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Larry Nassar gymnastics scandal has cost Michigan State $20M in legal fees so far

USA TODAY SPORTS logo USA TODAY SPORTS 1/24/2019 Matt Mencarini

a man wearing glasses and looking at the camera: FILE - In this Feb. 2, 2018, file photo, Larry Nassar listens as Melissa Alexander Vigogne gives her victim statement in Eaton County Circuit Court in Charlotte, Mich. The U.S. Olympic Committee has fired chief of sport performance Alan Ashley in the wake of an independent report that said neither he nor former CEO Scott Blackmun elevated concerns about the Larry Nassar sexual abuse allegations when they were first reported to them. The 233-page independent report was released Monday, Dec. 10, 2018. It detailed an overall lack of response when the USOC leaders first heard about the Nassar allegations from the then-president of USA Gymnastics, Steve Penny. Blackmun resigned in February because of health concerns.(Matthew Dae Smith/Lansing State Journal via AP, File) © Provided by USA TODAY, a division of Gannett Satellite Information Network, Inc. FILE - In this Feb. 2, 2018, file photo, Larry Nassar listens as Melissa Alexander Vigogne gives her victim statement in Eaton County Circuit Court in Charlotte, Mich. The U.S. Olympic Committee has fired chief of sport performance Alan Ashley in the wake of an independent report that said neither he nor former CEO Scott Blackmun elevated concerns about the Larry Nassar sexual abuse allegations when they were first reported to them. The 233-page independent report was released Monday, Dec. 10, 2018. It detailed an overall lack of response when the USOC leaders first heard about the Nassar allegations from the then-president of USA Gymnastics, Steve Penny. Blackmun resigned in February because of health concerns.(Matthew Dae Smith/Lansing State Journal via AP, File) EAST LANSING — Michigan State University will pay for former university President Lou Anna Simon's criminal defense as its legal bills related to the Larry Nassar scandal approach $20 million.

With those legal fees, plus a settlement with hundreds of Nassar's victims, payments to consultants and a fund that had been set up for some of Nassar's victims to receive counseling, the total cost to MSU was more than $523 million as of the middle of November, according to records obtained through public records requests.

The university is paying the law firms using income generated by its investment office that doesn't come from endowment funds. The university will sell bonds to pay for the $500 million settlement.

$19.4 million and rising 

Since December 2016, a dozen law firms have billed the university for $19.4 million for work related to lawsuits and outside investigations connected to Nassar, a former MSU doctor who sexually abused hundreds of women and girls, including many at his campus office.

Twelve law firms sent invoices to MSU for 28,561 hours, with some charging as much as $990 per hour

As early as summer 2017, MSU began paying Latham & Watkins LLP to handle the insurance matters that might arise from the Nassar case. At least $3.4 million has been paid to law firms handling insurance-related issues. In July, MSU filed a lawsuit against several of its insurers, arguing they aren't honoring policies dating back to the late 1990s. The lawsuit remains open.

The majority of the university's legal fees — $13.4 million — have gone to two law firms: Skadden, Arps, Slate, Meagher & Flom and Latham & Watkins.

Former president's legal defense

Three former MSU officials face charges related to the Nassar scandal, and MSU is paying for all or part of the defense for each. The university did not pay any of Nassar's criminal defense. 

Simon, who had been university president for more than a decade, resigned that post hours after Nassar was sentenced in Ingham County. 

Former MSU President Lou Anna Simon appears before Judge Julie Reincke in Eaton County on Monday, Nov. 26, 2018, for her arraignment on four charges of lying to police related to the Larry Nassar investigation. [AP Photo/Matthew Dae Smith/Lansing State Journal] © Matthew Dae Smith/Lansing State Journal Former MSU President Lou Anna Simon appears before Judge Julie Reincke in Eaton County on Monday, Nov. 26, 2018, for her arraignment on four charges of lying to police related to the Larry Nassar investigation. [AP Photo/Matthew Dae Smith/Lansing State Journal]

She and former MSU gymnastics coach Kathie Klages face charges of lying to police about when they knew about sexual abuse reports against Nassar. 

Related: Police say MSU's Lou Anna Simon attended 2014 meeting where Larry Nassar inquiry was discussed

Another new president: Michigan State interim president resigns after remarks about Nassar victims

The university will pay for both of their criminal defenses. MSU also will pay for half of former medical school Dean William Strampel's defense. He faces two charges of willful neglect of duty from his role as Nassar's boss, along with sexual assault and harassment charges.

As of Nov. 12, MSU has been billed $29,689 for Strampel's defense and had not yet received invoices related to Klages and Simon.

The cases against Klages and Strampel are in Ingham County Circuit Court, where they could go to trial.

Simon is set for a preliminary hearing in Eaton County next week. The hearing will determine if there's enough evidence against her for the case to proceed.

Simon still holds a professorship at the MSU's College of Education but has taken a leave of absence without pay while the criminal case proceeds.

Follow Matt Mencarini on Twitter: @MattMencarini

This article originally appeared on Lansing State Journal: Larry Nassar gymnastics scandal has cost Michigan State $20M in legal fees so far

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