of public entities, officials and employees, to improve the Divisions' performance, efficiency and professionalism, and strive to retain highly competent litigation staff.

2. Better utilize the funds available to the Office of Risk Management for legal expenses by increasing the percentage and number of cases handled in-house.

3. Continue developing a working environment that encourages competent individuals to seek career employment in the division.

The state's tort liability exposure is far greater than in the private sector, both in dollar amount and the variety of claims asserted; examples include: road hazard liability; public health care provider liability; legislative liability; regulatory liability; and alleged liability for illegal and/or intentionally wrongful actions of elected officials. Suits against the state range from relatively minor worker's compensation claims to complex multi-district federal litigation involving hundreds of suits and/or parties and hundred of thousands or millions of dollars of exposure. Estimated attorneys' fees range from less than $500 to hundreds of thousands of dollars. In 1995 the state paid out $45.8 million in judgments through the Office of Risk Management and another $71.1 million through legislative appropriation. According to the House Legislative Services, in 1996 the state paid out $106 million in judgments through the Office of Risk Management and another $3.8 million through legislative appropriation.

In June 1993 it was determined that the state could not continue its heavy reliance upon the utilization of private contract attorneys for its tort defense. Utilization of contract attorneys had grown from $10.8 million for representation in 2,364 cases in FY 1989-90 to $20.13 million for representation of 4,000 cases in FY 1992-93. During this same period, the Litigation Division's cases and funding went from 2,693 cases and $2.61 million to 3,000 cases and $2.7 million. The Attorney General developed a three-step program to increase the utilization of Litigation Division attorneys for the state's tort defense. Step One was completed in FY 1993-94 with the addition of 15 new attorney positions and 13 new support positions. With this increased staff, the Litigation Division handled 92.2% or 1,688 of the 1,830 new cases filed against the state in FY 1993-94 at a cost of $3.2 million. The total number of cases being handled by private attorneys was reduced from 4,000 to 3,501 and contract attorney costs were reduced from $20.13 million to $19.63 million. During this same period, the Litigation Division recovered and returned to the Office of Risk Management over $1 million through subrogation and/or intervention claims. Step Two was implemented in FY 1994-95 with the addition of 26 attorney positions and 23 support positions and the opening of regional division offices in Shreveport, New Orleans, and Lake Charles. With this staff, the Litigation Division handled 87% or 1,635 of the 1,878 new cases filed during FY 1993-94, at a total cost of $5.4 million. The total number of cases being handled by contract attorneys was reduced to 2,343 and total contract attorneys' fees were reduced to $9.5 million. Total attorneys fees were reduced to $14.9 million, a savings of $7.9 million from the $22.8 million level of FY 1993-94. Step Three of the program, which was approved by the 1995 legislature, authorized the opening of regional offices in Alexandria, Lafayette, and Monroe as well as the addition of 17 attorney and 15 support positions. The Alexandria and Lafayette regional offices were opened during FY 1995-96. During FY 1995-96, the Litigation Division received 2,189 new cases to defend, of which 1,980 or 90.5%, were assigned to division attorneys to handle, while only 209 or 9.5% were referred to contract counsel. By August 20, 1996, 76% of all open and pending cases were being handled by Litigation Division attorneys. The Litigation Division forecast for FY 1997-98 is to handle 81% of all open and pending cases.

The Litigation Division is divided into six sections: Administration, Civil Rights, General Liability, Medical Malpractice, Road Hazards, and Workers' Compensation.

The Civil Rights Section began as the Prison Litigation Section. With the increase in litigation against state actors pursuant to the Civil Rights Act, the Section grew to represent state actors, state agencies, and the state. As an adjunct to the Civil Rights suits, the Section also handles 42 USC 1998 attorney fees litigation defense. Pursuant tot he statutory authority in LA R.S. 13:5108.1 & 2, the section represents the Attorney General in execution of his mandate to determine representation and indemnification of state employees who are sued. The Section also assists the Office of Risk Management in deciding issues pursuant to the contractual dictates found in the Comprehensive General Liability policy issued to the state agencies and the state.

The General Liability Section provides legal defense to the state, state agencies and employees, etc. against tort litigation in regard to claims of personal injuries and/or property damages which allegedly occurred on state property or was caused by a state employee or officer.

The Medical Malpractice Section is primarily responsible for handling malpractice cases against public health care providers as defined by La. R.S. 40:1299.39.

The Road Hazards Section is responsible for handling litigation matters filed against the State and Department of Transportation.

The Workers' Compensation Section is primarily responsible for handling litigated workers' compensation matters filed against the State, along with providing support for other related concerns such as advice to the Office of Risk Management regarding claims and handling of settlements as appropriate. The Section is also responsible for the Jones Act and maritime matters filed by State employees, and is responsible for pursuit of subrogation claims that are referred by Risk Management. Most of the cases handled by the Section are litigated matters falling within purview of the Workers' Compensation Act, R.S. 23:1021-1361.

OBJECTIVES AND PERFORMANCE INDICATORS

1. The Litigation Program will handle in-house 90% of the new tort litigation cases filed against the state during FY 1998-99.

1 Based on estimates.

2. In FY 1998-99, the Litigation Program will provide at least 15 educational and training opportunities for attorneys, with particular emphasis on specialized training and education.

1 New indicator for which some values are not available.

RESOURCE ALLOCATION FOR THE PROGRAM

SOURCE OF FUNDING

This program is funded with fees and self-generated revenues. Fees and self-generated revenues are derived from the Office of Risk Management for investigative and legal services.

ANALYSIS OF RECOMMENDATION

GENERAL FUND

TOTAL

T.O.

 

DESCRIPTION

 

 

 

 

 

$0

$8,013,262

180

 

ACT 18 FISCAL YEAR 1997-1998

 

 

 

 

 

 

 

 

 

BA-7 TRANSACTIONS:

$0

$12,552

0

 

Carryforward for computer equipment

 

 

 

 

 

$0

$8,025,814

180

 

EXISTING OPERATING BUDGET - December 10, 1997

 

 

 

 

 

$0

($12,552)

0

 

Nonrecurring Carryforwards for computer equipment

$0

($110,000)

0

 

Equipment/Major Repairs Adjustment(s)

$0

($28,000)

0

 

Retirement Rate Adjustment(s)

$0

$454,500

0

 

Implementation of agency's unclassified attorneys pay schedule

 

 

 

 

 

$0

$8,329,762

180

 

TOTAL RECOMMENDED

 

 

 

 

 

$0

$303,948

0

 

DIFFERENCE (TOTAL RECOMMENDED AND EXISTING OPERATING BUDGET)

The total means of financing for this program is recommended at 103.7% of the existing operating budget. It represents 94.9% of the total request ($8,773,038) for this program. The net increase in funding is primarily due to increased funding to provide for the implementation of the agency's unclassified attorneys pay schedule, the removal of funding for nonrecurring acquisitions and carryforwards and a reduction in the retirement rate.

PROFESSIONAL SERVICES

$65,000

 

Legal services for funding expert witness costs and other related legal expenses

 

 

 

$65,000

 

TOTAL PROFESSIONAL SERVICES

OTHER CHARGES

$1,050

 

Funding for taking depositions, court costs and travel of special expert witnesses

 

 

 

$1,050

 

TOTAL OTHER CHARGES

 

 

 

 

 

Interagency Transfers:

$161,951

 

Funding to the Division of Administration for data processing needs and to the Department of Public Safety and Corrections for gasoline purchases

 

 

 

$161,951

 

TOTAL INTERAGENCY TRANSFERS

ACQUISITIONS AND MAJOR REPAIRS

$200,000

 

Computer and office equipment

 

 

 

$200,000

 

TOTAL ACQUISITIONS AND MAJOR REPAIRS


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