The Talent

August 11, 2008 6:04 PM

Fred Baron: John Edwards' Money Man

Posted by Zach Lowe

Dallas-area Democrats defended Fred Baron Monday, saying his loyalty to his friends and passion for Democratic politics were behind his payments to John Edwards' mistress and the Edwards campaign worker who has identified himself as the father of her child.

Baron, a trial lawyer who became one of the kings of asbestos litigation, has admitted paying Rielle Hunter and former Edwards campaign staffer Andrew Young relocation expenses when they moved out of North Carolina and into million-dollar homes in California in the last two years.

The payments may amount to as much as $15,000 per month, some news outlets reported.

Baron's admissions and Edwards' acknowledgment of the affair came after the two-time presidential hopeful--and 2004 Democratic vice-presidential candidate--spent months denying reports of marital infidelity published in the National Enquirer.

Baron has backed Edwards since 2004, when the former North Carolina senator made his first failed run for the Democratic presidential nomination. Baron supported Edwards again in the 2008 cycle before the former trial lawyer ended his bid; Baron later endorsed Barack Obama, the presumptive Democratic nominee.

Baron and his wife, Lisa Blue, did not return messages from The Am Law Daily Monday.

His friends in Texas, where Baron's fortune has helped lead a Democratic resurgence in the legislature and the judiciary, defended the payments Monday even as some of them questioned his judgment.

"It came as a big surprise," says Darlene Ewing, chair of the Dallas County Democratic Party. "I think his intentions were well-meaning, if maybe a bit misdirected."

Ewing says she never took any of Baron's money for her county chair campaign, but Baron's political action committee, the Texas Democratic Trust, has spent millions backing Democratic candidates since 2004, when he all but quit his law practice to support Edwards.

"He has no personal interest in Democratic politics, and he could easily sit back and do nothing right now," says Marc Stanley, name partner at Stanley, Mandel & Iola and an active Democrat. "And yet he spends an inordinate amount of time and money on it, because he believes in the cause."

Critics have suggested Baron simply wanted to elect plaintiff-friendly judges to the Texas bench.

The bulk of Baron's money came from asbestos litigation, a tort area Baron first discovered in the 1970s and turned into big business. Some have estimated Baron's old firm, Baron & Budd grossed more than $800 million on asbestos litigation alone.

Baron did not envision himself as a torts lawyer when he graduated from the University of Texas School of Law in the early 1970s, according to this 2007 profile in Texas Lawyer, a sibling publication of the Am Law Daily.

But he said he felt "proselytized" by a speech Ralph Nader gave about using the law to regulate corporate conduct. Nader served as Baron's mentor in the early days of his career.

Nader's aides said he was unavailable for comment Monday.

The asbestos litigation earned Baron some powerful enemies, especially when a young associate at his firm accidentally handed defense counsel an internal memo telling witnesses how to answer questions in depositions.

The memo, parts of which were leaked to the Dallas Observer in the late 1990s, coached plaintiffs to say they saw "just as much of one" asbestos-laden product as "all the others" -- so as many companies as possible could be held liable, the Observer reported. The memo also instructed potential plaintiffs to say they never saw warning labels on containers of asbestos products, even if they couldn't remember whether that was true. Baron denied knowing about the memo but defended it at the same time.

One Texas judge called the memo "an affront to the integrity of the judicial system," and a grand jury reportedly considered charging Baron with encouraging witnesses to lie under oath. He was never charged, and he continued pursuing asbestos cases with a team that numbered more than 400--out of a 60-lawyer firm.

In the 1990s, Baron won a landmark U.S. Supreme Court case, Amchen Products v. Windsor, that banned injured individuals from pursuing mass torts as a class. His attorney in that case, Harvard Law School  professor Laurence Tribe, did not return messages seeking comment on Baron's payments to Hunter.

Baron left his firm in the same controversial fashion with which he went after asbestos defendants. He and his wife sued Baron & Budd in 2006, claiming the partners conspired to deny them money they said they were owed as part of his departure agreement.

During the litigation, which ended in a confidential settlement, Baron's legal team made one particularly ironic charge against his ex-firm's legal team at Vinson & Elkins--that they were coaching witnesses inappropriately.

Russell Budd, Baron's former partner, did not return calls seeking comment. Most lawyers involved in the litigation say they prefer not to discuss Baron publicly.

One, Eric Gambrell, an Akin Gump Strauss Hauer & Feld partner says he hopes the Edwards scandal does not taint Baron's career. (The firm represented Baron.)

"He's obviously a legal legend, and I've never seen a better strategist," Gambrell says. "Beyond all this [Edwards] stuff, he's a great human being."


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