No. 39099 (Amendment): Rule R105-1. Attorney General's Selection of Outside Counsel, Expert Witnesses and Other Litigation Support Services

(Amendment)

DAR File No.: 39099
Filed: 01/30/2015 10:53:13 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this amendment is to implement the recent changes to the Utah Procurement Code regarding the contingency fee cap for outside counsel.

Summary of the rule or change:

The change corrects the contingency fee cap from the 33-1/3% to the 25% as provided by the Utah Procurement Code, and correct a minor typo in Subsection R105-1-12(c).

State statutory or constitutional authorization for this rule:

• Subsection 67-5-32(1)(a)

Anticipated cost or savings to:

the state budget:

There are no anticipated costs that are expected. The changes update the rule and provide provisions related to the Utah Procurement Code.

local governments:

There are no anticipated costs that are expected. The changes update the rule and provide provisions related to the Utah Procurement Code.

small businesses:

There are no anticipated costs that are expected. The changes update the rule and provide provisions related to the Utah Procurement Code.

persons other than small businesses, businesses, or local governmental entities:

There are no anticipated costs that are expected. The changes update the rule and provide provisions related to the Utah Procurement Code.

Compliance costs for affected persons:

There are no anticipated costs that are expected. The changes update the rule and provide provisions related to the Utah Procurement Code.

Comments by the department head on the fiscal impact the rule may have on businesses:

There are no anticipated affects that the rule will have on businesses. The changes update the rule to implement the recent changes to the Utah Procurement Code regarding the contingency fee cap for outside counsel.

Sean Reyes, Attorney General

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Attorney General
Administration
Room 230 UTAH STATE CAPITOL
350 N STATE ST
SALT LAKE CITY, UT 84114

Direct questions regarding this rule to:

• Alan Bachman at the above address, by phone at 801-538-3105, by FAX at 801-538-3313, or by Internet E-mail at [e-mail]
• Nicole Alder at the above address, by phone at 801-538-3240, by FAX at , or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

03/17/2015

This rule may become effective on:

03/24/2015

Authorized by:

Brian Tarbet, Chief Civil Deputy Attorney General

RULE TEXT

R105. Attorney General, Administration.

R105-1. Attorney General's Selection of Outside Counsel, Expert Witnesses and Other Litigation Support Services.

R105-1-1. Purpose and Authority.

A. The purpose of this rule is to provide the requirements for procurements that are managed by the Attorney General, including the hiring of outside counsel, expert witnesses, litigation support services and procurement items.

B. This rule is adopted pursuant to authority granted by the Utah Procurement Code and Section 67-5-32(1)(a), including authority to manage procurement of procurement items directly or by delegation of the Chief Procurement Officer of the Division of Purchasing of the Department of Administrative Services.

 

R105-1-2. Definitions.

Terms in this Rule R105-1 shall be as defined in the Utah Procurement Code. The definitions in Rule R33-1 also apply to this Rule R105-1, except in case of conflict, the definitions in this Rule R105-1 shall control. Additional definitions are provided below.

A. "Agency" means any department, division, agency, commission, board, council, committee, authority, institution, or other entity within the State government of Utah (see Utah Code Ann. Sec. 67-5-3).

B. "Attorney General" means the Attorney General of the State of Utah, or the Attorney General's designee.

C. "Emergency" means a determination by the Attorney General in writing that a provision of this Rule needs to be waived due to the need for timeliness, litigation deadlines, confidentiality, or other emergency circumstances.

D. "Expert witness" means a person whose knowledge, skill, experience, training or education in a scientific, technical, or other specialized area, would enable the person to give testimony under Rule 702 of the Utah Rules of Evidence.

E. "Litigation Support Services" includes any goods, services, software, or technology.

F. "Outside counsel" means an attorney or attorneys who are not, or a law firm whose attorneys are not, employed by the Attorney General's office, pursuant to Utah Code Ann. Sec. 67-5-7 et seq., which the Attorney General appoints, pursuant to Utah Code Ann. Sec. 67-5-5, to represent, provide legal advice, or counsel to an agency of the State. "Outside counsel" may or may not be designated as "Special Assistant Attorney General", as the Attorney General determines.

G. "Procurement item" or "Procurement items" means any goods, services, software or technology.

H. "Small purchase" means a purchase under Rule R105-1-7.

I. "Sole source" means a determination by the Attorney General, in writing, that the sole source requirements of the Utah Procurement Code and this Rule have been met.

J. "State" means the State of Utah.

 

R105-1-3. Special Considerations to Best Serve the Public.

A. This rule applies to the procurement and appointment of outside counsel, expert witnesses, litigation support services, litigation related consultants, as well as management software and services by the Attorney General.

B. In order to properly fulfill the responsibilities of the Office, the procurement of outside counsel, expert witnesses, litigation support services, litigation related consultants, as well as management software and services often requires that public notice of a particular procurement not be provided. The provisions of the Utah Procurement Code and this Rule must be met. Such a procurement must be processed as an emergency procurement or be a procurement that does not require notice.

C. The Attorney General may select outside counsel, expert witnesses, professional litigation support services, litigation related consultants, as well as management software and services pursuant to any authorized process under the Utah Procurement Code. In any such selection process, it may be specified that the outside counsel is responsible for providing the expert witnesses or other litigation goods and services through the selection process for outside counsel and pursuant to the contract provisions with the Attorney General.

D. If a procurement item is not procured through the request for proposals, small purchases, prequalification and vendor list, sole source, or emergency provisions of this rule, the Attorney General may determine to use an Invitation for Bids or any other procurement process allowed by the Utah Procurement Code provided that the following applicable Utah laws are met:

1. The Utah Procurement Code; and

2. Administrative Rules of the Division of Purchasing and General Services, when such rules of the Division of Purchasing and General Services are referred to in this Rule R105-1, except as otherwise exempted or in conflict with this Rule R105-1.

E. The Attorney General may, in a multistate case involving other states as parties aligned with Utah, elect to enter into a fee sharing agreement in which each state contributes to a litigation fund that is used to purchase expert witnesses and/or other litigation support services including litigation related consultants, as well as management software and services, or through a similar group procurement agreement. The agreement shall be treated collectively as a sole source procurement of all goods and services purchased under the terms of the agreement.

F. The Attorney General may, in a multistate case involving other states as parties aligned with Utah, select outside counsel jointly with some or all of the other states as a sole source procurement. If a contingency fee (not based on hourly rates) is used in the multistate case, it shall not be subject to the fee limitations of Rule R105-1-11.

G. The Attorney General's office shall ensure that the procurement of outside counsel is supported by a determination by the Attorney General that the procurement is in the best interests of the state, in light of available resources of the Attorney General's office.

H. The Attorney General's office shall provide for the fair and equitable treatment of all potential providers of outside counsel, expert witnesses, and other litigation support services including, litigation related consultants, as well as management software and services consistent with the limitations and procedures set forth in this Rule R105-1.

I. The Attorney General's office shall ensure that fees for outside counsel, whether based on an hourly rate, contingency fee, or other arrangement, are reasonable and do not exceed industry standards.

 

R105-1-4. Available Procurement Processes.

(1) In General. Prior to any procurement for legal services, the Attorney General shall first determine which process under the Utah Procurement Code shall be used, including but not limited to, small purchase, prequalification and vendor list, sole source, emergency procurement, availability of a statewide or regional contract, invitation for bids, or request for proposals.

(2) Prequalification and Approved Vendor Lists. Rule R33-4-101 and R33-4-102 shall apply to the Prequalification of Potential Vendors and Thresholds for Approved Vendor Lists, except that the maximum threshold for procuring the services of a licensed attorney(s) shall be $250,000.

 

R105-1-5. Invitation for Bids.

Any competitive sealed bidding (invitation for bids) or multiple stage bidding process may occur in accordance with Sections 63G-6a-601 through 63G-6a-612, as well as Rule R33-6.

 

R105-1-6. Request for Proposal Process.

A. The Request for Proposal process may be used in accordance with Sections 63G-6a-701 through 63G-6a-711. The process shall also be subject to Rule R33-7 except as otherwise specified in this Rule R105-1.

B. The Request for Proposal process may be issued in stages, or may be issued after a request for information or other procurement process allowed by the Utah Procurement Code or this Rule.

C. The Request for Proposal, shall contain, in addition to the requirements of Rule R33-7-102, at a minimum, the following information:

1. A description of the project.

2. Any fee arrangements.

3. The persons or entities being sought in the procurement, including whether an individual person, firm or association of firms may respond.

4. The qualification criteria and the relative importance of the criteria. Examples of criteria include:

a. Identification by name and experience of the proposed service provider(s);

b. A description of the duties and responsibilities of each person providing the service; and

c. The ability of the persons providing the service to meet the needs of the project, including the consideration of any association with other persons, expert witnesses or firms;

5. The Contractual Requirements, which may be accomplished by including a copy of the contract.

6. A request for a conflicts analysis, including potential conflicts of interest or other related matters concerning the offeror's ability to ethically perform the requested services.

7. Requirements regarding the date, time, place, form and method concerning the filing of the Response to the Request for Proposals.

8. A statement that the Attorney General reserves the right to reject late-filed or nonconforming proposals.

9. A statement that the Attorney General reserves the right to reject all proposals. The Attorney General also reserves the right to modify or cancel the Request for Proposal Process and may or may not initiate a new Request for Proposal Process for the particular procurement matter.

D. Public notice of the Request for Proposals shall be provided in accordance with the Utah Procurement Code.

E. The award process, including notice of award, shall be made by the Attorney General in accordance with the Utah Procurement Code and this Rule.

F. A record of the procurement shall be made in accordance with the Utah Procurement Code and this Rule, including Rule R105-1-14.

G. In any selection process for outside counsel, it may be specified that the outside counsel is responsible for providing the expert witnesses or other litigation goods and services including litigation related consultants, as well as management software and services through the outside counsel's selection process and pursuant to the contract provisions with the Attorney General.

H. Minimum scores for any of the criteria may be used.

 

R105-1-7. Small Purchases.

A. Small Purchases shall be conducted in accordance with the Utah Procurement Code and Rule R33-4-104, except that the maximum thresholds for small purchases shall be as described in this Rule R105-1-7.

B. For Outside Counsel, litigation related consultants, management software and services, as well as expert witnesses, the small purchase maximum threshold is $250,000. A written justification statement shall be filed explaining the reason(s) for selection of the particular attorney, law firm or expert witness for the particular matter.

C. For the selection of litigation support services that are not covered under Rule R105-1-7(B), including but not limited to court reporting, litigation related copying and printing services, the small purchase maximum threshold is $50,000. For a purchase between $2500 and $50,000, a minimum of two quotes shall be obtained or there shall be developed a rotation system of qualified persons or firms that meet the qualifications for the service. For any purchase of $2500 or less, a direct award may be made.

D. The Attorney General may make such other small purchases delegated to the Attorney General by the Chief Procurement Officer pursuant to the Utah Procurement Code.

E. Under Section 63G-6a-408(3), a threshold stated in this Rule may be exceeded if the Attorney General (not a designee) or a person specifically designated in writing by the Attorney General gives written authorization to exceed the threshold that includes the reasons for exceeding the threshold.

 

R105-1-8. Sole Source.

A. Sole Source procurement shall be conducted in accordance with the requirements set forth in Section 63G-6a-802 of the Utah Procurement Code.

B. Unless the Attorney General determines that a publication of a sole source shall be published, sole sourced procurement items under this Rule need not be published regardless of cost, all of which is in accordance with Section 63G-6a-802(4)(b)(ii).

 

R105-1-9. Emergency Procurements and Waiver of Requirements.

A. Emergency procurements shall be conducted in accordance with the requirements set forth in Section 63G-6a-803 of the Utah Procurement Code and Rule R33-8-401.

B. An emergency procurement is a procurement procedure where the Attorney General does not need to use a standard procurement process.

C. An emergency procurement may only be used when an emergency exists as defined in this Rule.

D. Emergency procurements are limited to those procurement items necessary to mitigate the emergency.

E. While a standard procurement process is not required under an emergency procurement, when practicable, the Attorney General should seek to obtain as much competition as possible through the use of phone quotes, internet quotes, limited invitations to bid, or other selection methods while avoiding harm, or risk of harm, to the public health, safety, welfare, property or impairing the ability of a public entity to function or perform required services.

F. The Attorney General shall make a written determination documenting the basis for the emergency and the selection. A record of the determination and selection shall be kept in the contract file. The documentation may be made after the emergency condition has been alleviated.

 

R105-1-10. Confidentiality.

Except when an emergency exists under Rule R105-1-9 and in accordance with applicable law, where public inspection may be delayed until such time as the cause for the emergency no longer exists, the following shall be met:

A. Protected Records.

1. The following are protected records and may be redacted subject to the procedures described below in accordance with the Governmental Records Access and Management Act (GRAMA) Title 63G, Chapter 2 of the Utah Code:

a. Trade Secrets, as defined in Section 13-24-2;

b. Commercial information or non-individual financial information subject to the provisions of Section 63G-2-305(2); or

c. Other Protected Records under GRAMA.

2. Process For Requesting Non-Disclosure. Any person requesting that a record be protected shall include with the bid/proposal or submitted document:

a. a written indication of which provisions of the bid/proposal or submitted document are claimed to be considered for business confidentiality or as a protected record (including trade secrets or other reasons for non-disclosure under GRAMA); and

b. a concise statement of the reasons supporting each claimed provision of business confidentiality or as a protected record.

c. Pricing may not be classified as business confidential and will be considered public information.

d. An entire set of bidding documents or proposal documents may not be designated as "PROTECTED", "CONFIDENTIAL" or "PROPRIETARY" and shall be considered non-responsive unless the offeror removes the designation.

e. This term bid or proposal for purposes of this Rule shall apply to any document submitted to the Attorney General for purposes of a procurement matter.

B. Notification.

1. A person who complies with this Rule R105-1-10 shall be notified by the Attorney General's office prior to the public release of any information for which a claim of confidentiality has been asserted.

2. Except as provided by court order, the Attorney General's office to whom the request for a record is made under GRAMA, may not disclose a record claimed to be protected under this Rule but which the Attorney General's Office or State Records Committee determines should be disclosed until the period in which to bring an appeal expires or the end of the appeals process, including judicial appeal, is reached. This Rule does not apply where the claimant, after notice, has waived the claim by not appealing or intervening before the State Records Committee. To the extent allowed by law, the parties to a dispute regarding the release of a record may agree in writing to an alternative dispute resolution process.

3. Any allowed disclosure of public records submitted in the request for proposals process will be made only after the selection of the successful offeror(s) has been made public in compliance with Section 63G-6a-709.5.

C. Publicizing Awards.

1. In addition to the requirements of Section 63G-6a-709.5, the following shall be disclosed after receipt by the Attorney General's Office of a GRAMA request and payment of any lawfully enacted and applicable fees:

a. the contract(s) entered into as a result of the selection and the successful proposal(s), except for those portions that are to be non-disclosed under this Rule or State law;

b. unsuccessful proposals, except for those portions that are to be non-disclosed under this Rule or State law;

c. the rankings of the proposals;

d. the names of the members of any evaluation committee members (reviewing authority);

e. the final scores used by the evaluation committee to make the selection, except that the names of the individual scorers shall not be associated with their individual scores or rankings; and

f. the written justification statement supporting the selection, except for those portions that are to be non-disclosed under this Rule or State law.

2. After due consideration and public input, the following has been determined by the Procurement Policy Board and the Attorney General's Office to impair governmental procurement proceedings or give an unfair advantage to any person proposing to enter into a contract or agreement with a governmental entity, and, to the extent allowed by law, will not be disclosed by the Attorney General's Office at any time to the public including under any GRAMA request:

a. the names of individual scorers/evaluators in relation to their individual scores or rankings;

b. any individual scorer's/evaluator's notes, drafts, and working documents;

c. non-public financial statements; and

d. past performance and reference information, which is not provided by the offeror and which is obtained as a result of the efforts of the Attorney General's Office. To the extent such past performance or reference information is included in the written justification statement, the justification statement is still subject to public disclosure.

3. In regard to an Invitation for bids issued by the Attorney General's Office, the Attorney General's Office shall, on the day on which the award of a contract is announced, make available to each bidder and to the public, a notice that includes:

a. the name of the bidder to which the contract is awarded and the price(s) of the procurement item(s); and

b. the names and the prices of each bidder to which the contract is not awarded.

 

R105-1-11. Special Provisions regarding Procurement of Outside Counsel.

A. The Attorney General shall not enter into a contract for outside counsel unless the following requirements are met throughout the contract period and any extensions thereof:

1. The Attorney General shall review the proposed fee arrangement to hire outside counsel to ensure that that there is a reasonable, good faith legal basis to pursue the litigation in the interest of the citizens of the State, and ensure that fees for outside counsel, whether based on an hourly rate, contingency fee, or other arrangement, are reasonable and consistent with industry standards.

2. The Attorney General shall retain oversight and control over the course and conduct of the litigation or anticipated litigation;

3. The Attorney General shall designate a member of the Attorney General's Office to personally oversee the litigation;

4. The Attorney General shall retain veto power over any decisions made by outside counsel, and no lawsuit will be filed, or party added to or served with process in any lawsuit, by outside counsel, without express written permission of the Attorney General;

5. The Attorney General shall be apprised of, attend and/or participate in all settlement offers or conferences; and

6. Decisions regarding settlement of the case shall be made by the Utah Attorney General and not the outside counsel, provided that the Attorney General may give outside counsel a reasonable range of specific settlement authority in writing, within which outside counsel is authorized to settle the case.

B. Every contingency fee contract for outside counsel shall be reasonable and not exceed industry standards for the type of case and level of expertise needed. Unless subject to the Opt-Out Provisions of Rule R105-1-11 C or an exception under Rule R105-1-11 D, contingency fees (not based on hourly rates) paid by the State of Utah shall be no greater than:

1. [33 and 1/3]25 percent [of the first $5,000,000 recovered;

2. 25% of any additional amounts recovered above $5,000,000, ]up to a total of $25,000,000 recovered;

[3]2. 10 percent for any amount in excess of $25,000,000 recovered; and

[4]3. A total maximum contingency fee paid by the State of Utah to not exceed $50,000,000.

C. Opt-out.

1. A contingency fee contract in excess of the limits set forth in Rule R105-1-11 B 1 through Rule R105-1-11 B 4, or that otherwise differs materially from any limitations contained in this Rule R105-1, may only be entered into upon a written finding by the Attorney General that the higher fee or different terms are appropriate given the needs of the case, reasonable and do not exceed industry standards given the nature of the case, and that the contract will not encourage unwarranted high risk litigation that is not in the interests of the citizens of the State. This written finding shall be posted on the Attorney General's website. The written finding may be filed at any time, including, but not limited to, before or after the filing of a protest or any other objection, claim or litigation regarding the procurement.

2. The Attorney General shall provide the written finding that the higher fee is appropriate to the Governor at least seven calendar days before the contingency fee contract is to be signed, except when an emergency exists under Rule R105-1-9, in which case the Attorney General shall, if time permits given the emergency, provide the written finding one day before the contingency fee contract is to be signed.

3. If the Governor so requests prior to the contingency fee contract being signed, the Attorney General shall call a meeting of all Division Directors in the Attorney General's Office to review the Attorney General's written finding. The contract shall only be signed if at least two thirds of the Division Directors whose Divisions are not directly involved in the procurement agree that the higher fee or different terms are in the interests of the citizens of the state. Some Directors may participate by electronic means.

D. Exceptions: This Rule R105-1-11 does not apply to the hiring of counsel for any of the following:

1. Debt collection or restitution cases;

2. Legal advice or litigation services related to international goods or services;

3. Legal advice or litigation services related to matters involving death or personal injury;

4. Bond counsel, disclosure counsel, or other similar counsel involved in the issuance of debt instruments by the State;

5. A multistate case under Rule R105-1-3 E or F; or

6. As otherwise provided in Utah Code, including Section 26-19-7(2)(b)(ii), wherein the Office of Recovery Services pays a contingency fee of 33.3% in Medicaid reimbursement cases.

E. Notwithstanding any other provision of this Rule R105-1-11, the solicitation for outside counsel may provide a lower fee limitation and/or provide for weights and scoring of the proposed fees in accordance with the Utah Procurement Code, which will allow for a competitive process and may provide for fees below the limitations set forth in this Rule.

 

R105-1-12. Transparency in Contingency Fee Contracts with Outside Counsel.

A. Except as otherwise provided by GRAMA, applicable law, Rules of Professional Conduct or this Rule, a copy of the executed contract with outside counsel shall be made available for public inspection in accordance with GRAMA.

B. Any payment by the Attorney General under a contingency fee contract shall be made available for public inspection in accordance with GRAMA.

C. Upon request of the President of the Utah Senate or Speaker of the Utah House of Representatives, the Attorney General shall make available all contracts for hiring outside counsel on a contingency fee basis in the preceding year from the date of the request as well as any known names of the parties to the legal matter, the amount of any recovery and the amount of any contingency fee paid. Notwithstanding this, the Attorney General may withhold information that is confidential under GRAMA, Rules of Professional Conduct or applicable law unless the Attorney General determines that such release of information can lawfully be provided to the President of the Utah Senate or Speaker of the Utah House of Representatives [can be]and is adequately assured of confidentiality through a confidentiality agreement or similar document.

 

R105-1-13. Contracts.

Those awarded a contract under this Rule shall be required to enter into a written contract with the Attorney General. The written contract shall contain all material terms set forth in:

A. The final procurement documents issued by the Utah Attorney General;

B. The provisions in documents submitted by the provider to the extent such provisions are accepted by the Attorney General;

C. A termination for cause and a termination for convenience clause; and

D. Any terms required by law, whether by the constitutions, statutes, or rules or regulations of the United States or the State of Utah.

 

R105-1-14. Retention and Non-availability of Files.

A. All proposals submitted to the Attorney General under this rule become the property of the State of Utah and the office of the Attorney General.

B. All information in all proposals shall be placed in a file relating to the project for which the proposal was submitted. Each file shall contain:

1. If applicable, a copy of all written determinations of the Attorney General required by the Utah Procurement Code or this Rule;

2. A copy of the procurement documents and any written documentation related to notification requirements; and

3. All responses to procurements and modifications, in writing, to any procurement if those modifications have been negotiated by the Attorney General.

4. All records shall be maintained or disposed of in accordance with Part 20 of the Utah Procurement Code.

 

R105-1-15. Cancellations, Rejections, and Debarment.

Cancellations, rejections and debarments shall be subject to the provisions of the Utah Procurement Code and, except as otherwise provided in this Rule R105, Rule R33-9.

 

R105-1-16. Preferences.

Preferences shall be subject to the provision of the Utah Procurement Code, and except as otherwise provided in this Rule R105, Rule R33-10.

 

R105-1-17. Bond and Security.

Any bonds or security shall comply with Part 11 of the Utah Procurement Code and Rule R33-11.

 

R105-1-18. Terms and Conditions, Contracts, Multiple Year, Multiple Award, Change Orders and Costs.

There shall be compliance, as applicable, with Part 12 of the Utah Procurement Code and Rule R33-12.

 

R105-1-19. Controversies and Protests.

Part 16 of the Utah Procurement Code shall apply as well as Rule R33-16.

 

R105-1-20. Procurement Appeals Board, Appeals to Court and Court.

Parts 17, 18 and 19 of the Utah Procurement Code shall apply as well as Rules R33-17, R33-18 and R33-19.

 

R105-1-21. Interaction between Procurement Units.

Part 21 of the Utah Procurement Code shall apply as well as Rule R33-21.

 

R105-1-22. Unlawful Conduct and Penalties.

There shall be compliance with Part 24 of the Utah Procurement Code and Rule R33-24.

 

KEY: Attorney General, litigation support, outside counsel, expert witnesses

Date of Enactment or Last Substantive Amendment: 2015

Authorizing, and Implemented or Interpreted Law: Art VII Sec 16; 67-5; 63G-6

 

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