Archive for December, 2011

ERIC DETERS BRIEF TO KY. SUPREME COURT – FORGY CALLS FOR DISMISSAL OF KBA FINDINGS

Friday, December 30th, 2011

 

SUPREME COURT OF KENTUCKY

2011-SC-000641-KB

KENTUCKY BAR
ASSOCIATION                                                            MOVANT

 

V.
IN SUPREME COURT

 

ERIC DETERS                                                                                  RESPONDENT

*    *
*    *    *

REVIEW REQUEST

UNDER SCR 3.370

 

Comes now, the
Respondent, by and through counsel, the Honorable Lawrence E. Forgy, Jr., and
for Respondent’s Notice of Review and Brief, states first and foremost,
gratitude for the extension of time granted.

Pursuant to SCR 3.370, Respondent gives notice he seeks review of the Findings of Fact, Conclusions of Law, and Recommendations of the Board of Governors of the Kentucky Bar Association entered October 21, 2011.

Pursuant to 3.370,
Respondent requests the Honorable Court to accept this matter for full review.

In addition, Respondent
files on this same date a Motion To Hold Any Ruling In Abeyance To Permit
Respondent To Take Limited Discovery On A Due Process Issue, specifically, the
appointment of Frank Doheny as Respondent’s Trial Commissioner.

INTRODUCTORY STATEMENT

No
lawyer in the Commonwealth of Kentucky has exemplified more courage than Respondent
in his fight against former Kentucky Bar Counsel Linda Gosnell, his Trial
Commissioner Frank Doheny, Interim Bar Counsel Jay Garrett and Respondent’s
prosecutor of record, Sarah Coker.

Faced
with what could have been the end of his legal career, he called lies lies and
injustice injustice.  A 181 day
suspension would have required a reapplication process which Bar Counsel would
have no doubt delayed and opposed.  To
their credit, the Kentucky Board of Governors found Respondent not guilty of 15
of 19 charges.  The attached Respondent’s
Board of Governors Brief summarizes the case of Respondent. The not guilty
votes were one vote, 11-2 not guilty; five votes, 12-1 not guilty; and nine
votes, 13-0 not guilty.  In other words,
the votes weren’t close.  This review
focuses on the remaining four which respectfully, the Board should have also
dismissed.  The stress of being so
publicly prosecuted; being sanctioned by a federal judge for seeking federal
relief; being willing to accept a law firm audit; having his bank’s auditors
express concern about his license; having to constantly ease the mind of his
clients and employees; having to wonder what clients never came in the door as
a result of this ordeal, resulted in an understandable emotional breakdown by
Respondent at the conclusion of the Board hearing.  Of course, this too was publicly reported by
the newspaper following the story hoping for Respondent’s demise for the
newsworthiness of the story.

These
four remaining Charges, like the other fifteen, do not involve the allegation
of a crime, dishonesty, moral turpitude, fraud, legal malpractice, substance
abuse, harm to a client or any dastardly deed.
They are nothing less than the remaining residue of a serial prosecution
of a lawyer who is a credit, not a bane, to the legal profession.  (See Exhibit A which is supported by the
record.)

We
ask this Honorable Court to vindicate Respondent by reversing the Board on the
four remaining charges.  If not, we ask
the Honorable Court to not suspend Respondent for a day.  He has suffered and been punished enough by
having to defend himself on what is at least fifteen baseless charges even in
the eyes of the Board.  As a public
figure, Respondent has been publicly maligned enough.

Issue One:      The Board of
Governors Missed the Deadline to Issue Their Findings and Order

 

Despite
preferring vindication on the merits, there is a procedural technical issue
Respondent must raise.  Pursuant to Rule
3.370(7), the Board had thirty days to file a written decision memorializing
their vote.  The vote took place on
September 16.  The Board filed their written
decision on October 21.           Respondent
is confident it was simply inadvertence, probably based upon meeting times, but
it makes no difference, it was late.
Rather than by October 15, the Findings and Order was filed October 21,
2011, five days late.

The
Rule says “shall.”  As the Court
is aware, there is no relief for a late Notice of Appeal or deadline missed by
a Respondent in a Bar Discipline process.
For example, if this Notice were filed tomorrow, it would be fatal.

If
the Court would like a short, simple dispensing of this matter, it has
one.  The Board missed the date, the
matter against Respondent should be dismissed.

The
Court has recognized this issue because the Court recently amended Rule
3.370(7) to give the Board forty-five days to file their written decision.  This makes sense to avoid the issue in the
future.

Respondent
requests dismissal of the remaining four charges for the Board’s failure to
timely file their written decision.

Issue Two:      The Only Charges Subject to Review Are the Four Remaining

Respondent
filed for an extension to December 18 (Sunday) to file his Notice of Review and Brief.
Movant did not file such a request.
Therefore, there can be no reconsideration of its written decision of
the dismissed fifteen charges.  Even if
there was, the margin of vote on these Charges should cause the Court to not take
notice.

Issue Three:   The Merits of the Four Remaining Charges

On
KBA File 16024, (Bates), Count II, SCR 3.130-8.2(a), the Board found Respondent
guilty of making “a statement that the lawyer knows to be false or with
reckless disregard as to its truth or falsity concerning the qualifications or
integrity of a judge.”  Respondent denies
vehemently making any false statement about Judge Bates.  If the Court accepts this matter, Respondent
will fully address this matter from the record.
In summary though, Judge Bates issued a Summary Judgment on a case and
opposing counsel to Respondent filed a Rule 11 Motion against Respondent on the
same day of the Summary Judgment, a truly remarkable event.  In the history of Kentucky jurisprudence, has
a Rule 11 Motion ever been filed the same day as a Summary Judgment was
entered?  Respondent had a legitimate question
of how this happened and questioned how it could have occurred.  He publicly discussed this on his radio show.  He chose his words very carefully.  He didn’t call Judge Bates any names, call
him a crook or anything of that nature.  He
never used the famous “Kangaroo Court” comment.
He simply asked: how can that happen?
Did the opposing counsel know some how the decision was coming based
upon opposing counsel being Judge Bates appointed Master Commissioner and being
friends with Judge Bates wife, who was the Judge’s secretary, or the Master
Commissioner’s husband who is the felony prosecutor for Judge Bates’ judicial
district.

On
KBA File 15674, (Clise), Count I, SCR 3.130-3.3(a), the Board found Respondent
guilty of making false statements in the guardianship pleadings that he filed
in Grant County District Court, which stated that Richard Clise was a
petitioner seeking to be appointed co-guardian with ex-wife, Stacey Clise.

As
argued and proven by Respondent, the Petition form was typed and prepared by
Respondent’s secretary and reviewed by Respondent.  However, it was signed only by
Respondent’s client.  It was a simple
inadvertent mistake that the ex-husband was typed in as a Petitioner.  The ex-husband had, as known by the District
Court, retained other counsel.  There was
a contested hearing.  The District Court
did not recognize it as a Petition for both because it wasn’t.  It was a classic scrivener’s error which went
unnoticed.  No evil deceit.  And, it happened because the ex-wife was
asking the Court to appoint her and her ex-husband guardians since they had
joint custody.  There was no
representation to the Court Respondent represented the ex-husband because he
didn’t.  Respondent was not going to be
able to “sneak” it by anyone.  The
allegation itself is silly, to be found guilty preposterous.

Also
on KBA 15674, the Board found Respondent guilty on Count V, SCR 3.10-7.09.02(2)
over phone calls to the ex-husband.  They
decided this constituted coercion and harassment.  The record is clear (transcribed voicemails)
all Respondent was trying to do is find out who Respondent’s lawyer was so a
unified front in litigation (both parents) could go forward.  In addition, the voicemail transcriptions
reflect Respondent wanting to keep the ex-spouse informed of what they were
doing as a common courtesy.

It
should be noted, Respondent was found not guilty of three charges in this
matter.

Finally,
on KBA File 15745 (Radakovic), the Board found Respondent not guilty on four,
but guilty on one, Court V, SCR 3.130-1.16(d) for failing to refund an amended
fee on a $1,500 legal matter.  The record
reflects it was a non-refundable fee and regardless he had earned the $1,500
fee.

It
is on these four matters, the Board reduced from a recommended 181 days
suspension to a 60 day suspension.

Issue Four:     Punishment

Respondent
does not deserve a suspension.  On pages
22-24 of the written findings, the Board discussed Discipline.

First,
as supported by the record, the December 18, 2003 private reprimand became public
by a mistake of the Supreme Court and made the press.  Former Justice Keller wrote a letter of
apology to Respondent.  This was not
recognized by the Board in their decision.
Also, on the merits of that discipline case, the “lien” was not paid
based upon a  chiropractor malpractice
issue.  Respondent fought for his client.  The “lien” was never paid.  This too is part of the record.

Relative
to the ABA Standards, it is unfair for the Board to use a matter ten years
prior which Respondent apologized for (he wrote it in anger) and has not
repeated.

What
is not understandable is how can the Board use “refuse to acknowledge the
wrongful nature of his conduct” against Respondent?  The Board found Respondent not guilty of 15
of 19 charges.   Why should he be
punished for not admitting guilt?

Also,
the statement Respondent made about $1,000 donation to Judge Bates opponent which
the Board relied upon for the guilty finding (15 of 19) was Respondent’s
opinion based upon a reasonable conclusion from a reasonable premise.

Relative
to the Clise matter, Clise admitted he was speaking about lawyers with
Respondent’s client and actually filed a lawsuit with a lawyer before
Respondent’s client, days after the communications from Respondent.

The
Board punished Respondent for multiple offenses when the multiple offenses were
not substantiated.  Respondent actually
agreed these Charges be consolidated to show how he was being serially persecuted,
not fairly prosecuted.

Respondent
battled these collective charges for five years, they fill eight banker boxes
and it cost him $300,000 to $500,000 of his billable time.  If it wasn’t his time, it would have been his
cash for a lawyer.

The
Board of Governors is in error when they state:

“The
Board of Governors is not aware of any mitigating factors.”

The
Board of Governors under ABA Standards failed to consider the following
mitigating factors:

  1. Absence of dishonest or selfish motive
  2. Full and free disclosure to disciplinary board and
    cooperative attitude toward proceedings
  3. Character and reputation
  4. Remoteness of prior offenses

 

All of these mitigating
were documented in the record and ignored by the Board by their own admission.

Issue Five:      Supreme Court Rule Changes

It
appears based upon the timing of circumstances and events the Respondent may
have played a role in several Supreme Court Rule changes.  This too should be factored in to
punishment.  Respondent helped change the
rules for the better for future lawyers.

  1. The Kentucky Supreme Court amended the SCR 3.370(7) to
    allow the Board 45 days to submit their decision.
  2. The Kentucky Supreme Court amended the rules so that
    Bar members can appeal to the Court without posting a bond to pay costs.
  3. Linda Gosnell was discharged.  Was it in part a result of Bar Counsel’s conduct
    against Respondent?  One rumor is the
    Board was upset with her “over prosecution.”
    If so, Respondent’s case is Exhibit A.

Respondent also
has a pending federal lawsuit challenge to Bar Counsel’s absolute immunity,
even from Rule 11, and the recusal process for Trial Commissioners.

Respondent’s
first federal lawsuit, in an effort to stop the process in this matter, drew
him a suspended sanction and a voluntary audit of his firms lawsuit filing
practices.  He “passed” his audit.  His zealous defense by filing the federal
lawsuit bought him more punishment.
Also, Bar Counsel attempted to apply the legal defense fees as costs and
the Board, to their credit, rejected this.
The first federal lawsuit fees Bar Counsel noted them as such on the
certification.  However, the second federal
lawsuit fees Bar Counsel tried to sneak them in as just “Legal Costs.”  (See Exhibit B for Bar Counsel’s misconduct from
the record.)  Who deserves a
suspension?  Coker or Respondent?  Gosnell or Respondent?)

Issue Six:        Chief Justice
Minton Should Have Heard Respondent’s Motion to Recuse Frank Doheny

Respondent
filed a Rule 26A recusal with the Chief Justice.  The Chief refused to hear it, citing the rule
any objection to the Trial Commissioner had to be made within ten days of their
appointment.  This is not reasonable
because Frank Doheny’s conflict didn’t arise until the middle of the hearing.  Doheny’s law partner accepted a $25,000 fee
from the couple who filed a Complaint against Respondent in the same matter as
complained about where Respondent’s $1,500 fee was in question.  In other words, the lawyer for the accuser
was the law partner of the Judge.  (See
Exhibit C for Frank Doheny’s misconduct as supported by the record.)

Furthermore,
Respondent had no idea Frank Doheny is a member of the Board of Kentucky Bar
Foundation.  It was not listed on his law
office website at the time Respondent checked him out after he was
appointed.   Should Bar Foundation Board members serve as
Trial Commissioners?

Issue Seven: First Amendment Issue

(See
Exhibit 1 to attached Respondent’s Board of Governor’s Brief.  This pertains to the Judge Bates issue.)

Issue Eight:    Reforms

Respondent
and counsel would like this case to be a platform for reform.  There has to be changes to the discipline
process.  These include:

  1. Charges should be private until the final Supreme Court
    decision.  If not, lawyers like Respondent
    may receive negative publicity despite later defeating the Charge.
  2. Bar Counsel needs to have better awareness of the
    motive behind a Bar Charge.  They believe
    the disgruntled client more than the lawyer in he said/she said
    situations.  For example, as supported by
    the record, it is clear the charges against Respondent derived from
    Respondent’s lawyer competition in the Northern Kentucky area.
  3. There should be more informal discussion and resolution
    at the outset of a bar complaint.
    Respondent hates to use another state as an example, but Bar Counsel
    should review the Ohio discipline process.
  4. Bar Counsel should exercise better discretion and
    restraint.
  5. Experienced practitioners who practice law should be
    more involved in the review of Bar Complaints and their prosecution.  Sarah Coker, Respondent’s prosecutor, has
    never practiced law outside Bar Counsel’s office.  The practice of law can be an unfair
    “minefield.”  Those who have walked in
    that “minefield” have a better understanding.
    In fact, Respondent believes this is why the Board, lawyers in the
    “minefield,” found him not guilty of 15 of 19 Charges.
  6. Bar Counsel should not have absolute immunity.  This has given rise to all the problems.  They feel untouchable.  It’s clear Linda Gosnell felt
    invincible.  Should they not at least be
    subject to Rule 11?
  7. The standard of review in lawyer discipline should be
    clear and convincing, not preponderance of the evidence.
  8. Bar Counsel, once a Trial Commission Hearing begins,
    has a policy of no negotiation once the hearing begins.  None during or after.  This is ridiculous.  No matter what comes out at the Hearing, Bar
    counsel is still unyielding.  Does this
    happen at civil and criminal trials?  No.
  9. Why should the Inquiry Commission members be
    secret?  A lawyer can’t object to a bias.  On the eve of Respondent’s Board of Governors
    hearing, he learned President Margaret Keane was the Chairman on one of his
    Inquiry Commission Complaints and she presided at the Board Hearing.  His Chief Judge was his “grand jury”
    forewoman.  When this was brought up by
    the Respondent, Ms. Keane did recuse herself.
  10. There really should be a three person panel to decide
    the Bar Charge, not a single Trial Commissioner.   The appeal to the Board should then be cut
    out.  The Board process is not suited to
    a proper review.  Have appeals go from
    the three person panel to the Supreme Court where the Justices are suited for
    judging.

Issue Nine:     The Price Paid By Respondent

Respondent
is not a threat to the public or his clients.
He does not deserve a suspension.

Bar
Counsel told lies in their Briefs in this matter and called them “technical
deficiencies.”  It is inherently unfair
that Bar Counsel Coker in not punished at all.
Yet, she can ask for Respondent to be suspended?  (See Exhibit A, B and C for all the misconduct
supported by the record.)

Other
painful side effects of Respondent’s Bar battle:

  1. Stress
  2. Time lost
  3. Money lost
  4. New business lost
  5. Clients lost
  6. Negative publicity of people thinking Respondent is
    suspended or disbarred.
  7. Stain on reputation
  8. Health affected
  9. Energy spent to battle
  10. Firm audit/federal sanction

 

The bullying by
Bar Counsel of Respondent continues.
They continue with similar Bar Charges such as these he has
defeated.  For example, they have charged
Respondent for his filing the first federal lawsuit.  Bar counsel claimed the source was Judge
Reeves.  Respondent wrote to Judge Reeves
and Judge Reeves confirmed he was not the source of the complaint.  Therefore, despite Linda Gosnell being fired,
Interim Counsel Jay Garrett and Associate Counsel Sarah Coker continue the
policies of Linda Gosnell of do whatever it takes to get someone they want to bring
down.  The record reflects from the day
Jay Garrett made a false statement to Respondent and Respondent asked him who
files Complaints against Bar Counsel, the quest to “get” Respondent was on.

Conclusion

I wrote a
statement which is part of the Board of Governors Brief.  It began with a quote Respondent has front
and center on his website:

“Aggressive fighting for the right
is the noblest sport the world affords.”

Theodore
Roosevelt

Respondent has
fought a righteous fight.  I have fought
it with him.  We ask this Honorable Court
to give him a just and full vindication.
He deserves it.

Respectfully,

 

 

Lawrence E. Forgy

83 C. Michael
Davenport Blvd.

P.O. Box 4292

Frankfort, KY
40601

COAKY Holds That Injuries Intentionally Caused By A Third Party Are “Accidental” For Purpose Of Uninsured Motorist Coverage

Thursday, December 29th, 2011

 

By David Kramer | dkramer@dbllaw.com

The Kentucky Court of Appeals considered an interesting issue of insurance law in a reported decision earlier this year. In Stamper v. Hyden, 334 S.W.3d 120 (Ky. App. 2011), a case
arising in Kenton County, the Court held that an insured driver was entitled to make a claim for uninsured motor ist (“UM”) benefits for injuries suffered when the driver’s ex-boyfriend intentionally rammed his car into hers. The insurance
carrier had denied UM coverage, arguing that the injuries were not the result of an “accident” because the uninsured tortfeasor intentionally caused the collision. The injured person sued both the uninsured tortfeasor for damages and
her own carrier for UM benefits. The appellate opinion states that the trial court concluded that the UM policy did not provide coverage for a collision intentionally caused by the ex-boyfriend, that the trial court instructed the
jury that the plaintiff was entitled to benefits from her carrier if they believed her injuries resulted from an accident, and that the jury awarded zero damages against either defendant (even though the trial court had previously
entered summary judgment against the tortfeasor).

On appeal, the Court of Appeals focused on the issue whether an “accident” for insurance purposes covers an intentional act. The Court first drew on case law interpreting a life insurance policy providing double indemnity for accidental death, Fryman for Fryman v. Pilot Life Ins. Co., 704 S.W.2d 205 (Ky. 1986), in which the insured decedent was killed while operating a motorcycle recklessly and under the influence of alcohol. The trial court in Fryman found the death to be accidental such that the beneficiaries were entitled to double indemnity under his group life policy from his employer, but the Court of Appeals reversed, finding that death is not accidental when it is a “foreseeable result of a
voluntary and unnecessary act or course of conduct of the insured.” The Kentucky Supreme Court reversed the Court of Appeals and held that if death was not a result of plan, design or intent on the part of the decedent, it should
be considered accidental.

The Court in Stamper applied this rationale to UM coverage and found that a driver with UM coverage whose injuries were not the result of a plan, design or intent on the part of the insured, and thus were accidental from the standpoint of the insured, is entitled to UM benefits even though an uninsured driver intentionally caused the collision with the insured. The Court noted that a majority of jurisdictions that have decided the issue have held that the question whether a
casualty resulted from an accident is to be determined from the point of view of the injured person, not that of another actor who caused injury.
Ultimately, the Court of Appeals reversed the trial court and remanded for a new trial based on instructional error. The trial court had instructed the jury that the plaintiff was entitled
to UM benefits “only to the extent that [her injuries] were caused by an accident.” The Court of Appeals followed the rule that instructional error is presumed to be prejudicial unless the appellee meets the burden of showing that
no prejudice resulted. The Court stated that the erroneous instruction “potentially confused or misled the jury” such that a new trial was warranted.
The Court rejected the carrier’s fallback argument that the award of zero damages even against the intentional tortfeasor indicated the jury concluded the plaintiff had not suffered compensable damages as a result of the
collision, such that the error in the instructions could be deemed harmless.

Stamper v. Hyden was authored by Judge Donna Dixon and is final and published. Plaintiff’s counsel Nick Nighswander informed me the case was settled after remand.

David Kramer is a Northern Kentucky attorney practicing at Dressman Benzinger LaVelle psc.

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KY. SUP. CT. REFUSED TO ALLOW FILING OF AMICUS BRIEF SEEKING TO UPHOLD JUDICIAL IMMUNITY DOCTRINE –

Monday, December 26th, 2011

The following brief was submitted by retired Judge Stan Billingsley in behalf of all judicial officials.  The KBA sought the disbarrment of Judge Joseph Bamberger and the Sup. Ct. upheld the disbarment.  Bamberger elected not to file an apeal of the disbarment ruling by the KBA Board of Governors which did not address the judicial immunity defense of Bamberger.  At the time Bamberger had an opportunity to file an appeal the Supreme Court Rules required the defendant attorney to post a 100% surety of the “cost and expense” bill imposed by the Bar Counsel.  No appeal could be filed until the $18,800 was paid.  In November the Supreme Court repealed that Supreme Court Rule but Bamberger’s appeal time had tolled.    Judge Billingsley acting on his own, tendered an Amicus brief discussing only the issue of the Judicial Immunity Doctrine.   The Supreme Court in the exercise of their discretion refused to consider the Amicus Brief, and they upheld the KBA Board of Governors disbarment reccomendation.

Billingsley sought the support of the Judicial Conduct Commission to intervene and support the Judicial Immunity Doctrine, but the JCC refused.

The Supreme Court did not explain why they refused to consider the Judicial Immunity Doctrine.  It is suggested that the ruling of the Board of Governor’s and the lack of action by the Supreme Court have established a precedent that any judge can now be santioned by the KBA for issuing any decision which the KBA finds “shocking”.   Billingsley argues that any judge who issues any ruling in the future, which is disfavored by the KBA, may likewise be subject to “ethical” santions based only on their official rulings.  For more than 200 years, the Immunity of Judges for all their official rulings has been well established.   That doctrine has arguably been repealed by the Supreme Court’s failure to consider this doctrine.

KENTUCKY SUPREME COURT
KBA FILE NO. 13985

KENTUCKY BAR ASSOCIATION                                 COMPLAINANT
v.
JOSEPH BAMBERGER                                                RESPONDENT

PETITION
AND BRIEF OF  RETIRED JUDGE STAN
BILLINGSLEY

AS AMICUS CURIAE

IN SUPPORT OF RESPONDENT


MAY
IT PLEASE THE COURT:

Appearing as a Amicus Curiae,
Judge Stan Billingsley (Retired) hereby petitions this Honorable Court to
permit the filing of the following Amicus Curiae Brief.

 

CERTIFICATION

I hereby certify that a true and
correct copy of this petition and brief
was properly addressed to the Hon. Linda Gosnell, KBA Chief  Bar Counsel, at 514 W. Main Street, Frankfort
KY 40601-1812 and to the Disciplinary Clerk, of the Kentucky Bar Association
at  514 W. Main Street Frankfort KY
40601-1812, and the Hon.  Susan D.
Phillips Phillips, Parker Orberson, 716 W Main St Ste 300, Louisville, Ky. 40202,
Trial Commissioner of the KBA in this action, and the Hon. Jerry J. Cox,
Attorney for the Respondent, 115 Richmond St,
PO Box 1350, Mt Vernon, KY 40456-1350,
with proper postage affixed, and mailed by placing same in the U.S.
Mail, on July 12, 2011.

 

Judge Stan
Billingsley (Retired)
314 7th. St.
Carrollton,
Ky. 41008
Bar Number-05170
Phone
(502)732-4617

GROUNDS  JUSTIFYING
THE COURT IN ALLOWING THIS AMICUS CURIAE BRIEF TO BE CONSIDERED

STANDING
OF RETIRED JUDGE

The author of this tendered amicus curie brief, alleges interest and standing
on the basis that if the Judicial Immunity Doctrine is voided, then all rulings
of any sitting or retired judges will thereafter be subject to hindsight review
by the KBA.  The author is a retired
judge.

Under the argument advanced in this case by the KBA, it is claimed that
the KBA has the jurisdiction to review any ruling of any judge without
limitation.

If the precedent sought by the KBA is upheld in this case then the
jurisdictional authority of the  KBA will
be so broadly expanded then the justification for the existence of the Judicial
Conduct Commission will be voided.  this
case warrants a declaratory ruling by the Ky. Supreme Court regarding the jurisdiction
of the JCC versus the KBA.

Our research has found no precedent of any other state ever granting the
right to review the judicial rulings of a judge, made within his jurisdiction,
by a State Bar Association.

The author of this brief has no financial interest in the underlying
case, does not represent any party in this case, and has not sought or received
approval of either party to this action to tender this brief.  If the KBA and Bar Counsel is upheld, and if
they elect to conduct a review of  all
rulings made by the author during his 23 years on the bench, then the author
will be subject to severe financial implications in defending himself.

 

AUTHORITY OF THE
KENTUCKY  SUPREME  COURT  TO
GRANT  DISCRETIONARY REVIEW  OF  THIS
CASE
UNDER  SCR 3.370 (9)

The Supreme Court may exercise
discretionary authority under SCR 3.370 (9), to consider the issues in this
case even if the complainant or respondent fail to file an appeal.

SCR 3.370 Procedure before the Board and
the Court

“(9) The Court may, within ninety (90) days of the filing with the Court of
the Trial Commissioner’s report as provided by 3.360(4), or of the Board’s
decision, notify Bar Counsel and Respondent that it will review the
decision….
, the Court shall enter such orders or opinion as it deems
appropriate on the entire record.”
(emphasis added by author)

If the Ky. Supreme Court does not
agree to review this action as permitted under Section (9), then the findings
of the Board of Governors will be automatically adopted by rule SCR 3.370 – (10).  Section (10) which holds that:


If no notice of review is filed by either one of the parties, or the Court
under paragraph nine (9) of this rule, the Court shall enter an order adopting
the decision of the Board or the Trial Commissioner, whichever the case may be,
relating to all matters.”

There is an important jurisdictional question raised by the attempt of
the KBA to discipline  a judge for acts
taken by the judge in his jurisdiction without the referral by the Judicial
Conduct Commission. Until now, the Doctrine of Judicial Immunity has protected
a judge from claims involving decisions he has made within his jurisdiction.

The Supreme Court’s action in this
case will establish an important precedent regarding the jurisdiction of the
Judicial Conduct Commission versus the jurisdiction of the KBA.

The Bar Counsel has filed a report with the
Disciplinary Clerk requiring the respondent judge to post a surety in the
amount of approximately $18,500 in order to have the right to file an
appeal.

This high surety violates Section 115 of the
Kentucky Constitution which states that all appeals shall be
“inexpensive”. This high surety imposed unilaterally by the Bar
Counsel may well prevent the respondent judge from filing an appeal.

In such a case,
important questions of law affecting the jurisdiction of the Judicial
Conduct Commission, and rights of all sitting and all retired judges will be
automatically decided in favor of the KBA, and against the interest of the
Judicial Conduct Commission, and of the
judiciary, by repealing the Doctrine of Judicial Immunity.

That makes the tendered Amicus brief highly
important to the JCC and the Judiciary.

AMICUS CURIAE BRIEF BY JUDGE STAN BILLINGSLEY (RETIRED)

MAY
IT PLEASE THE COURT:

THE  KENTUCKY  SUPREME  COURT  SHOULD  GRANT
DISCRETIONARY REVIEW  OF  THIS
CASE  UNDER  SCR 3.370

There are three reasons why the
Supreme Court should exercise discretionary authority granted to the court
under SCR 3.370, to consider the issues in this case.

1.
The costs claimed by the Bar Counsel’s office, which must be posted by
the respondent are in violation of Section 115 of the Kentucky
Constitution.   The actions of the Bar
Counsel’s office, in unilaterally setting a high cost bill, denies due process
to the respondent.

2.
There is an important jurisdictional question raised by the attempt of
the KBA to discipline  a judge for acts
taken by the judge in his jurisdiction. This action by the KBA violates the
Judicial Immunity Doctrine.  If the
Supreme Court does not review this jurisdictional issue, then there will be
established a precedent which will void the Doctrine of Judicial Immunity.

3. The Supreme Court’s action in
this case will establish an important precedent regarding the jurisdiction of
the Judicial Conduct Commission versus the jurisdiction of the KBA.

KENTUCKY CONSTITUTION
SECTION 115 – RIGHT TO INEXPENSIVE APPEAL

It is possible that neither the respondent
judge nor the KBA will file an appeal with the Supreme court in this action.   Even though Section 115 of the Kentucky
Constitution states that all appeals shall be “inexpensive”. The SCR
rules permit the Bar Counsel to unilaterally determine the costs of the
discipline proceeding, and report said costs to the Disciplinary Clerk.

The respondent in a discipline action must
deposit a surety with the Disciplinary Clerk in the amount unilaterally claimed
by the Bar Counsel’s office in order to have the right to appeal the findings
of the Board of Governors to the Supreme Court.
As the rule is worded if there is no surety posted there is no appeal.

The
report of the Bar Counsel’s office regarding costs in this case will require
the respondent to post a surety of some $18,500.  This does not appear to be “inexpensive”
and operates as an unconstitutional restriction on the right to appeal that is
granted by the Kentucky Constitution.

WHEN
THE RESPONDENT OR THE KBA FAIL TO FILE AN APPEAL,  THE SUPREME COURT RETAINS THE JURDICTION TO
“REVIEW” THE FINDINGS OF THE BOARD OF GOVERNORS.

A review of SCR 3.370 grants the
Supreme Court the discretion to review a finding of the Board of Governors even
in the absence of an appeal by the respondent or by the KBA.

” SCR 3.370 Procedure before the
Board and the Court

(9) The Court may,
within ninety (90) days of the filing with the Court of the Trial
Commissioner’s report as provided by 3.360(4), or of the Board’s decision,
notify Bar Counsel and Respondent that it will review the decision.
If the
Court so acts, Bar Counsel and Respondent may each file briefs within thirty
(30) days, with no right to file reply briefs unless by order of the Court,
whereupon the case shall stand submitted. Thereafter, the Court shall enter
such orders or opinion as it deems appropriate on the entire record.”
(emphasis added by author)

We respectfully submit that an
important jurisdictional issue and constitutional question is presented by this
case, and that a failure of the Supreme Court to review the findings of the
Board of Governors will have the effect of voiding the Judicial Immunity
Doctrine, and will destroy the justification for the existence of the Judicial
Conduct Commission.

 

 

THE JURISDICTIONAL QUESTION

In the ethics investigation of  retired Judge Joseph Bamberger, the KBA
investigation seeks to expand the jurisdiction of the KBA to review and review Judges
past decisions for ethics review.

The Trial Commissioner in his Brief
to the Board of Governors opined that the KBA had jurisdiction to review a
judicial officials acts even without a referral by the JCC.

Current rules grant jurisdiction to the Judicial Conduct Commission to
examine the ethical conduct of judicial officials.  The rules permit the JCC to make referrals to
the KBA if the JCC determines that additional review is appropriate by the KBA.

The end result sought by the KBA is to expand their jurisdiction to
review the judicial rulings of a judicial officer, and to inflict sanctions
including disbarment if they disagree with the judge’s rulings.

First we note that this attempted review of Judge Bamberger’s rulings
violate SCR 4.029.

See: SCR 4.020 Jurisdiction (of the JCC which says):

“(2) Any erroneous decision made
in good faith shall not be subject to the jurisdiction of the Commission
.

We would ask the Court to consider why the Judicial Conduct Commission
is denied the right  to review erroneous
rulings of a judge, and why the KBA  should be granted such a right? (Such a right
is claimed in this action by the KBA.)

We suggest that this Supreme Court Rule  4.020 is solidly based in the Judicial
Immunity Doctrine  explained in Collins v. Brown, No.
2007-CA-000847-MR (Ky. App. 2/26/2010) (Ky. App., 2010)”.  (This
is an unpublished decision but it cites several Kentucky and U.S. Supreme Court
decisions which uphold the Doctrine of Judicial Immunity.)

” First, as to the judicial
defendants, Judge Wise and former Chief Justice Lambert, the trial court
properly found them to have been shielded by absolute judicial immunity. The doctrine of judicial immunity is
well-settled under federal and common law and predates the adoption of the
current
Constitution of
Kentucky.
See Pierson v. Ray,
386 U.S. 547
, 87 S.Ct. 1213, 18 L.Ed.2d 288 (1977); Vaughn v. Webb, 911 S.W.2d 273 (Ky. App. 1995). So long as the
judge has jurisdiction over the subject matter of the cause before him, he is
entitled to immunity
. Id. There is no question in this case that Judge Wise
and former Chief Justice Lambert acted within their jurisdiction at all times
pertinent to the matters raised in Wes’s complaint. Thus, they are clearly
entitled to immunity from civil complaints stemming from their judicial acts.”
(emphasis added by author)

“The
function of absolute immunity in the performance of judicial duties is not to
shield members of the judiciary from liability for their own misconduct, but
rather “to protect their offices from the deterrent effect of suit(s) alleging
improper motives where there has been no more than a mistake or a disagreement
on the part of the complaining party with the decision made.” Yanero v. Davis, 65 S.W.3d 510, 518 (Ky. 2001.”

“[i]t has been repeatedly held by
this court in a long line of decisions that a judicial officer is not subject
to civil suit when in the performance of his judicial duties and within his
jurisdiction, although his ruling may be the result of mistake of law, error of
judgment, or malice, or be done corruptly.”  Yanero v. Davis, 65 S.W.3d 510, 518 (Ky. 2001.”

We suggest that a KBA discipline proceeding is a “civil”
proceeding.  SCR 3.300 and SCR 3.330 both
describe discipline proceedings in terms of a civil action.

“SCR 3.300 Rights of respondent against whom a charge has been files

 

…”The Respondent shall have
all the rights secured to a party by the Rules of Civil Procedure …”

“SCR 3.330 Order of proceedings and burden of proof

…. The
burden of proof shall rest upon the Association in a disciplinary proceeding,
and the facts must be proven by a preponderance of the evidence. ..”

We respectfully suggest that the discipline process is a civil
proceeding and thus falls within the protective walls of the Judicial Immunity
Doctrine.

In  Vaughn v. Webb, 911 S.W.2d 273 (Ky. App.,
1995)
it was held:

“The acts of Judge Ray, exercised
within his jurisdiction, were judicial acts, not administrative acts and
Judge Ray is entitled to the protection of judicial immunity.
Under federal law, a judge is immune
from personal liability for judicial acts if at the time he acted, regardless
of whether he acted in error, maliciously, or in excess of his authority, he
had jurisdiction over the subject matter before him. Pierson v. Ray,
386 U.S. 547, 87 S.Ct. 1213, 18 L.Ed.2d 288 (1977)…”

In Baker v.
(Governor) Fletcher, 204
S.W.3d 589 (Ky., 2006)
it was
stated:

“See Stump v. Sparkman, 435 U.S.
349, 98 S.Ct. 1099, 55 L.Ed.2d 331 (1978), for the best recitation of the rule
granting judicial immunity and the reasons underlying
its desirability. For Kentucky cases recognizing judicial immunity
in the Commonwealth see Henry v. Wilson, 249 Ky. 589, 61 S.W.2d 305
(1933), and Vaughn v. Webb, 911 S.W.2d 273 (Ky.App.1995) (“a judge is
immune from personal liability for judicial
acts if at the time he acted, regardless of whether he acted in error,…”

“And such a view is also consistent
with the immunity afforded to judges, which immunizes judges from suit
for ANY judicial act, which is
defined as any act that is of the nature normally performed by a judge and one
in which the parties dealt with the judge in his official capacity
.”  (emphasis added by Billingsley)

The question of judicial immunity was properly raised by Judge Bamberger
in his brief to the Board of Governors.

The Supreme Court will have an opportunity to review the findings of the
Trial Commissioner and the Board of Governors against Judge Bamberger. If the
court sanctions Judge Bamberger for a ruling he made that was within his
jurisdiction, then they will be writing new law which negates the Doctrine of  Judicial Immunity and will dangerously expand
the jurisdiction of the KBA.

Such a ruling would destroy the
theory behind the existence of the Judicial Conduct Commission. Such a ruling
would grant the KBA jurisdiction to file a civil action seeking sanctions of
judges who were acting in their judicial function.

ARGUMENT

Bamberger made rulings which the KBA claims he should have examined more
closely.  The Bar Counsel argues that the
respondent judge made bad rulings based largely on the reputation of the
attorneys and experts who appeared before him.
This argument is nothing less than a head on attack on the Judicial
Immunity Doctrine, as it challenges the judges reasoning for making a
ruling.

Nowhere does the KBA argue that Bamberger did not have the jurisdiction
to make every ruling he made.  They argue
about his reasoning and his wisdom, but they do not present facts contesting his
jurisdiction to rule on the issues before him.

It is not enough that some decisions turned out bad.  It is not enough that the non-judge lawyers
in the KBA believe they would have done things differently had they been the
judge.

No evidence was presented against Judge Bamberger by the KBA to support
the proposition that he acted “with evil or improper intent to aid the
plaintiff’s lawyers misconduct”.

No evidence was presented that Bamberger was even aware of the
plaintiff’s lawyers misconduct until after he had retired.  Therefore the KBA has failed to provide a
preponderance of evidence to justify their findings against Judge Bamberger.

Testimony in the two criminal trials against Gallion and Cunningham alleged
that Gallion and Cunningham,  lied to
Judge Bamberger about material elements as to their actions.  This effort to misinform Judge Bamberger on
the law and facts is admitted by the Trial Commissioner in her brief as having
occurred in Judge Bamberger’s case.

The Trial Commissioner admits  in her
brief that “there is no doubt that Gallion lied to the respondent (Judge
Bamberger), as did Chesley and others.” (See page 9 of KBA brief.)

Judge William Graham acting as Trial
Commissioner for the KBA in their ethics case against attorney Stan Chesley,
concluded:

“Chesley himself bamboozled Judge
Bamberger with his often non-sensical answers to the Judges queries about
notice.”

One must ask; “if Judge Bamberger was in-on-the-deal…why was it
necessary for the plaintiff’s lawyers to lie to him about material elements?”

More importantly, if the KBA can sanction a judicial ruling anytime they
disagree with the results, the Doctrine of Judicial Immunity will be thereby
voided.   We note that there is no
statute of limitations applying to the KBA which will prevent the KBA from
reviewing the rulings of any sitting or retired judges over their entire
judicial career.

The KBA bar counsel argues that Bamberger relied on a case citation
presented to him by one of the plaintiff’s attorneys that was no longer good
law (See KBA brief page 11).   We suggest
if that is a basis for ethical sanctions then all judges may at some time in
their career be brought up on charges.

This argument by the KBA Bar Counsel would justify a sanction against
any Judge who incorrectly interpreted the law. If such a theory is sustained by
the Supreme Court, then any judge who is ever overruled by a higher court on
appeal, will be subject to an ethics sanction by the KBA. But it also means
that the KBA has assumed the jurisdiction to make their own evaluation of a
judge’s rulings on any issue that ever came before the judge.

Such a conclusion would result in harassment of all judges and could be
used to justify absolute control of the Judiciary by the KBA, and would destroy
the Doctrine of Judicial Immunity.

DISCUSSION  OF
FACTS  CITED  BY
TRIAL COMMISSIONER  AND  BAR COUNSEL
FOR  THEIR  RECOMMENDED
DISCIPLINE  OF  JUDGE BAMBERGER.

The KBA argues for punishment of Judge Bamberger because he “had not
reviewed any accounting whatsoever and had never even seen the Settlement
Agreement.” We suggest that the record clearly shows that Bamberger was
correctly advised that the plaintiffs had executed signed settlement agreements
by all 440 plaintiffs regarding the initial award and again received 440 signed
settlement agreements on the distribution of the second amount of funds awarded
to them.   He was never informed that the
plaintiff’s lawyer had secured contingent fee contracts with their clients.

If the plaintiff and the defendant
in a civil case all agree to a settlement, it is not uncommon for a judge not
to conduct an accounting.  Judge
Bamberger only awarded attorney fees
after the 440 plaintiff’s expressed their satisfaction with the amount
they received. It was not a situation where the attorney fees were awarded and
the claimants received what was remaining.

Will a judge now be required to review all settlements by calling in all
plaintiffs and defendants to his court room and conducing a hearing on each
settlement with each plaintiff and defendant?   Attorneys representing the plaintiffs
appeared before Judge Bamberger.  Is a
client not bound by the actions of his own lawyer?

Does a signed settlement agreement submitted by a plaintiff or defendant
have no legal consequences if the party later changes their mind?  Will this now be a new ethical requirement in
all civil cases and criminal cases?  If
so, we predict there will never be another settlement approved by a trial
judge. Why would any judge in the future risk being sanctioned by the KBA by
approving a settlement?

The overriding fact in this case admitted by the KBA, is that the
attorneys lied to Judge Bamberger, and he is now to be punished by the KBA for
exercising his protected  judicial
discretion.

The original  plaintiff’s surely
have some burden to put the court on notice that they are unhappy with a
settlement.  They could have done this by
not signing the settlement. They had the right to file an appeal of any ruling
of Judge Bamberger, but none did so.

We would suggest that as far as the
Judge’s duties are concerned, the plaintiffs in this case waived any duty of
the judge to personally inquire of each plaintiff of his satisfaction.

The original plaintiff’s should be
equitably estopped from claiming a foul when their own signed releases were
relied upon by the court. They set on their rights for years and never appealed
any decision made by Judge Bamberger.

Only after the original plaintiffs
discovered that their own attorneys had not been candid with them, did they
turn their attention to Judge Bamberger.
There appeal rights had tolled, and the only way they could proceed and
keep their claims alive, was to attack the trial judges’ integrity.

If the attorneys have improperly obtained the signed settlements, than
that is a completely different issue. Attorneys do not enjoy the protection of
the Judicial Immunity Doctrine. If the attorneys committed a fraud or committed
malpractice, or violated the Code of Professional Conduct, how does that
implicate the judge? The best answer to this question given by the KBA is that
the judge should have known better. This is clear hindsight review.

The KBA argues in their brief (Page 13) that “to believe his
(Bamberger’s) testimony that he signed whatever orders the attorneys give him
because he trusted them and had no knowledge or suspicion of impropriety is to
believe he had little cognitive ability” … “he was dazzled by and enamored with
a group of powerful men…”

Is ” lack of cognitive ability” a new standard for ethics sanctions? May
not a trial judge weigh the credibility of highly successful lawyers who are
nationally recognized for their prior work, when they advise him on issues of
law and fact?

The KBA brief includes many conclusions which merely speculate on what
Judge Bamberger was thinking when he signed court orders. Will the Supreme
Court tolerate such speculation as to a Judge’s thoughts?  I would submit that the colorful and
deprecating language, and unsupported speculation as to another persons’
thoughts, as used by the Bar Counsel in their brief, would be thrown out of
almost any real trial court under the Rules of Evidence.

 

BAMBERGERS’S SERVICE ON THE BOARD OF THE FUND FOR HEALTY
LIVING CHARITABLE TRUST

One of the essential elements of
this case which was picked up by the media, and which was played to the hilt by
the Bar Counsel was that six months after Bamberger retired he accepted a
position on the board of the Healthy Living Charitable Trust. The Judicial Conduct Code clearly
permits even a sitting judge to sit on the board of a charitable
trust.

 

See
Commentary:

“Canon
4- Section …4C(3) permitting service by a judge with organizations devoted to
the improvement of the law, the legal system or the administration of justice
and with educational, religious, charitable,
fraternal or civic organizations not conducted for profit….

(3) A judge may serve as an officer, director, trustee or
non-legal advisor of an organization or governmental agency devoted to the
improvement of the law, the legal system or the administration of justice or of
an educational, religious, charitable,
fraternal or civic organization not conducted for profit,…”

The record reveals that Judge Bamberger, before accepting this
position obtained ethics opinions from two lawyers which suggested that it was
not an ethical violation for Bamberger to serve as a board member. At the time
he became a Board member of the trust, he had retired from office and had no
judicial control over the operation of the Trust.

The Bar Counsel has conveniently ignored the fact that the Healthy
Living Charitable Trust was a suggestion made by Stanley Chesley after all of
Bamberger’s orders concerning attorney fee awards were signed.  The Bar Counsel suggests that a Cy Pres trust
is itself evidence of improper conduct.

In fact there is a great deal of precedent
in class action cases for such trusts to be set up to dispose of class action
funds left over after all plaintiff’s have received their fair share. Further
the Bar Counsel demonstrates their mindset against Judge Bamberger by stating
in their brief that the Charitable Trust was “secret”. This argument suggests,
without any proof, that the trust funds were improperly handled.

Nationally recognized Class Action expert Stan Chesley and a respected
mediator have supported the appropriateness of the cy pres trust option.  Only after Judge Bamberger’s retirement were
questions raised which might have supported a different ruling by respondent.

The KBA Bar Counsel brief suggests
that Bamberger was “dazzled” by these experts. (What judge wouldn’t be?  Bamberger made his last ruling in this case
in January 2004.  His conduct is now
measured by events and revelations made years after his rulings were made.

The charitable trust was approved by the IRS, and was apparently audited
by the U.S. Attorney’s office. After the funds were seized by the order of
Judge Wehr and Judge Crittenden, there was over a million dollars more in the
trust then were initially placed in the trust, even after the payment of the
trustees salaries and expenses, and after an award by the trust of over a
million dollars to other charitable organizations.

The Bar Counsel dramatically implies that the board of trustees were
highly paid, but their salaries were in line with salaries paid in other
charitable trusts. The IRS had no problem with the fees paid to the trustees,
but the Bar Counsel does a parody of the actor Claude Rains as Police Captain
Louis Renault in the l942 movie Casablanca, who was “shocked…shocked I tell
you!” to find that gambling was going on in his jurisdiction.

What research has the KBA done to
support the conclusion that the Charitable Trust trustees were overly paid? We
find no examples of proper salaries for trustees being introduced by the KBA.

THE LINGERING ISSUE OF AGGREGATE SETTLEMENT VERSUS CLASS
ACTION SETTLEMENT

One of the main arguments made by the Bar Counsel is that the settlement
was an “aggregate” settlement as opposed to a “class action settlement”. If the
settlement was an aggregate settlement then the 440 Fen Phen plaintiffs in the
class action should receive all of the money left over after the payment of
attorney fees and court costs.

On the other hand if the settlement
was properly classified as a “class action settlement” then each of the 440
plaintiffs where only entitled to a settlement which fairly compensated them
for their true loss.  Judge Bamberger
ruled that the settlement was a class action settlement, and this resulted in
excess funds being left after all the 440 plaintiff’s had been paid according
to the facts of their individual claims.

The issue of whether or not the
settlement was an “aggregate” settlement or a “class action settlement” is
currently on review by the Sixth Circuit and possibly by the Kentucky Supreme
Court.   The KBA and the Board of
Governors have ignored this continuing but highly important issue.

Gallion and Cunningham and Chesley all argue that there is a document
which is part of the settlement which answers this question. This document is
identified as “the settlement letter of  5-1-01″.
This document allegedly defines the status of “settling claimants”.

Judge Bamberger is faulted by the KBA for his judicial interpretation of
this issue. The KBA seeks sanctions against the Judge based on their guess on
how the Kentucky Supreme Court will rule on this issue in the plaintiff’s civil
case now on appeal.

The finding of the  Kentucky Court
of Appeals held that the type of settlement was a jury question.

2007-CA-001971 -
Date: 2/3/2011 ABBOTT V. GALLION, CUNNINGHAM AND MILLS

Quotes from the Ct. of Appeals
ruling:

“…it was represented to the Court (i.e.
to Judge Bamberger)
during the June 27, 2002, hearing regarding that Seven
Million Five Hundred Thousand Dollars ($7,500,000.00) that all clients had or
would agree to the balance of funds going to charity. It is now clear from the
paper discovery produced that same was not true, and none of the clients were
advised of the magnitude of the funds being transferred.”

” Judge Bamberger was not made aware
of the fee contracts,…” (i.e. the contingent fee contracts originally obtained
by CMC.)

” Abbott points out that GMC (Gallion Mills and Cunningham) gave it no
notice of the true amount of fees it was taking, or that it had asked Bamberger
to approve fees in excess of the contingent fee contracts it had executed.”

” This is an independent action that
is not the result of a modification or vacation of Bamberger’s orders in the Guard
action.” (i.e. the Court is saying the plaintiff’s represented by Angela
Ford did not seek to set aside any orders of Judge Bamberger.)

” In response to Abbott’s motion for
partial summary judgment, the seventeen-page affidavit of Hon. Kenneth R.
Feinberg, a practicing attorney and an expert in mass tort litigation, was
submitted in the Boone County civil case heard by Judge Wehr.

Feinberg’s
affidavit concluded the settlement entered in the Guard action was
“reasonable” and the “side letter” agreement supported the conclusion that the
$200,000,000.00 paid by AHP was not intended to compensate only the 431
plaintiffs, but was also intended “to provide for other payments, including
potential claims or (sic) other Phen-Fen (sic) users, subrogation claim
holders, and other unforeseen claims.”

Feinberg went on to state:

“There was nothing out of the
ordinary in the Boone Circuit Court approving the use of approximately twenty
million dollars from Guard for cy pres purposes or in approving
the formation of a charitable foundation
,
the Kentucky Fund for Healthy Living, Inc. (Kentucky Fund), to administer the cy
pres
funds. I am aware that certain of the plaintiffs’ attorneys were
appointed by the Court to serve as directors of the Kentucky Fund.

In my opinion, there was no conflict
of interest or impropriety whatever in those appointments. The plaintiffs’
attorneys were in an excellent position to understand the purposes of the fund
and to carry out the intent of the Court that approved the establishment of the
charitable foundation.

In my opinion, the case was handled
properly and ethically. I have seen nothing that credibly suggests any
misconduct by the attorneys or any inappropriate action by the judge who
presided over the case
. It appears that the instant action against the
plaintiffs’ attorneys in Guard (AKA the Fen Phen case) is based on
nothing more than misinformation or lack of understanding of the procedures
involved in class action or common fund or aggregate mass tort settlement.”

Feinberg’s affidavit was sufficient
to create genuine issues of material fact such as:

…whether the entire settlement,
minus fees and expenses, was to be split between the 431 settling claimants;
whether the settling complainants were fairly and adequately compensated;
whether KFHL was funded with money that should have been distributed to the
settling claimants or was funded with excess funds for which the plaintiff’s
consent to its ultimate use was not required; and, whether GMC and Chesley were
obligated to indemnify AHP for additional claimants who might come forward
after the settlement had been dispersed. The foregoing questions of fact
justified going forward with trial. Steelvest, 807 S.W.2d at 480-82; See
also, Chalothorn v. Meade,
15 S.W.3d 391 (Ky. App. 1999).”

The Court of Appeals ruled, ” We agree that creation of a cy pres trust
is a valid option under the appropriate circumstances.”

According to the Court of Appeals, the
Charitable Trust approved by Judge Bamberger was a valid option for him to
consider. This ruling of the Court of Appeals was not mentioned in the Bar Counsel’s
brief.

The Bar
Counsel stated in their brief re: the Charitable Trust:

“He (meaning
Bamberger
) allowed the attorneys to keep another twenty million dollars of
settlement funds …”  (i.e. by setting
up the charitable trust
.)

This
money was not kept by Gallion, Mills or Cunningham.  This argument by the Bar Counsel simply
misstates the facts on this issue. This exaggeration is just one of many in the
Trial Commissioner’s brief.  The
$20,000,000 did not go to GMC, it went to a legally formed charitable trust.  All funds from this trust were recovered.

The Kentucky Court of Appeals concluded, ” Therefore, reversal is
necessary. Because we have determined partial summary judgment was
improvidently granted…”.

Upon trial it is possible that a judgment
may be entered declaring the settlement to have been a “class action”
settlement and not an “aggregate” settlement, and if that occurs, then every
claim brought by the Bar Counsel against Judge Bamberger’s rulings will be cast
in quite a different light.

We submit that the Supreme Court must view
Judge Bamberger’s rulings in light of the law, and not just the rhetoric of the
Bar Counsel. We have not discovered one instance in the Bar Counsel’s brief
which supports their conclusion that Bamberger ever acted outside of his
judicial function in making any ruling. Therefore there is a strong argument
that Judge Bamberger should be protected by the Doctrine of Judicial Immunity

This material issue demonstrates that the action by the KBA against
Judge Bamberger is based on the Bar Counsel’s interpretation of the meaning of
said document as opposed to Judge Bamberger’s interpretation of the meaning of
said document.

Ruling on conflicting legal issues
is clearly within a judges jurisdiction and is protected by the Doctrine of
Judicial Immunity.

If this position is sustained in favor of the KBA, then any ruling of
any judge can be subjected to ethics prosecution if the KBA disagrees with the
trial court’s findings. Is the Bar Counsel the proper person to rule on
questions such as this before they are decided by the appellate courts?

The record of the Bamberger proceedings reveal testimony of Kenneth R.
Feinberg. Feinberg is a nationally recognized expert on class action settlements
and the evaluation of claims in class actions. He is the man that President
George W. Bush appointed to oversee the evaluation of compensation for the
victims of the Sept. 11 terroristic attack upon the New York World Trade
Center. Feinberg also handled the evaluation of the claims of the 440
plaintiffs in the Kentucky Fen Phen case and he states under oath:

“I have read and considered the
assertion in the Plaintiff’s memorandum supporting their motion for summary
judgment that Exhibit 3 to the settlement agreement is a “smoking gun” that
“proves” that all of the $200,000,000 was intended to compensate only 431
claimants, many of whom are involved in the instant litigation against their
former attorneys. In my opinion that assertion is simply a naive
misunderstanding or misinterpretation of the language in the settlement
agreement and the purpose it served in memorializing the settlement.”

(Footnote on Kenneth Feinberg:

Kenneth Feinberg – Feinberg was appointed Special Master of the U.S. government’s September
11th Victim Compensation Fund
and currently serves as the Special Master
for TARP Executive Compensation, popularly called the “pay czar.” Additionally,
Feinberg currently serves as the government-appointed administrator of the BP
Deepwater Horizon Disaster Victim Compensation Fund.

In the first criminal trial of Gallion, Cunningham and Mills, before
Judge Bertlesman, the court ruled the settlement was a “class action
settlement”, not an “aggregate” settlement. No weight is given by the KBA
to this ruling of a U.S. District Judge.  If a Federal judge found it to be a “class
action” type settlement it is reasonable to justify Judge Bamberger’s identical
finding on this issue.  The KBA dismisses
the very real and legitimate issue regarding what type of settlement was made
between the diet drug manufacturer and the plaintiff’s.

In the second criminal trial, Judge
Danny Reeves refused to allow testimony on this subject and instructed the jury
that it was an “aggregate” settlement. That ruling is on appeal to the Sixth
Circuit Court of Appeals.  The KBA
argument ignores the possibility that the Sixth Circuit Court of Appeals may
find that Judge Bertlesman was correct and that Judge Reeves was wrong on this
issue.

Judge Wehr, the Boone Circuit Court
Judge who handled the Angela Ford case against the Plaintiff’s original lawyers,
granted a summary judgment apparently finding it was an “aggregate
settlement”. That summary judgment was set aside by the Ky. Court of
Appeals. The Court of Appeals found that the type of settlement was a jury
question and could not be decided by a summary judgment ruling as it was in the
purview of the jury to rule on the facts. That very issue is currently on
appeal to the Kentucky Supreme Court in the civil suit.

A denial of judicial immunity to Judge Bamberger will put every judge in
Kentucky under the threat of KBA discipline sanctions if they acted on
representations made by the attorneys or parties who appeared before them.

If any judge is overruled by a
higher court will he now be subject to an ethics prosecution because he ruled
incorrectly on the law or made some other kind of mistake?

THE FEE JUDGE BAMBERGER AWARDED TO
PLAINTIFF’S ATTORNEYS WAS WITHIN GUIDELINES ESTABLISHED BY THE COURT OF APPEALS

In Shelton v. Simpson, 441
S.W.2d 421 Ct. of Appeals, May 23, 1969, the court upheld a fee of 50% in a
Kentucky class action which had 400 plaintiffs. In that decision the Court of
Appeals set aside the trial judges fee award of 25%, and restored the 50% fee
claimed by the class action attorney.  Bamberger
awarded an attorneys fee of 48%. Bamberger’s fee award was clearly made with
some precedent.

WHAT JURISDICTION SHOULD THE KBA HAVE OVER JUDGES

We would suggest that the Judicial Immunity Doctrine can co-exist with
the KBA discipline process. In Hardesty the Supreme Court (in dicta)
suggested that there were instances where the KBA could proceed without a
referral by the JCC. One reasonable interpretation of that dicta is to
recognize the right of the KBA to proceed immediately against a Judge who has been
convicted of a criminal offense. A criminal offense is not a judicial function
and therefore is not protected by the judicial immunity doctrine.

However, the JCC should retain the
right in any case against a judge, to make a finding as to whether or not the
actions of the defendant judge “was an action within his judicial function” and
therefore entitled to the judicial immunity defense.

If the JCC finds that a judges’ complained of conduct was done within
the role of a judge (i.e. signing orders, holding hearings, etc.) he should be
entitled to judicial immunity and no discipline action could be taken by the
KBA without a finding by the JCC that the judge was acting outside of his
official duties. (We again point out that KBA discipline actions are defined as
civil actions.)

On the other hand, if the JCC issues a finding of fact that the
complained of actions of the judge were not judicial acts, then the judge
should not be protected by judicial immunity.

The JCC by making a referral to the KBA is essence is saying that the
conduct of the judge was not protected by judicial immunity. The JCC is
authorized by Supreme Court Rules to refer a judge to the KBA for consideration
of sanctions or disbarment. No such
referral was made by the JCC in the case involving Judge Bamberger.


The KBA never explains why the
Supreme Court Rule granting jurisdiction to the JCC to make a discipline
referral to the KBA should be ignored.

The KBA in essence argues that they
do not have any limits on their jurisdiction to consider a discipline action,
and therefore they claim that the Supreme Court Rule regarding “referrals” by
the JCC is without any meaning.

The purpose of the JCC is to provide a body with knowledge of judicial
functions. The JCC membership includes a Court of Appeals judge, a Circuit
Judge and a District Judge, a representative of the Bar Association and two
citizen members. They are presumed to have an understanding of the type of
special problems and duties of judges.

If the KBA is allowed carte blanche to determine the proper duties of
judges and to rule on whether actions taken by a judge are within his judicial
function, then there really will be no reason to continue the existence of the
JCC.

JURISDICTION
OF THE JCC AND KBA

The question of the jurisdiction of
the JCC and KBA was raised by Judge Bamberger in his brief to the Board of
Governors. Bamberger asserted that “Section 121 (of the Kentucky Constitution)
fixes original jurisdiction for judicial discipline exclusively in the (Judicial
Conduct) Commission…”

The JCC did not refer
Judge Bamberger to the KBA “for possible suspension or disbarment…”

We have yet to see any proof that Judge
Bamberger by signing certain orders was acting “outside of his judicial
function“. This point distinguishes every argument raised by the KBA Bar
Counsel in their brief to the Board of Governors and to the Trial Commissioner.

CONCLUSION

The Bar Counsel has argued that Judge Bamberger was dazzled by the legal
arguments of highly respected experts in the class action practices, and
therefore he should be sanctioned with permanent disbarment. This sets a
dangerous precedent for any judge who has ever made a ruling based on
conflicting facts or conflicting legal issues.

If this novel theory of jurisdiction over judge’s rulings by the Kentucky
Bar Association is upheld, then every judge will henceforth be subject to
hindsight review by the Bar Counsel.

We further submit that the practice of the Bar Counsel in being allowed
to unilaterally set the appeal surety of a judge or lawyer as a prerequisite
for the right to appeal to the Supreme Court is unconstitutional.

We submit the Supreme Court should clarify the jurisdiction of the JCC
and the KBA and uphold the Doctrine of Judicial Immunity.  And further, the Court should amend the SCR’s
to permit the filing of  inexpensive
appeals.

RESPECTFULLY SUBMITTED:

 

Judge Stan Billingsley
(Retired)
314 7th. St.
Carrollton, Ky. 41008
Bar
Number-05170
Phone (502)732-4617
E-mail:
Firstjudge@aol.com

 

 

LAWREADER RECEIVES ALLEGATIONS REGARDING THE QUESTIONABLE USE OF OUTSIDE COUNSEL BY THE KBA BAR COUNSEL

Thursday, December 22nd, 2011

In a recent e-mail a respected party commented:

“Tthe bill of costs served upon attorney Stan Chesley in his disciplinary case included  $15,736.86 paid as fees to Jane Graham, a Lexington attorney, apparently for attending and  observing Mr. Galllion’s criminal trial.

Chesley was billed some $88,000 as a condition of having the right to file an appeal to the Ky. Supreme Court.  After Chesley paid the $88,000 to the KBA, the Supreme Court repealed the SCR which conditioned an appeal on the payment
of the “cost and expense” bill submitted by the Bar Counsel.

Chesley was not a defendant in the criminal trial and has not been charged with any criminal offense. (Chesley has not been consulted regarding this report.)

The invoices from attorney Graham were alleged to have been so severely redacted that it is unclear what services were rendered for which the KBA paid Jane Graham $15,736.86.

David Helmers reports that he was billed $4000 for Jane Graham’s services in sitting in on the Gallion criminal trial at the  direction of the KBA Bar Counsel.  Helmers was not
a criminal defendant but nevertheless received a bill for the KBA participation in the Gallion criminal trial.

“The legal services rendered by Ms. Jane Graham to Bar Counsel Linda Gosnell were described in a letter written in June  2011, two years after the fees had been paid by the KBA.”

One of the letters “tersely explained that Ms. Graham’s services had been rendered in connection with Ms Gosnell’s appearance as a witness in the federal prosecution “ of Gallion and Cunningham.”

If these cost demands are correctly reported, it suggests that the Bar Counsel was hiring outside counsel to help her prepare for her testimony in the criminal trial, but instead of the KBA being responsible for the
outside counsel fee, they billed attorneys who had pending ethics charges (and who were not parties to the criminal trial.)

Last month the KBA President announced that Bar dues would be increased by 1/3 over the next three years.  In the last budget cycle the Bar Counsel’s office received $1.6 million dollars paid out of dues paid by Kentucky’s 17,000
lawyers.   The Bar Counsel’s office has nine full time attorneys, 3 secretaries, and  13 para-legals and legal assistants.  Dues paying attorneys are beginning to question the wall of secrecy by the KBA which fails to explain the high cost of
operation of the Bar Counsel’s office, the need for expensive outside counsel, and secrecy about why Linda Gosnell was fired as Bar Counsel on Nov. 21, 2011.

LawReader has received reports in four cases where the Bar Counsel has hired outside counsel.  One case imposed an outside counsel’s fee on Eric Deters of $44,000.  The KBA Board granted Deters a
hearing and set aside the demand of the Bar Counsel for reimbursement of the $44,000 outside counsel fee.  Since most ethics prosecutions are hidden behind the confidentiality rules, it is not
known how frequently the Bar Counsel has employed outside counsel.  Nor is it frequently revealed how outside counsel are selected, how much they are paid.

No one has explained by the 24 employees of the Bar Counsel’s office cannot handle their workload, and why outside counsel is so frequently required.   A review of Supreme Court rulings in KBA matters reveals a very large number of KBA cases go on for more than five years, some cases take as long as eight years to work their way through the Supreme Court.

The Supreme Court Rules include a rule which requires all discipline matters to be handled, “promptly”.

The criminal courts frequently dismiss cases which have not provided the defendant a trial within one year.

The Ky. Supreme Court in Lococo v. KBA, held that a three year delay was “prejudicial” but they only suggested the penalty for violation of the promptness rule was “consideration of mitigation” of the penalty.”

DETERS FILES MOTION WITH SUPREME COURT REQUESTING RIGHT TO DEPOSE KBA OFFICIALS REGARDING BAR COUNSEL’S INTERFERENCE IN THE SELECTION OF TRIAL- suggests Bar Counsel used influence to select Trial Commissioner

Thursday, December 22nd, 2011

 

In a pleading filed with the Supreme Court by Hon. Larry Forgy in behalf of his client, Eric Deters, a request was made to the Supreme Court  to allow depositions to be taken of Susan
Greenwell, the Disciplinary Clerk, and Frank Doheny Jr. (who served as Trial Commissioner in Deters ethics prosecution) and of Linda Gosnell, who was Bar Counsel at the time of the Deter’s prosecution.
The motion seeks permission to depose other KBA officials who may have knowledge of the Trial Commissioner selection process.

The Supreme Court Rules direct the Supreme Court to appoint a panel of Trial Commissioners.   The Disciplinary Clerk is thereby required to select at random the Trial
Commissioner in any particular case.

Deter’s brief states that Linda Gosnell admitted she interfered  in the selection of Trial Commissioners in the Stan Chesley prosecution.

The argument suggests that interference with the random selection of Trial Commissioners is a violation of a defendant attorneys due process rights.

The Deters Motion was mailed to the Supreme Court on Dec. 19, 2011.

FEINBERG RECANTATION MADE AFTER TRIAL, IN CLOSED ROOM, WITHOUT CROSS-EXAMINATION – WILL THIS BE BASIS FOR NEW LEGAL THEORY ALLOWING POST TRIAL RECANTATIONS

Thursday, December 22nd, 2011

The recantation by Feinberg reportedly occurred during a closed hearing where neither party to the appeal were present.  No party was given the opportunity to cross-examine Feinberg on his recantation.
It is puzzling how such an extrajudicial recantation by itself could be the basis for appellate review.   The Court of Appeals ruled that the case should go back to the trial judge and he could consider the recantation.

The Supreme Court has frequently educated the Bar on legal theories and they will no doubt expand our knowledge in their decision in this case.  They have the power to make new law and perhaps that is their intent in granting
Discretionary Review in this case.

But we would suggest that basing an appellate reversal on an extrajudicial statement would open the floodgates, and litigants would be encouraged to seek to introduce all types of extrajudicial and post-trial statements by witnesses and jurors.

Ms. Ford will file her brief on Feb. 15, 2012.  Only then will we know her legal arguments for sure.  But the quotes from her 6th. Cirt. Brief strongly suggests that her appeal is based solely on the Feinberg recantation.

WHAT ISSUE MIGHT BE CONSIDERED BY THE KY. SUPREME COURT IN THEIR DISCRETIONARY REVIEW OF THE COURT OF APPEALS RULING IN ABBOTT V. GALLION ET AL?

Wednesday, December 21st, 2011

Angela Ford in her brief to the 6th. Circuit attempted to avoid compliance with the U.S. District Court’s order directing her to provide an accounting to the U.S. Justice Department of her handling of funds in the Abbott case.   The 6th. Circuit Denied the motion and the accounting in currently in possession of the U.S. Attorney’s office.

About ten days after the accounting was delivered by Ford, the KBA Board of Governors fired Linda Gosnell the KBA Bar Counsel and chief prosecution of ethics complaints against attorneys in Kentucky.
The KBA Board has not stated the reasons for the firing of Gosnell.

On Dec. 21, the Ky. Supreme Court granted Discretionary Review of the Court of  Appeals decision in Abbott that remanded the case for a new trial.

The following excerpt from Ford’s brief filed before the 6th. Circuit suggests the grounds that Ford will argue in her brief to the Ky. Supreme Court which is due on Feb. 15, 2012.

As we understand Ford’s argument and the decision of the Court of Appeals issued in Feb. of 2011 the main reason the Court of Appeals reversed the summary judgment
in the Boone Circuit Court (Judge Wehr) was that the Ct. of Appeals reasoned that the statement of Feinberg, who oversaw the distribution of funds to the
Fen Phen plaintiffs presented a fact issue that should be determined by a jury.  Therefore the issue could not have been disposed of by a Summary Judgment.

In the excepts below (from Ford’s 6th. Circuit brief) she argues that while Feinberg filed an affidavit raising a jury question, he later recanted the affidavit.

Apparently the Supreme Court found some merit in Ford’s argument.  If this is the issue to be decided by the Ky. Supreme Court, (and we are only guessing and they aren’t talking) then the
court must decide the following question:  “Can the bell be unrung by an appellate court?”

If a witness gives a statement under oath, can the trial be affected by a subsequent statement made by the same witness which disavows his first statement?  One would think that both statements should
be presented to a jury to determine which version of the testimony is credible.

A finding of the bonafides of two statements is not a question of law.  In our understanding this is a classic question of fact which can only be determined by a jury.
The decision of the Court of Appeals certainly considered the conflicting Feinberg statements to present a question of fact.

Perhaps the Supreme Court sees issues that we have not perceived.  In one to two years we will get to read their decision and find out.

Ford Brief Argument
Case No. 11-6187

____________________________________________________________

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

____________________________
ANGELA M. FORD,
Appellant

v.

UNITED STATES OF AMERICA,
Appellee
___________________________________________________________

Appeal from the United States District Court for the Eastern District of Kentucky (Honorable Danny C.Reeves)

________________________________________________________

BRIEF OF APPELLANT ANGELA M. FORD

________________________________________________________
R. Kenyon Meyer

Stephen J. Mattingly

DINSMORE & SHOHL LLP
101 S. Fifth Street, Suite 2500

Louisville, Kentucky 40202

(502) 540-2300

(502) 585-2207 – fax
kenyon.meyer@dinsmore.com

stephen.mattingly@dinsmore.com

Counsel for Angela M. Ford

Case: 11-6187 Document:

006111143825 Filed: 12/01/2011 Page: 1

A. The Kentucky Court of Appeals’
opinion in Abbott

In February 2011, the Kentucky Court
of Appeals entered an opinion in Abbott. The Court of Appeals determined
that summary judgment was inappropriate because an affidavit submitted

on behalf of the defendants by attorney Kenneth Feinberg created a question of
material fact on

the breach of fiduciary duty claim. (Court of Appeals’ Opinion, R. 1283-1.) 2

If the opinion becomes final, it will
reverse the Abbott summary judgment and remand the matter to circuit court. The Abbott plaintiffs petitioned
the Court of Appeals for rehearing because Feinberg had since recanted his
affidavit. Although the Court of Appeals denied the petition for rehearing, the
court stated that “upon remand, the trial court may reconsider its opinion and
order.
The court may once again reject the affidavit of Mr. Feinberg .
. . .” (R. 1283-7, Order Denying Rehearing.)

KENTUCKY SUP. CT. GRANTS DISCRETIONARY REVIEW OF DISMISSAL BY CT. OF APPEALS IN ABBOTT V. GALLION FEN PHEN CIVIL CASE

Wednesday, December 21st, 2011

It has been reported to LawReader that the Ky. Sup. Ct. has granted Discretionary Review in the Abbott v. Gallion (et al) civil case.   The appeal was sought by Angela Ford, on behalf of her Fen Phen clients.

Ford’s brief is due Feb 15 and Gallion’s reply brief is due on April 15  This appeal will allow a review of the Reversal and Remand order of the Ky. Court of Appeals.   The Court of Appeals ordered a new trial in the Boone Circuit Court case in which Circuit Judge Wehr granted a summary judgment against Gallion, Mills, Cunningham et al defendants.

 

The Media Seems Outraged by Newt’s Plan to Arrest Judges Who Make Rulings He disagrees With….But that same doctrine has been advanced by the KBA in Kentucky, and was recently upheld

Tuesday, December 20th, 2011

By LawReader Senior Editor Stan Billingsley

A republican was quoted this week in attacking the philosophy of  Newt Gingrinch’s plan to arrest judges who issue rulings he disagrees with.

Michael Mukasey, George Bush’s attorney general said:  “It would lead us to become a banana republic, in which administrations would become regimes and
each regime would feel it perfectly appropriate to disregard decisions of courts staffed by previous regimes. That’s not what we are.”

Newt’s doctrine however was recently implemented in Kentucky.   The KBA prosecuted Judge Joseph Bamberger for a ruling he made as a Circuit Judge.   The defense of Judicial Immunity was raised
but ignored by the Bar Counsel and the KBA Board of Governors.  A motion to allow the filing of an amicus brief* raising the Judicial Immunity doctrine, was denied by the Ky. Supreme
Court.  So Judge Bamberger was permanently disbarred for signing orders in his official capacity as a judge.
The Ky. Supreme Court had previously held that: “The doctrine of judicial immunity is well-settled under federal and common law and predates the adoption of the
current Constitution of Kentucky.” See Pierson v. Ray, 386 U.S. 547, 87 S.Ct. 1213, 18 L.Ed.2d 288 (1977); Vaughn v. Webb, 911 S.W.2d 273 (Ky. App. 1995). “So
long as the judge has jurisdiction over the subject matter of the cause before him, he is entitled to immunity. Id”

But in the Bamberger case, they Bar Counsel successfully argued that Judge Bamberger’s ruling was “shocking”, and therefore justified permanent disbarment.

It appears to LawReader that the Judicial Immunity Doctrine has been relegated to the attic of legal doctrines.   Perhaps the Judicial Immunity Doctrine will be considered again in the future when there is
some political clout backing a judge, but as long as a Judge has ruled in a controversial case, the Bar has established the precedent that any ruling of a judge the KBA
finds “shocking” is a justification for the judge’s disbarment.

So Newt is being attacked by his opponents for advocating the same doctrine that in November was adopted by the Kentucky Supreme Court.

The Kentucky Supreme Court refused to consider this issue and never explained why they ignored the Judicial Immunity Doctrine.
Maybe there were facts we are not aware of, or maybe they just didn’t want to consider this case since the offending judge had not paid the Appeal
tax of $18,800 in order to have the right to file an appeal in his own name.  (The court a month later repealed the Appeal Tax rule.)
It appears to us that the Supreme Court has failed to consider the consequences of their denial to consider Judge Bamberger’s Judicial Immunity Defense.  They may attempt to defend their inaction by calling
it a procedural ruling, but they didn’t even make that defense for their decision to permanently disbar a trial judge for making a “shocking” ruling.

*The author tendered an Amicus Brief to the Supreme Court raising only the Judicial Immunity Doctrine in behalf of Judge Bamberger and all other judges.
The Supreme Court denied the motion and the Amicus brief was not considered by the Supreme Court.

IS IT POSSIBLE FOR BAR COUNSEL’S OFFICE TO HIDE ETHICS COMPLAINTS AND PROTECT THEIR FRIENDS?

Saturday, December 17th, 2011

By LawReader Senior Editor Stan Billingsley – Dec. 17, 2011

LawReader has received several anonymous allegations where it is suggested that certain attorneys may have had ethics complaints filed against them. These allegations suggest that the complaints
were disposed of by the Bar Counsel’s office without any investigation, prosecution or sanction.

We cannot confirm these allegations, and make no accusations, but we have reviewed SCR 3.160 which grants the power to the Bar Counsel to unilaterally refuse to investigate claims of ethics violations, and
we can find no method where the actions of the Bar Counsel’s office have to be disclosed. This power granted to the Bar Counsel is protected by a wall of secrecy. We emphasize that the SCR rule cited herein gives legal authority for
the Bar Counsel to dismiss any ethics complaint at their discretion.

We recognize the reason that frivolous ethics complaints should be dismissed. However, we are bothered by the wording of SCR 3.160 which also allows the Bar Counsel to unilaterally dismiss or dispose of
serious ethics complaints at the sole discretion of the Bar Counsel. No District or Circuit Judge has such unlimited and unregulated power. The rules do not provide for any administrative review of these discretionary dismissals
by the Bar Counsel. This rule is another example of our conclusion that the KBA Bar Counsel is the most powerful prosecutor in Kentucky.

In regular civil and criminal cases, there is an independent judge that is elected by the public, and trial judges conduct is not hidden behind a wall of secrecy. If the allegations LawReader
has received have any basis, there really is no remedy or review under the current rule.

See “SCR 3.160 — (E) If Bar Counsel deems any written and sworn complaint against a member not to state an ethical violation and it is not suitable for alternative
disposition, it may decline, without investigation, to entertain it.”

This same rule states that: “…the Office of Bar Counsel may issue a warning letter, which will be maintained in the investigative file of the Office of Bar Counsel.” (This file is confidential
and not accessible to the public.)

This file is secret and therefore is not subject to open records production, and is hidden from the Board of Governors, from the Inquiry Commission, and of course it is hidden from the Supreme Court and the
public.

Our study of SCR 3.160 convinces us that it is entirely possible for the Bar Counsel’s office to protect their friends. Nothing is illegal about such a procedure. That suggests to the author that this is a very dangerous rule which gives the Bar Counsel power not enjoyed by any other prosecutor in our judicial system.

The Supreme Court wrote this rule in 1990, and they can change this rule at their discretion. The ethics system would be greatly improved if all dismissals had to be reviewed by the Board of
Governors. The Bar Counsel’s file listing these discretionary dismissals should be accessible to the Inquiry Commission and to the Board of Governors.

Recently I joined with the Hon. Larry Forgy in calling for an independent investigation of the practices of the Bar Counsel’s office. I would suggest that an independent review of any discretionary
dismissals by the Bar Counsel should be reviewed. The Independent Investigation should demand access to the Bar Counsel’s files to see if any discretionary dismissals were made and whether or not there was justification for such
dismissals.

SCR 3.160 Initiation of disciplinary cases

(1) After review by Bar Counsel pursuant to subparagraph (3) of this Rule, any sworn written statement of complaint against an attorney for unprofessional conduct shall be filed with the Disciplinary Clerk who shall promptly notify the attorney by certified mail, sent to the address maintained by the Director pursuant to SCR 3.175, or other means consistent with the Supreme Court

Rules and Civil Rules, of the complaint, and that he/she has twenty (20) days to respond to the complaint. Upon completion of the investigation by the Office of Bar Counsel the matter shall be
assigned to an Inquiry Commission panel by rotation.(2)

Notwithstanding the provisions of paragraph (1), when it comes to the attention of the Inquiry Commission from any source that an attorney may have engaged in unprofessional conduct, the Inquiry
Commission, or a three-person panel thereof, may initiate and conduct an investigation, and if it believes from its investigation that there is sufficient evidence to justify its filing a complaint
against the attorney it may file such a complaint.

(3) (A) Upon receipt of a verbal or written allegation of a violation of the Rules of Professional Conduct, or sworn complaint, the Office of Bar Counsel will initially determine, under
the direction of the Chair and Inquiry Commission, whether the matter is appropriate for alternative disposition.
Alternative disposition may include, but is not limited to: Informal resolution ii. Referral to Fee Arbitration under SCR 3.810

iii. Legal negligence arbitration under SCR 3.800

iv. Legal or management education programs

v. Remedial ethics education programs vi. Referral to KYLAP under SCR 3.970(1)(c)
vii. Issuance of a warning letter.

(B) A complaint is not suitable for alternative disposition if it alleges serious misconduct in which the sanction would more than likely result in a suspension. Additionally, some
ethical violations warranting a private or public reprimand may not, under all circumstances, be eligible for alternative disposition.

(C) After review and such preliminary investigation as may reasonably be necessary, the Office of Bar Counsel may attempt informal resolution and subsequently close the Complaint. If
the acts or course of conduct complained of merit referral under 3(A)(ii)-(vii), and do not warrant a greater degree of discipline, the Office of Bar Counsel may issue a warning letter, which will be maintained in
the investigative file of the Office of Bar Counsel
but not be considered as discipline, or it may recommend remedial ethics, related legal or management education programs, fee arbitration, or KYLAP, completion of which
would result in the complaint being dismissed.

(D) If Bar Counsel deems a written and sworn complaint to state an ethical violation, such that alternative disposition is not appropriate or the Respondent will not consent to or
complete the alternative disposition program, the matter shall proceed under subsection (1) above.

(E) If Bar Counsel deems any written and sworn complaint against a member not to state an ethical violation and it is not suitable for alternative disposition, it may decline, without investigation, to
entertain it.

(4) Neither the Association, the Board, the Director, the Inquiry Commission, the Trial Commission, the Office of Bar Counsel, nor their officers, employees, agents, delegates or members shall be
liable, to any person or entity initiating a complaint or investigation, or to any member of the bar or any other person or entity being charged or investigated by, or at the direction of, the Inquiry Commission, for any damages
incident to such investigation or any complaint, charge, prosecution, proceeding or trial.

HISTORY: Amended by Order 2007-007, eff. 2-1-08; prior amendments eff. 12-18-07 (Order 2007-008), 4-1-07 (Order 2007-01); eff..1-1-06 (Order 2005-10), 10-1-98 (Order 98-1), 1-13-86 (Order 86-1),
7-1-79, 1-1-78, 7-2-71

DUTY OF ATTORNEYS TO REPORT ETHICAL VIOLATIONS OF OTHER ATTORNEYS – Does this apply to Bar Counsel’s Office?

Saturday, December 17th, 2011

By LawReader Senior Editor Stan Billingsley

Quis custodiet ipsos custodes” *1
We have had sources claim that the Bar Counsel has prosecuted claims  against attorneys who have allegedly committed violations of the Rules of  Ethics, and have failed to report their own violation. Our
research of the Supreme Court Rules find no such rule.
If anyone can cite a rule imposing on an attorney the duty of  “self-reporting” his/her own violations, please share their  authorities with us.(LawReader has previously published an article discussing
Kentucky Bar Ass’n v. Rorrer, 222 S.W.3d 223 (Ky.,  2007) (See Footnote *2 below). The Rorrer case would appear to  grant 5th. Amendment rights to an attorney. The case discusses the
right of attorneys not to incriminate themselves. This Supreme Court ruling  suggests that it may be unconstitutional to demand that an attorney report  his own violations.)
However, there is a rule, SCR 3.130(8.3), known popularly as the” Squeal  Rule”, which requires an attorney who has knowledge of an ethical violation of  another attorney
to report it to the Bar Counsel’s office.  A formal complaint  must be signed and notarized. There is no such requirement for merely making a  report to the Bar Counsel under the “Squeal Rule” SCR 3.130 (8.3).
The rule states:
“SCR 3.130(8.3) Reporting professional misconduct
(a) A lawyer who knows that another lawyer has committed  a violation of the Rules of Professional Conduct that raises a substantial  question as to the lawyer’s honesty, trustworthiness or fitness as a lawyer
in other respects, shall inform the Association’s Bar Counsel.”
This rule would appear to apply to members of the Board of Governors,  attorney Members of the Inquiry Commission, KBA Ethics Trial Commissioners, and  attorney employees of the Bar Counsel’s office.
The argument goes that every attorney must report possible ethics  violations by “another attorney”. There is no exception to this rule for KBA  officials and Bar Counsel office attorneys.
The firing of the Bar Counsel, Linda Gosnell, on November 21, 2011, has not been explained by the KBA Board of Governors, or the KBA  President Maggie Keane.
Only the disclosure of the reasons the Board of Governor’s discharged Linda  Gosnell will reveal if any members of the KBA or Bar Counsel’s office have failed to comply with SCR 3.130
(8.2).
The possibility, that the Bar Counsel’s office is totally in charge of  enforcing SCR 3.130(8.2) against themselves, if they had knowledge of any  ethical violations of the former Bar Counsel, is not reassuring.
It appears  clear from the reading of the “Squeal Rule” that if any attorney in the Bar  Counsel’s office had knowledge of an ethical violation by the former Bar  Counsel, that they have a duty to report it to the Bar Counsel’s
office. We  acknowledge that any pending charge being handled or investigated by the Bar  Counsel’s office must remain confidential until the Trial Commissioner had made  a finding. Only then could such a charge be disclosed to
the public.
Once again this situation brings into question the justification for the  secrecy rules protecting the KBA attorney discipline process.
We have no knowledge of any violation of SCR 3.130 (8.2) by anyone.  We have no knowledge of any ethical violation by the former Bar Counsel.
We are merely discussing the Supreme Court Rules which appear to be  deficient in that they allow a system where the Bar Counsel’s office polices
itself.
The possibility of a violation of SCR 3.130(8.2) will likely never be revealed if the KBA continues to refuse to publically announce their reasons for  terminating Linda Gosnell.
We would argue that the current Supreme Court Rules regarding attorney discipline procedures are a mess. If the justification for attorney discipline rules are to protect the image of the legal profession, the current process
fails miserably. The public and members of the Bar and the public are  not likely to be reassured that all ethics violations will be properly investigated.
***
*1-Quis custodiet ipsos  custodes? is a Latin  phrase traditionally attributed to the Roman poet Juvenal from his  Satires (Satire VI, lines 347–8), which is literally translated as
“Who will guard the guards themselves?” Also sometimes  rendered as “Who watches the watchmen?”, the phrase has other
idiomatic translations and adaptations such as “Who will  watch the watch-guards?” In modern usage, it is frequently associated with the
political philosophy of Plato and the problem of political corruption. – Wikipedia
*2-Kentucky Supreme Court Suggests Attorney Defending Against  Ethics Complaint May Demand His Rights Under 5th. Amendment Not To Incriminate
Himself Read  Story
–>
Kentucky Bar Ass’n v. Rorrer, 222 S.W.3d 223 (Ky., 2007)
Rorrer poses a more difficult question on his conviction for failing to
respond to the KBA’s request for information. Although his criminal conviction
had been
finalized, Rorrer was in the process of appealing his sentence
during much of the attorney discipline process. And Rorrer’s response to the
charges against him alleged that he did not answer the initial complaint because
he wanted to
exercise his Fifth Amendment right to avoid self-incrimination.
But Rorrer did not raise this self-incrimination argument until after the
Inquiry Commission had issued the charges.
Obviously, each attorney is obligated to respond to the KBA’s
lawful request for information involved in a disciplinary
investigation.12 But the
Fifth Amendment guarantees each person a
right to avoid self-incrimination.13 In certain cases, therefore,
there is a conflict between an attorney’s
obligation under SCR 3.130(8.1)(b)
to respond to a lawful request for information in an attorney discipline matter
and the attorney’s constitutional
right to avoid
self-incrimination.

 

 

COPY OF ANGELA FORD BRIEF SEEKING TO AVOID ACCOUNTING TO U.S. ATTORNEY

Monday, December 12th, 2011

the following brief is a public record in the Gallion, Cunningham criminal action.

The U.S. 6th. Circuit upheld District Judge Danny Reeves order to provide an accounting.

This brief  presents her claim that she does not have to provide an accounting.

Ford was ordered to file the accounting by Nov. 5, 2011.   Upon its receipt by the Justice Department, it was
sealed by District Judge Danny Reeves.

 

Case
No. 11-6187

____________________________________________________________

UNITED
STATES COURT OF APPEALS

FOR
THE SIXTH CIRCUIT

____________________________

ANGELA M. FORD,

Appellant

v.

UNITED STATES OF
AMERICA,

Appellee

___________________________________________________________

Appeal from the
United States District Court

for the Eastern
District of Kentucky

(Honorable Danny C.
Reeves)

________________________________________________________

BRIEF
OF APPELLANT ANGELA M. FORD

________________________________________________________

 

R. Kenyon Meyer

Stephen J. Mattingly

DINSMORE & SHOHL LLP

101 S. Fifth Street, Suite 2500

Louisville, Kentucky 40202

(502) 540-2300

(502) 585-2207 – fax

kenyon.meyer@dinsmore.com

stephen.mattingly@dinsmore.com

Counsel for Angela M. Ford

Case: 11-6187 Document:
006111143825 Filed: 12/01/2011 Page: 1

 

i

 

DISCLOSURE
OF CORPORATE AFFILIATIONS

AND
FINANCIAL INTEREST

Pursuant  to FRAP 26 and 6th Cir. R. 26.1, Angela M.
Ford makes the  following

disclosure:

1.  Is said party a subsidiary or affiliate of a
publicly owned corporation?  NO

If  the
answer  is YES,  list
below  the  identity
of  the  parent
corporation  or

affiliate and the
relationship between it and the named party.

2.  Is
there a publicly owned corporation, not a party  to  the
appeal,  that has a

financial interest in
the outcome?  NO

If the answer is YES,
list the identity of such corporation and the nature of

the financial
interest:

s/ R. Kenyon
Meyer        12/1/2011

R. Kenyon Meyer

Counsel
for Appellant

Date

 

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ii

 

TABLE
OF CONTENTS

DISCLOSURE OF
CORPORATE AFFILIATIONS

AND FINANCIAL
INTEREST
………………………………………………………………………
i

TABLE OF CONTENTS ……………………………………………………………………………… ii

TABLE OF AUTHORITIES
………………………………………………………………………..
iv

STATEMENT REGARDING
ORAL ARGUMENT ……………………………………….. v

JURISDICTIONAL
STATEMENT………………………………………………………………..
1

STATEMENT OF THE
ISSUES
……………………………………………………………………
3

STATEMENT OF THE CASE
………………………………………………………………………
4

I.  Nature of the Case, Course of Proceedings,
and Disposition Below … 4

STATEMENT OF
FACTS…………………………………………………………………………….
5

I.
Background
……………………………………………………………………………….
5

A.
The Abbot lawsuit and judgment
………………………………………… 5

B.
The  criminal  case,
Ford’s  appointment  as  victims’  legal

representative, and
the restitution order ………………………………. 6

 

II.
Recent developments leading to this appeal
………………………………….. 8

A.
The Kentucky Court of Appeals’ opinion in Abbott ………………
8

B.
The  United  States’
request  for  an
accounting  and  Ford’s

Response
………………………………………………………………………….
9

C.
Proceedings in the district court ………………………………………..
11

 

SUMMARY OF THE
ARGUMENT…………………………………………………………….
12

ARGUMENT
…………………………………………………………………………………………….
14

I.  Standard of Review.
………………………………………………………………… 14

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iii

 

II.  The District Court Lacked  Jurisdiction
to Order  Ford  to
Provide  an

Accounting and the
Location of Her Personal Funds.. …………………. 14

A.
Ford’s attorney’s fees are included in the restitution order

and
have  been  offset
against  the  defendants’
restitution

obligation.
………………………………………………………………………
17

 

B.  The
restitution  order would  render
void  any  state
court  order

requiring  the
victims  or  Ford
to  return money  to Gallion
and

Cunningham.
…………………………………………………………………. 19

C.  The
MVRA  provision  allowing
enforcement  of  a
restitution

order  by  “available  and
reasonable  means”  does
not  permit

compelled discovery
of  assets of a  third party
that  are not  the

property of the
judgment debtor…………………………….21

D.  Ford’s
status  as  the
victims’  legal  representative  did
not

authorize the United
States to obtain discovery from her merely

by filing a motion
…………………………………………………………… 22

CONCLUSION
………………………………………………………………………………………….
25

CERTIFICATE OF
COMPLIANCE
……………………………………………………………. 26

CERTIFICATE OF
SERVICE
…………………………………………………………………….
27

APPELLANT’S
DESIGNATION OF RELEVANT DOCUMENTS ……………….. 28

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iv

 

TABLE
OF AUTHORITIES

CASES

Baze
v. Parker,
632 F.3d 338 (6th Cir. 2011)
…………………………………. ………15, 25

Brinn
v. Tidewater Transp. Dist. Comm’n
, 242 F.3d 227 (4th Cir.
2001)………19

Burak
v. Scott
, 29 F. Supp. 775 (D.D.C. 1939) ……………………………………………….
23

Kohler
v. Transportation Cabinet
, 944 S.W.2d 146 (Ky. App. 1997)
………………. 16

Payne
v. Motorists Mut. Ins. Cos.,
4 F.3d 452 (6th
Cir. 1993) ………………………….. 14

Schultz
v. United States,
594 F.3d 1120 (9th Cir. 2010)
……………………………………
15

United
States v. Bearden
, 274 F.3d 1031 (6th Cir. 2001)……….……………18, 20

United
State v. Brown,
639 F.3d 735 (6th Cir. 2011)
………………………………………. 14

United
States v. Elson,
577 F3.d 713 (6th Cir. Ohio 2009) ……. …………………..18

United
States v. Hairston
, 888 F.2d 1349 (11th Cir. 1989)……..…………………20

United
States v. Hoglund
, 175 F3.d 410 (6th Cir. 1999)
……………………………………. 8

United
States v. Kaczynski
, 416 F.3d 971 (9th Cir. 2005)
………………………………… 20

United  States
v.  Law
,
No.  1:08-CR-137-EJL,  2011 U.S. Dist. LEXIS  79783
(D.

Idaho June 28, 2011) ………………………………………………………………………………….. 15

United
States v. One 1985 Chevrolet Corvette
, 914 F.2d 804, 807 (6th
Cir. 1990) .. 2

United  States
v.  Schwartz,

Case No.  1:09-cr-67,  2011, U.S. Dist. LEXIS  43110,

*12-13 (S.D. Ohio
2011) ……………………………………………………………………………..
22

 

United
States v. Williams
, 612 F.3d 500, 510 (6th Cir. 2010)……………………18

 

Xpedior
Inc
., 354 B.R. 210, 235 (Bankr. N.D. Ill. 2006)…………………………19

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v

 

STATUTES
AND RULES

Fed. R. Civ. P. 26
……………………………………………………………………………………….
16

Fed. R. App. P. 32
………………………………………………………………………………………
26

Kentucky Civil Rule
76.30
…………………………………………………………………………..
16

18 U.S.C. § 3613
………………………………………………………………………………….
passim

18 U.S.C. § 3663A
……………………………………………………………………………….
passim

18 U.S.C. § 3664
………………………………………………………………………………….
passim

18 U.S.C. §§ 3771
………………………………………………………………………….
1, 4, 24, 25

28 U.S.C. § 1291
………………………………………………………………………………………
1, 2

28 U.S.C. § 3015
………………………………………………………………………………………..
15

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vi

 

STATEMENT
REGARDING ORAL ARGUMENT

Appellant Angela M. Ford  requests oral argument  in
this matter.    It would

assist  the Court
in  understanding  the
complex  facts  and
legal  issues  involved
in

Ford’s  appeal.
Oral  argument will  further
permit  the  attorneys
for Ford  and  the

United  States
to  address  any
outstanding  factual  or
legal  issues  that
the  Court

deems relevant.

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1

 

JURISDICTIONAL
STATEMENT

The Mandatory Victims’ Restitution Act of
1996 (“MVRA”), 18 U.S.C. §§

3663A, 3664, provided
the United States District Court for the Eastern District of

Kentucky  with
jurisdiction  over  post-conviction  proceedings
against  defendants

William J. Gallion
and Shirley A. Cunningham, Jr.

On August 16, 2007, the district court, sua
sponte
, appointed Angela Ford to

serve as the victims’
legal representative under the Crime Victims’ Rights Act, 18

U.S.C. § 3771.  (R. 54, Order Appointing Ford.)  In June 2011, the district court

ordered Ford, the
lawyer for 407 victims in a Kentucky state-court lawsuit, Abbott

v.
Chesley
(“Abbott”),  to
provide “a full and complete accounting,” including the

location,  “of
all  funds  collected
by  her  in  [Abbott]  .
.  .  and
not  distributed  to

victims.”    (R. 1284, Order of Accounting.)   Ford
then moved  to alter, amend, or

vacate  the district
court’s order.    (R. 1286,
Motion  to Alter, Amend, or Vacate.)

On September 9, 2011,
the district court denied Ford’s motion to alter, amend, or

vacate.  (R. 1303, September 9, 2011 Memorandum
Opinion.)

On September 23, 2011, Ford appealed the
order requiring her to provide the

location and an
accounting of her fees and the order denying her motion to alter,

amend,  or
vacate.    (R.  1308, Notice
of Appeal.)   Under  28 U.S.C.
§  1291,  this

Court has appellate
jurisdiction over Ford’s appeal from both orders.  Because the

orders were  entered
in  a  post-conviction  proceeding,
they  are  a  “final  decision”

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2

 

under  28
U.S.C.  §  1291
on  the  ancillary
issue  of  whether
Ford  is  required
to

provide the United
States with an accounting of funds “collected by her in [Abbott]

and  not
distributed  to  the
victims.”    See  United
States  v.  One
1985  Chevrolet

Corvette,
914 F.2d 804, 807 (6th Cir. 1990) (holding that “[a]s a practical matter,

most  post-judgment
orders  should  be
deemed  final  because
‘there  is  often  little

prospect that further
proceedings will occur to make them final’”) (internal citation

omitted).  As the Court stated in Chevrolet, “the
concept of finality for purposes of

appellate review is
to be given a practical rather than a technical construction.”  Id.

(internal  citation
and quotation omitted).   An  appeal
from  a post-judgment order

does not present a
significant risk of piecemeal review; thus, post-judgment orders

are generally  considered
final.    Id. The post-conviction orders  from which Ford

appeals are
final.

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3

 

STATEMENT
OF THE ISSUE

Did the district
court err by ordering attorney Angela M. Ford to provide the

United  States
with  an  accounting
and  the  location
of  funds  that
have  been

collected,  paid
to  the  victims,
and  offset  against
the  amount  of
the  defendants’

restitution
obligation?

 

 

 

 

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4

 

STATEMENT
OF THE CASE

I.  Nature of the Case, Course of Proceedings,
and Disposition Below

This
appeal  arises  from
post-conviction  proceedings  against
attorneys

William  J.
Gallion  and  Shirley
A.  Cunningham,  Jr.,
who  were  convicted
of

defrauding  their
clients  out  of
settlement  proceeds.    The
appellant,  Angela M.

Ford, represents 407
of 421 of Gallion and Cunningham’s victims in a civil case in

Kentucky state court
that remains pending against Gallion, Cunningham, and other

civil
defendants.   In the  federal criminal case, Ford was appointed
by  the district

court to serve as the
victims’ legal representative under 18 U.S.C. § 3771.  (R. 54,

Order  Appointing
Ford.)    The  district
court  made  clear
that  Ford’s  role
as  the

victims’ legal
representative did not include the disbursement of funds collected in

the federal criminal
case.  (R. 958, August 19, 2009
Order.)

The  district
court  ordered  Ford
to  provide  an
accounting,  including  the

location, of all
funds collected on behalf of her clients in the state court civil case

“and not distributed
to victims.”  (R. 1284.)  Ford moved to alter, amend, or vacate

the  court’s
order.    (R.  1286.)
After  the  district
court  denied  that motion,
Ford

appealed both the
original order of accounting and the order denying her motion to

alter, amend, or
vacate the order of accounting.  (R.
1308.)

 

 

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5

 

STATEMENT
OF FACTS

I.  Background

A.  The Abbott lawsuit and judgment

In 2004, Ford
uncovered a fraudulent scheme by Gallion, Cunningham, and

two other attorneys—Melbourne
Mills and Stanley Chesley—to steal $64 million

from over 400 of
their clients, who had been injured by the diet drug fen-phen.  (R.

913, United  States’
Sentencing Memorandum  for
Gallion,  p.  1.)
Ford  filed  the

Abbott
lawsuit and now represents 407 of the defendants’ 421 victims.  The lawsuit

named  five
defendants:  the  four
attorneys  and  the
Kentucky  Fund  for
Healthy

Living,  Inc.  (“KFHL”),  a
corporation  created  and
operated  by  the
attorneydefendants

to divert $20 million of the fen-phen
settlement funds to themselves.

In March 2006, the
Boone Circuit Court granted summary judgment in favor

of the Abbott
plaintiffs on their breach of fiduciary duty claim.  The court awarded

the  plaintiffs
$42,000,000  in  compensatory
damages    (the  “Abbott judgment”).

Holding  that
the  plaintiffs  were
the  lawful  owners
of  the  $20
million  held  by

KFHL,  the
court  also  entered
summary  judgment  against KFHL
and  imposed  a

constructive  trust
in  favor  of  the  plaintiffs
on  all  stolen  funds.
(R.  1286,  p.
3.)

After  the
civil  judgment  became
final  in  August
2007,  the  attorney-defendants

appealed but did not
supersede the judgment.  KFHL did not
appeal.  (Id.)

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6

 

With  the
Boone  Circuit  Court’s
approval  and  oversight,
Ford  began  to

collect on the Abbott
judgment.  Ford collected and distributed
$40.2 million to her

clients, who  in
turn  compensated  Ford
in  accordance with  their
contingency  fee

agreements with
her.    (Id., pp. 3-4.)   Over half of the  funds collected came  from

KFHL, which did not
appeal.  Some amounts were also collected
from Mills, who

was acquitted in the
first criminal trial and is not subject to a restitution order.  (R.

500, Judgment of
Acquittal.)

The United
States  has  acknowledged Ford’s  critical
role  in  unearthing
the

defendants’  fraudulent
scheme  and obtaining  a
civil  judgment  against
them.    (R.

913, p. 7,.)  (“[T]he
fraud  came  to
light  through  the
civil  action  filed by
attorney

Angela Ford.”)  As noted by the government, Ford “vigorously
litigated the matter

for years”  and has done a “tremendous amount of work” on
behalf of the victims.

(Id. at
9.)

B.
The  criminal  case,
Ford’s  appointment  as
victims’  legal

representative,
and the restitution order

Ford’s  investigation
and  civil  discovery
in  Abbott led
to  federal  criminal

charges  against
Gallion,  Cunningham,  and  Mills
in  the  Eastern
District  of

Kentucky.  Chesley was granted immunity.

Early  in
the  criminal  proceedings,
the  district  court,
sua  sponte,  issued
an

order identifying
Ford as the victims’ legal representative under the Crime Victims

Rights Act and
instructing the clerk to add Ford to the service list.  (R. 54, p. 1.)

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7

 

At  the
time  of  her
appointment,  Ford  had
neither  entered  an
appearance  in  the

district court nor
asked to be appointed the victims’ legal representative.

In April 2009, a jury
convicted Gallion and Cunningham of wire fraud and

conspiracy to commit
wire fraud.  (R. 820, Judgment of
Conviction (Gallion); R.

821, Judgments of
Conviction (Cunningham).)1  During the sentencing
process, the

United  States
argued  that  the
victims  were  entitled
to  restitution  for
the  total

amount of their loss,
including costs the victims incurred to retain Ford.  (R. 913,

pp. 11-12.)  The United States maintained that the fees
paid to Ford by the victims

were  direct
and  foreseeable  results
of  the  defendants’ wrongful  conduct
because

the victims “had no
other alternative but to retain the services of a civil attorney for

purposes of seeking
recovery of the settlement money the defendants fraudulently

took from them.”  (Id.)

The government
therefore argued that the restitution amount should include

amounts already
collected in Abbott, including any fees paid to Ford by her clients.

(Id., p.
12.)  Once the restitution amount was
fixed, the United States argued, then

the defendants would
be entitled to a credit against the total restitution figure in the

amount of any funds
collected in the civil case, including “any attorney fees paid

to  attorney
Angela  Ford.
”    (Id.)  (emphasis
added).    During  the
defendants’

sentencing
hearing,  the district court  repeatedly acknowledged  the United States’

 

1 In
the first criminal trial, a mistrial was declared as to Gallion and Cunningham,

and the jury found
Mills not guilty.

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8

 

argument  that
Ford’s  attorney’s  fees
should  be  included
in  the  total
amount  of

restitution.    (R.
1179,  Transcript  of
Sentencing  Hearing,  pp.
65-70.)    The

government  agreed
during  the  hearing
that  the  victims were
required  to  pay  an

attorney  for
the money  that  had
been  collected  for
them:  “THE  COURT:
You

would acknowledge
that they [the victims] would have to pay attorneys at least one

time? MR. WALBOURN:
Absolutely, Your Honor.”  (Id., p.
69.)

The  district
court  ultimately  ordered Gallion  and
Cunningham  to  pay
the

victims $127,679,734.05—an
amount equal to the total fen-phen settlement, minus

amounts  that
the  defendants  had
distributed  to  the
victims.    (Id.;  R.
955,  956,

Restitution
Orders.)  The court reasoned that under United
States v. Hoglund
, 178

F.3d 410, 414 (6th
Cir. 1999), the victims were entitled to the full amount of the

fen-phen settlement
because settlement funds “belong[] to the plaintiff alone,” not

his or her
attorney.  (R. 1179, pp. 58-59.)

II.  Recent developments leading to this appeal

A.  The Kentucky Court of Appeals’ opinion in Abbott

In  February
2011,  the  Kentucky
Court  of  Appeals
entered  an  opinion
in

Abbott.    The
Court  of  Appeals
determined  that  summary
judgment  was

inappropriate  because
an  affidavit  submitted
on  behalf  of
the  defendants  by

attorney Kenneth  Feinberg
created  a  question
of material  fact  on
the  breach  of

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9

 

fiduciary  duty  claim.  (Court
of Appeals’ Opinion,  R.  1283-1.)  2    If
the  opinion

becomes final, it
will reverse the Abbott summary judgment and remand the matter

to circuit
court.  The Abbott plaintiffs
petitioned the Court of Appeals for rehearing

because Feinberg had
since recanted his affidavit.  Although
the Court of Appeals

denied  the petition
for  rehearing,  the
court  stated    that
“upon  remand,    the
trial

court may  reconsider
its opinion and order.  The court
may once  again  reject
the

affidavit  of Mr.
Feinberg . . . .”  (R. 1283-7,
Order Denying Rehearing.)

The  Abbott
plaintiffs  moved  for
discretionary  review,  and
their  motion

remains pending
before  the Kentucky Supreme Court.    (R. 1286-1-5, Motion  for

Discretionary
Review.)

B.  The United States’ request for an accounting
and Ford’s response

Several weeks
after  the Kentucky  Court
of Appeals  issued  its
opinion  in

Abbott,
the United States wrote Ford to request an accounting of all funds collected

to  satisfy
the  Abbott judgment.
(R.  1283-2,  Request
for  Accounting.)    The

government stated
that it was concerned that as a result of the Court of Appeals’

opinion,  the  Abbott plaintiffs
might  be  required
to  repay  amounts
collected  to

satisfy the Abbott
judgment.  (Id.)  Ford responded the next day, asking the
United

 

2  Feinberg opined that the fen-phen action was
settled as a class action rather than

an  aggregate
settlement.    (Id.)    The
Kentucky  Supreme  Court
has  issued  four

opinions permanently
disbarring attorneys, including the defendants, for their role

in  the
scandal.    In  each opinion,
the Supreme Court has  found—contrary  to Mr.

Feinberg’s  affidavit—that  the
action was  decertified  and
settled  as  an
aggregate

settlement. (R.
1286-1, p. 12.)

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10

 

States  to
provide  any  authority
that would  require  the Abbott plaintiffs
to  return

money to Gallion and
Cunningham.  (R. 1283-3, 2-17-2011 Email
from Ford.)

After  an
exchange  of  emails,
Ford  emailed  the
United  States  three

distribution grids
created by a third party.  The grids
provide a detailed accounting

of all  funds collected and distributed  in
satisfaction of  the Abbott judgment.
(R.

1286-2,  Distribution
Grids.)3    For  each  Abbott plaintiff,
the  grids  provide
a

breakdown of the
gross distribution amount, the amount paid in attorney fees, the

pro-rata portion of
total expenses, the pro-rata portion of administrative expenses,

the amount of any
Medicare secondary payer claim, and the net distribution.  (Id.)

In  addition
to  these  distribution
grids,  the United  States was
provided with  the

amount of
undistributed funds.4

This  information
represented  all  information
in  Ford’s  possession

concerning the funds
collected in Abbott, other than the location of attorney’s fees

paid  to
Ford  by  her
clients.    The  United
States  does  not
dispute  that  Ford
has

accounted  for
the  $40.2 million  that
she  collected  and
distributed  to  her
clients

(including  the
amount  of  her
attorney’s  fees);  the
amount  of  funds
still  held  in

escrow for her
clients; the entire amount of fees and expenses paid to Ford by her

 

3  Ford
also  noted  in
the  email  that
the United  States  had
already  been  provided

with the grids
related to funds derived from sources other than KFHL.

4 (R.
1268, Fall 2010 Distribution Grid, R. 1295-1, 11-8-2010 Email from Ford.)

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11

 

clients; and  the
fees paid  to a  third party
to hold and distribute  the  funds
(which

were approved by the
state court).

Nevertheless, the
United States continued  to ask Ford  for an “accounting,”

making  it
increasingly  clear  that
it  desired  information on  the
location  of Ford’s

personal  funds.
The  United  States
did  not  explicitly
state  that  it
was  seeking

information on the
location of Ford’s fees until it telephoned Ford on June 9, 2011.

(R. 1286, p. 6.)

C.  Proceedings in the district court

In June 2011, without having further
consulted with Ford, the United States

asked the district
court to order Ford to provide an accounting and the location of

“all funds collected
by her in the Abbott matter and not distributed to the victims.”

(R.  1283, Motion
for Order  of Accounting,  p.  5.)   The
district  court  granted
the

United States’ motion
before Ford’s response time had run.  (R.
1284.)  Stating that

“the  exigencies presented  [by
the United States]  support  a prompt
ruling  on  this

motion,” the district
court ordered Ford to provide an accounting and the location

of these funds within
10 days of entry of the order.  (Id.)

Ford moved to alter,
amend, or vacate the order of accounting and to stay the

district  court’s order of  accounting pending  the
resolution of  the motion  to
alter,

amend, or
vacate.  (R. 1286; R. 1287, Motion to
Stay.)  Although the district court

denied  Ford’s motion
for  a  stay,
the  court  allowed
her  to  file
the  accounting—

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12

 

which consisted of
information on the location of fees paid by her clients—under

seal  in
camera
.    (R.  1288,
July  8,  2011 Order.)    Ford
then  filed  the
accounting

under seal. (R. 1289,
Sealed Accounting.)

After a hearing,  the district court denied Ford’s motion  to alter, amend, or

vacate.  (R. 1303.)
The court ordered the district court clerk to provide the United

States with  the
accounting  previously  filed
under  seal.    (Id.,  p.
11.)   While  the

district court  recognized
that  funds collected  from KFHL were not  subject
to  the

Kentucky  Court
of Appeals’  opinion  in  Abbott and would
not  be  subject
to  an

accounting,  the
court  nevertheless  ordered
the  clerk  to
give  the  United
States

Ford’s accounting,
which included the location of accounts holding fees collected

from KFHL.  (Id., pp. 3-4.)

SUMMARY
OF THE ARGUMENT

This Court
should  vacate  two of
the  district  court’s
orders:  (1)  the district

court’s order
requiring Ford to provide an accounting of “all funds collected by her

in  [Abbott] and not distributed  to  the
victims”; and  (2)  the court’s order denying

Ford’s motion to
alter, amend, or vacate the order of accounting.

These two orders
require Ford to provide the government with information

about  personal
funds  that  are
not  and  cannot
become  owed  to
Gallion  and

Cunningham.    The
funds  in  question
were  paid  to
Ford  by  the
victims  after  a

judgment  was
entered  in  Abbott
v.  Chesley
in
2007—nearly  two  years
before

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13

 

Gallion and
Cunningham were convicted.  The funds
were paid from distributions

received by Ford’s
clients in 2008 and 2010.

The  district
court  lacked  jurisdiction
to  order  Ford
to  provide  information

about these
funds.  Federal courts are courts of
limited jurisdiction, and the court’s

only  possible
source  of  authority
in  post-judgment  restitution-collection

proceedings—the
Mandatory Victims Restitution Act
of  1996  (“MVRA”)—does

not permit the
accounting imposed on Ford.

The  MVRA
does  not  authorize
the  accounting  because
Ford’s  personal

funds  could
never  become  the
property  of Gallion  and Cunningham.   The
legal

fees  Ford
received  in  the
state  civil  case
were  collected  from
Gallion  and

Cunningham,  distributed
to  the  victims,
and  credited  toward
Gallion  and

Cunningham’s
restitution obligations—which included Ford’s attorney’s fees.

The restitution order
itself thus ensures that no state court could order Ford

or the victims to
return funds to Gallion and Cunningham.
The restitution order,

which encompassed the
funds previously distributed in the state court civil action,

would supersede and
nullify any state court order requiring Ford or the victims to

return  money
to  Gallion  or
Cunningham.    And  Gallion
and  Cunningham  are

estopped under  the MVRA
from  arguing  in  the  state
civil  case  that
they  did  not

defraud the
victims.

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14

 

Additionally, no
procedural mechanism permits the United States to obtain

post-judgment  discovery
from  a  third
party merely  by  filing
a motion  with  the

district court
requesting an order compelling production of the discovery.  Ford’s

court-appointed
status as the victims’ legal representative under the Crime Victims

Rights Act does not
authorize discovery of her personal funds.

This Court should therefore vacate the
district court’s orders requiring Ford

to provide the
location and an accounting of her personal funds.

ARGUMENT

I.  Standard of Review

The  district
court’s  interpretation  of
its  authority  under
the  MVRA  is  a

question of law
reviewed de novo:  “A matter requiring
statutory interpretation is a

question of law
requiring de novo review, and the starting point for interpretation

is  the
language of  the  statute
itself.” United  States  v. Brown,
639 F.3d 735,  737

(6th Cir. 2011).  Ford’s challenge to the district court’s
jurisdiction is, likewise, a

question of law
subject to de novo review.  See Payne
v. Motorists’ Mut. Ins. Cos.
,

4 F.3d 452, 454 (6th
Cir. 1993).

II.  The District Court  Lacked
Jurisdiction  to Order  Ford
to  Provide  an

Accounting
and the Location of Her Personal Funds.

The district  court
lacked  jurisdiction  to
issue  the orders on  appeal because

the  court’s
only  possible  source
of  authority  over
Ford—the MVRA—does  not

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15

 

provide  a
statutory  basis  for
compelling  discovery  of
Ford’s  personal  funds
that

cannot become the
property of Gallion and Cunningham.

“In determining the
scope of a district court’s jurisdiction, our starting point

is that the lower
federal courts are courts of limited jurisdiction and possess only

those powers
granted  to  them by Congress.”   Baze v. Parker, 632 F.3d 338, 341

(6th Cir. 2011).  In criminal proceedings, a district court’s
authority is particularly

circumscribed,  and  “federal  courts must
be  reluctant  to
infer  that  Congress
has

expanded  their
jurisdiction.”    Id.

As the district court
recognized, its only possible source of authority to order

the  accounting
was  the  MVRA,
which  provides  the
exclusive  procedures  for

enforcing the
district court’s restitution order.  (R.
1303, p. 6); Schultz  v.  United

States,  594
F.3d  1120,  1123
(9th  Cir.  2010).

The  government’s
authority  to  conduct
discovery  under  the
MVRA  is

logically  limited
to  discovering  the
financial  condition of  the
judgment debtor
.

See
United States v. Hawkins
, 392 F. Supp. 2d 757, 760 (W.D.Va.
2005); United

States
v. Law
, No. 1:08-CR-137-EJL, 2011 U.S. Dist. LEXIS 79783, *8 (D. Idaho

June  28,
2011);  28  U.S.C.
§  3015(a)  (“the
United  States  may
have  discovery

regarding the
financial condition of the debtor in the manner in which discovery is

authorized by  the Federal Rules of Civil Procedure  in an action on a claim  for a

debt”) (emphasis
added).

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16

 

Thus, to establish
jurisdiction for the accounting, the government must show

that  the
funds at issue are potentially
relevant  to  the debtor’s
financial condition.

See
generally
Fed. R. Civ. P. 26(b)(1).
The United States argued below
that  the

location of Ford’s
personal funds is relevant because it is possible that Ford could

become  indebted
to Gallion  and Cunningham  in  the  future
if  the Boone Circuit

Court were to order
her to repay legal fees she earned in Abbott.  The government

asserts that if this
were to occur, it would need to know the location of these funds

to  be
prepared  to  prevent
the  money  from
being  returned  to
Gallion  and

Cunningham.

In  the
proceedings  below,  Ford
argued  that  the
government’s  fears  were

unwarranted  because
it  is  unlikely
that  a  state
court  would  order
Ford  and  the

victims  to
return  money  to
Gallion  and  Cunningham,
for  numerous  reasons,

including  the
following:  (1)  the  Abbott judgment
remains  in  force
while  the

Kentucky Supreme
Court considers the plaintiffs’ motion for discretionary review.

(R.  1286,
pp.  13-14)  (citing
Kentucky  Civil  Rule
76.30  and  Kohler
v.

Transportation  Cabinet,    944
S.W.2d    146,    147
(Ky.  App.    1997));
and  (2)

equitable principles
governing the return of funds after reversal would prevent the

Boone  Circuit
Court  from  ordering
Ford  or  the
victims  to  pay
Gallion  and

Cunningham—who  have
been  criminally  convicted
for  defrauding  the
victims.

(See R. 1286,
pp. 16-18.)

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17

 

The United States
did  not
dispute  that  the  possibility  of
such  a  state-court

order was remote; it
termed the possibility an “unlikely circumstance[].”  (R. 1312,

Transcript of
September 7, 2011 Hearing, p. 30.)

This  scenario, however,  is not merely unlikely—it  is
a  legal  impossibility.

As  detailed
below,  the  restitution
order  itself  prohibits
any  state  court
from

ordering the victims
or Ford to return to Gallion and Cunningham funds that have

been distributed  to  the
victims and offset against  the  restitution amount owed by

the defendants.

A.  Ford’s
attorney’s  fees  are
included  in  the
restitution  order  and

have
been offset against the defendants’ restitution obligation.

The
restitution  order  ensures
the  funds  collected
by  Ford  in  Abbott

including amounts
later paid to her by her clients—cannot become the property of

Gallion  and Cunningham.    (R.
1179, pp. 58-59.)   By  operation of
the  restitution

order, Gallion and
Cunningham are indebted to the victims, and their debt includes

the legal fees the
victims paid Ford to recover the money stolen from them.  As the

United States argued
during the sentencing process, Ford’s attorney’s fees were a

loss  suffered
by  the  victims
as  a  foreseeable
result  of  the
defendants’  criminal

conduct;  thus,
Ford’s  fees  were
appropriately  included  in
the  initial  restitution

amount fixed by the
district court.  (R. 913, p. 12.)

Under the MVRA, the
amounts collected and distributed in the civil case are

offset  against
the  restitution  owed
by  Gallion  and
Cunningham.    Seee.g.,
18

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18

 

U.S.C.  §
3664(j)(2).   This Court has  recognized
that  any  amounts
received  by  a

victim  in
a  related  civil
case  are  to
be  treated  “as
potential  credits  against
the

defendant’s
restitution obligation,” because “a defendant should not have to pay a

victim for the same
loss twice.”   United States v. Elson,
577 F.3d 713, 733 (6th

Cir. Ohio 2009); United
States v. Williams
, 612 F.3d 500, 510 (6th Cir. 2010).

Where  victims
“have  received  compensation
for  their  losses,
the  district

court should offset
the restitution obligation by the amount received, assuming that

the  compensation
is  for  the
same  loss  that
is  the  subject
of  the  restitution

obligation.” Elson,  577
F.3d  at  735.
This  applies  to
payments made  to  victims

both  before
and  after  entry
of  the  restitution
order.  “[W]hen  determining
the

amount of a
restitution award under the MVRA, the court must ‘reduce restitution

by any amount the
victim received as part of a civil settlement’ . . . . to avoid[] the

undesirable result of
restitution effectuating a double recovery.” Id. at 734; United

States  v.
Bearden
,  274  F.3d
1031,  1041  (6th
Cir.  2001).   As
the United  States

argued during the
sentencing process,  the amounts  received by
the victims  in the

state civil case include
the amounts they received and paid Ford.
(R. 913, p. 12)

(asking the Court to
give the defendants credit for any amounts paid to the victims

in the civil case, including
“attorney fees paid to attorney Angela Ford”).

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19

 

In sum, the funds of
which the government seeks an accounting were part of

the  restitution order, and  their distribution  to  the
victims  reduced  the defendants’

obligations under the
restitution order.

B.  The
restitution  order  would
render  void  any
state  court  order

requiring  the
victims  or  Ford
to  return  money
to  Gallion  and

Cunningham.

The Supremacy Clause
ensures  that as  long  as  the defendants’  convictions

stand,  no
state  court  could
order  Ford  or
the  victims  to
return  to  Gallion
and

Cunningham  funds
that  have  been
determined  to  be
part  of  the  defendants’

restitution  obligation.
Any  such  state
court  order  would
conflict  with  the

restitution order
itself.

Federal court orders
enforcing federal statutes and federal rights have been

held to supersede
conflicting state acts.  “Federal court
orders enforcing a federal

statute  (such
as  the Bankruptcy Code)  supersede
any  contrary  state
law.”    In  re

Xpedior  Inc.,  354
B.R.  210,  235
(Bankr. N.D.  Ill.  2006).
“A  state  statute
that

thwarts a federal
court order enforcing federal rights ‘cannot survive the command

of  the Supremacy Clause.’”   Brinn v. Tidewater Transp. Dist. Comm’n,
242 F.3d

227, 233-34 (4th Cir.
2001).

Federal courts
recognize the dominance of federal court restitution orders in

several  contexts.
For  example,  this
Court  has  held
that  settlement  agreements

between criminal
wrongdoers and their victims in resolution of civil cases cannot

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20

 

preclude entry of
restitution orders by district courts for the same wrong.  Bearden,

274 F.3d at
1040-41.   The Eleventh Circuit has found
that the dismissal of a civil

action  in
state  court  does
not  preclude  a
restitution  order  on
the  same  claim.

United
States v. Hairston
, 888 F.2d 1349, 1355 (11th Cir. 1989).

A restitution order
is an order enforcing a federal statute, the MVRA.  The

restitution  order
here  would  thus
render  null  and
void  any  state
court  order

requiring money  already
distributed  to  the
victims  to  be
returned  to Gallion  and

Cunningham.    Such
an  order  would
conflict  with  the
restitution  order,  which

determined  that
Gallion  and  Cunningham
are  indebted  to
the  victims  for
the

amounts stolen and
for attorney’s fees paid by the victims to Ford.  As the United

States argued during
sentencing, Ford’s attorney’s fees—which are the subject of

the  accounting—are money
that  has  been
distributed  to  the
victims,  as

contemplated by the
restitution order.

The supremacy of the
restitution order is supported by a related provision of

the MVRA,  18
U.S.C.  §  3664(l),
which  estops  Gallion
and  Cunningham  from

arguing  to
the  state  court
that  they  did
not  defraud  the
victims.   Under  section

3664(l),

[a] conviction of a
defendant for an offense involving the

act  giving
rise  to  an
order  of  restitution
shall  estop  the

defendant  from
denying  the  essential
allegations  of  that

offense  in
any  subsequent  Federal
civil  proceeding  or

State civil
proceeding, to the extent consistent with State

law, brought by the
victim.

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18 U.S.C.  §
3664(l).   Because Gallion  and Cunningham were  convicted
of wire

fraud and conspiracy
to commit wire fraud, they are estopped from arguing to the

state  court
in  Abbott that
they  did  not
commit  fraud  or
steal  from  the
victims.

Section 3664(l)  is
complementary  to  the
restitution order  and  reinforces
that  any

state  court
order  requiring  the
victims  (or  Ford)
to  return  money
Gallion  and

Cunningham would be
void under the Supremacy Clause.

It would therefore be legally impossible for
Ford’s personal funds to become

the property of the
judgment debtors, Gallion and Cunningham.
Accordingly, the

district  court
lacked  jurisdiction  to
order  Ford  to
produce  an  accounting
of  her

personal funds.

C.  The MVRA provision allowing enforcement of a
restitution order

by “available
and  reasonable means” does not
permit  compelled

discovery
of assets of a third party that are not the property of the

judgment
debtor.

The  district
court  justified  the
accounting  by  holding
that  it  was  an

“available and  reasonable means” of enforcing  the
restitution order and was  thus

appropriate  under
18  U.S.C.  §
3664(m)(1)(A)(ii),  which  states
that  the  United

States  may
enforce  a  restitution
order  “by  all
other  available  and
reasonable

means.”  (R. 1303, pp. 6-7.)

The government’s
request for an accounting is not “reasonable” because, for

the reasons detailed
above, the funds in question could never become the property

of the judgment
debtors, Gallion and Cunningham.  While
this provision gives the

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22

 

United States, “some
degree of discretion” as to how to enforce a restitution lien,

see
United States  v. Kaczynski
,
416 F.3d 971, 976  (9th Cir.  2005), no
published

federal decision
holds  that  this provision could authorize discovery of
assets  that

are not and could
never become the property of a judgment debtor.

The request for an
accounting is also not an “available” means of enforcing a

restitution
order.   No court has held  that
this provision allows the government to

subject a non-party
to discovery merely by filing a motion.
Courts have, instead,

cited  the  “available  and
reasonable  means”  language
to  support  the
use  of

“available” statutory
procedures for collecting on a debt.  See,
e.g., United States v.

Schwartz,
Case No. 1:09-cr-67, 2011 U.S. Dist. LEXIS 43110, *12-13 (S.D. Ohio

2011) (“The FDCPA
[Federal Debt Collection Procedures Act] is an ‘available and

reasonable   means’

of  enforcing  the  judgment”)  (internal
citation  omitted).   As

detailed  below,
the  government  did
not  use  any  “available”
method  of  seeking

discovery from a
third party.

D.  Ford’s status as the victims’ legal
representative did not authorize

the
United States to obtain discovery from her merely by filing a

motion.

The United States has
not  identified or utilized any  federal or
state  rule of

procedure  that
would  require  a
non-party  to  produce,
in  response  to  the

government’s motion,
information about personal finances that do not belong to a

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23

 

judgment debtor.  In fact, the procedural rules do not permit
discovery from a nonparty

under these circumstances, for several
reasons.

First,  the
Federal  Rules  of
Civil  Procedure  generally
do  not  permit
a

judgment  creditor
to  discover  the
personal  assets  of
a  non-party.    See
Burak  v.

Scott, 29
F. Supp. 775, 776  (D.D.C. 1939).    In Burak,  the district court held  that

Federal Rule of Civil
Procedure 69, which provides for post-judgment discovery,

does not give a
judgment creditor “any right . . . to require the disclosure of assets

of  persons
other  than  the
judgment  debtor.”    Id.
Quashing  subpoenas  issued
to

non-parties by the
judgment debtor, the court held that the non-parties “cannot be

required, by  the Rules of Civil Procedure referred  to,  to
make disclosure of their

individual assets.”  Id.

Second,  the
United  States  did
not  employ  any
civil-judgment  collection

mechanism  for
bringing  a  non-party
before  the  court
to  obtain  discovery.
The

government did
not,  for example,  issue a
subpoena to Ford.   Cf. Law,
2011 U.S.

Dist. LEXIS 79783 at
*1-5  (in an attempt  to discover assets  the
judgment debtor

had deposited in her
mother’s bank account, the United States issued subpoenas to

the mother’s bank and
conducted a debtor examination of the mother).
Instead, it

simply  filed
a motion  seeking  to
compel  Ford  to
produce  her  personal
financial

information.

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24

 

The government and
district court justified the motion for an accounting by

invoking Ford’s  status as the victims’  representative.   The government  suggested

that  the district court had  jurisdiction over Ford because  she was
an  “arm of  the

Court” and because
she “holds funds for the benefit of the victims of the crimes of

the defendants in
this case.”  (R. 1297, United States’
Pre-Hearing Memorandum,

p. 4.)  The court reasoned that it had jurisdiction
to order the accounting because

Ford,  as
the  court-appointed  victims’
representative, was  “related  to
the  action”

and “an active
participant in the case.”  (R. 1303, p.
6.)

Neither the
government nor the district court explained how Ford’s limited

role  as
the  victims’  legal
representative  under  the
Crime  Victims  Rights
Act

(“CVRA”) conferred on
the court unfettered authority  to  require Ford
to disclose

her personal
assets.  Ford’s role as the victims’
representative is to ensure that the

victims are afforded
the following eight rights enumerated in 18 U.S.C. § 3771:

(1)  The
right  to  be  reasonably  protected
from  the

accused.

(2)  The
right    to    reasonable,    accurate,
and    timely

notice   of
any   public    court proceeding, or  any parole

proceeding,  involving
the  crime  or  of  any
release  or

escape of the accused.

(3)  The
right  not  to
be  excluded  from
any  such  public

court proceeding,
unless the  court,  after
receiving  clear

and  convincing
evidence,  determines  that testimony by

the victim would be
materially altered if the victim heard

other testimony at
that proceeding.

(4)  The
right    to  be
reasonably  heard  at
any  public

proceeding  in  the
district court involving release, plea,

sentencing, or any
parole proceeding.

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25

 

(5) The  reasonable
right  to  confer with
the  attorney  for

the Government in the
case.

(6) The right to full
and timely restitution as provided in

law.

(7)  The
right  to  proceedings
free  from  unreasonable

delay.

(8) The    right
to   be    treated
with    fairness   and
with

respect  for
the  victim’s dignity and
privacy.

18  USCS
§  3771(a).    Ford’s
appointment  by  the
district  court  to
represent  the

victims in this
capacity placed her in a position akin to counsel of record.

But  neither
the  government  nor
the  district  court
identified  any  rule
that

requires  attorneys
to  provide  extensive
discovery  of  their
personal  assets merely

because they are
practicing before a federal court.
Federal district courts “possess

only those powers
granted to them by Congress,” Baze, 632 F.3d at 341, and have

no  generalized
authority  to  require
an  attorney  to
produce  personal  financial

information to a
party-litigant.

CONCLUSION

For the above reasons, Angela M. Ford
respectfully requests that the Court

vacate the district
court’s June 29, 2011 and September 9, 2011 orders.

 

 

 

 

 

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26

 

Respectfully
submitted

 

/s R. Kenyon Meyer__________

R. Kenyon Meyer

Stephen J. Mattingly

DINSMORE & SHOHL LLP

101 S. Fifth Street, Suite 2500

Louisville, Kentucky 40202

(502) 540-2300

(502) 585-2207 – fax

kenyon.meyer@dinsmore.com

Counsel for Angela M. Ford

CERTIFICATE
OF COMPLIANCE

I  hereby
certify  that  the
foregoing  brief  complies
with  the  type-volume

limitation provided
in Fed. R. App. P. 32(a)(7)(B).
The  foregoing brief contains

5,529  words
of  Times  New
Roman  (14  point)
proportional  type.    The
word

processing software
used to prepare this brief was Microsoft Word 2007.

Case: 11-6187 Document:
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27

 

CERTIFICATE
OF SERVICE

On December 1, 2011,
I electronically filed this document with the clerk of

the  court
by  using  the CM/ECF
system which will  send  notice
of  the  electronic

filing to all parties
of record.

 

/s R. Kenyon Meyer_____________

Counsel for Angela M. Ford

 

 

 

 

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28

 

APPELLANT’S
DESIGNATION OF RELEVANT DOCUMENTS

 

Appellant,  pursuant
to  Sixth  Circuit
Rule  28(c),  hereby
designates  the

following filings in
the district court’s record as relevant documents:

Description
of Item

Record
Entry

Number

District Court Docket
Sheet  –

Order Appointing
Ford  54

Judgment of
Acquittal  500

Judgment of
Conviction (Gallion)  820

Judgment of
Conviction (Cunningham)  821

Sentencing Memorandum
for Gallion  913

Restitution Order
(Gallion)  955

Restitution Order
(Cunningham)  956

August 19, 2009
Order  958

Transcript of
Sentencing Hearing  1179

Fall 2010
Distribution Grid  1268-9

Motion for Order of
Accounting  1283

Kentucky Court of
Appeals’ Opinion  1283-1

Request for
Accounting  1283-2

2-17-2011 Email from
Ford   1283-3

Order Denying
Rehearing  1283-7

Order of
Accounting  1284

Motion to Alter,
Amend, or Vacate  1286

Motion for
Discretionary Review  1286-1 – 1286-5

Distribution
Grids  1286-2

Motion to Stay  1287

July 8, 2011
Order  1288

Sealed
Accounting   1289

11-8-2010 Email from
Ford  1295-1

United States’
Pre-Hearing Memorandum  1297

September 9, 2011
Memorandum Opinion  1303

Notice of Appeal  1308

Transcript of
September 7, 2011 Hearing  1312

886548v3

 

WHEN WILL THE KBA TELL THE PUBLIC WHY THEY FIRED LINDA GOSNELL? OPPOSITION TO BOARD OF GOVERNORS GROWS.

Monday, December 12th, 2011

As of  Monday  Dec. 12, it has been 21 days since the Bar Association fired Bar Counsel Linda Gosnell.

LawReader has refrained from discussing the issue of “Why was Linda Gosnell fired” after we were told by a source close to the KBA, that there were legal reasons why
the KBA should not make a statement for “21 days”.   Out of respect for the KBA we therefore have not asked that question after we learned of  the possibility of a legitimate reason for the KBA to withhold
comment.  However the 21 day “safety” period has now expired.  So we would ask the KBA, “Why was Linda Gosnell fired?”

We would also ask if the full Board of Governors who met on Nov. l8, were informed of the issues for Gosnell’s firing discussed by the Executive Committee of the Board which apparently met on Nov. l7th. prior to the issue being presented to the full board.  The rumor persists that  there may have been an effort to suppress the real reasons that Gosnell was fired?

The KBA President, Maggie Keane, was quoted by the Courier-Journal that the Angela Ford Fen- Phen distribution list had nothing to do with the firing of Gosnell.  We note that the Bar President carefully did
not say why Gosnell was fired.    The KBA President referred to the Fen Phen distribution list, but made no reference to the distribution list in the civil case of Abbott v. Gallion.

Today we heard from a source that displeasure about the Board of Governors continued silence on this issue has inspired talk of a slate of candidates to oppose the current members of the Board of
Governors who are up for re-election this year.  (One half of the Board stands for election every two years.  So half of the Board members will stand for election this year.)

It has been announced that noted defense lawyer William Johnson of Frankfort, has stated publically that he would be a candidate for the office of Vice-President of the KBA.  He will be oppose William
H. Wilhoit of Grayson.  Other candidates calling for reform and transparency may soon announce their plans.

AOC CLAIMS COURTS ARE OPEN AND TRANSPARENT – BUT KBA REFUSES TO RELEASE INFORMATION

Monday, December 12th, 2011

Quote from a Courier-Journal article dated Dec. 5, 2011 – By Andy Wolfsen

“The bar association is an agency of the Supreme Court, which has said the judicial branch is not covered by the state open records act.

“A spokeswoman for the Administrative Office of the Courts said last year that it was unnecessary for the judicial branch to enact a written open records
policy of its own because it already operates in “an open, transparent manner.”

“The KBA, however, has refused to release staff salaries and other documents, including an investigative report on misconduct allegations against one of its former presidents, Barbara Bonar, or
how much an outside lawyer was paid to produce the report.”

CHIEF JUSTICE JOHN MINTON CALLS ON LEGISLATURE WITH BUDGET REQUESTS

Saturday, December 10th, 2011

Dec. 9, 2011

FRANKFORT — Chief Supreme Court Justice John D. Minton told a legislative committee Friday that Kentucky’s courts desperately need a new computer system, 25 more staffers and
more new family court judges.

In total, the courts are asking for an additional $62 million for the next fiscal year, but only about $20 million of that would be for new projects, positions or pay raises. The
vast majority of the $62 million is for other increased costs, such as health care and contributions to the retirement system, court officials said Friday.

The legislature will tackle the two-year budget when it reconvenes in January. State leaders have cautioned agencies not to expect much new money during the next two years given
that projected revenues are expected to fall several hundred million dollars short of what’s needed to maintain current programs.

Minton said the passage of House Bill 463 earlier this year, which was designed to divert more non-violent, first-time offenders from the state’s prisons and jails, has meant
more work for the state’s pretrial officers.

Minton told the Interim Joint Committee on the Judiciary on Friday that he would ask in his two-year budget request to hire an additional 25 pretrial officers, who assess whether
people should stay in jail or be released as their criminal case is resolved in court. It would cost about $2.1 million to hire the pretrial officers.

The new legislation, which took effect June 8, has resulted in about 783 fewer people in county jails and an increase in the number of people on monitored court release. There
does not appear to be a spike in the number of people who have committed crimes while their pending criminal cases are resolved, Minton said.

But the most pressing issue facing the state court system is its antiquated computer system, which is running on technology that is 25 years old and on software that is 10 years
old, Minton said. Two groups have looked at the system and have strongly advised that the court replace it or face a catastrophic system failure, Minton said.

“Simply put, we are at serious risk,” he said.

The first phase of the information system overhaul would cost about $28.4 million. The court is asking lawmakers to borrow money to pay for that phase of the project, which would
cost the state roughly $2.2 million in debt service a year for 10 years.  Projected costs for the second and third phases of the project are in flux, said Laurie Dudgeon, the executive director of the Administrative Office of the
Courts.

The courts also need to increase pay for some entry-level positions to make them equitable to similar jobs in the legislative and executive branches. The judiciary is losing too many staff to other branches of government, Minton said.

“My goal is to pay our work force on a scale that is competitive with the rest of state government,” Minton said.

He is asking for an additional $11.9 million next year and in coming years to increase pay. Still, not all court employees would get raises, Dudgeon said.

Minton also is requesting money to pay for three new family court judge positions: one in Knott and Magoffin counties, one in Pulaski, Rockcastle and Lincoln counties, and one

in Daviess County. Those jurisdictions either do not have a family court or have high family court caseloads, Minton said. It will cost $1.9 million to create the three positions.

Minton said he also will ask for the authority to issue bonds that would pay for new courthouses in Henry County and in Nicholas County.

In total, the judicial branch is asking for $378 million for the fiscal year that begins July 1 and $382.9 million for fiscal year 2014.

Minton said the judiciary had not asked for additional money during the past several budget cycles and realizes that the state’s finances are precarious. The court has been a good steward of taxpayers’ money, streamlining its operations and
slashing its staff, Minton said.

INTERFERENCE OF BAR COUNSEL IN SELECTION OF TRIAL COMMISSIONERS REPORTED TO KBA IN 2009 – Has the Bar Counsel influenced selection of KBA Trial Commissioners in violation of Sup. Ct. Rules?

Friday, December 9th, 2011

LawReader.com – Dec. 9, 2011
In a letter written in 2009,( and shared with LawReader on Dec. 9, 2011), the KBA was warned of issues regarding the interference of the Bar Counsel regarding the selection of Trial Commissioners assigned
to hear ethics discipline cases.

Copies of this letter were reported to have been shared with several KBA officials including the Bar Counsel. (This letter is no longer confidential since the Board has made a final ruling in this case.)

This letter alleges that the procedures used to select the Trial Commissioner was not in compliance with Supreme Court Rules:

The letter states:  “…we are aware that Bar Counsel has participated in selecting prior Trial Commissioners in this case because she told us that Frank DohenyJr.  was selected for his experience in class
action law.”

“Because the Rules do not provide for any role for Bar Counsel in the selection of the “next available” name on the Trial Commission list, we respectfully request that Bar Counsel should either refrain from having any
conversations with the Disciplinary Clerk concerning the selection of the Trial Commissioner or have all such conversations occur in the presence of counsel for Respondent.”

For authority regarding the procedures for the selection of Trial Commissioners we refer to Kentucky Bar Ass’n v. Harris, 269 S.W.3d 414 (Ky., 2008) which states:
“The Disciplinary Clerk appoints the next available Trial Commissioner to serve as a hearing officer. SCR 3.230. Trial Commissioners are also appointed by the Chief Justice, subject
to approval of the Supreme Court. SCR 3.225.”


Nothing in the court’s ruling suggests that the Bar Counsel/Prosecutor has any right to interfere or influence the selection of the Trial Commissioner/judge who will actually hear the attorney discipline case.

Doheny was recently assigned to the Eric Deters discipline case, and apparently has been on the list provided by the Supreme Court at least since 2009.  We find no authority in the Supreme Court Rules for the Bar Counsel or the
disciplinary clerk to select Trial Commissioners based on their expertise in “class action cases” or any other type of practice.

Deters moved for recusal of Doheny as the Trial Commissioner in his case, after Doheny disclosed after the hearing started, that one of his fellow attorney’s at Dinsmore and Shohl had taken over
and completed the case that Deters was being prosecuted for.  The client who complained against Deters was representedd by  the Trial Commissioner’s law partner.

The particular charge alleged that Deters had charged a fee of $1500.  Doheny advised Deters that his law partner charged a fee of $25,000 to complete the case from which Deters was fired by
the complaining client.  Deters sought mediation of the fee, but the Bar Counsel objected.   Deters offered to return the entire fee but the offer was rejected by the Bar Counsel.

Deters motion for recusal of Doheny was rejected by the Chief Justice, and Doheny completed the hearing and recommended a sanction against Deters.

The Disciplinary Clerk is to appoint “the next available Trial Commissioner” who is selected from a list of nominees appointed by the Chief Justice subject to the approval of the Supreme Court. No role is provided in the rules, for the Bar Counsel to interfere or to have the right to influence, the selection process of the Trial Commissioner.

The 2009 letter we quote says the Bar Counsel “told us that Doheny was selected for his experience in class action law.”

(Doheny is generally recognized to practice medical malpractice defense cases, and we are unaware of his expertise in “class action cases” which was cited by Linda
Gosnell to support his selection as a Trial Commissioner in a “class action” related case.)

(We would expect that this letter should be in the KBA files. An independent investigation as requested by Billingsley and Larry Forgy could begin their review by looking for this and similar letters. )

We cannot imagine any right for the Bar Counsel to interfere in the selection of Trial Commissioners in violation of the procedures set out by the Supreme Court.

We can’t imagine that the Supreme Court is aware of this twisting of their rule providing for the selection of “the next available” Trial Commissioner nominee.
This rule implies that the Trial Commissioner is to be randomly selected. See: SCR 3.230.

It is hard to imagine a Commonwealth Attorney having the power to select the Trial Judge to hear a case to be prosecuted by the Commonwealth Attorney’s Office?

It was reported to LawReader that former Bar Counsel Linda Gosnell was seen in the office of Dinsmore and Shohl this week speaking to a Dinsmore lawyer.
Interesting coincidence.

****************************

Authorities for selection of Trial Commissioner

Kentucky Bar Ass’n v. Harris, 269 S.W.3d 414 (Ky., 2008 provides a detailed analysis for the attorney discipline process.

The following quotes are from KBA v. Harris:

“When a complaint of professional misconduct comes to the Kentucky Bar Association, the gears of the disciplinary proceedings are set in motion. “

“The Office of Bar Counsel2 reviews the complaint, has it reduced to a sworn written statement (SCR 3.160) and files it with the Disciplinary Clerk.3 “

“The Disciplinary Clerk (or deputy) notifies the attorney by certified mail, etc. of the complaint and of his or her response time. SCR 3.160. “

“Bar Counsel investigates the complaint and presents the case to the Inquiry Commission. SCR 3.170. The Inquiry Commission consists of nine persons (six attorneys, and three
non-attorneys) appointed by the Chief Justice with consent of the Court.”

“The Inquiry Commission meets in panels of three, with two attorneys and one non-attorney on each panel. SCR 3.140.”

“The Inquiry Commission reviews the investigative evidence from Bar Counsel and any response from the accused attorney (Respondent) and determines whether the complaint should be dismissed
or a charge be filed. SCR 3.170.”

“If the Inquiry Commission determines “that probable cause exists for a charge to be filed,” it drafts the formal charges which are filed with the Disciplinary Clerk. SCR 3.190.”

“The Disciplinary Clerk appoints the next available Trial Commissioner to serve as a hearing officer. SCR 3.230. Trial Commissioners are also appointed by the Chief Justice, subject to
approval of the Supreme Court. SCR 3.225.”

“The Trial Commissioner sets the matter for a hearing. All charges, pleadings, motions, notices, briefs, orders, etc. shall be filed with the Disciplinary Clerk. SCR 3.290. After a hearing,
with evidence, briefs, and oral argument, the Trial Commissioner must decide the case by “a preponderance of the evidence.” SCR 3.330.”

“Upon submission of the case, the Trial Commissioner files a written report with the Disciplinary Clerk. SCR 3.360. The written report sets forth the findings of fact, conclusions of law,
whether or not a violation occurred, and if so, the proposed sanction. Id. Either party may file a timely “Notice of Appeal” with the Disciplinary Clerk (SCR 3.365) which transfers jurisdiction to the Board of
Governors.4”

“The Board may review the record or grant a de novo hearing. SCR 3.370. The Board’s decision may be appealed to the Supreme Court by either party. SCR 3.370(8). Notices, pleadings, briefs, etc.
before the Board are all filed with the Disciplinary Clerk and upon filing of the “Notice of Review” of the Board’s decision, the record is transferred to the Supreme Court Clerk. After the parties file briefs, the case
is considered submitted to the Supreme Court for a decision. SCR 3.370.”

“A closer inspection of the functions described above reveals that the Disciplinary Clerk is merely an administrator, much like the District/Circuit Court Clerks that receive papers,
serve notices by mail, and appoint warning order attorneys, etc. when needed. The Clerks, as an administrative [269 S.W.3d 418] arm working with the attorneys, parties, witnesses, and judges, in no way affect the impartiality of
the decision maker.”

NEW RULE ALLOWS EASY ENTRANCE TO PRACTICE IN OHIO FEDERAL COURTS

Friday, December 9th, 2011

The U.S. District Court, Southern District of Ohio would like to announce a change in the entrance requirement for being admitted to practice in our Court.
General Order 11-03 abolishes the requirement in Local Rule 83.3 to pass a bar exam in order to be admitted to practice in the Southern District of Ohio and
replaces it with a requirement for attendance at a Federal Court Practice Seminar.

Upcoming Federal Court Practice Seminars which are sponsored by the local Federal Bar Association Chapters are as follows:

DAYTON:

Date: December 10, 2011 (Saturday)

Time: 9:00 am – 4:00 pm

Location: Sinclair Community College, 444 West 3rd Street, Dayton, Ohio

4.75 Hours CLE Credit* – including 1 Hour of Professionalism

Lunch and Refreshments Provided
COLUMBUS:

Date: December 14, 2011 (Wednesday)

Time: 9:00 am – 12:15 pm

Location: Columbus Convention Center (Rooms A-103(a) – A103(b))

3.0 Hours CLE – General Credit

Refreshments Provided
CINCINNATI:

Date: January 11, 2012

Time: 8:00 am – 1:00 pm

Location: Room B-17, Potter Stewart U.S. District Courthouse

3.0 Hours CLE Credit* – including 1 Hour of Professionalism

Refreshments Provided

*
Ohio Supreme Court CLE Credit Approval Application Pending

Attendance at any of the three seminars qualifies for admission and previously
admitted practitioners are welcome to attend as a refresher.

For
further information, including registration forms, please visit the court’s
website: http://www.ohsd.uscourts.gov/attorneyinfo.htm
Registration forms are at the bottom of the page.

 

CINCINNATI TORT LAWYER STANLEY CHESLEY FILES MOTION TO STAY KBA DISCIPLINE PROCEEDINGS – QUESTIONS REASONS BAR COUNSEL WAS TERMINATED ON NOV. 21, 2011

Wednesday, December 7th, 2011

Dec. 7, 2011  by LawReader Senior Editor Stan Billingsley

LawReader has read a copy of pleadings filed on Monday Dec. 5th. By Stan Chesley in his discipline hearing before the Kentucky Supreme Court.  He seeks
discovery of the reasons the KBA terminated Bar Counsel Linda Gosnell and suggests a possible denial of due process of law.

Chesley cites in his motion a Courier-Journal news story from July 15, 2011 in which it was reported that “ …Federal Prosecutors have now turned their attention to (Angela) Ford, in what they say is an effort
to protect the Fen Phen victims after a $42 million civil judgment that she won for her clients was reversed.”

“the U.S. attorney’s office in Lexington has won a court order requiring Ford to account for the money she’s collected and hasn’t passed on to her clients…including $13.5 million she’s been paid in legal
fees.”

(In another article by the Courier Journal in 2009, Ford is quoted by reporter Andy Wolfsen,  as saying that she has shared her attorney fees “with other
lawyers”.   It is believed that the names of the other lawyers may be revealed by the Accounting which is now in the possession of the U.S. Attorney’s office.
Federal Judge Danny Reeves has ordered that the accounting be sealed pending further order of the court.)
In Chesley’s  motion styled, ‘Motion to Abate to Allow Limited Discovery On Deprivation of Due Process”, he seeks discovery “…to determine whether any of
the facts related to the termination of Bar Counsel’s (Linda Gosnell) employment must be disclosed to Respondent to satisfy due process of law.”
Chesley goes on to say:

“Investigation is required into Angela Ford’s payments of money to other lawyers from funds she collected for the fen-phen plaintiffs in Abbott.”  (Abbott
is the civil case from Boone County which was reversed by the Ky. Court of Appeals in February of 2011.)

The Bar Counsel sought restitution from Chesley of $7.5 million dollars of his legal fee in the original fen-phen case.   Chesley states in his motion that Judge Wehr,
the Boone Circuit Judge who granted a summary judgment against Gallion, Mills, and Cunningham,  did not issue a summary judgment against Chesley.
Apparently the Bar Counsel was seeking restitution without any judgment against Chesley.

“After the Court of Appeals vacated the summary judgment against G.M. C (Gallion, Mills and Cunningham) in the Abbott case, the
United States attorney for the Eastern District of Kentucky demanded an accounting from Ms. Ford of the funds she had collected and of the disbursement
from those funds. Ms. Ford vigorously resisted rendering an accounting., causing many members of the Bar to wonder what was being concealed from the
public record in fen-phen related proceedings.”

The motion explains that approximately one week after the 6th. Circuit Court of Appeals dismissed Ford’s motion to set aside the Accounting ordered by Judge
Reeves, that the Ky. Bar Association “abruptly terminated” Bar Counsel Linda Gosnell.

Chesley argues in his motion, “The circumstances attendant to the termination has raised questions whether it was in any way related to the accounting rendered on November 9—such as disclosing a conflict of interests that would have required Bar Counsel to recuse in this case.”

A second section of the motion is titled:  “Investigation is required into Bar Counsel’s  overly zealous prosecutions, including charging disciplined lawyers for legal fees paid by the KBA to her friends.”

Chesley argues: “…Bar Counsel charged Mr. Chesley for legal fees that were incurred by the KBA in Gallion’s criminal trial.”  (Chesley was not a defendant in the criminal
trial, he was only named in the Abbott civil trial.)

“Specifically, the bill of costs served upon Respondent (Chesley) in this case included $15,736.86 paid as fees to Jane Graham, a Lexington attorney, apparently for attending and observing Gallion’s
criminal trial.”

Graham explained her work in June of 2011 by saying her “…services had been rendered in connection with Ms. Gosnell’s appearance as a witness in the federal prosecution of Gallion and Cunningham.”

Chesley argues that while a discipline case was pending against former KBA President Barbara Bonar, that a stay in the Bonar discipline case was granted pending the outcome of the Boone Civil trial.  A similar motion by Chesley for a stay pending the final outcome of the Abbott case, was denied.

So the KBA prosecuted Chesley regarding claims made in the Abbott case, but the Abbott case has been reversed and the reversal and
remand for a new trial is currently pending in the Ky. Supreme Court.   This means it is possible that Chesley may be subject to a restitution order of $7.5 million dollars, and the Abbott case
never granted such an order against Chesley and is still pending.

Chesley has moved the Ky. Supreme Court for an order allowing discovery.  “…the KBA should be required to provide counsel for Respondent with any and all exculpatory
materials, including any and all materials that might tend to support a motion for a new trial on the basis of conflict of interests and/or prosecutorial misconduct.”

Chesley’s attorney, Sheryl Snyder of Frost, Brown and Todd in Louisville,  said the material they seek could be limited to an “attorney eyes only basis”.

To read more from the Chesley motion go to:  Chesley Test which is posted on LawReader.com.

The American Bar Association Recommends Kentucky Suspend Capital Punishment

Wednesday, December 7th, 2011

 

See:  http://fatlip.leoweekly.com/2011/12/07/american-bar-association-calls-on-ky-to-suspend-executions/

 

An extensive review of Kentucky’s capital punishment system has uncovered serious flaws, prompting the American Bar Association to call for a moratorium on
executions in the commonwealth.  A team of attorneys, former Kentucky state Supreme Court justices and law school professors spent two years assessing the state’s death penalty system. In a
report released this morning, the team states that they “identified a number of areas in which Kentucky’s death penalty system falls short in the effort to
afford every capital defendant fair and accurate procedures and minimize the risk of executing the innocent.” Their troubling findings include:

Of the last 78 people sentenced to death in Kentucky, 50 have had a death sentence overturned on appeal by Kentucky or federal courts. That is an error rate of
more than 60 percent.

Evidence in criminal cases is not required to be retained for as long as a defendant remains incarcerated, and the problem of lost evidence significantly diminishes
the effectiveness of a state law that allows post-conviction DNA testing prior to execution. Such lost or missing evidence prevents exonerating innocent
people and can prevent apprehension of the guilty.

There are no uniform standards on eyewitness identifications and interrogations, and many of Kentucky’s largest law enforcement agencies do not fully adhere to best
practices to guard against false eyewitness identifications and false confessions, two of the leading causes of wrongful conviction nationwide.

Kentucky public defenders handling capital cases have caseloads that far exceed national averages and salaries that are 31 percent below those of similarly experienced
attorneys in surrounding states…
At least 10 of the 78 people sentenced to death were represented by defense attorneys who were subsequently disbarred…

And the list goes on.

“We came in to this with no real idea of what we would find,” said Linda Ewald, University of Louisville Louis D. Brandeis School of Law, who co-chaired the
assessment team. “But at the close of our two-year deliberations, we were left with no option but to recommend that the commonwealth halt executions until the
problems we identified are remedied. This report is really about the administration of justice in Kentucky.”

Kentucky was the ninth state to undergo such a review by the American Bar Association, which takes no official stance for or against capital punishment.

 

SUPREME COURT REPEALS SCR WHICH ALLOWED THE BAR COUNSEL TO SUBMIT A COST BILL TO ATTORNEYS IN DISCIPLINE MATTERS AND REQUIRED PAYMENT OF THE COST AND EXPENSE BILL BEFORE THE ATTORNEY HAD A RIGHT TO APPEAL.

Wednesday, December 7th, 2011

 

 

TIME LIMIT FOR SUPREME COURT TO RULE REPEALED.  COURT MAY NOW TAKE SUCH
TIME TO ISSUE A DISCIPLINE RULING AS MAY BE REQUIRED.

IN RE:
ORDER AMENDING RULES OF THE SUPREME COURT (SCR)
2011-11
______________________
Upon review of this Court, the following amendment to SCR 3.370 of the Rules of the Supreme Court shall become effective

November 15, 2011.

AMENDMENT TO THE RULES OF THE SUPREME COURT

SCR 3.370 Procedure before the Board and the Court

SCR 3.370 shall read:

(1) Thirty (30) days after the filing of the notice of
appeal,
the Appellant shall file a brief supporting his/her
position on the merits of the case. Fifteen (15) days thereafter,
the Appellee shall file his/her brief. No reply brief
shall be permitted.

(2) Upon motion by the parties or upon the Board’s own

motion, oral arguments may be scheduled before the
Board.
(3) Within sixty (60) days of completion of briefing by the

parties, the Board shall consider and act upon the entire

record. Only the President, the President-Elect, the Vice-President,

the fourteen (14) duly-elected members of the Board
from their respective Supreme Court Districts, and four (4)

adult citizens of the Commonwealth who are not lawyers

appointed by the Chief Justice as hereinafter described, shall
be eligible to be present, participate in and vote on
any disciplinary

case. Any member, including a non-lawyer member,

who has participated in any phase of a disciplinary
case submitted

to the Board under this rule, or who has been
challenged

on grounds sufficient to disqualify a Circuit Judge

shall be disqualified. If disqualification or absence
results in

lack of a quorum the Chief Justice shall appoint a
member or

members (or, if applicable, non-lawyer participants)
sufficient

to provide a quorum to consider and act on the cases.
Any

challenge to a member’s qualifications shall be
determined

by the Chief Justice in accordance with KRS 26A.015,
et seq.

(4) Eleven (11) of those qualified to sit in a
disciplinary

matter must be present to constitute a quorum for
consideration

of such matters.

(5) (a)The Board, after deliberation, and consideration
of

oral argument, if any, shall decide, by a roll call
vote:

(i.) To accept the Trial Commissioner’s Report as to

the guilt, innocence, and the discipline imposed, by
concluding

that the Trial Commissioner’s report is supported

by substantial evidence and is not clearly erroneous
as a

matter of law, or,

(ii.) To conduct a de novo review, in its discretion.
In

that event it shall make findings as to the guilt or
innocence

on each Count, and the appropriate discipline to be

imposed, if any, and take separate votes as to each.
If the

Board votes to take de novo review of the case, said

review shall be confined to the evidence presented and
the

record of the case. The Board may consider the
admissibility

of evidence as well as the appropriate weight of it.
The

Board shall state, in its written report required by
subsection

(8), the difference between its findings and
recommendations

and the report of the Trial Commissioner.

(b) In the event of a case submitted under SCR

3.210, the Board shall decide, by a roll call vote,
guilt or

innocence on each Count and the appropriate discipline
to

be imposed, if any. It shall make findings of fact in
the

event of a disputed fact, and make conclusions of law.

Failure to answer may be deemed an admission of the

facts stated in the charge.

(c) Each roll call vote under (5)(a)(b) shall be
agreed

upon by eleven (11) or three-fourths (3/4) of the
members

of the Board present and voting on the proceedings,

whichever is less.

(d) At any time during deliberations the Board by a

vote of a majority of the Board present and voting,
may

remand the case to the Inquiry Commission for
reconsideration

of the form of the charge or remand the case to

the Trial Commissioner for clarification of the Trial
Commissioner’s

report or for an evidentiary hearing on points

specified in the order of remand. The Board may order
the

parties to file additional briefs on specific issues.

(6) The Board shall issue a written decision within
forty

five (45) days of voting on the cases. The Disciplinary
Clerk

shall mail copies of such report to the Respondent,
counsel

of record, and to each member of the Inquiry
Commission.

The Disciplinary Clerk shall place ten (10) copies of
the

report in the record and file the entire record of the
case with

the Court, unless the Board has taken actions under
subsection

(5)(d), in which case the matter will proceed in
accordance

with the Board’s direction.

(7) Within thirty (30) days after the Board’s decision
is

filed with the Disciplinary Clerk, Bar Counsel or the
Respondent

may file with the Court a Notice for the Court to
review

the Board’s decision stating reasons for review,
accompanied

by a brief, not to exceed thirty (30) pages in length,
supporting

his/her position on the merits of the case. The
opposing

party may file a brief, not to exceed thirty (30)
pages in

length, within thirty (30) days thereafter. No reply
brief shall

be filed unless by order of the Court.

(8) If no notice of review is filed by either party,
the Court

may notify Bar Counsel and Respondent that it will
review the

decision. If the Court so acts, Bar Counsel and
Respondent

may each file briefs, not to exceed thirty (30) pages
in length,

within thirty (30) days, with no right to file reply
briefs unless

by order of the Court, whereupon the case shall stand
submitted.

Thereafter, the Court shall enter such orders or
opinion

as it deems appropriate on the entire record.

(9) If no notice of review is filed by either of the parties,
or

the Court under paragraph eight (8) of this rule, the
Court

shall enter an order adopting the decision of the
Board or the

Trial Commissioner, whichever the case may be,
relating to

all matters.

(10) When the Respondent is proceeded against by
warning

order, the notice in paragraph two (2) and paragraph
eight

(8) of this rule shall be deemed to have been served
thirty

(30) days after the date of the making of the warning
order.

(11) In each case to be presented to the Trial
Commissioner,

there shall be supplied with the Disciplinary Clerk’s
file a sealed

envelope containing a statement of the Respondent’s
years of

membership in the Association, all orders of
unprofessional

conduct, and all withdrawals from the association and
reasons

therefor. The envelope will be opened only if the
Trial Commissioner

makes a finding of a violation and may be considered
in

deciding what discipline to impose. Such statement
will

become part of the record of the case and be
transmitted with

the rest of the file to the Disciplinary Clerk, Board
and/or

Supreme Court. Before submission of a case to the
Trial Commissioner

or the Board a copy of said statement shall be sent to

the Respondent, who may review documents relative to
it at the

Bar Center, and may comment to the Trial Commissioner
or the

Board upon the statement and point out errors
contained in it.

All sitting. All concur.

ENTERED: November 15 , 2011.