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Thursday, April 03, 2008
Stan Chesley, Fen-Phen, and Character at the Enquirer
Posted by The Dean of Cincinnati
Yesterday, the Lexington Herald-Leader named local attorney Stan Chesley in a story about lawyers cheating their clients for millions of dollars. Here in Cincinnati, mum’s the word on the Fen-Phen lawsuit while the Enquirer instead prints Chesley’s name as an example of “character.”
From our daily paper of record:
My choice is Stan Chesley because he stands up for the little guy. He stood up for me, and I wouldn’t have been able to do what I did without his support.
I define character as honesty. That’s what means a lot to me, and Stan Chesley is what he appears to be.
From the Lexington Herald-Leader:
William J. Gallion and two other lawyers relied heavily on the advice of famed trial lawyer Stan Chesley in the handling of a $200 million civil settlement with a diet drug manufacturer, according to an expert witness retained by Gallion.
Chesley discouraged Gallion and two lawyers from providing notice to potential plaintiffs that a lawsuit against the maker of the diet drug fen-phen had become a state class action, according to a report filed in U.S. District Court by Richard L. Robbins, a Harvard-educated lawyer retained by Gallion as an expert on class-action litigation.
Chesley said the notice in the state case would interfere with a national class action he was leading against the manufacturer, according to Robbins, who reviewed documents in the criminal case against suspended lawyers Gallion, Shirley Cunningham Jr. and Melbourne Mills.
Robbins’ report, filed Monday, offered a glimpse into Gallion’s defense strategy heading into the May criminal trial. Gallion, Cunningham and Mills, who represented 440 fen-phen users in a lawsuit against American Home Products, are accused of bilking their clients out of $65 million.
They are charged with conspiracy to commit wire fraud.
A $42 million civil judgement was entered in March 2006 against the lawyers, who are being held in the Boone County jail.
No notice was delivered to Kentucky fen-phen users that the lawsuit had been settled in 2001. Robbins argues that notice would have served only to confuse potential plaintiffs because they were never notified of the lawsuit to begin with.
Attorney Angela Ford, who is representing former clients of the three lawyers, called the argument double talk. Ford said the lawyers had an ethical obligation to notify clients of the terms of the settlement.
Robbins said Gallion was not familiar with class-action litigation, Robbins said. He relied heavily on Chesley in setting procedures and sought approval from Judge Joseph Bamburger. Chesley advised them that notice was not needed, Robbins said.
Chesley could not be reached for comment Monday night. He received $20.5 million in fees for negotiating the settlement. He has said he was representing the lawyers, not the plaintiffs, and that he was not aware that they were allegedly deceiving their clients.
No criminal charges have been filed against Chesley. A lawsuit against him is pending.
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03 Apr 2008 at 07:00 am | #
From “Chesley Inc.: Famed Local Attorney Got Rich by Breaking Ground” by Lucy May, Cincinnati Business Courier, December 3, 2004: http://tinyurl.com/364pyo
In the American Lawyer article, Seattle attorney Leonard Schroeter called Chesley “the ultimate grotesque, exaggerated perversion of what it means to be a lawyer.” He is no more charitable now. “I’ve known him for 40 years, and I’ve always thought he was an opportunist and just a nasty son of a bitch,” Schroeter said in a recent interview.
03 Apr 2008 at 09:04 am | #
What we all knew was coming: Fen-phen lawyers blame Chesley, Bluegrass Bulletin, April 1, 2008: http://tinyurl.com/24rr4v
Stan Chesley is widely known as one of America’s premiere class action lawyers. Now that his co-counsel are sitting in jail for their conduct in a case he helped them settle, a peek at their defense reveals that they blame Chesley.
According to a report this morning in the Lexington Herald Leader attorney Bill Gallion, one of three lawyers being held in jail pending their federal criminal trial in May in Covington, has filed a report by an expert which says, in effect, that the three jailed lawyers relied upon Chesley’s expertise in class action litigation which is why they are in trouble.
Chesley has not been indicted, yet. He may never be, but many in the legal community have been speculating for months that his name would surface as the mastermind behind the settlement which was constructed in such a way as to result in a $42 million judgment against his co-counsel.
Chesley, who has raised a ton of money for the Clinton’s over the years, apparently had other litigation pending which might have been adversely affected by widespread notice of the class action settlement, according to the expert report. This omission, which is part of the reason the lawyers are in jail facing criminal charges and have a multi-million dollar judgment against them, was the result of Chesley’s advice, according to Gallion’s witness.
Competition in the legal profession at that level is fierce. There are many who are secretly wishing that Chesley gets hammered. If Judge Bertlesman’s treatment of the other three is any indication, should Stan Chesley ever get indicted, he can expect to receive equal treatment under the law.i
03 Apr 2008 at 10:32 pm | #
Chesley is a cad. Though I don’t think the attorneys are clean on this in any way, shape or form - they knew taking that money and putting it into a fake nonprofit was illegal and self-dealing. Chesley’s failure to report the scheme - alone - should be enough to have him indicted but he has spread so much money around on both parties, he has bought protection. Heck, he had contracts with the Republican AG’s office and now Petro heads Chesley’s Columbus office. Isn’t that sweet.
Having worked for him for over a year - I can say that his recent piss-poor record of legal failures are examples of his ego driving his practice instead of the law. A tactic that has allowed many sins of incompetence to be overlooked for several years in quivering response to an unearned reputation built on 1 good concept magnified a milllion fold.