State lawmakers delivered a simple, clear message to attorneys and state officials battling over who gets to lead the state's efforts to recover taxpayer dollars lost in suspicious investment deals: Learn to work together.

"I know it's difficult; there's been so much sniping back and forth," Sen. William Payne, R-Albuquerque, said. "But we're so bollixed up amongst ourselves it's hard to proceed."

Sen. George Muñoz, D-Gallup, expressed a similar sentiment, saying that recovering state money shouldn't be "a pissing match."

The message of reconciliation was repeated so often Wednesday that it resembled a mantra by the end of a four-hour legislative hearing at the state Capitol.

Estimates are the state of New Mexico lost hundreds of millions of dollars in recent years due to a pay-to-play scandal in which investment deals were struck to reward politically influential people.

But since May, a whistle-blower and his attorney have dueled with New Mexico Attorney General Gary King, the State Investment Council and an out-of-state law firm the agency hired over who decides the state's strategy in trying to recover that money.

A state judge is scheduled to hear claims from both sides on Aug. 17.

On one side, former Educational Retirement Board investment officer Frank Foy and his attorney, Victor Marshall, want to block a suit filed in May by King and the State Investment Council that would go after "ill-gotten gains" that "unjustly enriched" nearly 20 defendants, as that suit put it.

On the other side, King and the State Investment Council want to block Foy from being able to go after taxpayer dollars lost in deals involving the investment council. That would leave Foy the ability to pursue money lost in deals that involved the Educational Retirement Board under the state's Fraud Against Taxpayers Act. That 2007 statute is what allowed Foy to sue in 2008 to recover taxpayer dollars potentially lost to fraud.

Before the Aug. 17 hearing, Marshall said he wants to depose King, current State Investment Officer Steven Moise and State Investment Council member Doug Brown.

While Foy has pursued recovery of taxpayer dollars for longer than anyone else, lawmakers appeared split Wednesday on his efforts.

"I think it's really not benefiting the state," said Rep. Miguel Garcia, D-Albuquerque. "The nature of the Foy suit has lost its zeal. The picture that the lawsuit gives is that there is still corruption in the state, corruption in investments. We have in place a lot of rules, a lot of reform, that keeps that from occurring."

But Sen. President Pro-Tem Tim Jennings, a Roswell Democrat, said Foy deserved to be rewarded for speaking out before anyone else would.

"Had Foy not brought this lawsuit, nothing would ever have happened," Jennings said. "He was the first guy, and only guy, to speak up against an administration" that punished people for speaking up. Jennings was referring to former Gov. Bill Richardson's administration.

King told state lawmakers Wednesday that his office waited nearly three years to sue to recover taxpayers' dollars, in part, to see if the efforts of Foy and Marshall produced results. They have not, the attorney general said.

"They have sued a hundred defendants and not won a dollar," agreed Evan Land, the general counsel for the State Investment Council.

Another obstacle makes Foy's efforts less likely to pay off, King and Land said. Two state judges have ruled that the Fraud Against Taxpayers Act, the weapon Foy and Marshall have wielded to recover taxpayer money, cannot apply to money lost in investment deals before 2007, the year the state statute went into effect.

The lawsuit the State Investment Council filed in June sidesteps that problem, Land told state lawmakers. "If the council sues, and Gary King dismisses Foy claims as to the SIC, the retroactivity doesn't not apply to us. We can get at actions in 2003," the SIC attorney said.

All the bickering exasperated some lawmakers, who viewed it as a sideshow to the real issue at hand: getting taxpayer dollars back.

"I think we need to figure out how to support the attorney general and Mr. Marshall," said Sen. Mary Kay Papen, D-Las Cruces.

Marshall acknowledged the courtroom hostilities and expressed a desire to work things out.

"We're shooting at each other. I don't want to shoot each other," Marshall said.

At the end of Wednesday's hearing, however, none of the attorneys involved in the legal squabbling appeared ready to completely back off his or her position.

Contact Trip Jennings at 986-3050 or at tjennings@sfnewmexican.com.