Kentucky Supreme Court to hear lawsuit over diet drug

By Brett Barrouquere Associated Press LOUISVILLE, Ky. (AP) -- A group of people sickened by the diet-drug fen-phen will get a chance to argue that a $42 million judgment awarded to them from their one-time attorneys should be reinstated. The Kentucky Supreme Court has agreed to take up the case brought by former clients of three now-disbarred lawyers who once represented them in a $200 million settlement that has devolved into a spate of criminal and civil litigation, prison terms and attorney disciplinary actions. The court, in its order released last week, did not give a reason for taking up the case. Angela Ford, a Lexington attorney who represents some of the plaintiffs, said the decision to take up the case isn't a surprise. "I would have been disappointed if they hadn't taken it," Ford said. Former clients of attorneys William Gallion, Shirley Cunningham Jr., and Melbourne Mills sued the men, claiming they mishandled the settlement and improperly kept a significant portion of the funds for themselves, while keeping clients in the dark about the full amount of the agreement to end the litigation. A judge in 2007 awarded the $42 million to 431 people. A related civil case against class-action guru Stanley Chesley of Cincinnati is pending. The Kentucky Court of Appeals overturned that decision in February, saying that Special Judge William Wehr lacked sufficient evidentiary and legal grounds for ruling against Gallion, Cunningham and Mills and awarding the funds. Andre Regard, the attorney for Gallion and Cunningham, did not return messages left over two days. Gallion and Cunningham, one-time owners of champion racehorse Curlin, are serving federal sentences after being convicted of bilking their clients out of millions from the settlement. Both resigned from the bar. Mills was acquitted at a federal criminal trial, but disbarred for his role in the scheme. Gallion, 60, is not scheduled to be released from federal prison until 2029; Cunningham, 57, won't get out until 2025. The two men are appealing their convictions. The U.S. 6th Circuit Court of Appeals has scheduled arguments in the case for Jan. 17 in Cincinnati. The high court is also weighing whether to disbar Chesley for his role in the settlement. Chesley, who has denied any wrongdoing in the settlement, has asked the high court to hear oral arguments over the Kentucky Bar Association's request to revoke his license, a move that could jeopardize his ability to serve as co-counsel in multiple high-profile class action cases. Chesley's attorneys, Jim Gary and Sheryl Snyder, have filed motions in federal court and in the Kentucky Supreme Court seeking access to an accounting of how Ford distributed the attorney's fees she collected from the judgment. Chesley is hoping to show that attorneys for the Kentucky Bar Association received some of the funds, which could lead to a new disciplinary trial and stave off attempts to disbar him. A former associate of Gallion's, David Helmers of Lexington, and retired state judge Joseph F. "Jay" Bamberger, have also been disbarred in connection with the fen-phen settlement. Bamberger, a circuit court judge in Boone and Gallatin counties from 1992 until his retirement in 2004, signed off on a deal that gave attorneys nearly two-thirds of the settlement and didn't disclose to clients the terms of the deal. Wehr found that Gallion, Cunningham and Mills kept $126 million, more than 63 percent of the settlement, for themselves and took another $20 million in "excess funds." The men distributed $74,194,577 to their clients, who were never told about the total amount of the settlement or the fees kept by the lawyers. The state's high court disbarred Bamberger earlier this year, finding he mishandled the settlement and later received money from the settlement. Published: Fri, Dec 30, 2011