Scruggs to Serve Prison Time in Kentucky; Son Headed to Florida

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July 28, 2008 Monday 01:57 PM EST

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Scruggs to Serve Prison Time in Kentucky; Son Headed to Florida

Chad Hemenway

OXFORD, Miss.

Once a renowned attorney who took on the insurance industry's handling of claims following Hurricane Katrina, Richard "Dickie" Scruggs has been ordered to serve five years in a federal prison in a state prone to many more tornadoes than hurricanes.

According to court documents, Scruggs on Aug. 4 is headed to a facility in Ashland, Ky. His son, Zach Scruggs, is to serve his 14 month prison term in Pensacola, Fla., beginning Aug. 15.

Scruggs and his son, as well as several associates, conspired to bribe Circuit Court Judge Henry L. Lackey in hopes of getting a favorable ruling in a case involving the split of about $26.5 million in legal fees from an settlement with State Farm (BestWire, June 27, 2008). Lackey reported the bribe attempt to authorities and worked with investigators.

Scruggs and law partner Sidney Backstrom each pleaded guilty to a conspiracy charge. The younger Scruggs pleaded guilty to a charge of failure to report a felony. Backstrom will serve a 28-month sentence in an Arkansas facility.

Another attorney, Timothy Balducci, offered $50,000 to Lackey in return for a favorable ruling in the State Farm legal fees case. Balducci was approached by authorities early with the evidence against him and decided to work with them. He wore a wire to the Scruggs Law Firm and taped conversations about the bribe, authorities have said. Balducci has pleaded guilty to the bribery attempt. Steven Patterson, former Mississippi state auditor and law partner of Balducci, also pleaded guilty to his role in the bribery attempt and worked with authorities. Balducci and Patterson have not been sentenced.

According to court records, the elder Scruggs had asked to serve his time in to Pensacola, Fla., but the facility does not house prisoners with a pilot's license. Scruggs was a Navy pilot and still has a license. The prison is on an air base. A motion by the younger Scruggs to be sent with his father to the Arkansas prison was denied.

The Mississippi Bar Association is seeking to disbar Scruggs, his son and Backstrom. The association has filed formal motions with that state's Supreme Court that would strip the law licenses of the trio in light of recent judgments against the trio. The attorneys are permitted to respond to the complaints, with the high court empowered to make the ultimate determination on disbarments. Backstrom already has agreed to disbarment, according to court filings (BestWire, July 23, 2008).

Known for his successful asbestos and tobacco litigation, Scruggs most recently formed the Scruggs Katrina Group to file lawsuits against insurers for their handling of claims following Katrina in 2005. The group's remaining firms reorganized after Scruggs' indictment, but U.S. District Judge L.T. Senter disqualified the group because of its relationship to Scruggs and his alleged unethical practices (BestWire, April 7, 2008).

(By Chad Hemenway, associate editor, BestWeek: [email protected])

July 29, 2008