This from the Wall Street Journal
By DIONNE SEARCEY
A groundbreaking plaintiffs' attorney should be disbarred for bilking clients out of millions of dollars in the settlement of a 1998 diet-pill lawsuit, a Kentucky judicial official said.
Trial Commissioner William L. Graham's recommendation Tuesday that Stanley Chesley be stripped of his law license in Kentucky marks the latest legal twist following the suit filed by people who had taken fen-phen over the drug's alleged health risks. The suit ended in a $200 million settlement paid by drug maker American Home Products.
Stanley Chesley's attorneys plan to appeal a recommendation that he be disbarred in Kentucky.
Fee fights among plaintiffs' lawyers involved in the case began early on, and the Kentucky Bar Association was called to investigate alleged misrepresentations about the settlement. Two plaintiffs' attorneys eventually received prison sentences for defrauding clients, and the judge who handled the case stepped down from the bench.
American Home Products faced numerous federal and state suits over the drug, which was later banned for causing heart-valve problems. The company was eventually acquired by a company now part of Pfizer Inc. A Pfizer spokesman didn't respond to a request for comment.
Judge Graham accused Mr. Chesley of defrauding plaintiffs out of about $7.5 million in fees.
Mr. Chesley's actions were essentially "a cover-up of thievery," Judge Graham said in a report that demanded the return of the money. "His callous subordination of the interests of his clients to his own greed is both shocking and reprehensible," Judge Graham wrote.
Mr. Chesley's attorneys said they planned to appeal to the Kentucky Supreme Court, which will make a final determination on the commissioner's recommendation. The attorneys cited a federal probe of the case, which didn't result in charges against Mr. Chesley. "His findings are directly contrary to the findings of federal authorities, who fully investigated this case and never considered Mr. Chesley a target of their investigation," they said in a statement.
The trial commissioner's report accused Mr. Chesley of muscling into fen-phen litigation under way in Kentucky's Boone Circuit Court and strong-arming attorneys into sharing fees with him in exchange for his "expertise" in handling class actions.
The more than 400 plaintiffs weren't notified, at least initially, of Mr. Chesley's involvement nor were they ever told he had reached an agreement with their attorneys to share in 21% of attorneys' fees in the settlement, according to the report.
Mr. Chesley later convinced Boone Circuit Court Judge Joseph Bamberger to boost attorneys' cut to 49% of the total settlement in a February 2002 clandestine meeting in the courthouse jury room, according to the report. Clients weren't told of the new arrangement. And Mr. Chesley received an additional $4 million payment out of the fees, which Judge Graham said amounted to a bonus for securing such a big cut for his colleagues.
Mr. Chesley wound up being paid more than $20 million in fees, when his agreement called for him to earn roughly $12 million, the report said.
Mr. Chesley said he didn't recall the meeting with the judge, according to the report. Judge Bamberger, the trial judge who resigned, had testified he never would have approved the fees had the lawyers told him about prior fee arrangements.
Mr. Chesley, of Cincinnati, rose to fame in legal circles after representing families of those who died in the 1977 Beverly Hills Supper Club fire in Kentucky. In what was a new tactic, he filed suit against more than 1,000 defendants, most of them companies that had sold supplies or services to the club, eventually securing nearly $50 million in settlements and court awards. His strategy became a blueprint for how plaintiffs' attorneys pursue mass torts—gathering large numbers of plaintiffs and casting a wide net for potential defendants.
Showing posts with label stan chesley. Show all posts
Showing posts with label stan chesley. Show all posts
Friday, February 25, 2011
Thursday, February 24, 2011
Stan Chesley
(c) 2011 F. Bruce Abel
There are two huge stories in my lifetime eminating from Cincinnati impacting my interests and crossing my practice: the law and business. One of them is Stan Chesley and what he accomplished/accomplishes. Being a trial lawyer I am jealous. For large cases there just wasn't anybody else on the plaintiff's side and the world knew it.
But give the man his due! I was discussing the case yesterday with a co-counsel and he said: "I saw him argue in federal court in favor of class action status and without any written legal authority all he did was say, 'Well in Utah I caused the court to do this and in New Jersey [I caused the court] did that.'"
And I said, "Yeah that's the point. When he spoke the judge knew that he was the master of this field and that he could rely on what Stan said."
The man just took the air out of the room for the rest of the plaintiffs' trial bar. So be it. I wish I were he.
And his wife is the best federal judge around.
The other story: Carl Lindner.
There are two huge stories in my lifetime eminating from Cincinnati impacting my interests and crossing my practice: the law and business. One of them is Stan Chesley and what he accomplished/accomplishes. Being a trial lawyer I am jealous. For large cases there just wasn't anybody else on the plaintiff's side and the world knew it.
But give the man his due! I was discussing the case yesterday with a co-counsel and he said: "I saw him argue in federal court in favor of class action status and without any written legal authority all he did was say, 'Well in Utah I caused the court to do this and in New Jersey [I caused the court] did that.'"
And I said, "Yeah that's the point. When he spoke the judge knew that he was the master of this field and that he could rely on what Stan said."
The man just took the air out of the room for the rest of the plaintiffs' trial bar. So be it. I wish I were he.
And his wife is the best federal judge around.
The other story: Carl Lindner.
Tuesday, July 1, 2008
Phen-Fen!
Kentucky
Cincinnati.Com » KentuckyLast Updated: 6:52 pm Tuesday, July 1, 2008
Fen-phen One cleared in diet drug case COVINGTON -- The lawyer for Melbourne “Mel” Mills Jr. said his client was too drunk to conspire with his colleagues to loot a $200 million settlement intended for Kentuckians sickened by the diet drug fen-phen. A federal jury believed him. • Video: Melbourne Mills leaves Boone County jail with his girlfriend Jury of seven women and five men found him not guilty on Tuesday to conspiracy to commit wire fraud. They are still deliberating verdicts for Mills’ codefendants, Shirley Cunningham Jr. and William Gallion. Each faces 20 years in prison and forfeiture of $65 million if found guilty of same crime Mills was indicted on. When asked what he thought led to the not guilty finding, Mills’ attorney, Jim Shuffett, said, “Whatever it was, we are happy about it.”He simply claimed throughout the entire trial his client was too drunk to adequately do his job, much less realize something illegal might be happening. Mills was hospitalized for an “alcoholic seizure” 29 days after the settlement was reached in May 2001, Shuffett said during opening statements.Mills was released from the Boone County jail early Tuesday afternoon. “We've got the greatest court system in the world,” he said. “This is the greatest country in the world with the greatest court system. I'm looking forward to getting back into it.” When asked what he plans to do, he said, “Well, I've got a few papers to keep me busy.”The jury instructions were also favorable to Mills. U.S. District Judge William Bertelsman instructed the jurors that the fact Mills could have been impaired may make it impossible for him to have the intent to defraud necessary to commit the offence of conspiracy to commit wire fraud.Shuffett called no witnesses on his client’s behalf, objected little to the prosecution’s case and gave opening and closing statements that totaled only about 20 minutes in a trial that has now stretched into its eighth week.“Let Mel go home with his grandchildren,” Shuffett said during closing arguments. “He has suffered enough.”The oldest of the defendants, the 77-year-old Mills appeared physically weak during much of the trial, a proceeding that was delayed for two days when he had to be taken to the hospital for an illness. Other times, Mills would appear to fall asleep during testimony.Mills has been held at the Boone County jail since August in lieu of a $5 million cash bond. His codefendants are also being held in lieu of bonds in the millions of dollars.The defendants, all lawyers, were suspended from practicing law in Kentucky after they received a $45 million judgment against them in Boone Circuit Court for their handling of the same settlement.The involvement of Mills in the settlement was limited, Shuffett said throughout the trial.Gallion and Cunningham needed to sign enough clients to file a class-action lawsuit against the maker of fen-phen, the now defunct American Home Products, according to testimony at the trial. To do that, they recruited Mills to find people whose hearts were damaged by the now-banned drug.It was a natural fit. Mills was once known throughout central Kentucky for his flamboyant advertising campaign where he urged people who had been wronged to “call the man.”Shuffett argued during the trial that had Gallion and Cunningham conspired to defraud the users of fen-phen, they would have never brought Mills, a known alcoholic, into the scheme.“They would not have taken a bad alcoholic in had they been scheming to steal,” Shuffett said. “They would have been insane, and they are not.”He said Mills was so impaired that Cunningham and Gallion didn’t invite him to the mediation where the settlement was reached or even give Mills a copy of the settlement agreement.U.S. Assistant Attorney Laura Voorhees countered by saying Mills sobered up when he was hospitalized for alcoholism a short time after the settlement. Mills “laughed” when he found out that the fen-phen takers only received $75 million – less than half of the settlement, Voorhees said during her opening arguments.She and U.S. Assistant Attorney E.J. Walbourn presented evidence that Mills received $24 million from the settlement. Cunningham got $21 million and Gallion pulled in $24 million. Those figures are in addition to $20 million the three defendants put into an Edgewood trust that they paid themselves to administer.The defendants were entitled to about $60 million in fees for getting the settlement for the 440 fen-phen users, but took an additional $45 million and put an extra $20 million in a charitable trust they created and controlled, according to the federal indictment.One of the star prosecution witnesses was Mills’ former office assistant, Rebecca Phipps. Named as an un-indicted coconspirator, she was given full immunity to testify against the three defendants.Phipps, who was paid $1.4 million for her work on the settlement, testified that Mills thought Cunningham and Gallion had deceived him. The codefendants told Mills the settlement was for $150 million to cheat him out of an equal share of the legal fees, she testified.That resulted in a confrontation at Mills’ birthday party that was much talked about at the trial. Mills called Gallion “a thief and liar” while people were singing “Happy Birthday,” Phipps testified. Walbourn declined comment after Mills was found not guilty. He said he would wait until after the jury finished deliberating on Cunningham and Mills before he would make a comment.Carrie Cochran contributed to this report." name=story-contents> -->
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COVINGTON -- The lawyer for Melbourne “Mel” Mills Jr. said his client was too drunk to conspire with his colleagues to loot a $200 million settlement intended for Kentuckians sickened by the diet drug fen-phen.
A federal jury believed him.
• Video: Melbourne Mills leaves Boone County jail with his girlfriend
Jury of seven women and five men found him not guilty on Tuesday to conspiracy to commit wire fraud.
They are still deliberating verdicts for Mills’ codefendants, Shirley Cunningham Jr. and William Gallion. Each faces 20 years in prison and forfeiture of $65 million if found guilty of same crime Mills was indicted on.
When asked what he thought led to the not guilty finding, Mills’ attorney, Jim Shuffett, said, “Whatever it was, we are happy about it.”He simply claimed throughout the entire trial his client was too drunk to adequately do his job, much less realize something illegal might be happening. Mills was hospitalized for an “alcoholic seizure” 29 days after the settlement was reached in May 2001, Shuffett said during opening statements.Mills was released from the Boone County jail early Tuesday afternoon.“We've got the greatest court system in the world,” he said. “This is the greatest country in the world with the greatest court system. I'm looking forward to getting back into it.”When asked what he plans to do, he said, “Well, I've got a few papers to keep me busy.”The jury instructions were also favorable to Mills. U.S. District Judge William Bertelsman instructed the jurors that the fact Mills could have been impaired may make it impossible for him to have the intent to defraud necessary to commit the offence of conspiracy to commit wire fraud.Shuffett called no witnesses on his client’s behalf, objected little to the prosecution’s case and gave opening and closing statements that totaled only about 20 minutes in a trial that has now stretched into its eighth week.“Let Mel go home with his grandchildren,” Shuffett said during closing arguments. “He has suffered enough.”The oldest of the defendants, the 77-year-old Mills appeared physically weak during much of the trial, a proceeding that was delayed for two days when he had to be taken to the hospital for an illness. Other times, Mills would appear to fall asleep during testimony.Mills has been held at the Boone County jail since August in lieu of a $5 million cash bond. His codefendants are also being held in lieu of bonds in the millions of dollars.The defendants, all lawyers, were suspended from practicing law in Kentucky after they received a $45 million judgment against them in Boone Circuit Court for their handling of the same settlement.The involvement of Mills in the settlement was limited, Shuffett said throughout the trial.Gallion and Cunningham needed to sign enough clients to file a class-action lawsuit against the maker of fen-phen, the now defunct American Home Products, according to testimony at the trial. To do that, they recruited Mills to find people whose hearts were damaged by the now-banned drug.It was a natural fit. Mills was once known throughout central Kentucky for his flamboyant advertising campaign where he urged people who had been wronged to “call the man.”Shuffett argued during the trial that had Gallion and Cunningham conspired to defraud the users of fen-phen, they would have never brought Mills, a known alcoholic, into the scheme.“They would not have taken a bad alcoholic in had they been scheming to steal,” Shuffett said. “They would have been insane, and they are not.”He said Mills was so impaired that Cunningham and Gallion didn’t invite him to the mediation where the settlement was reached or even give Mills a copy of the settlement agreement.U.S. Assistant Attorney Laura Voorhees countered by saying Mills sobered up when he was hospitalized for alcoholism a short time after the settlement. Mills “laughed” when he found out that the fen-phen takers only received $75 million – less than half of the settlement, Voorhees said during her opening arguments.She and U.S. Assistant Attorney E.J. Walbourn presented evidence that Mills received $24 million from the settlement. Cunningham got $21 million and Gallion pulled in $24 million. Those figures are in addition to $20 million the three defendants put into an Edgewood trust that they paid themselves to administer.The defendants were entitled to about $60 million in fees for getting the settlement for the 440 fen-phen users, but took an additional $45 million and put an extra $20 million in a charitable trust they created and controlled, according to the federal indictment.One of the star prosecution witnesses was Mills’ former office assistant, Rebecca Phipps. Named as an un-indicted coconspirator, she was given full immunity to testify against the three defendants.Phipps, who was paid $1.4 million for her work on the settlement, testified that Mills thought Cunningham and Gallion had deceived him. The codefendants told Mills the settlement was for $150 million to cheat him out of an equal share of the legal fees, she testified.That resulted in a confrontation at Mills’ birthday party that was much talked about at the trial. Mills called Gallion “a thief and liar” while people were singing “Happy Birthday,” Phipps testified. Walbourn declined comment after Mills was found not guilty. He said he would wait until after the jury finished deliberating on Cunningham and Mills before he would make a comment.Carrie Cochran contributed to this report.
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obeythelaw wrote:
WOW! I love the photo of Mills! Got teeth maw? Wow his teeth are black and yellow- nice combination of colors going on there. He looks good next to his young daughter- I mean, "girlfriend" (gee, they do look alike). .And hey. What'd ya expect? The jury is smart enough to realize it's CHESLEY that's guilty. After all, that's what happens when ya give a big fraud liar like Chesley immunity. The jury saw through the whole scheme. Bet they were wishing it was Chesley on trial.7/1/2008 7:21:58 PM WOW! I love the photo of Mills! Got teeth maw? Wow his teeth are black and yellow- nice combination of colors going on there. He looks good next to his young daughter- I mean, "girlfriend" (gee, they do look alike). .And hey. What'd ya expect? The jury is smart enough to realize it's CHESLEY that's guilty. After all, that's what happens when ya give a big fraud liar like Chesley immunity. The jury saw through the whole scheme. Bet they were wishing it was Chesley on trial. obeythelaw
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Lovinsteph wrote:
Replying to Festis:
"Damn, I hammered! Where'd I put that $60 mil I stole.Juctice system judging the justice system... What would you expect?A jury of his peers judged his conduct not the justice system or its operatives. Consider this, the presiding judge--a member of the justice system-- ordered him held (essentially) without bond since August of 2007 for a crime he was subsequenltly acquitted of committing. So, Melbourne Mills spent one year in jail for a crime he did not commit. How does that fit into your theory?Surprise! It doesn't, but don't let the facts confuse you.7/1/2008 7:21:03 PM
A jury of his peers judged his conduct not the justice system or its operatives.
Consider this, the presiding judge--a member of the justice system-- ordered him held (essentially) without bond since August of 2007 for a crime he was subsequenltly acquitted of committing. So, Melbourne Mills spent one year in jail for a crime he did not commit. How does that fit into your theory?
Surprise! It doesn't, but don't let the facts confuse you. Lovinsteph
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Festis wrote:
"Damn, I hammered! Where'd I put that $60 mil I stole.Juctice system judging the justice system... What would you expect?7/1/2008 6:30:40 PM "Damn, I hammered! Where'd I put that $60 mil I stole.
Juctice system judging the justice system... What would you expect? Festis
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obeythelaw wrote:
Hate to say it people, but yesterday I posted here, and predicted they'd walk free. AND VERY VERY RICH, as they are walking!7/1/2008 6:18:09 PM Hate to say it people, but yesterday I posted here, and predicted they'd walk free. AND VERY VERY RICH, as they are walking! obeythelaw
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Lovinsteph wrote:
Replying to NewportDem:
So this creep gets to keep the $125 million?Justice is as blind as his girlfriend.This verdict has no bearing on the civil suit that has already been filed against these defendants. This verdict relates to guilt of a criminal nature not a civil nature.
Cincinnati.Com » KentuckyLast Updated: 6:52 pm Tuesday, July 1, 2008
Fen-phen One cleared in diet drug case COVINGTON -- The lawyer for Melbourne “Mel” Mills Jr. said his client was too drunk to conspire with his colleagues to loot a $200 million settlement intended for Kentuckians sickened by the diet drug fen-phen. A federal jury believed him. • Video: Melbourne Mills leaves Boone County jail with his girlfriend Jury of seven women and five men found him not guilty on Tuesday to conspiracy to commit wire fraud. They are still deliberating verdicts for Mills’ codefendants, Shirley Cunningham Jr. and William Gallion. Each faces 20 years in prison and forfeiture of $65 million if found guilty of same crime Mills was indicted on. When asked what he thought led to the not guilty finding, Mills’ attorney, Jim Shuffett, said, “Whatever it was, we are happy about it.”He simply claimed throughout the entire trial his client was too drunk to adequately do his job, much less realize something illegal might be happening. Mills was hospitalized for an “alcoholic seizure” 29 days after the settlement was reached in May 2001, Shuffett said during opening statements.Mills was released from the Boone County jail early Tuesday afternoon. “We've got the greatest court system in the world,” he said. “This is the greatest country in the world with the greatest court system. I'm looking forward to getting back into it.” When asked what he plans to do, he said, “Well, I've got a few papers to keep me busy.”The jury instructions were also favorable to Mills. U.S. District Judge William Bertelsman instructed the jurors that the fact Mills could have been impaired may make it impossible for him to have the intent to defraud necessary to commit the offence of conspiracy to commit wire fraud.Shuffett called no witnesses on his client’s behalf, objected little to the prosecution’s case and gave opening and closing statements that totaled only about 20 minutes in a trial that has now stretched into its eighth week.“Let Mel go home with his grandchildren,” Shuffett said during closing arguments. “He has suffered enough.”The oldest of the defendants, the 77-year-old Mills appeared physically weak during much of the trial, a proceeding that was delayed for two days when he had to be taken to the hospital for an illness. Other times, Mills would appear to fall asleep during testimony.Mills has been held at the Boone County jail since August in lieu of a $5 million cash bond. His codefendants are also being held in lieu of bonds in the millions of dollars.The defendants, all lawyers, were suspended from practicing law in Kentucky after they received a $45 million judgment against them in Boone Circuit Court for their handling of the same settlement.The involvement of Mills in the settlement was limited, Shuffett said throughout the trial.Gallion and Cunningham needed to sign enough clients to file a class-action lawsuit against the maker of fen-phen, the now defunct American Home Products, according to testimony at the trial. To do that, they recruited Mills to find people whose hearts were damaged by the now-banned drug.It was a natural fit. Mills was once known throughout central Kentucky for his flamboyant advertising campaign where he urged people who had been wronged to “call the man.”Shuffett argued during the trial that had Gallion and Cunningham conspired to defraud the users of fen-phen, they would have never brought Mills, a known alcoholic, into the scheme.“They would not have taken a bad alcoholic in had they been scheming to steal,” Shuffett said. “They would have been insane, and they are not.”He said Mills was so impaired that Cunningham and Gallion didn’t invite him to the mediation where the settlement was reached or even give Mills a copy of the settlement agreement.U.S. Assistant Attorney Laura Voorhees countered by saying Mills sobered up when he was hospitalized for alcoholism a short time after the settlement. Mills “laughed” when he found out that the fen-phen takers only received $75 million – less than half of the settlement, Voorhees said during her opening arguments.She and U.S. Assistant Attorney E.J. Walbourn presented evidence that Mills received $24 million from the settlement. Cunningham got $21 million and Gallion pulled in $24 million. Those figures are in addition to $20 million the three defendants put into an Edgewood trust that they paid themselves to administer.The defendants were entitled to about $60 million in fees for getting the settlement for the 440 fen-phen users, but took an additional $45 million and put an extra $20 million in a charitable trust they created and controlled, according to the federal indictment.One of the star prosecution witnesses was Mills’ former office assistant, Rebecca Phipps. Named as an un-indicted coconspirator, she was given full immunity to testify against the three defendants.Phipps, who was paid $1.4 million for her work on the settlement, testified that Mills thought Cunningham and Gallion had deceived him. The codefendants told Mills the settlement was for $150 million to cheat him out of an equal share of the legal fees, she testified.That resulted in a confrontation at Mills’ birthday party that was much talked about at the trial. Mills called Gallion “a thief and liar” while people were singing “Happy Birthday,” Phipps testified. Walbourn declined comment after Mills was found not guilty. He said he would wait until after the jury finished deliberating on Cunningham and Mills before he would make a comment.Carrie Cochran contributed to this report." name=story-contents> -->
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COVINGTON -- The lawyer for Melbourne “Mel” Mills Jr. said his client was too drunk to conspire with his colleagues to loot a $200 million settlement intended for Kentuckians sickened by the diet drug fen-phen.
A federal jury believed him.
• Video: Melbourne Mills leaves Boone County jail with his girlfriend
Jury of seven women and five men found him not guilty on Tuesday to conspiracy to commit wire fraud.
They are still deliberating verdicts for Mills’ codefendants, Shirley Cunningham Jr. and William Gallion. Each faces 20 years in prison and forfeiture of $65 million if found guilty of same crime Mills was indicted on.
When asked what he thought led to the not guilty finding, Mills’ attorney, Jim Shuffett, said, “Whatever it was, we are happy about it.”He simply claimed throughout the entire trial his client was too drunk to adequately do his job, much less realize something illegal might be happening. Mills was hospitalized for an “alcoholic seizure” 29 days after the settlement was reached in May 2001, Shuffett said during opening statements.Mills was released from the Boone County jail early Tuesday afternoon.“We've got the greatest court system in the world,” he said. “This is the greatest country in the world with the greatest court system. I'm looking forward to getting back into it.”When asked what he plans to do, he said, “Well, I've got a few papers to keep me busy.”The jury instructions were also favorable to Mills. U.S. District Judge William Bertelsman instructed the jurors that the fact Mills could have been impaired may make it impossible for him to have the intent to defraud necessary to commit the offence of conspiracy to commit wire fraud.Shuffett called no witnesses on his client’s behalf, objected little to the prosecution’s case and gave opening and closing statements that totaled only about 20 minutes in a trial that has now stretched into its eighth week.“Let Mel go home with his grandchildren,” Shuffett said during closing arguments. “He has suffered enough.”The oldest of the defendants, the 77-year-old Mills appeared physically weak during much of the trial, a proceeding that was delayed for two days when he had to be taken to the hospital for an illness. Other times, Mills would appear to fall asleep during testimony.Mills has been held at the Boone County jail since August in lieu of a $5 million cash bond. His codefendants are also being held in lieu of bonds in the millions of dollars.The defendants, all lawyers, were suspended from practicing law in Kentucky after they received a $45 million judgment against them in Boone Circuit Court for their handling of the same settlement.The involvement of Mills in the settlement was limited, Shuffett said throughout the trial.Gallion and Cunningham needed to sign enough clients to file a class-action lawsuit against the maker of fen-phen, the now defunct American Home Products, according to testimony at the trial. To do that, they recruited Mills to find people whose hearts were damaged by the now-banned drug.It was a natural fit. Mills was once known throughout central Kentucky for his flamboyant advertising campaign where he urged people who had been wronged to “call the man.”Shuffett argued during the trial that had Gallion and Cunningham conspired to defraud the users of fen-phen, they would have never brought Mills, a known alcoholic, into the scheme.“They would not have taken a bad alcoholic in had they been scheming to steal,” Shuffett said. “They would have been insane, and they are not.”He said Mills was so impaired that Cunningham and Gallion didn’t invite him to the mediation where the settlement was reached or even give Mills a copy of the settlement agreement.U.S. Assistant Attorney Laura Voorhees countered by saying Mills sobered up when he was hospitalized for alcoholism a short time after the settlement. Mills “laughed” when he found out that the fen-phen takers only received $75 million – less than half of the settlement, Voorhees said during her opening arguments.She and U.S. Assistant Attorney E.J. Walbourn presented evidence that Mills received $24 million from the settlement. Cunningham got $21 million and Gallion pulled in $24 million. Those figures are in addition to $20 million the three defendants put into an Edgewood trust that they paid themselves to administer.The defendants were entitled to about $60 million in fees for getting the settlement for the 440 fen-phen users, but took an additional $45 million and put an extra $20 million in a charitable trust they created and controlled, according to the federal indictment.One of the star prosecution witnesses was Mills’ former office assistant, Rebecca Phipps. Named as an un-indicted coconspirator, she was given full immunity to testify against the three defendants.Phipps, who was paid $1.4 million for her work on the settlement, testified that Mills thought Cunningham and Gallion had deceived him. The codefendants told Mills the settlement was for $150 million to cheat him out of an equal share of the legal fees, she testified.That resulted in a confrontation at Mills’ birthday party that was much talked about at the trial. Mills called Gallion “a thief and liar” while people were singing “Happy Birthday,” Phipps testified. Walbourn declined comment after Mills was found not guilty. He said he would wait until after the jury finished deliberating on Cunningham and Mills before he would make a comment.Carrie Cochran contributed to this report.
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obeythelaw wrote:
WOW! I love the photo of Mills! Got teeth maw? Wow his teeth are black and yellow- nice combination of colors going on there. He looks good next to his young daughter- I mean, "girlfriend" (gee, they do look alike). .And hey. What'd ya expect? The jury is smart enough to realize it's CHESLEY that's guilty. After all, that's what happens when ya give a big fraud liar like Chesley immunity. The jury saw through the whole scheme. Bet they were wishing it was Chesley on trial.7/1/2008 7:21:58 PM WOW! I love the photo of Mills! Got teeth maw? Wow his teeth are black and yellow- nice combination of colors going on there. He looks good next to his young daughter- I mean, "girlfriend" (gee, they do look alike). .And hey. What'd ya expect? The jury is smart enough to realize it's CHESLEY that's guilty. After all, that's what happens when ya give a big fraud liar like Chesley immunity. The jury saw through the whole scheme. Bet they were wishing it was Chesley on trial. obeythelaw
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Lovinsteph wrote:
Replying to Festis:
"Damn, I hammered! Where'd I put that $60 mil I stole.Juctice system judging the justice system... What would you expect?A jury of his peers judged his conduct not the justice system or its operatives. Consider this, the presiding judge--a member of the justice system-- ordered him held (essentially) without bond since August of 2007 for a crime he was subsequenltly acquitted of committing. So, Melbourne Mills spent one year in jail for a crime he did not commit. How does that fit into your theory?Surprise! It doesn't, but don't let the facts confuse you.7/1/2008 7:21:03 PM
"Damn, I hammered! Where'd I put that $60 mil I stole.
Juctice system judging the justice system... What would you expect?
A jury of his peers judged his conduct not the justice system or its operatives.
Consider this, the presiding judge--a member of the justice system-- ordered him held (essentially) without bond since August of 2007 for a crime he was subsequenltly acquitted of committing. So, Melbourne Mills spent one year in jail for a crime he did not commit. How does that fit into your theory?
Surprise! It doesn't, but don't let the facts confuse you. Lovinsteph
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Festis wrote:
"Damn, I hammered! Where'd I put that $60 mil I stole.Juctice system judging the justice system... What would you expect?7/1/2008 6:30:40 PM "Damn, I hammered! Where'd I put that $60 mil I stole.
Juctice system judging the justice system... What would you expect? Festis
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obeythelaw wrote:
Hate to say it people, but yesterday I posted here, and predicted they'd walk free. AND VERY VERY RICH, as they are walking!7/1/2008 6:18:09 PM Hate to say it people, but yesterday I posted here, and predicted they'd walk free. AND VERY VERY RICH, as they are walking! obeythelaw
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Lovinsteph wrote:
Replying to NewportDem:
So this creep gets to keep the $125 million?Justice is as blind as his girlfriend.This verdict has no bearing on the civil suit that has already been filed against these defendants. This verdict relates to guilt of a criminal nature not a civil nature.
Tuesday, June 24, 2008
And More on Fen-Phen Trial End
Fen-phen trial
Jury hears closing remarks in fen-phen trial
3 lawyers allegedly conspired to boost fees
By Beth Musgrave
bmusgrave@herald-leader.com
COVINGTON — Using intimidation, secrecy and lies, three once-prominent Lexington-area attorneys conspired to pocket the bulk of a $200 million diet-drug settlement, a federal prosecutor told a Covington jury Monday.
Shirley Cunningham Jr., Melbourne Mills Jr. and William Gallion would have kept more of the $200 million settlement — in addition to the $105 million they received — if the Kentucky Bar Association had not issued a subpoena for bank records in the case in February 2002, said Laura Voorhees, assistant U.S. attorney.
Voorhees, in her closing arguments Monday, also accused the attorneys of using a series of court hearings to cover up their alleged theft of $65 million from 440 former clients.
Meanwhile, defense attorneys questioned the credibility of several government witnesses and said any mistakes made in the settlement were unintentional — and not criminal.
The attorneys sued American Home Products on the behalf of the former clients who said the diet-drug fen-phen damaged their hearts. The case was settled in 2001.
The closing arguments in the case — now in its seventh week — took all day Monday to complete. The jury will begin deliberations Tuesday.
If convicted of one count each of conspiracy to commit wire fraud, the maximum sentence the three could receive is 20 years in prison.
After the attorneys learned that the bar association was applying for a subpoena to get bank records in the case, there were a series of wire transfers from Gallion's and Cunningham's personal accounts — totaling approximately $60 million — into an account designated for clients' settlement money, the indictment alleges.
Not long after they moved money back into the clients' account, they went to then-Boone Circuit Court Judge Joseph ”Jay“ Bamberger, who approved the 2001 fen-phen settlement, and asked him to approve attorney fees of approximately 49 percent of the $200 million settlement.
”But they had already taken their fees,“ Voorhees said.
Bamberger also OK'd a second distribution of funds to the clients.
Even though the order was entered in February 2002, it did not become part of the Boone Circuit Court record until June 2002, when Bamberger issued an order sealing everything after the May 2001 settlement agreement in the case.
Voorhees said even after ”they got their hands caught in the cookie jar,“ by the bar association, they still didn't tell the truth about what happened to the money.
Whitney Wallingford, a Lexington attorney who represented the three attorneys at the time, sent the bar a letter saying that the clients had received $116 million. In fact, the clients had received $74 million.
Wallingford said he made a calculation error on the spreadsheet that he sent the bar and that his clients never saw the letter.
Voorhees didn't buy it.
”That wasn't a mistake,“ Voorhees said.
But defense lawyers slammed the government's case. At one point O. Hale Almand Jr., a lawyer for Gallion, even pointed to Voorhees and referred to the case as an ”overzealous“ prosecution.
In order for the jury to convict, federal prosecutors have to show beyond reasonable doubt that the three intended to defraud their clients. There was no criminal intent, defense lawyers said.
The federal government had several people who worked for Gallion and Mills testify in the case. They were named as co-conspirators in the indictment. Yet the alleged co-conspirators — some who had immunity from federal prosecutors — said they were not part of a criminal enterprise, said Stephen Dobson, a lawyer for Cunningham. In fact, some of the former employees said they thought at the time they were doing the right thing for their clients, Dobson said.
Cunningham was not present at many key hearings in the case, Dobson said.
Mills couldn't have participated in a conspiracy to defraud the clients, his lawyer said. He was a barely functioning alcoholic at the time, said James Shuffett, Mills' lawyer. ”Mills played no role in the handling of the case because of his condition,“ he said.
Defense attorneys also dismissed the testimony of Stanley Chesley, a Cincinnati lawyer who testified that he was hired by the three men to negotiate a settlement with American Home Products.
Chesley was paid $20 million to negotiate the settlement but testified last week that he had no idea how the funds were distributed to the clients. Chesley was given limited immunity in the case by federal prosecutors.
Dobson said that Chesley's testimony was ”bought and paid for by an immunity agreement.“ Voorhees later countered that it was the defense, not the prosecution, that called Chesley to the stand. They did not pay for anything, she said.
Chesley said he was not at a key February hearing where decisions were made on how the attorney fees would be calculated. Yet, there was testimony from Bamberger and at least one other person that showed that Chesley was at the hearing, said Almand, Gallion's attorney.
If he lied about that, what else did he lie about, Almand questioned?
The attorneys did not tell their clients many details about the settlement because of a confidentiality clause that said the fine for disclosing the total amount of the settlement was $100,000, Almand said.
Almand also said that the clients in the case received much more money — some received millions more — than those who filed similar fen-phen lawsuits.
Voorhees, in her rebuttal, told the jury to remember what the lawyers' former clients said on the stand. ”They deserved dignity and respect,“ Voorhees said. ”They were treated like they were being run through a mill.“
One client tried unsuccessfully to get more information from Cunningham, but never did. Instead, she was given a second check. But something didn't seem right, the woman testified.
”She was smelling a rat,“ Voorhees said. ”She was smelling three rats.“
Reach Beth Musgrave at (859) 231-3205 or 1-800-950-6397, Ext. 3205.
The Fifth Third/Cincinnati Financial Tragedy
OK, listen-up. We're talking Core of Cincinnati here. Fifth Third--Leads to Jack Schiff of Cincinnati Financial--Leads to Mike Brown (Cincinnati Bengals). Oops, got off track with Mike Brown. What is happening to the "Fifth Third Cin Fin" debacle is the biggest failure to this town's upper crust wallet (CINF down almost 2 yesterday as people begin to realize what this sleepy but respected insurance company did) since the collapse of D. H. Baldwin and Morely Thompson. And it will be worse because it is The Big Fifth Third, which has the bank trust monopoly of the century in one city.
Perhaps there is hyperbole in what I say. I can also remember the day Procter fell by 1/2. And I don't mean the 1987 Crash, either, when P&G fell 33% but quickly recovered.
I can also remember when Cincinnati Bell was "Cincinnati Bell," if you know what I mean. And Frost & Jacobs was "Frost & Jacobs," not Frost Brown & Todd.
People are geniuses until they are not. Brand Names are brand names until they screw up.
And then those that screwed up come back. A.K. Steel, Cincinnati Bell (I think it's coming back after looting itself of the good guys).
Oh, with Stan Chesley's downfall, there's air in the room for another class action lawyer: Rick Wayne of Strauss & Troy. But there will never be another Stan Chesley.
So what happens to Graydon Head & Ritchey? The Good Guys who stayed the Good Guys (and had the Fifth Third account)?
And James K.L. Lawrence of Frost Brown -- quietly dominating a firm over time with good work and a good heart? (I was best man at his wedding.)
It's a new world every day, don't you think?
Perhaps there is hyperbole in what I say. I can also remember the day Procter fell by 1/2. And I don't mean the 1987 Crash, either, when P&G fell 33% but quickly recovered.
I can also remember when Cincinnati Bell was "Cincinnati Bell," if you know what I mean. And Frost & Jacobs was "Frost & Jacobs," not Frost Brown & Todd.
People are geniuses until they are not. Brand Names are brand names until they screw up.
And then those that screwed up come back. A.K. Steel, Cincinnati Bell (I think it's coming back after looting itself of the good guys).
Oh, with Stan Chesley's downfall, there's air in the room for another class action lawyer: Rick Wayne of Strauss & Troy. But there will never be another Stan Chesley.
So what happens to Graydon Head & Ritchey? The Good Guys who stayed the Good Guys (and had the Fifth Third account)?
And James K.L. Lawrence of Frost Brown -- quietly dominating a firm over time with good work and a good heart? (I was best man at his wedding.)
It's a new world every day, don't you think?
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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"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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