State government in 2025 paid private practice attorney fees exceeding $53 million, more than double the total six years ago.
The outside counsel charges were roughly 25% of overall costs for advice, investigations, lawsuits and other legal work involving state agencies. For services by in-house attorneys, the Department of Law and Public Safety estimated it charged the agencies at least $145 million.
The largest outside expenditure was roughly $14.8 million — about a quarter of the total — paid to Kelley Drye & Warren LLP of New York for environmental matters, including action against DuPont and related companies over hazardous waste. The litigation led to a settlement of more than $2 billion, a national record for an environmental legal agreement with a single state, according to the Attorney General’s Office.
The state has several reasons for seeking help from non-governmental legal staff, Attorney General Jennifer Davenport told the Assembly Budget Committee recently.
“There may be a conflict, a specialized area of law or if there’s insufficient capacity (in the department) or something maybe that’s large-scale,” she said.
In two years, outside counsel spending soared 57%, according to an analysis by the nonpartisan Office of Legislative Services. That’s partly because the state agreed to “reasonable increases” in pay of $50 per hour, bringing a law associate’s compensation to $250 and a partner’s to $300, the report found.
Two recent legal matters were particularly costly. The state spent $8.4 million for a review of the state’s COVID-19 response and the resulting 910-page report by the Philadelphia-based Montgomery McCracken Walker & Rhoads. To block New York City congestion pricing, the state paid $1.1 million to King & Spalding of Atlanta.
In all, the state paid 114 private firms to handle about 1,700 legal matters. The top 10 highest-earning firms collected two-thirds of the total fees. Nine firms were paid more than $1 million each, according to an NJ Spotlight News analysis.
The record-setting environmental agreement involved the cleanup of per- and polyfluoroalkyl substances, known as PFAS or “forever chemicals,” at four sites. It includes $875 million in natural resources and other damages and to cover abatement projects, including drinking water treatment.
Among other legal work handled by outside counsel:
- PILOT and tax appeals in Atlantic City (Chiesa Shahinian & Giantomasi PC of Roseland).
- The ongoing 2020 federal lawsuit and others filed by Short Hills-based Blueprint Capital Advisors LLC, a Black-owned firm, against the governor, the Treasury Department, Division of Investment and others alleging discrimination and contending the state wrongfully gave a contract and confidential information to BlackRock Inc., the world’s biggest asset manager ($564,000 paid to Connell Foley LLP of Roseland).
- The whistleblower lawsuit filed by Chris Neuwirth, who contended that he was fired as an assistant Health commissioner for reporting alleged unethical conduct by state officials early in the COVID-19 pandemic. The state settled last year for $2.25 million (Friedman Kaplan Seiler Adelman & Robbins LLP, New York).
Under rules put in place in 2009, outside counsel must clear conflict-of-interest checks and other vetting prior to hire. The state typically contracts with firms with expertise in such areas as employment, civil rights, natural resources, fatal accidents and land use. In rare instances, the governor may authorize outside counsel without pre-approval because it has highly specialized skills.
This story is made possible in part by the Corporation for Public Broadcasting, a private corporation funded by the American people.
