Garamendi Clashes With Lungren on Choice of Lawyers

Insurance Commissioner John Garamendi, butting heads with Atty. Gen. Dan Lungren on Tuesday over which lawyers will represent Garamendi in the expected court fight over $2.5 billion in insurance rebates, is suing to stop Lungren from interfering with his choice.

Garamendi, a Democrat, charged that the Republican Lungren is trying to aid the insurance industry efforts to block the Proposition 103 rebates by keeping him from having top-notch outside counsel. He asked a San Francisco Superior Court to order the attorney general to allow Garamendi to retain the attorneys he wants, Michael Strumwasser and Fred Woocher.

“Since I took office, the insurance industry has been quarterbacking an assault on my legal team,” the commissioner said. “Now, we see Dan Lungren carrying the ball down the field for the insurance industry. . . . We’ve got to tackle Dan Lungren before he runs off with our rollbacks.”

Lungren said Garamendi is taking “one of the worst” cheap political shots he has ever seen. He renewed his contention that the commissioner’s $195-an-hour, $750,000 contract with Strumwasser and Woocher is illegal. But he added that the commissioner is free to hire the two attorneys for his regular staff, which Lungren says would be far cheaper to the taxpayers.

A spokesman for Garamendi fired back that Lungren should know there are no such vacancies on Garamendi’s staff, and even if there were, staff attorneys are not permitted to represent the department in court.

The long-distance verbal exchanges between the two men, considered to be possible gubernatorial rivals some day, began with a Garamendi press conference in San Francisco, followed by a Lungren press conference in Sacramento, and ended with comments by Garamendi’s staff in Los Angeles.

“I hired the best, most experienced legal team in the nation to represent the people and go toe-to-toe with the insurers’ hordes of high-priced lawyers,” Garamendi said.

Hiring private outside lawyers to represent a department in a sensitive matter is not uncommon. Garamendi’s predecessor, Republican Roxani Gillespie, was routinely allowed by the Democratic attorney general, John Van de Kamp, to hire her own Proposition 103 lawyer, for $225 an hour.

Woocher and Strumwasser were used as insurance specialists by Van de Kamp. And for three months, Lungren has charged that the two attorneys violated state law because before they left the attorney general’s office last year, Lungren believes, they had a hand in writing their own contract to represent Garamendi.

Strumwasser and Woocher, whose contract expires Sept. 30 unless Lungren approves a renewal, deny that. Garamendi has frequently insisted to Lungren that there have been no violations. He notes that the two have won nearly every Proposition 103 court battle since they became his special counsel. A hearing in the matter is expected Sept. 4.

On Tuesday, confronted with Lungren’s continued refusal to keep the men on, Garamendi sharpened his language.

“Now that Dan Lungren has chosen to represent--either wittingly or unwittingly--the needs of a powerful special interest against the public interest, I will fight him with every resource at my command.” For that reason, he said he decided to go to court.

At his news conference, Lungren responded, “I have been involved in politics for a few years, and have seen some cheap political shots. This press statement by Insurance Commissioner John Garamendi ranks right up there with the worst of them.

“This dispute is not about Proposition 103 or consumer protection,” the attorney general added. “In my view, this is about state contracts given to private lawyers in violation of the revolving-door statutes. This is about ethics in government.”

Questioned by reporters, Lungren said his contact with insurance industry representatives on the Strumwasser-Woocher matter has been minimal.

But Proposition 103 author Harvey Rosenfield commented later that he believes Lungren’s ties to insurers are significant. Rosenfield said he will detail “sizable” Lungren campaign contributions from insurers at a news conference today.

Also today, Gov. Pete Wilson will discuss insurance issues with Garamendi, a Wilson spokesman said. Both the Proposition 103 rebates and Wilson’s proposal for no-fault insurance are on the agenda.