WLBT 3 - Jackson, MS: Scruggs and Others Indicted for Bribery

Scruggs and Others Indicted for Bribery

By Howard Ballou
howard@wlbt.net

Richard "Dickie" Scruggs, the attorney who helped negotiate a multi-billion dollar settlement with tobacco companies in the 1990s and represents hundreds of post-hurricane Katrina homeowners against insurance companies, has been indicted in an alleged scheme to bribe a judge.

A federal grand jury in Oxford indicted Scruggs; his son and law partner Zach Scruggs; Sidney Backstrom, a lawyer in Scruggs' firm; New Albany based lawyer Timothy Balducci; and former state auditor Steve Patterson, who is an employee of Balducci's firm.

They are accused of conspiring to bribe state circuit court judge Henry Lackey with $40,000 cash. Thirteen pages long, the indictment accuses the men of trying to influence Lackey to rule in favor of Scruggs' firm in a civil lawsuit.

That suit was filed by a Jackson law firm. It accuses Scruggs of withholding millions of dollars in fees for work on Hurricane Katrina insurance litigation.

The indictment says Judge Lackey reported the "bribery overture" to the feds and agreed to go undercover with investigators.

The indictment includes excerpts of telephone conversations between Balducci and Judge Lackey. The indictment says Balducci told Lackey, in one of those conversations, "My relationship with Dick (Scruggs) is such that he and I can talk very private about these kind of matters and I have the fullest confidence that everything will be good." 

Balducci allegedly delivered $20,000 in cash to Lackey in his court chambers on September 27 and gave him separate $10,000 payments on October 18 and November 1.

Another excerpt, occurring allegedly on November 1, has Balducci discussing with Zach Scruggs and Backstrom a court order in Scruggs' favor. Balducci allegedly says, "We paid for this ruling; let's be sure it says what we want it to say."

Dickie Scruggs' brother-in-law is Senator Trent Lott, who announced on Monday his plans to resign.

On Tuesday, FBI agents searched Scruggs' law offices in Oxford and left with copies of computer hard drives.

Dickie Scruggs was arraigned on Wednesday and released on $100,000 bail, while Zach Scruggs and Steve Patterson each were freed on $50,000 bail. 

"These guys did not do what they're accused of doing," said Joey Langston, an attorney representing Scruggs' firm. He said Backstrom is expected to be arraigned on Thursday.

There's no word yet on when Balducci will appear in court.

The charges against Scruggs and the others include one count of defrauding the federal government and two counts of wire fraud.