SC Gov. McMaster objects to plutonium settlement and the $75 million in attorneys fees

The day before South Carolina’s attorney general announced a settlement that will bring $600 million to the state and start the process of removing deadly plutonium stores, Gov. Henry McMaster said he couldn’t support paying private lawyers in the deal $75 million or waiting two decades for the waste to be gone.

In a letter to S.C. Attorney General Alan Wilson written Sunday, McMaster said the roughly $75 million in fees the state will pay three S.C. law firms that worked on the deal — orchestrated by Wilson, the state’s members of Congress and Trump administration lawyers — is grossly excessive for the work they did.

“I simply cannot endorse the payment of $75 million in attorneys’ fees under the circumstances,” McMaster, a former state attorney general, told Wilson in a letter written Sunday.

In his letter, McMaster also said Wilson’s settlement agreement doesn’t give enough assurances that the U.S. Department of Energy will remove the deadly plutonium from South Carolina “in a timely manner.” The plutonium is stored at the Savannah River Site.

At a State House press conference Monday, Wilson celebrated the settlement agreement as a big in for the state. Asked by The State about the attorneys’ fees, Wilson said he knew the fees were high, but the attorneys who will get those fees devised the winning legal tactic for getting the state a $600 million settlement. The $75 million in fees comes out of the $600 million.

The disagreement between two of the state’s top Republican officials played out even before Monday’s announcement.

On Saturday, Wilson’s office issued a press release which said McMaster would be at Monday’s press conference. But in a revised press release, issued later, McMaster’s name was not on the list.

Although Attorney General Wilson praised McMaster for the role he played early on, McMaster made it clear that he believed details were kept from him.

“As you know, I did not receive the Settlement Agreement until late last week, at which point you had already signed it on behalf the State,” McMaster wrote.

McMaster also told Wilson that the attorney general’s deal surrenders South Carolina’s ability to force a timely removal of the deadly plutonium.

“Currently, federal law provides that all defense plutonium transported into the State between 2002 and the present must be removed from SRS by January 1, 2022,” McMaster wrote. But Wilson’s deal now gives the federal government until Jan. 1, 2037 to remove the plutonium and until 2042 if DOE removes just half of the plutonium by 2027, the governor wrote.

McMaster continued, “I cannot support a compromise that extends the existing removal deadline by up to twenty years.”

As for the $75 million in attorneys’ fees to several private law firms used by Wilson, McMaster said that while he didn’t doubt Wilson’s office needed help from outside law firms, the fact that the U.S. Department of Energy is finally willing to agree to a settlement is due to his (McMaster’s) “zealous advocacy and coordination with members of our Congressional delegation.”

McMaster concluded, “I cannot support a Settlement Agreement that ... potentially sidelines South Carolina’s future leadership by restricting the State’s ability to enforce its legal rights.”

In his press conference, Wilson admitted the $75 million in private attorneys’ fees were “a lot more than I would like ... I understand people will be upset. Lawyers making $75 million is excessive. I believe that is a lot of money to go to outside counsel. But without that effort, there would be zero dollars recovered.”

Wilson said his office and then-Gov. Nikki Haley were approached in 2016 by one of the law firms that splitting the $75 million fee. That firm came up with the legal strategy that led to the $600 million settlement, said Wilson. At that time, no one had any idea that the state might get $600 million, and the standard contract agreed upon with the lawyers turned out to give them 12.5% of the $600 million — which is the “largest settlement in the history of the state,” Wilson said.

Asked to comment on the fact that one of the law firms splitting the $75 million fee is his old firm, Willoughby and Hoefer, Wilson said, “I didn’t pick the law firm because I know them. I picked the law firm because they are the ones that did the legwork and brought it to us.”

The law firms assumed 100% of the risk, worked more than four years on speculation and fought legal battles in a half dozen federal district and appeals courts around the country, Wilson said.

Payday will come fast for the law firms. All $600 million including lawyers’ fees will come out of a special pool of money of judgments paid to the United States, said U.S. Sen. Lindsey Graham, R-S.C. Attorney General Bill Barr controls that money and has signed off on the deal, Graham said.

“The check will not bounce,” Graham said.

Besides Willoughby and Hoefer, other law firms listed in court records as representing South Carolina were Davidson Wren and DeMasters (earlier known as Davidson Wren and Plyler) and Benjamin Parker Mustian Law Firm.

Each law firm’s share was not available.

Longtime Savannah River Site activist Tom Clements disliked the $75 million fees. “It’s far beyond the worth of any work they did.”

Wilson said he had no regrets. “You aren’t going to have everybody agree with every single thing.”

This story was originally published August 31, 2020 at 12:28 PM with the headline "SC Gov. McMaster objects to plutonium settlement and the $75 million in attorneys fees."