By Daniel LeDuc
Washington Post Staff Writer
Sunday, February 8, 1998; Page B01

A fierce behind-the-scenes struggle in Annapolis will soon burst into public view, as the General Assembly begins to consider legislation that would help Maryland win its lawsuit against cigarette makers. With billions of dollars at stake, the fighting -- and the search for the moral high ground -- is already intense.

The legislation has been requested by Attorney General J. Joseph Curran Jr. (D), who said it would greatly strengthen Maryland's lawsuit seeking more than $3 billion from cigarette makers to recover Medicaid costs the state incurred in treating smoking-related illnesses.

But opponents -- including the tobacco companies and business groups -- are complaining that Curran's efforts are unfairly changing the rules in the middle of the lawsuit and could mean a dramatic change in Maryland's negligence laws, which have long favored big business.

They worry that the legislation might prove appealing to lawmakers, who see billions of dollars dangling before their eyes and already are making plans to spend it on state programs.

Adding to the controversy is the role of Baltimore lawyer and Orioles owner Peter G. Angelos, Maryland's attorney in the lawsuit. Angelos, whose law firm is fronting the cost of the litigation, has contracted to receive 25 percent of any settlement. That means his fees could easily total more than $750 million, which nearly all legislators denounce as excessive.

"They either say [Angelos's] fees are too high or that it's anti-business," Curran said of the cigarette companies' advocates. "They never admit they have a deceptive client who lies to people, who kills people."

But to Keith Teel, a lawyer representing several cigarette makers in the Maryland case, the legislature is exercising "raw, unchecked political power. They're changing the rules to benefit themselves."

At issue is a Maryland law that says someone who has been injured can't collect from the responsible party if he or she contributed in any way to the injury.

Early drafts of Curran's proposal would have changed the law so that even people who had contributed to their injuries could recover money, said legislators who saw the drafts. That would mean a significant change in state law.

But the main sponsors of the legislation to be introduced Monday say it will be narrowly crafted to apply only to the state's lawsuit against the cigarette makers and that it will not undo Maryland's current negligence laws.

House Speaker Casper R. Taylor Jr. (D-Allegany) said the fine-tuning was necessary to make sure the proposal did not have greater ramifications than intended.

A spokesman for Gov. Parris N. Glendening (D) was unable to describe the governor's views on the proposal. But the bill had yet to be introduced when each side began staking out its turf last week, mindful of the huge stakes in the's lawsuit.

Maryland sued seven cigarette makers and related companies and organizations in May 1996, seeking $13 billion for Medicaid costs and for punitive damages. It was the eighth lawsuit filed by a state against the tobacco industry. Some 40 states, Puerto Rico and several local governments have filed similar suits. (Virginia and the District of Columbia have not sued.)

A tentative settlement was reached last summer with six states, but Curran decided that Maryland would not be part of it. He said the settlement favored the cigarette makers and he opted, as did many other states, to continue to litigate. Congress is also considering a national settlement of the issue,

Maryland suffered a setback May 21, when Circuit Court Judge Roger Brown in Baltimore threw out nine of the 13 counts in the state's lawsuit, effectively reducing Maryland's claim to $3 billion. The dismissed counts would have allowed the state to sue the tobacco companies using fraud and negligence laws.

Curran said he thinks he can convince many legislators that the judge mistakenly interpreted the law when he threw out the counts and that the new legislation would simply clarify that.

But to opponents, including the Maryland Chamber of Commerce, the legislation is no simple clarification. They said it could end the state's long history of contributory negligence law.

Critics also said that the legislation could help Angelos in a class-action lawsuit unrelated to the state's case in which he represents a group of Maryland smokers suing cigarette makers. Curran insisted that his proposal applied only to the state's Medicaid lawsuit.

In the House, Majority Leader John A. Hurson (D-Montgomery) said the lawsuit represents a unique situation that requires unique legislation.

"What is at stake is not only [billions of dollars], but the reputation of Maryland across the country," he said. "If Maryland can become one of the first 10 states to settle with the tobacco companies, that enhances our reputation. If Maryland becomes the first state to not successfully sue the tobacco companies, that would be an embarrassment."

Of greatest concern to the Senate sponsor, Walter M. Baker (D-Cecil), however, is Angelos's fee. "Mr. Angelos is entitled to something -- the question is how much?" he said. He wants that fee to be renegotiated before his bill reaches the full Senate.

Angelos declined comment, but Curran said: "There is not going to be any 25 percent. The issue should be: Give us the ammunition to win the case and then we'll decide" the fees.