Ky. SC may reinstate $42M award to fen-phen plaintiffs

By John O'Brien | Dec 29, 2011


FRANKFORT, Ky. (Legal Newsline) - The Kentucky Supreme Court will decide if former plaintiffs in fen-phen litigation that was tainted by the actions of attorneys will receive $42 million.

Last week, the court decided to hear the case, which involves the former clients of Lexington-area attorneys William Gallion, Shirley Cunningham and Melbourne Mills, reported The Associated Press. Those three were accused of mishandling settlement funds away from their clients, who had sued over the diet drug's potentially fatal side effects.

Four attorneys involved in the litigation have been disbarred. The lawyers received roughly 50 percent of a $200 million settlement, and their 431 clients received the rest.

The clients later sued the lawyers for allegedly breaching their duties by diverting most of the settlement money. A 2007 ruling awarded the clients $42 million but it was overturned earlier this year by an appellate court.

In 2009, Cunningham and Gallion were sentenced to 20 years in federal prison for their roles in stealing the settlement money. Mills was acquitted of all charges. All three have lost their law licenses.

Most recently, the court disbarred David Helmers, who was a relatively new associate at the law firm Gallion, Baker and Bray at the time of the settlement.

Attorney Stanley Chesley is also facing possible disbarment and has asked the court to consider delaying the process. His attorneys want the process stayed until it is determined why the Kentucky Bar Association fired chief disciplinary lawyer Linda Gosnell in November.

Chesley received $20.5 million to negotiate the 2001 settlement.

From Legal Newsline: Reach John O'Brien by e-mail at jobrienwv@gmail.com.

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