Thursday, June 19, 2008

More on Great Trial -- Louisville CJ Today

COVINGTON, Ky. -- Cincinnati attorney Stan Chesley finished testifying yesterday in Kentucky's fen-phen case, concluding two days of damaging testimony against three lawyers charged with defrauding their clients by taking $65 million more than they were due.
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"We are astonished the defense would call Mr. Chesley in their case, because they knew his testimony would severely damage their clients," said Scott C. Cox, an attorney for Chesley, in an interview after the testimony had ended.
Chesley, who negotiated the settlement in 2001 and testified with immunity from prosecution, was one of the last defense witnesses called in the federal fraud case against lawyers William Gallion, Shirley Cunningham Jr. and Melbourne Mills Jr.
Nearly six weeks after the trial started, the defense finished its case yesterday and prosecutors will be done early today. The federal jury will hear closing arguments Monday and could begin deliberating later that day or early Tuesday.
The defendants are charged with conspiracy to commit wire fraud for taking $98 million from the settlement -- allegedly $65 million more than allowed under contracts with their 431 clients who claimed they were harmed by fen-phen, a diet-drug combination pulled from the market in 1997. They could be sentenced to 20 years in prison if they are convicted
The defense closed without the testimony of Mills, who was supposed to testify yesterday but decided against it on the advice of his attorneys.
Mills, 77, has said he had no role in negotiating the settlement and that he was drinking a fifth of bourbon a day at the time. Mills broke with the other two defendants more than a year ago.
In court records, he has said the other defendants lied when they initially told him the $200 million settlement was for $150 million.
Gallion has testified that his associate, David Helmers, was supposed to tell Mills about the additional $50 million. But yesterday, Helmers testified that he was never told to speak with Mills and was, in fact, directed to not discuss the settlement.
Helmers testified that Gallion "said he told Mills about the $200 million" and that if Mills didn't remember, he must have forgotten or been impaired.
Helmers also said he had "no recollection" of an e-mail the defense claimed he had sent to Gallion about speaking with Mills.
Lawyers for all three men have blamed mistakes in the case on Chesley, who testified again yesterday that the plaintiffs should have been paid more money.
The defense continued to try to make Chesley look dishonest, bringing in witnesses yesterday to testify that he had appeared at a February 2006 hearing on the creation of a charitable fund in which $20 million of the $200 million settlement was placed.
Chesley, who himself was paid more than $20 million, had testified that he did not recall attending the meeting.
An attorney representing Cunningham and Gallion in a civil suit in the case testified that Chesley had told her he would be "the best witness" for the three defendants -- before he was given immunity.
Reporter Jason Riley can be reached at (502) 582-4727 .

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