Facing deluge of questions on $24M settlement reached by his predecessor and former law firm, Beshear exits hearing after reiterating his noninvolvement

10/12/2017 06:23 PM

FRANKFORT – After more than an hour of questions on a $24 million settlement with drug maker Purdue Pharma that he repeatedly insisted he had no role in litigating or negotiating, Attorney General Andy Beshear abruptly left a Program Review and Investigations Committee meeting on Thursday and accused the co-chairman of the panel of political showmanship.

State Sen. Danny Carroll, R-Paducah, led most of the questioning, delving into topics such as the appropriateness of settling for $24 million when past attorneys general had said the case could yield $1 billion to how his father, former Gov. Steve Beshear, is paid by Stites and Harbison, which represented the drug company and employed the younger Beshear before he took office.

Beshear, who had presented information on his office’s efforts to take other drug manufacturers and distributors to court through a contingency fee contract with four law firms, said time and again that he had no role in litigating the case or negotiating the settlement with Stites and Harbison and that he did not handle any aspect of the matter, which was settled for $24 million in former Attorney General Jack Conway’s final days in office in December 2015, when he took over as the state’s top elected attorney.

“I think I’ve been more than patient in answering every question I can,” he said after Carroll asked about political donors to his campaign for attorney general connected to the case. “We’ve moved into issues from a previous campaign. My only clients are the people of Kentucky.”

“We will see you again next month General Beshear,” Carroll said as Beshear stood to leave.

“OK,” the first-term attorney general said.

Thursday wasn’t the first time Republicans have questioned the $24 million settlement with Purdue Pharma, but Carroll also took issue with terms of the settlement that he said seemed to take Stites and Harbison off the hook of a potential malpractice lawsuit as well as a contract awarded to Dolt, Thompson, Shepherd and Kinney, where Conway now works, after Beshear took office.

That contingency fee contract for legal work on the Purdue Pharma case had expired during Conway’s term in June 2015, and Beshear said he had no idea why it was allowed to lapse since he was not attorney general at the time.

His office – Beshear said he refrained from all matters related to Purdue Pharma since becoming attorney general — issued the contract again so that the firm could be paid the $3.7 million in contingency fees for its help in the case, he said.

“I would say if the point here is the commonwealth could somehow get out of paying lawyers who took a contingency fee contract and worked the case, that’s a tough argument to make in front of a court,” Beshear said.

Holly McCoy-Johnson, who leads administrative services in Beshear’s office, also noted that the contract, which was retroactive, passed muster with the Finance and Administration Cabinet and the General Assembly’s Government Contract Review Committee.

“This contract expiring did not occur under General Beshear’s administration,” she said. “However, all the pieces to go into place to ensure that a contract was in place so that proper payment could be made was something that we became aware of after we came into office and made sure that that occurred so that the work that was done previously could be taken care of and handled properly and appropriately.”

Speaking to reporters after the meeting, Beshear had some harsh words for Carroll and his line of questioning.

“We heard more conspiracy theories today than I think were included in the movie ‘JFK,’ and to throw those around when we’re dealing with a drug epidemic, when four Kentuckians dies every single day is grossly irresponsible,” he said.

But Carroll countered that he did not question the Purdue Pharma settlement for political theatrics.

He said he received help from Gov. Matt Bevin’s office, which has frequently sparred with Beshear in the press and in courtrooms, and the Justice and Public Safety Cabinet in compiling information ahead of Thursday’s hearing, adding that the committee could force additional Beshear testimony with a subpoena.

“You’ve got an agreement that protects the new attorney general’s firm and it’s protecting the firm that the former governor’s about to go back to for employment, so tell me that doesn’t raise suspicion,” Carroll told reporters. “Tell me that Jack Conway going to work for Dolt Thompson doesn’t raise suspicions. Tell me that Attorney General Beshear getting donations for his campaign from the opposing counsel in this case, tell me that there aren’t suspicions there.

“So you look at all these things as a complete package and you can’t help but think that this scream of corruption, and I think the people of our state are tired of that type of politics.”

Asked why he didn’t ask Conway to appear before the Program Review and Investigations Committee and answer questions on the settlement his office reached with Purdue Pharma, Carroll said Thursday was “the beginning of this and we needed to see how this was going to go and then make a decision from there.”


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