By David Thomas and Mike Scarcella

May 7 (Reuters) - (Billable Hours is Reuters' weekly report on lawyers and money. Please send tips or suggestions to D.Thomas@thomsonreuters.com.)

Washington lawyer Terry Collingsworth is asking a judge to overturn a racketeering verdict against him that could reach $256 million – and contemplating bankruptcy for his law firm if the judge or an appeals court won't reverse it.

"There’s no way we can even pay a small fraction of that judgment," said Collingsworth in an interview.

Collingsworth spent decades suing major corporations on behalf of plaintiffs alleging overseas rights violations. He was among the lawyers behind a 22-year lawsuit against ExxonMobil, alleging that security personnel guarding the company’s Indonesian natural gas operations committed murder and torture. Exxon, which denied wrongdoing, settled days before trial in 2023.

But Collingsworth was forced to play defense in litigation involving Birmingham, Alabama-based coal producer Drummond. The company sued him for racketeering in 2015, alleging he filed fraudulent lawsuits and formulated a scheme to pay witnesses to deliver false testimony linking Drummond to a violent Colombian paramilitary group. An Alabama federal jury cleared Drummond of liability in Collingsworth's case related to its Colombian mining operations in 2007.

A federal jury in Birmingham in January found Collingsworth and his firm liable for racketeering and awarded Drummond $68 million in damages. The jury also awarded Drummond $52 million in compensatory and punitive damages over allegedly defamatory statements by Collingsworth in letters to Dutch officials and Drummond’s Japanese business partners.

U.S. District Judge R. David Proctor last month granted Drummond's motion to triple the $68 million award under a provision of the federal Racketeer Influenced and Corrupt Organizations Act. He has not yet entered a final judgment.

Collingsworth filed court papers last week to overturn the jury's verdict or obtain a new trial. He argued Drummond failed to present adequate evidence of racketeering and failed to prove he acted with actual malice, a key requirement for some defamation claims.

Collingsworth and his firm, International Rights Advocates, have also argued that Proctor made numerous mistakes over the course of the long-running litigation and during the five-week trial. He also argued that Proctor was biased against him and should have recused himself.

"We hope we have a decent chance with these post-trial motions," Collingsworth told Reuters.

Trey Wells, an attorney at Starnes Davis Florie who is representing Drummond, said in a statement that the company plans to "vigorously pursue full collection" of the jury's award against Collingsworth, his firm and other defendants in Colombia and the Netherlands.

"Drummond’s intent through all of this litigation was to right a wrong that had been done to it," Wells said. "While money was not the primary motivating factor, the amount of the verdict is evidence of the jury’s view of the egregiousness of the defendants’ misconduct."

Drummond's response to Collingsworth's bid to overturn the verdict is due on Monday.

ETHICS FILINGS SHOW PAY FOR FRESHFIELDS, WHITE & CASE LAWYERS

New U.S. ethics and financial disclosures from some of President Donald Trump’s nominees for senior federal posts include a lawyer picked to lead the U.S. State Department’s legal team and another tapped to serve as ambassador to Norway.

Trump's nominee for Norwegian ambassador, Michael Kavoukjian of White & Case, reported receiving more than $4.3 million from the law firm as his final partnership share, his disclosure showed.

Brock Dahl of Freshfields, nominated as the State Department legal adviser, reported receiving more than $1 million from the law firm since the start of 2025, according to his disclosure.

Dahl and Kavoukjian did not immediately respond to requests for comment.

Kavoukjian heads the fiduciary litigation group at White & Case, representing high net worth estates and financial institutions in cross‑border trust and estate matters. He said in his disclosure that he retired from his equity partnership in the firm in December but remains a partner of counsel.

At Freshfields, Dahl focuses on cybersecurity and data privacy matters from the firm’s Washington and Silicon Valley offices. Dahl was previously a top lawyer at the National Security Agency.

Dahl’s ethics disclosure showed he has provided legal services to Freshfields clients including Google, Visa, General Dynamics, Merck, CrowdStrike and KPMG International Services.

STATES FACE PUSHBACK ON FEES IN KROGER-ALBERTSONS CASE

Grocery retail giants Kroger KR.N and Albertsons ACI.N have asked a judge to sharply reduce a $10 million legal fee demand from the state attorneys general who helped the U.S. Federal Trade Commission block their proposed merger, arguing the states played too small a role in the case to justify the award.

The new filing in U.S. District Court in Oregon says the FTC led the litigation from start to finish. Kroger and Albertsons called the states' fee demand "extraordinary,” taking issue with its size and the states' hourly rates.

“No state attorneys general have ever recovered fees in federal court after obtaining a preliminary injunction blocking a merger — much less the millions of dollars of fees requested here,” the filing said. Kroger and Albertsons did not immediately respond to requests for comment.

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