By David Kramer | dkramer@dbllaw.com

In Goodin v. White, 342 S.W.3d 282 (Ky. App. 2011), the Kentucky Court of Appeals upheld a trial court’s refusal to admit into evidence a settlement agreement between the plaintiff and a third-party defendant who remained in the case for trial. The jury exonerated the settling third-party defendant but imposed a significant verdict against the nonsettling defendant. The opinion states that the jury was informed of the fact that the plaintiff and third-party had settled, but the terms were not disclosed, nor was a copy of the agreement admitted. The Court of Appeals also upheld the trial court’s refusal to make the plaintiff and settling third-party defendant share their peremptory jury challenges, rejecting the nonsettling defendant’s argument that the plaintiff and the third-party were not antagonistic in light of their settlement.

Goodin v. White is the first reported Kentucky appellate decision discussing so-called Mary Carter settlement agreements. The nickname of those agreements derives from the case of Booth v. Mary Carter Paint Co., 202 So. 238 (Fla. App. 1967). Goodin defined a Mary Carter agreement as having the following characteristics: (1) it limits the liability of the settling defendant, who remains a party to a pending action; (2) it is kept secret from the nonsettling parties and/or judge and jury; and (3) it guarantees to the plaintiff a minimum recovery, notwithstanding the fact that the plaintiff may not collect on the judgment against the settling defendant or that the verdict may be less than that specified in the agreement. The classic Mary Carter agreement would add a fourth characteristic: that the settling defendant’s liability is decreased in direct proportion to the increase in the nonsettling defendants’ liability. See, e.g., Cox v. Kelsey-Hayes Co., 594 P.2d 354 (Okl. 1978).

Whether the agreement is a classic Mary Carter or a variant that has some elements of a Mary Carter, the point of such agreements is that they tactically help the plaintiff divide and conquer the defendants by reducing the incentive of the settling defendant to vigorously defend the claim, while not giving the nonsettling defendant an “empty chair” to blame at trial. In such cases, the nonsettling defendant may want the jury to consider the extent to which the motivations of the other parties have been affected by a settlement agreement that may have changed the normal and expected adversarial interests — and consequently the trial positions — of the parties.

My review of the Goodin v. White opinion leads to a number of observations:

- Though the opinion does not address the point, the duty to disclose a settlement with one but not all defendants to the court and to all other parties certainly exists under Kentucky civil procedure and legal ethics rules (specifically, the duty of candor to the tribunal and the duty of fairness to opposing party and counsel) if such information is requested in a valid discovery request, and may exist even without such a formal request. In this regard, I always ask in discovery to be informed of the existence of any settlement agreement with any other person or party.

- The agreement in Goodin v. White was not a classic Mary Carter agreement in that it did not reward the settling third-party defendant by reducing its liability by the amount awarded against the nonsettling defendant, and it was disclosed to the court and opposing parties, but it did have other characteristics of a Mary Carter. It is important to note the Court of Appeals held that a settlement that creates bias on the part of a witness or impeaches sworn testimony can be admissible on those bases. The Court did not find any evidence of witness bias or prior inconsistent testimony, notwithstanding the defendant’s argument that once the settlement was reached the plaintiff’s counsel adjusted their litigation strategy by pulling punches on the third-party defendant at trial compared to plaintiff’s more adversarial approach to the third-party during discovery. Also, the opinion notes that the agreement was disclosed to the court at the beginning of the trial, and the jury was later advised that there was a settlement between the plaintiff and the third-party defendant.

- The party the plaintiff settled with was a third-party defendant who was brought into the case by the defendant, not a defendant who was kept in the case for trial by the plaintiff. Thus, this doesn’t appear to have been a sham high/low between a plaintiff and a defendant with limited resources intended to increase the potential return from a defendant with deeper pockets; rather, it was probably a tactic designed to reduce the antagonism the plaintiff would face at trial and avoid an empty chair situation. On the other hand, the high and low numbers of the agreement were not mentioned in the opinion, so it’s unknown how narrow the settlement spread was. The lower the numbers and the narrower the spread between the high and the low, the more likely the agreement might be a sham, and the more the agreement resembles a Mary Carter.

- There was no indication in the opinion that the plaintiff and the third-party defendant colluded with each other during jury selection, or that the nonsettling third-party defendant used its peremptories to benefit the plaintiff. If either of those circumstances had occurred, the defendant could probably have made a persuasive motion for mistrial on that basis.

In conclusion, a Mary Carter agreement or its variant, the sham high/low agreement, i.e., one with comparatively low numbers and in which there is an artificially narrow spread between the high and the low, can distort the adversarial process, cause a misalignment of the parties and raise both questions of fairness and potential ethical implications. This is particularly true when the agreement is not disclosed to the court and counsel, or when there is collusion between ostensibly opposing parties during jury selection, or when the settling defendant “takes a dive” by not mounting a vigorous defense or changes tactics and blames a nonsettling defendant at trial when that was not previously the settling party’s position. Defense counsel should be on guard for such tactics and raise them with the trial court when they occur. Options may include seeking relief by way of a mistrial or requesting leave to admit into evidence the terms of the settlement or to use them for purposes of showing bias or impeaching inconsistent testimony.

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

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The new judicial article of the Ky. Constitution was approved in 1975. That amendment was first discussed in the following case.

Ex Parte Auditor of Public Accounts, 609 S.W. 2d 682 (Ky. 1980)

“The position of the KBA as an independent agency of the Supreme Court, not accountable to Kentucky’s legislative or executive branches of government, was confirmed in a landmark separation of powers case in Kentucky.

The Auditor of Public Accounts made direct application to the Supreme Court to determine whether he was legally entitled or required to audit the books and accounts of the State Bar Association.

The Supreme Court held that where funds of the State Bar Association and the Board of Bar Examiners were not collected pursuant to any statute and were not appropriated by the legislative body, and where both the Association and the Board of Bar Examiners existed solely by virtue of rules of the Supreme Court, expressly and exclusively authorized by State Constitution, and were accountable to that court only, there was not constitutional authority by which they could be made accountable to either one of the other two branches of government.

Held KRS 21A.130, 21A.140, 21A.150 and 21A.160 void because they purport to erect powers and limitations that no longer fall within the legislative province. This is the definitive case on the relationship of the Kentucky Bar Association as an “arm and agency” of the Supreme Court of Kentucky.”

609 S.W.2d 682

Ex parte AUDITOR OF PUBLIC ACCOUNTS.

No. 80-SC-540-DA

Supreme Court of Kentucky.

Nov. 25, 1980.

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Leslie G. Whitmer, William J. Parker, Henry R. Wilhoit, Jr., Charles Landrum, Jr., Frankfort, for Kentucky Bar Assn.

Rhonda E. Morgan, Frankfort, for Auditor of Public Accounts (Dr. Graham).

Fred G. Francis, Chairman, Kentucky State Bd. of Bar Examiners, Prestonsburg, for Bd. of Bar Examiners.

OPINION AND ORDER

A controversy exists between the Auditor of Public Accounts (hereinafter the Auditor) and the Kentucky Bar Association (hereinafter the Association). The question is whether the Auditor is legally entitled or required to audit the books and accounts of the Association. It comes before this court on a direct application by Hon. James B. Graham, the present Auditor, addressed to the Chief Justice, requesting that the controversy be resolved by the Supreme Court. This court does not render advisory opinions. It is generally authorized to exercise “appellate jurisdiction only, except it shall have the power to issue all writs necessary in aid of its appellate jurisdiction, or the complete determination of any cause, or as may be required to exercise control of the Court of Justice.” Const.Sec. 110(2)(a). This is an actual controversy requiring an official decision, and because the Association is an arm of the court itself, and therefore cannot properly be sued in any of the other courts of the state, this court is only forum in which the controversy can be heard and officially resolved. See Ex parte Farley, Ky., 570 S.W.2d 617, 621 (1978).

Until 1934 the state bar association was a voluntary organization. Before 1918 lawyers

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were admitted, or “licensed,” to practice upon local examination. Cf. Ch. 100, Acts of 1892; Ch. 17, Acts of 1902. The first Board of Bar Examiners was established by Ch. 131, Acts of 1918. There were no “license” fees except for original admission. By Ch. 3, Acts of 1934, the General Assembly integrated the bar by requiring all persons practicing law to be members of a state bar association. This Act directed the then Court of Appeals to adopt rules defining the practice of law, prescribing a code of professional ethics, establishing practice and procedure for the discipline, suspension and removal of attorneys, and organizing and governing a bar association “to act as an administrative agency of the Court of Appeals of Kentucky for the purpose of enforcing such rules and regulations as are prescribed, adopted and promulgated by the Court of Appeals under this Act, providing for the government of the State Bar as a part of the judicial department of the State government,” etc. (Emphasis added.) The 1934 Act also authorized the court to fix a schedule of fees (not exceeding $2.00 per annum) for its administration.

Upon the recodification of the Kentucky Statutes in 1942 the provisions relating to the Board of Bar Examiners, admission to the practice of law, the organization and government of a bar association by the then Court of Appeals, and the regulation of law practice and practitioners, were placed in KRS Chapter 30. As of this time, application fees for admission to the bar ($10.00) were required to be paid to and held by the Clerk of the Court of Appeals subject to disbursement upon order of the court. KRS 30.060 (1942). Bar dues were limited to $3.00, and their collection and disbursement were made subject to regulation by the court. KRS 30.170 (1942).

KRS 30.060 was amended by Ch. 207, Acts of 1946, to require that all funds derived from application fees be remitted to the State Treasury. In 1962 KRS 30.170(1)(e) was amended by deletion of the limitation (then $10.00) upon the amount of bar dues to be fixed by the court on recommendation of the governing body of the bar association. Ch. 5, Acts of 1962. Thereafter, and until adoption of the Judicial Amendment in 1975, these statutes remained substantially unchanged.

Whatever authority the court had possessed theretofore by statute with regard to admission to practice and regulation of the legal profession was superseded by Const.Sec. 116 as amended in 1975, the concluding sentence of which reads as follows: “The Supreme Court shall, by rule, govern admission to the Bar and the discipline of members of the Bar.”

There can be no doubt that this constitutional amendment completely removed the subject from any legislative authority and rendered obsolete and ineffective the statutes pertaining to it. Strangely, nevertheless, at its 1976 regular session the General Assembly reenacted provisions authorizing the Supreme Court to appoint a board of bar examiners and to organize and govern the bar, and again requiring that admission fees be remitted to the state treasury. Ch. 58, Acts of 1976; KRS 21A.130, 21A.150, 21A.160, 21A.140. These statutory provisions are void because they purport to erect powers and limitations that no longer fall within the legislative province.

The root source of all power validly exercised by any officer or agency of the state government is, of course, its Constitution. Placing first things first, ours begins with a Bill of Rights consisting of 26 Sections, the last of which declares in substance that these rights shall prevail over and above all else and are not subject to the general powers of government.

The next two sections of the Constitution, entitled “Distribution of the Powers of Government,” divide all governmental authority among “three distinct departments, and each of them to be confined to a separate body of magistracy, to wit: Those which are legislative, to one; those which are executive, to another; and those which are judicial, to another.” Const.Sec. 27. This distribution of authority concludes with an unusually forceful command: “No person or collection of persons, being of one

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of those departments, shall exercise any power properly belonging to either of the others, except in the instances hereinafter expressly directed or permitted.” Const.Sec. 28.

Sections 29-62, incl., provide for the legislative branch of government and limit its powers. Sections 69-108, incl., provide for the executive branch of government and delegate certain specific and exclusive powers to its officers. Any further powers this branch of government may possess-that is, beyond those expressly delegated or necessarily implied by the Constitution itself-must be conferred upon it by the legislative branch, which has all governmental authority not delegated elsewhere and not prohibited by the Constitution.

Sections 109-124, incl., the Judicial Amendment of 1975, provide for the judicial branch of government and, as in the instance of the executive branch, delegate certain specific and exclusive powers to its officers and agencies. The hallmark of this particular subdivision appears in its first section, as follows: “The judicial power of the commonwealth shall be vested exclusively in one Court of Justice …. The court shall constitute a unified judicial system for operation and administration ….” Const.Sec. 109. Further on, Sec. 110(5)(b) states, “The chief justice of the commonwealth shall be the executive head of the Court of Justice and he shall appoint such administrative assistants as he deems necessary…. The chief justice shall submit the budget for the Court of Justice and perform all other necessary administrative functions relating to the court.”

These references to administration and administrative functions do not appear in the Judicial Amendment by accident. Their purpose is to make it unmistakably clear that the judicial branch of this state government has exclusive authority to manage its own affairs. Significantly, whereas the Governor’s authority with regard to the presentation of a biennial budget to the General Assembly is purely statutory, cf. KRS 45.030-45.050, the authority of the Chief Justice to submit the budget for the Court of Justice comes directly and expressly from the Constitution itself. Const.Sec. 110(5)(b). Hence that function can be neither assumed by nor delegated to the executive branch.

The constitutional check-and-balance relationship between the executive and judicial branches of the government consists of the provisions for filling vacancies in judicial offices and for the appointment of temporary substitutes when two or more justices of the Supreme Court decline or are unable to participate in the disposition of a cause pending before that court. Const.Secs. 118, 110(3). Those relationships between the legislature and judicial branches exist by virtue of Const.Secs. 110(4), 111(1), 112(2) and (3) and 113(2) and (3), pertaining to judicial districts and number of judges and justices; Const.Secs. 111(2), 112(5) and 113(6), pertaining to jurisdiction; and Sec. 120, which provides that the compensation of all judges and justices shall be fixed by the General Assembly and that all compensation and necessary expenses of the Court of Justice shall be paid out of the state treasury.

The purpose and significance of the judicial budget is that it provides a means by which the legislative body may assess how much it must appropriate from the treasury for the operation of the judicial system. Once it has made that appropriation, the authority for and responsibility of determining the necessity for and the propriety of expenditures from that source rest exclusively with the judicial branch itself, and are not subject to executive 1 or legislative regulation. Nevertheless, to the extent that it has appropriated funds from the general revenues of the state to the judicial branch of government the legislative body has a legitimate and necessary right to know how those funds have been spent. In short, the legislative body may require that the accounts so financed be audited.

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At this point it is appropriate to consider the nature of the Auditor’s office and the source and extent of its authority. This office, as a constitutional agency, first appeared in Sec. 25 of the third Constitution of Kentucky (1850), which provided: “A Treasurer shall be elected … and an Auditor of Public Accounts…. The duties and responsibilities of these officers shall be prescribed by law.” The same provisions were carried into Secs. 91 and 93 of the fourth Constitution (1891) and continue in force today. As their powers are to be prescribed by law, and therefore must be conferred by the legislative body, these offices are subject to whatever limitations of authority apply to the legislative body itself. In other words, and in the context of the controversy with which we are here concerned, with respect to the judicial branch of government the Auditor cannot constitutionally be given any authority that the legislative body has no right to confer.

The authority upon which the Auditor relies in support of his right to audit the accounts of the Association is set forth in KRS Chapter 43. KRS 43.050(2) (a) directs him (or her) to audit the accounts “of all state agencies, all private and semi-private agencies receiving state aid or having responsibility for the handling of any state funds, the accounts, records and transactions of the budget units, and the general accounts of the state.” KRS 43.010 defines a “budget unit” as any department or unit for which a separate appropriation or appropriations are made, and a “state agency” as any state officer, department, institution, person or functional group that is authorized to or does exercise any powers, duties or obligations of state government.

We find it unnecessary to determine, as did the Supreme Court of Washington in the Matter of the Examination of the Washington State Bar Association, 86 Wash.2d 624, 548 P.2d 310 (1976), that the Association and the Board of Bar Examiners do not fall within these statutory definitions. That is irrelevant. The real question is the extent to which they may validly be applied to the Court of Justice as a constitutionally separate branch of government.

As we have indicated, we have no doubt that the General Assembly has the authority to require an accounting of funds it has appropriated from revenues it has caused to be raised. What we have in this case, however, are funds that have not been collected pursuant to any statute and have not been appropriated by the legislative body and are not subject to legislative appropriation. Both the Association and the Board of Bar Examiners exist solely by virtue of rules of this court expressly and exclusively authorized by Const.Sec. 116. There is no constitutional authority by which they can be made accountable to either of the other two branches of government except for their stewardship of such funds or property as may come into their possession through these sources. Neither of those agencies has any such funds or property. Their funds and property are public funds and property because their official functions are entirely public in nature, but their accountability is to this court only, of which they are an integral part.

Another contention by the Auditor is that bar dues are essentially occupational license taxes, which ordinarily the legislature has the exclusive power to levy, and that regardless of whether Const.Sec. 116 grants direct authority in that respect to the Supreme Court or “merely delegates legislative discretion to determine the amount” of the dues, because of their very identity as license fees collected by governmental authority they are public funds and, like the statutory license fees collected by the Department of Fish and Wildlife Resources and the fees of various county officials collected pursuant to Const.Sec. 106, are subject to the authority granted by the Constitution to the Auditor. Again, however, this argument assumes authority in the Auditor that is not granted by the Constitution. That funds are raised by governmental authority and are therefore “public” does not necessarily subject their collection and disbursement to the activities of the Auditor. It would make just as much sense to say

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that because these funds are “public” they can be used and disbursed only as directed by legislative appropriation. Such a result would open the floodgates to legislative control of the judicial branch of government, and that is exactly what the 1975 Judicial Amendment was designed to prevent.

Fees collected by the Department of Fish and Wildlife Resources are authorized entirely by legislative enactment. Cf. KRS 150.170 et seq. Indeed the Department itself is a creature of statute. KRS 150.021 et seq. Const.Sec. 106 expressly subjects the fees collected by county officials to legislative regulation. Hence all of those funds are subject to whatever authority the General Assembly sees fit to confer upon the Auditor, but funds raised under authority conferred by this court pursuant to its constitutional power to govern admission to the bar and the discipline of its members are not.

The Auditor has submitted an admirable brief in support of the contention that he has authority to audit the accounts of the Association. Among other things, he argues that the exercise of such authority would not interfere with the judicial function. What this argument overlooks, however, is that the 1975 Judicial Amendment extended the judicial function to include the administration of the business affairs of the judicial branch of government, and even though a post or performance audit by the Auditor might not actually “interfere” with that administrative function, certainly it would constitute an intrusion upon it. This intrusion need not be suffered, because appropriated funds are not involved. Experience teaches that a boundary not guarded will in time be lost.

Raney v. Stovall, Ky., 361 S.W.2d 518 (1962), and Arnett v. Meade, Ky., 462 S.W.2d 940 (1971), are cited in support of the Auditor’s position. Both were decided before the adoption of the Judicial Amendment, and to a large extent the instructive commentary contained in them is obsolete.

In Raney the court held simply that the State Treasurer had standing to contest the legality of a warrant issued by the Department of Finance. Although the opinion refers to “the implied obligations” of the office, we construe that expression as connoting merely that a public official having public funds in his custody necessarily has authority to protect them against illegal dissipation. The same result had been reached in Norman v. Kentucky Bd. of Managers, 93 Ky. 537, 20 S.W. 901 (1892), holding that the Auditor, who then had the authority to issue warrants against the state treasury, was entitled to question the validity of a legislative act under which he was ordered to issue a warrant.

We do not by any means accede to the proposition that Raney somehow lends force to the argument that by virtue of its title alone, referring to “Public” Accounts, the office of the Auditor is invested with rights and powers that pervade the entire spectrum of state government. As we have previously demonstrated, the duties and responsibilities of the Auditor are those and only those legally prescribed by the legislature. Consequently, he has no inherent powers. For example, prior to the effective date of the Governmental Reorganization Act of 1936, KS 4618-68 et seq., the Auditor served only as the bookkeeper for the state. KS 4618-137 et seq. He had no authority or duty to conduct post or performance audits. These were the function of the State Inspector and Examiner. KS 1992b-59. The effect of the reorganization act was to transfer the duties of Auditor to the Department of Finance, to transfer the duties of the State Inspector and Examiner to the Auditor, and to abolish the office of State Inspector and Examiner. A clearer history of subjugation to the legislature cannot be found.

The bottom line of Arnett v. Meade, Ky., 462 S.W.2d 940 (1971), was its holding that an ancient but unrepealed statute (KRS 421.140) imposing limits on the punishment for contempt of court had become a material interference with the judicial function and for that reason was invalid. The opinion devotes a great deal of the discussion to the overlapping of legislative

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and judicial functions. The sentence from which the Auditor’s position in this case would draw nourishment is to the effect that “the legislature may put reasonable restrictions upon constitutional functions of the courts, provided that such restrictions do not defeat or materially impair the exercise of those functions.” Arnett, supra, at 946. The correct principle, as we view it, is that the legislative function cannot be so exercised as to interfere unreasonably with the functioning of the courts, and that any unconstitutional intrusion is per se unreasonable, unless it be determined by the court that it can and should be tolerated in a spirit of comity. The converse also is true, and in Lunsford v. Commonwealth, Ky., 436 S.W.2d 512 (1969), this court recognized that its own rule authorizing imprisonment for failure to execute a peace bond was an unconstitutional infringement upon the legislative prerogative. And in Raney, supra, for the same reason, we declined the invitation to trespass upon the exclusive right of the Senate to determine the qualifications and disqualifications of its own members. Such an inquiry is, of course, of a judicial nature, but the Constitution excludes it from the judicial process.

Inevitably, there is and always will be a gray area in which a line between the legislative prerogatives of the General Assembly and the rule-making authority of the courts is not easy to draw. The policy of this court is not to contest the propriety of legislation in this area to which we can accede through a wholesome comity. There is, for example, the statute providing for the disqualification of judges, KRS 26A.015, as contrasted with SCR 4.300 Canon 3, C(1), in which the same subject-matter is included as a part of the Code of Judicial Conduct. There is also the matter of court costs and fees. See KRS 24A.270. Even the statutory creation of a small claims division within the structure of the constitutionally-established district court, KRS 24A.230, is not beyond the pale of an honest difference of opinion. But we hold the General Assembly in the highest respect, and much prefer cooperation over conflict. It has done great work in accommodating the statutes to the new and hitherto-untried requirements of the 1975 Judicial Amendment, and to the extent that we are able to accept its judgments without leaving seeds of future jeopardy to the integrity of the judicial system we shall continue to do so. The point we make here is that the commentary in Arnett regarding legislative restriction upon judicial functions is and must be confined fundamentally to the area of comity.

The Association has had its financial records regularly audited by certified public accountants for many years. 2 Its books and records, except for what must be held in confidence incident to disciplinary proceedings, are open for inspection by the news media and by any legitimately-interested member of the public. For 45 years there was no effort or attempt by the Auditor’s office to assume any authority or responsibility over them. Traditionally at least, the weight of history is against this new-found claim of right.

One remaining question might be asked-why not? In other words, why not comity in this instance? The answer is that there really is no necessity for it and there is good reason against it. Moreover, the legislature is not the real source of the pressure anyway. Without ascribing any questionable motive to the present incumbent or any particular one or more of his predecessors, we think it is appropriate to consider that the office of the Auditor is essentially political in nature and has not always been altogether unaffected by partisan political currents. In keeping with the letter and spirit of the 1975 Judicial Amendment it is the policy of this court, insofar as possible, to isolate the judicial system from the political arena.

At the present time we have 120 circuit clerks who collect some $3,000,000 per

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month for the general fund of the state. They are not regularly audited because the Auditor does not have a sufficient appropriation to make it possible. So, except for “spot” audits of selected offices the Auditor is not in a position to audit this, the greatest source of public revenue passing through the judicial system. We have some difficulty in comprehending how an audit of the Association, never before undertaken and not prompted by any source outside the Auditor’s office itself, can be justified when the 120 clerks’ offices cannot be served.

In a recent decision of the Court of Appeals it was held that the Kentucky Bar Center Headquarters, title to which is held by a board of trustees established by SCR 3.115, is nontaxable because it is public property under Const.Sec. 170. Travis v. Landrum, Ky.App., 607 S.W.2d 124 (1980). We have denied a motion for review of that decision for the reason that it reaches the correct result. Ford v. The Board of Tax-Roll Corrections of Oklahoma County, Okl., 431 P.2d 423 (1967); State Bar of Michigan v. City of Lansing, 361 Mich. 185, 105 N.W.2d 131 (1960).

There seems to be a rather prevalent misapprehension regarding the nature and function of the Association. It does not exist for the private benefit of the legal community. The members of the bar are entrusted with a privilege that places their duty of public service above their personal requirements and ambitions. The mission of the Association is to see to it that this trust is performed with fidelity to the high principles of their calling. This requires that the Association maintain a proper discipline of the bar, that it initiate and supervise appropriate means to insure a high standard of professional competence, and that it bear a substantial responsibility for promoting the efficiency and improvement of the judicial system itself. Without an arm such as the Association this court could not carry out its own responsibilities in those respects. As it is, the functioning of the Association in disciplinary and educational matters results in constant communication with this court and the Chief Justice in their supervisory capacities, entailing a consumption of time and effort that seems not to be realized by those not directly involved in the process.

In its motion for a review of the decision in Travis the Department of Revenue cited KRS 56.030, which requires that the Commonwealth be named as the grantee of any real property conveyed for the use of any of its agencies or officers. While the ownership of a building may not constitute “practice and procedure” within the meaning of KRS 447.154, it does come within the administrative authority of the Court of Justice and, as such, cannot be restricted or prohibited by statute.

The Department of Revenue also cited a ruling of the Internal Revenue Service to the effect that the Association has private as well as public purposes and for that reason donations to it are not deductible under Sec. 170(c)(1) of the Internal Revenue Code as charitable contributions. The answer to this is that the definition of terms within the federal hierarchy lie within the federal domain, and although we have no control of the IRS, the nature and functions of the Association are what this court, and not the IRS, says they are. There is no legitimate or authorized duality of purpose on the part of the bar association. And the comparison the Department of Revenue seeks to invoke between the Association and the Kentucky Medical Association and the Kentucky Dental Association is patently absurd. Neither of the latter organizations is created or governed by statute (as are the licensure boards for those professions), and neither, therefore, is subject to governmental limitation of its purposes. As a matter of fact, both are voluntary organizations, in which membership is not required of any individual practitioner.

In conclusion, it is our opinion that the Auditor has no legal authority with respect to the Association, and it is so ordered.

AKER, CLAYTON, LUKOWSKY, STEPHENS, STEPHENSON and STERNBERG, JJ., sitting.

All concur.

Entered November 26, 1980.

/s/ John S. Palmore

The Thomas Jefferson Center for the Protection of Free Expression has filed an Amicus brief in behalf of the free speech rights of Kentucky attorneys. This respected organization highlights the fact that the KBA has tolerated and continues to finance a legal argument that Kentucky lawyers can be punished for making truthful statements, and seeks to limit attorney’s free speech rights. (See comments of the Thomas Jefferson Center at footnote 3 below.)

Oral arguments will be heard on the Berry/ACLU appeal before the 6th. Circuit Court of Appeals in Cincinnati on April 13, 2012. This is a public hearing and we invite all Kentucky lawyers to attend this oral argument to offer support for their own free speech rights. We note that April 13th. Is Thomas Jefferson’s birthday!

The Berry case involved an attempt by the KBA to chill the free speech of John M. Berry Jr.. It is reported to LawReader that Berry and the ACLU over a year ago were demanding compensation for their legal bills in an amount in excess of $100,000.

In addition to the amount of fees claimed by the ACLU, it is highly probable that the legal bill of the KBA’s outside counsel is at least equal to the amount of legal fees claimed by the ACLU. The KBA is reported to have employed outside counsel, Stites and Harbison of Lexington. So if the ACLU was claiming over $100,000 in fees last year, then it is likely that the combined legal bills (plaintiff and defendant) will easily exceed $200,000 (and more likely $300,000). If the KBA loses the appeal currently pending before the 6th. Circuit Court of Appeals then the court may award legal fees to Berry and the ACLU for the violation of Berry’s free speech rights under the Federal Civil Rights statute.

Even if the KBA wins in the 6th. Circuit, then the KBA will be billed for the fee of Stites and Harbison (which is estimated to be something between $100,000 and $150,000.)

The KBA has recently announced an increase in the annual dues of all Kentucky lawyers. In 2012 alone this dues increase will be $1,360,000 (17,000 members X $80). As of 2011 the annual budget of the Bar Counsel’s office was $1,600,000. The Bar Counsel’s office budget is the largest single expense of the KBA.

One may ask, “is the KBA Board of Governors justified in spending hundreds of thousands of dollars to uphold their legal argument that the free speech rights of Kentucky lawyers may be limited is justified.” Before raising dues on Kentucky’s 17,000 lawyers did the Board consider making some cuts in the $1,600,000 annual budget of the Bar Counsel’s office?

We are aware of reports that the Board of Governors is writing new rules of conduct for the next Bar Counsel. We concede that the Board of Governors’ took a bold step in firing Linda Gosnell. We find these actions encouraging, but we would submit that their failure to advise Kentucky’s lawyers what is going on, is a continuing public relations disaster for the KBA.

The KBA is raising dues by an additional $1,350,000 in 2012. One of the expenditures they will have , will allow them to continue to finance the Berry/ACLU appeal, and therefore they are using our bar dues to limit the rights of the attorneys to exercise their rights under the 5th. Amendment.

We also note that some of the same legal issues raised in the Berry/ACLU case, have also been raised in the Deters case. Eric Deters appealed on a denial of due process claim which is also pending before the 6th. Circuit Court of Appeals. (Stites and Harbison are also representing the KBA in the Deters case.)

So the KBA is at risk for possible $300,000 to $400, 000 in legal fees for violation of attorneys civil rights claims. Even if Deters and Berry lose, the KBA will still be liable for the fees of their outside counsel, and between the two cases, the KBA will be liable for their own outside counsel’s fees which may exceed $200,000 to $300,000.

Is this expenditure of fees to outside counsel necessary? The Bar Counsel’s office has 24 employees including nine full time lawyers. It is troublesome that with a full time staff of nine lawyers they apparently don’t have anyone qualified to represent the KBA in the federal courts. The Board is about to hire a new Bar Counsel, and we would suggest that they require the new Bar Counsel to employ a couple of lawyers who have experience in Federal Court. If the Bar Counsel’s office has attorneys skilled in Federal Court practice, this could save hundreds of thousands of dollars a year.

The KBA Board of Governors apparently has the authority to authorize appeals. The Board of Governors apparently has the authority to decide if it is necessary for the Bar Counsel’s office to employ outside counsel and to not require the Bar Counsel’s office to handle its own appeals with staff attorneys. We would ask if the Bar Counsel’s office needs to employ outside counsel, why did they allow Linda Gosnell to employ a firm which employs her daughter? We don’t know why Linda Gosnell was fired on Nov. 21, 2011, since the KBA refuses to provide a justification for Gosnell’s firing. It has been 95 days since Linda Gosnell was fired and the KBA still has not notified its members of the reasons for the firing of the Chief Bar Counsel.

LawReader asked a Board member to comment on the reasons Gosnell was fired, and he refused, citing the “confidentiality rules”, which he said prevented him from commenting. Likewise KBA president Margaret Keane has refused to explain the reasons for Gosnell’s firing.

We have closely read the “confidentiality rule” found in the Supreme Court Rules and the only justification for “confidentiality” is found in SCR 3.150. (At this point the author, a licensed Kentucky lawyer, might risk sanctions if he further explained the potential significance of the application of SCR 3.150 to the failure of the KBA to disclose the reasons for the discharge of Linda Gosnell.)

Therefore we will leave it to the reader to determine if SCR 3.150 protects the KBA from disclosing the reason for Linda Gosnell’s firing, and also for suppressing the Houlihan Report which purportedly involved former BAR President Barbara Bonar. We acknowledge that we have no admissible information on the reasons for the suppression of the Houlihan Report or the firing of Linda Gosnell.

SCR 3.150 Access to disciplinary information

(1) Confidentiality. In a discipline matter, prior to a rendition of a finding of a violation of these Rules by the Trial Commissioner or the Board and the recommendation of the imposition of a public sanction, the proceeding is confidential.

(2)

(a) Notwithstanding subsection (1), the pendency, subject matter and status may be disclosed by Bar Counsel if:

i. The Respondent has waived confidentiality;

ii. The proceeding involves public reciprocal discipline;

iii. The disclosure of any information is made for the purpose of conducting an investigation by the Inquiry Commission or the Office of Bar Counsel, or;

iv. A Motion for Temporary Suspension is pending.

(b) After considering the protection of the public, the interests of the Bar, and the interest of the Respondent in maintaining the confidentiality of the proceeding prior to a finding of a violation of the Rules, the pendency, subject matter and status may also be disclosed by Bar Counsel at the discretion of the Chair of the Inquiry Commission, or of the Chair’s lawyer member designee, if:

i. The proceeding is based upon an allegation that the Respondent has been charged with a crime arising from the same nexus of facts; or

ii. The proceeding is based upon a finding by a court in a civil matter that an attorney has committed conduct that may constitute a violation of the Rules of Professional Conduct.

(3) Duty of Participants. All Participants in a proceeding under these Rules shall conduct themselves so as to maintain the confidentiality requirement of this Rule.

Footnote 1

The Thomas Jefferson Center for the Protection of Free Expression is an independently funded organization associated with the University of Virginia and dedicated to the protection of freedom of speech. Founded in 1989 and headed by former UVA president Robert M. O’Neil since its founding, the organization manages a number of programs and activities to support its mission, including testifying before Congress, providing legal briefs, educational programs, a variety of art-related exhibit programs and prizes, and the Jefferson Muzzles. Website: http://www.tjcenter.org (See footnotes about the Thomas Jefferson Center below)

A primary purpose of the nation’s civil rights laws is to protect citizens from abuses by government, including police misconduct. Civil rights laws allow attorney fees and compensatory and punitive damages as incentives for injured parties to enforce their rights.

Organizational Description: The Thomas Jefferson Center for the Protection of Free Expression is devoted solely to the defense of free expression. While its charge is sharply focused, the Center’s mission is broad. It is as concerned with the musician as with the mass media, with the painter as with the publisher, and as much with the sculptor as the editor. Located in Charlottesville, Virginia, the Center enjoys close ties to the University of Virginia, but is an autonomous, not-for-profit entity.

Services Provided: Since its founding in 1990, the Center has fulfilled its mission through a wide range of programs in education and the arts, and active participation in judicial matters involving free expression (most often in the form of friend of the court legal briefs). The Center’s director, Robert M. O’Neil, is a nationally recognized expert on matters involving the First Amendment and academic freedom and serves as a resource for members of the media and general public on questions involving either of these areas.

Footnote 2

Amount of attorney fees: Perhaps the most widely followed set of rates are what is called the Laffey Matrix that is available from the United States Attorney’s Office for the District of Columbia. These have been available since 1982 and are updated each year. The hourly rates are shown by years of experience. For June 1, 2006 to May 31, 2007 the rates are as follows: 20+ years of experience, $425 per hour; 11–19 years, $375; 8–10 years, $305; 4–7 years, $245; 1–3 years, $205; and Paralegals/law clerks $120 . The Laffey Matrix appears to be growing in acceptance by many courts throughout the United States, but the matrix must be adjusted to account for higher or lower costs for legal services in other areas.

Footnote 3

Arguments of the Thomas Jefferson Center for the Protection of Free Expression.

“there is not a compelling state reason to justify restricting attorneys’ speech concerning the (Legislative) ethics commission.”

“the (Federal) District Court failed to give proper weight to the fact that the Regulation (Ky. Supreme Court Rule) restricts speech on matters of public concern.”

LAWREADER COMMENTS ON KBA CHALLENGE TO OUR ARTICLE RE: INCREASE IN DUES – see their response to our dues increase article

This week LawReader posted a discussion of the pending lawyer’s dues increase (and the increase in pro hac vice fees). Our story was inspired by an e-mail news release by the KBA which discussed (a schedule of dues increases beginning in 2012 and being fully effected over a three year period, i.e. 2015. We recall that the press release cited the new dues fee to continue to rise over the next three years until it reached $500 a year. That is our recollection of the KBA news release.

We invite anyone who disagrees with the facts or conclusions of any article we publish to submit their comments. We promise to publish the comments (with restrictions on anything that might be in violation of the SCR’s or defamation laws).

The KBA took advantage of that offer and responded on Feb. 23, 2012 with the following comment which we immediately published on our front page without editing.

RESPONSE BY KBA FEB. 23, 2012:

“THERE ARE NUMEROUS ERRORS CONTAINED IN TODAY’S BLOG REGARDING THE KBA PROPOSED DUES INCREASE, THE MOST IMPORTANT OF WHICH IS THE AMOUNT OF THE PROPOSED INCREASE. THERE IS NO RECOMMENDATION TO INCREASE KBA DUES TO $500 AS YOU PUBLISHED.

FURTHER THE KBA DOES NOT SET ITS MEMBERS’ DUES – THAT IS SOLELY THE PREROGATIVE OF THE SUPREME COURT PURSUANT TO SCR 3.040.

THE KBA BOARD OF GOVERNORS RECOMMENDS TO THE COURT THE ANNUAL DUES AMOUNT AND CURRENTLY THAT RECOMMENDATION IS FOR A DUES AMOUNT OF $350 ANNUALLY FOR MEMBERS LICENSED FOR 5 OR MORE YEARS, WITH NO INCREASE FOR THOSE UNDER 5 YEARS ($220). THESE AMOUNTS WERE ANNOUNCED TO ALL ATTENDEES

AT THE 2011 KENTUCKY LAW UPDATES AND WAS THE SUBJECT OF KBA PRESIDENT MAGGIE KEANE’S PRESIDENT’S PAGE IN THE JANUARY 2012 BENCH AND BAR A COPY OF WHICH IS ATTACHED AND WHICH WE ASK THAT YOU PUBLISH.

THERE ARE OTHER ERRORS IN THE BLOG AS TO THE KBA FINANCES WHICH ARE EVIDENT FROM A REVIEW OF THE KBA FINANCIAL INFORMATION WHICH FOR YEARS HAS BEEN PUBLISHED ON THE KBA WEBSITE AND CAN BE LOCATED UNDER THE TAB “INSIDE KBA” AND BY PROCEEDING TO ‘FINANCIAL INFORMATION.’”

The KBA response disagrees with our reporting that the dues increase would rise to $500 by 2015, but they don’t mention plans to raise the dues past the level that will become effective in 2012, which by itself represents an increase in annual dues of $80 in 2012, and for judges the increase is $240 a year.

If LawReader is incorrect that the KBA plans to raise bar dues to $500 by 2015, we will admit our error (we relied on a KBA e-mail news story) and will continue to provide the KBA with access to LawReader to publish their comments.

But we pose a specific question to the KBA. Is there a plan to further increase the dues over the next three years until they reach $500 by 2015?

The KBA attempts to shift the blame for the dues increase to the Supreme Court. It’s true the Supreme Court has the ultimate authority, but we are not aware that this issue originated in the Supreme Court.

We will gladly correct any errors in our story. But at this point we have not seen the actual dues increase resolution published. What does it say? Did we misread the amount of the increase? The KBA response says the dues will only be $350 in 2012…but it fails to deny plans to increase the dues to $500 by 2015 as reported by LawReader.

We appreciate the KBA responding and informing us they disagree with some of our conclusions. This is possibly a new direction in the Bar to begin discussions with members of the Bar and to not just rely on administrative fiats posted after the fact.

The statement that President Keane reported the dues increase resolution at last summer’s bar convention may be true, but get real, less than 1/3 of the bar members attended classes at the convention, and far less probably attended the class where the dues increase was discussed.

We would like to see the KBA publish a specific budget for the benefit of the bar members. The financial report posted by the KBA does not have the detailed information that the actual budget document will have.

As requested by the KBA we publish the following article:

KBA President Margaret Keane column in Bench & Bar re: Increase in Bar Dues.

LESS THAN A DOLLAR A DAY — IS THE PRIVILEGE TO PRACTICE LAW IN KENTUCKY WORTH THAT?

By KBA president Margaret Keane Jan. 2012 http://www.kybar.org/30

A recommendation from the Kentucky Bar Association (“KBA”) Board of

Governors (the “Board”) to raise bar dues is a difficult and unpopular

decision. But with our bar facing the same financial challenges confronted by

each of us in the profession–whether in private practice, public service, or as in house

counsel–the Board, fulfilling its fiscal responsibilities, had the courage

to recommend a dues increase to the Kentucky Supreme Court (the “Court”)

on Dec. 9, 2011.

KBA dues are set by the Court based upon a recommendation of the Board

(Supreme Court Rule 3.040(1)). The last dues increase ordered by the Court

occurred on July 1, 2004. That increase was expected to fund the operations of

the KBA only through the 2010-2011 fiscal year.

Your Board members and the KBA staff, being good stewards of

KBA funds, have worked diligently to reduce costs, successfully delaying the

need to seek a dues increase.

Since 2004, the KBA’s expenses for its “overhead costs,” including

employee retirement contributions, employee health insurance, liability

insurance, taxes, energy and similar recurring and non-controllable costs,

have increased by more than 40 percent.

For example, the KBA’s portion of the health care insurance cost for our

employees has increased 91 percent and the KBA’s contribution to the Kentucky

Employees Retirement System for our employees has increased 400 percent.

In addition to these operating costs, Court rules require a portion of our KBA

dues to fund certain public service programs. For example, the 2004 Dues

Order requires that $7 of the dues paid by every practicing attorney and $6 of

the dues paid by every judge be allocated to the Clients’ Security Fund. Pursuant to

SCR 3.820, these funds are to provide “indemnification to clients who may

suffer pecuniary losses by reason of fraudulent or dishonest acts” by a KBA

member.

From 2004 through June 30, 2011, the Fund has paid over $840,000

to members of the public. The KBA’s total exposure for the fiscal year ending

June 30, 2011, was $563,150, while the amount collected from dues was only

$110,283. At its November and December 2011 meetings, the Fund

made awards of approximately $280,000.

Confronted with these financial realities, in 2011 the Board appointed a

Task Force on Dues Structure Evaluation, comprised of Board

members from various areas of the state.

At its Nov. 19, 2011, meeting, the Board voted unanimously to accept the Task

Force’s recommendation to seek a dues increase. The Board recommended that

the KBA dues be increased, as detailed in a Dec. 9, 2011, letter to the Court:

(i) for lawyers admitted to practice for five (5) years or more, dues would

be increased from $270 to $350 per year;

(ii) sensitive to the financial challenges faced by new lawyers, dues for new attorneys (those admitted to practice for less than five (5) years) would remain at the current rate of

$220; and

(iii) the separate dues category for judges (who now pay $110 in dues)

would be eliminated and judges’ dues would be set at the same level as other

attorneys, that is either $350 or $220, depending upon the date of the judge’s

admission to practice.

The recommendation asks that the dues increase become effective July 1, 2012.

If the Court orders a dues increase in the amount requested, the cost of being a

KBA member will still be a “good deal.”

As KBA members, we enjoy a benefit no other mandatory bar does. Our Court

rules require that dues payments cover the costs of providing each KBA

member with sufficient CLE hours to comply with education requirements to

maintain a high standard of competence.

In 2011, we had the highest number of attendees at the Kentucky Law Updates, 5,191 attorneys (almost one third of our members).

Also, all the KBA officers and Board members serve without pay, devoting a

significant amount of time preparing for and attending Board meetings, including

hearing and deciding discipline matters.

President’s Notes: (1) The Board at its Nov. 18, 2011, meeting approved a

Resolution in Support of the Report of the KBA Task Force on the Provision

and Compensation of Conflict Counsel for Indigents. Turn to page 27 in this

issue of the Bench & Bar or visit www.kybar.org to read the Resolution.

(2) The American Bar Association recently released a report, “Evaluating

Fairness and Accuracy in State Death Penalty Systems: The Kentucky Death

Penalty Assessment Report.” To access the Executive Summary and the

full report, visit www.kybar.org.

4 Bench & Bar January 2012

KBA members who serve on the Inquiry Commission, CLE Commission, Ethics

Committee and Ethics Hotline, as well as the Clients’ Security Fund Trustees,

IOLTA Board, Kentucky Bar Foundation Board, Bar Center Trustees,

Unauthorized Practice Committee, Attorney Advertising Commission, and

Volunteers For Kentucky Lawyers Assistance Program, devote

innumerable hours of service to KBA members without pay.

We have a great bar but we need sufficient funding to maintain it and to

fulfill our mission under SCR 3.025: to “maintain a proper discipline of the

members of the bar in accordance with these rules and the principles of the

legal profession as a public calling, to initiate and supervise, with the approval

of the court, appropriate means to insure a continuing high standard of

professional competence on the part of the members of the bar and to bear a

substantial and continuing responsibility for promoting the efficiency and improvement of the

judicial system.”

For most lawyers and judges, the increase would result in our paying less than $1 a day for the privilege of practicing law in the courts of Kentucky – a small price for such an honor. As

commented by one attendee of the 2011 KLUs, a dues “increase is justified and ove

KENTUCKY BAR ASSOCIATION IS ROLLING IN CASH, YET APPROVES INCREASE IN MEMBERS ANNUAL  DUES TO $500 A YEAR.

The Board of governors recently announced that over the next three years, the mandatory dues for each Kentucky lawyer will be raised to $500 a year.  The Board is also substantially raising Pro Hac Vice fees to $270. (Ohio only charges a $100 annual Pro Hac vice fee!)

LawReader strongly supports the KBA taxing its members for any necessary funds required for the orderly operation of the Bar Association.  But one who reviews the recent financial accounting posted on the Bench & Bar site may wonder  how the Board could possibly justify an increase that may approach grossing  over $5,000,000 additional funds per year by 2015.

To view the current financial report of the KBA go to: http://www.kybar.org/documents/membership/audit-report_063011.pdf

The financial reports informs us that the income from mandatory annual dues paid by lawyers in 2011 was $3,895,265.  This is an increase from 2010 when the annual dues collected was $3,807,020, an increase of $88,245.  This seems to indicate that the growth in the number of attorneys provided a nice growth in income under the current dues structure.

The full increase that will be derived from attorneys annual dues by 2015 will increase to $8,500,000.  That is an increase of $4,604,735 over the gross amount derived from member’s dues in 2011.

Perhaps the KBA has some large debts to pay off?  Well we have read the accountants financial statement and it indicates that the KBA has $759,032 in cash on hand.  Further the KBA has $10,074,955 in “investments”.

We concede that some of these assets may include the building that houses the KBA staff.

One might ask, if the KBA has almost $11 million dollars in investments and cash on hand, why is it necessary to raise our dues by almost $5,000,000 a year?

Currently there are 17,000 licensed lawyers in Kentucky.  By 2015 these 17,000 lawyers will be paying annual dues of $500 for a total dues income of $8,500,000.

We note that the cost of “conventions and conferences” in  2011 was $323,352 but the income from these “conventions and conferences” was $484,145.  This suggests  a profit of $160, 793. One vendor
commented, “They make a profit of $160,000 and they don’t even give us a free cup of coffee!”

The KBA web site states the purpose of annual dues:

“Membership dues are used only for expenses properly chargeable to compulsory dues. The KBA does not participate in political or ideological activities that are not reasonably
related to the regulation of the legal profession or improving the quality of legal services.”

We read the KBA press release  announcing  the action of the Board of Governors re: the increase in dues over the next three years.   That report however was devoid of any justification of the dramatic increase in dues.

The 17,000 lawyers licensed in Kentucky finance the KBA but they have been given no explanation for such a large increase in dues?  A little  “P-R” (Public Relations) Jelly would be appreciated before this action is taken!

We believe it is proper for every lawyer in Kentucky to ask their Board members why our dues are being raised by such a large amount.  We would suggest that the Board of Governors tell us why such a large increase is necessary.  Are they planning on erecting a new building?  Are they planning salary increases for BAR employees?   We have never seen a list that shows how many employees the KBA has and what they are being paid.   Such information is available for judges and executive and legislative branches….why not the KBA?

If the KBA would like to comment, LawReader will be glad to publish their response without editing.

The Ohio rules for speedy trial of attorney discipline complaints are far more specific than similar Kentucky rules. In Kentucky it is not uncommon for investigations to take several years, and some cases have taken eight to nine years.

Example: 2011-SC-000206-KB.PDF …this case began in 2005 and was not finally disposed of until 2010.  Also, the Bar Counsel investigated attorney John M. Berry Jr. for almost two years for writing a letter to the Legislature..no charge was presented to the Inquiry Commission.  Yet Berry and the ACLU have had no relief and the case is now before the 6th. Cirt. Court of Appeals.  This free speech issue seeks a clarification of whether or not the KBA can sanction an attorney for making truthful statements.  Berry’s letter was not profane, not threatening, and did not question the integrity or qualifications of a judicial officer.  The KBA has hired outside counsel to represent them…although they have nine full time lawyers, they have chosen to hire outside counsel….estimates are that the dues paying members of the Kentucky Bar will likely pay in excess of $100,000 in legal fees for the KBA to establish their right to limit the free speech of lawyers.

See Ohio Attorney Discipline rules at: http://www.supremecourt.ohio.gov/

OHIO RULES RE: SPEEDY DISCIPLINE HEARING

(D) Time for Investigation. The investigation of grievances by Disciplinary Counsel or a certified grievance committee shall be concluded within sixty days from the date of the receipt of the grievance. A decision as to the disposition of the grievance shall be made within thirty days after conclusion of the investigation.

(1) Extensions of Time. Extensions of time for completion of the investigation may be granted by the Secretary of the Board upon written request and for good cause shown. Investigations for which an extension is granted shall be completed within one hundred fifty days from the date of receipt of the grievance. Time may be extended when all parties voluntarily enter into an alternative dispute resolution method for resolving fee disputes sponsored by the Ohio State Bar Association or a local bar association.

(2) Extension Limits. The chair or Secretary of the Board may extend time limits beyond one hundred fifty days from the date of filing in the event of pending litigation, appeals, unusually complex investigations, including the investigation of multiple grievances, time delays in obtaining evidence or testimony of witnesses, or for other good cause shown. If an investigation is not completed within one hundred fifty days from the date of filing the grievance or a good cause extension of that time, the Secretary may refer the matter either to a geographically appropriate certified grievance committee or the Disciplinary Counsel. The investigation shall be completed within sixty days after referral. No investigation shall be extended beyond one year from the date of the filing of the grievance.

(3) Time Limits not Jurisdictional. Time limits set forth in this rule are not jurisdictional. No grievance filed shall be dismissed unless it appears that there has been an unreasonable delay and that the rights of the respondent to have a fair hearing have been violated. Investigations that extend beyond one year from the date of filing are prima facie evidence of unreasonable delay.

***

Three Member Hearing panels are used in Ohio instead of Trial Commissioners

(D) Probable Cause Determination; Appointment of Hearing Panel.

(1) Probable Cause Determination. Upon receipt of a complaint, the Secretary shall direct the complaint and investigatory materials to a probable cause panel for review. Each panel shall be composed of three members of the Board, chosen by the chair, who shall designate one attorney or judge member as chair of the panel. Upon review solely of the complaint and investigation materials, the probable cause panel shall make an independent determination of whether probable cause exists for the filing of a complaint. The panel shall issue an order certifying the complaint to the Board or dismissing the complaint and investigation. The determination of the panel shall be sent by certified mail to the Disciplinary Counsel, to the appropriate Certified Grievance Committee, and to the respondent.

(2) Dismissal for Lack of Probable Cause. Within seven days of receipt of the decision of the probable cause panel to dismiss the complaint, the Disciplinary Counsel or Certified Grievance Committee may appeal the decision to the full Board by filing a written appeal with the Secretary of the Board. The Board shall review the investigation and make an independent determination as to whether probable cause exists for the filing of a complaint. The Board shall issue an order certifying the complaint or dismissing it and send a copy of its decision to the parties by certified mail. There shall be no appeal from the decision of the Board.

(3) Appointment of Hearing Panel. After the respondent has filed an answer or the time for filing an answer has elapsed, the Secretary shall appoint a hearing panel consisting of three members of the Board chosen by lot from members who did not serve on the probable cause panel. The Secretary shall designate one attorney or judge member of the panel to serve as chair of the panel. No member of the hearing panel shall be a resident of the appellate district from which the complaint originated. Not more than one non-attorney shall serve on any hearing panel. A majority of the panel shall constitute a quorum. The panel chair shall rule on all motions and interlocutory matters, and no ruling by the panel chair on motions and interlocutory matters may be appealed prior to entry of the final order.

****

Section 9. Time Guidelines for Pending Cases

(A) Pre-hearing Conference

1) Within sixty days of the assignment date of a hearing panel, the panel chair shall conduct a pre-hearing conference to accomplish the following objectives:

(a) simplification of the issues;

(b) necessity of amendment to the pleadings;

(c) establishment of a discovery timetable;

(d) identification of anticipated witnesses and the exchange of reports of anticipated expert witnesses;

(e) identification and exchange of copies of anticipated exhibits;

(f) the possibility of obtaining:

(i) stipulations of fact;

(ii) stipulation of the admissibility of exhibits;

(g) such other matters as may expedite the hearing;

(h) establish a final hearing date.

At the discretion of the panel chair, a pre-hearing conference may be held by telephone, and may be continued from day to day. The hearing date shall be no more than one hundred fifty days following the date of assignment.

The Board shall adopt a form for use in a pre-hearing conference as well as an entry setting the conference time.

(2) Continuances of the hearing date shall not thereafter be granted due to counsel’s or respondent’s scheduled appearance before any state court or public agency, except the Supreme Court of Ohio or this Board as set forth in Rule 41(B)(2) of the Rules of Superintendence for the Courts of Ohio.

(B) Submission of Panel Reports

(1) The report of the panel for all hearings not conducted on an expedited basis shall be submitted to the full Board within forty days of the filing of the transcript for consideration at the next regularly scheduled meeting of the Board. For good cause shown, the Secretary, at the request of the panel chair, may extend the date for the filing of the hearing panel report with the Board.

(2) To be considered at the Board meeting, the panel report should be submitted to the Secretary at least seven days prior to that date.

(C) Failure by the Board to meet the time guidelines set forth in Section 9 of this rule shall not be grounds for dismissal of the complaint.

We have collected important pleadings in the pending appeal to the Ky. Supreme Court regarding the constitutionality of the legislative redistricting plan.

The argument by Jason Nemes and his firm, Fultz, Maddox, Hovious & Dickens of Louisville is the first pleading (see links below).  These pleading provides an excellent discussion of the law and facts.

Resp-Plaintiff’s_Resp_to_LRC_Motion_for_Interlocutory_Relief_(00410204).pdf,   (THIS PLEADING SEEKS TO UPHOLD THE RULING OF FRANKLIN CIRT. JUDGE SHEPHARD)

Response_to_Motion_to_Stay_Pending_Appeal_(00410189).pdf,

2012.02.17_Stein_Response_to_LRC_Motion_for_Stay.pdf,

Response_to_Motion_for_Interlocutory_Relief_(COA)[1].pdf,

Response_to_Pending_Motions_(Sup_Ct)[1].pdf

Concurrent Jurisdiction Presumed

By Todd McMurtry | tmcmurtry@dbllaw.com

In Mims v. Arrow Financial Services, LLC, 132 S.Ct. 740 (2012), the United States Supreme Court clarified that, unless specifically stated in the federal legislation, it is presumed that state and federal courts have concurrent jurisdiction over federal issues. This case involved claims arising under the Telephone Consumer Protection Act (TCPA). 47 U.S.C. § 227.

Here, Plaintiff brought his claims about computerized robo-calls initiated by the Defendant in the Federal District Court for the Southern District of Florida. The District Court dismissed Plaintiff’s claims for lack of jurisdiction. The Eleventh Circuit affirmed dismissal and the Supreme Court granted Certiorari.

The operative language of the law that led to dismissal was that “a private person may seek redress for violations of the Act in an appropriate court of [a] State.” Mims, 132 S.Ct at 744 (citing 47 U.S.C. § 227(b)(3)). On its face, the language suggests that state courts have exclusive jurisdiction of TCPA claims. Justice Ginsburg, writing for a unanimous court, disagreed.

Relying on 28 U.S.C. § 1331, which grants federal courts jurisdiction over federal claims, the Court stated that nothing in the “permissive language of § 227(b)(3) purports to oust federal courts of their” jurisdiction over federal claims. Mims, 132 S.Ct at 749. Defendant argued that the later-adopted language of the TCPA displaced § 1331. The Court disagreed, stating that “jurisdiction conferred by 28 U.S.C. § 1331 should hold firm against ‘mere implication flowing from subsequent legislation.’” Id. at 751 (citing Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 808, 809, n. 15, 96 S.Ct. 1236, 1236 L.Ed.2d 483 (1976)).

To explain its comment on the TCPA’s alleged grant of exclusive jurisdiction as a “mere implication,” the Court cited multiple statutes vesting “exclusive” jurisdiction. Id. at 750. Defendant argued persuasively that due to the potential burden on federal district courts and the apparent preference of the TCPA for state courts that Congress could not have reasonably intended a grant of federal court jurisdiction over TCPA claims. The Court nevertheless found that, absent specific language, concurrent jurisdiction over federal claims is presumed

Six Republicans file for 4th. Congressional Seat. Filing Friday were Republicans Marc Carey, an attorney from Sparta, and Crestwood businessman Walter C. Schumm.

The other GOP candidates for the 4th District are Lewis County Judge-Executive Thomas Massie of Garrison, Boone County Judge-Executive Gary Moore of Florence, Oldham County math teacher Brian D. Oerther of LaGrange, state Rep. Alecia Webb-Edgington of Ft. Wright, and consultant Tom Wurtz of Ft. Mitchell.

Democrats in the race are Grant County Democratic Party Chairman William R. “Bill” Adkins of Williamstown and Greg Frank of Corinth

By LawReader Senior Editor Stan Billingsley – Feb. 17, 2012

The U.S. Attorneys’ office for the Eastern District, has been trying for close to a year to obtain an accounting by Angela Ford of the Fen Phen funds she had seized as a result of a Boone Circuit Court summary judgment which was subsequently overruled by the Ky. Court of Appeals (and is now on review to the Ky. Supreme Court).

Angela Ford has previously appealed the District Court Order by Federal District Judge Danny Reeves which ordered her to provide an accounting to the U.S. Government. In Dec. of 2011 Ford filed a second appeal and refused to disclose the names of the attorneys with whom she shared legal fees.

The following brief is a well written response to Ford’s appeal brief to the 6th. Circuit seeking to overrule Judge Reeves order for her to file an accounting with is court. The Government pointedly suggests the possibility that the entire contingent fee Ford paid to herself and others can be seized by the U.S. Government.

The Federal government in the Gallion –Cunningham criminal trial ordered restitution to the victims. Before the Federal Court could enforce that order Ford had already seized some $43 million dollars in Fen Phen assets from Gallion and Cunningham, and paid some $13 million to herself and “other lawyers”.

If the Federal restitution order is upheld, then the Fen Phen victims may be entitled to a $13 million refund from Ford and the attorneys she shared the contingent fee with.

CASE NO. 11-6187

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

UNITED STATES OF AMERICA PLAINTIFF-APPELLEE

V.

WILLIAM J. GALLION; SHIRLEY A. CUNNINGHAM, JR.; DEFENDANTS

MELBOURNE MILLS, JR.

and

ANGELA M. FORD APPELLANT

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF KENTUCKY

BRIEF OF THE PLAINTIFF-APPELLEE

UNITED STATES OF AMERICA

KERRY B. HARVEY

UNITED STATES ATTORNEY

CHARLES P.WISDOM JR.

APPELLATE CHIEF

BY: CHERYL D.MORGAN

WADE T. NAPIER

ASSISTANT UNITED STATES ATTORNEYS

260 W. VINE STREET, SUITE 300

LEXINGTON, KENTUCKY 40507-1612

(859) 233-2661

FAX (859) 233-2658

Cheryl.Morgan@usdoj.gov

Wade.Napier@usdoj.gov

COUNSEL FOR PLAINTIFF-APPELLEE

TABLE OF CONTENTS

Table of Authorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

Statement Regarding Oral Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . v

Statement of the Issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Statement of the Case . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Summary of the Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Certificate of Service

Designation of District Court Documents

i

TABLE OF AUTHORITIES

I. Cases

Burak v. Scott,

29 F. Supp. 775 (D.D.C. 1939) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Dandridge v. Williams,

397 U.S. 471 (1970) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Falicia v. Advanced Tenant Servs, Inc.,

235 F.R.D. 5 (D.D.C. 2006) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

Kokkonen v. Guardian Life Ins. Co. of America,

511 U.S. 375 (1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-7

Mohamed v. Kerr,

91 F.3d 1124 (8th Cir. 1996) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13, 16

Pennsylvania Bureau of Corr. v. U.S. Marshals Serv.,

474 U.S. 34 (1985) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-9

Ramdass v. Angelone,

530 U.S. 156 (2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Sandpiper Vill. Condo. Ass’n Inc. v. Louisiana-Pacific Corp.,

428 F.3d 831 (9th Cir. 2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Shelby Cnty. Health Care Corp. v. Majestic Star Casino,

581 F.3d 355 (6th Cir. 2009) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

United States v. Beckner,

16 F. Supp. 2d 677 (M.D. La. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

United States v. City of Detroit,

329 F.3d 515 (6th Cir. 2003) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 7, 10-13

United States v. Davist,

481 F.3d 425 (6th Cir. 2007) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

ii

United States v. Gallion,

No. 2:07-39-DCR, 2011 WL 4015586 (6th Cir. Sept. 9, 2011) . . . . . . . . . . . . 4, 7

United States v. Gordon,

393 F.3d 1044 (9th Cir. 2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

United States v. Int’l Bhd. of Teamsters,

266 F.3d 45 (2nd Cir. 2001) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11, 12

United States v. Mills,

991 F.2d 609 (9th Cir. 1993) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

United States v. New York Tel. Co.,

434 U.S. 159 (1977) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 7, 10, 11, 13

United States v. Perry,

360 F.3d 519 (6th Cir. 2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-10

United States v. Pugh,

405 F.3d 390 (6th Cir. 2005) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

United States v. Simmonds,

235 F.3d 826 (3d Cir. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

United States v. Venneri,

782 F. Supp. 1091 (D. Md. 1991) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

United States v. Witham,

648 F.3d 40 (1st Cir. 2011) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 6, 9

United States v. Yielding,

657 F.3d 722 (8th Cir. 2011) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9-10

II. Statutes & Rules

18 U.S.C. § 3611 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

iii

18 U.S.C. § 3612 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

18 U.S.C. § 3612(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

18 U.S.C. § 3613 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

18 U.S.C. § 3613(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

18 U.S.C. § 3613(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

18 U.S.C. § 3613(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

18 U.S.C. § 3614 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

18 U.S.C. § 3615 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

18 U.S.C. § 3663A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

18 U.S.C. § 3663A(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

18 U.S.C. § 3664 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

18 U.S.C. § 3664(m)(1)(A)(i)(ii) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 9

18 U.S.C. § 3771 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

18 U.S.C. § 3771(a)(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

18 U.S.C. § 3771(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

18 U.S.C. § 3771(d)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

28 U.S.C. § 1651(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

28 U.S.C. § 3015(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

28 U.S.C. § 3202(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6, 9

FED. R. CIV.P. 69(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17

iv

STATEMENT REGARDING ORAL ARGUMENT

The United States does not request oral argument.

v

STATEMENT OF THE ISSUE

Did the district court err in ordering a court-appointed crime victims’

advocate to provide the government with an accounting of funds that the advocate

received in a related state court action on behalf of victims?

STATEMENT OF THE CASE

Angela Ford appeals the district court’s orders requiring her to provide the

United States with a full and complete accounting of the funds she collected on

behalf of victims she represents in a related state court civil action against William

Gallion and Shirley Cunningham. [See R. 1308: Notice of Appeal; R. 1303:

Memorandum Opinion and Order; R. 1286: Motion to Alter Judgment; R. 1284:

Order.]

Gallion and Cunningham represented 440 individuals who obtained

a $200,450,000 settlement from the makers of the diet drug Fen-Phen. [R. 599:

Superseding Indictment.] On December 30, 2004, 407 of Gallion’s and

Cunningham’s clients hired Ford to file a civil action in state court against Gallion

and Cunningham for breach of the lawyers’ contractual, ethical, fiduciary, and

professional duties. [See R. 1283: Motion, Attachment 1.] In 2006, the state court

entered summary judgment and awarded the victims approximately $42,000,000 in

damages. [R. 1283: Motion at ¶¶ 1-2.] The defendants appealed. [See id.]

1

On June 14, 2007, a federal grand jury indicted Gallion and Cunningham for

using interstate wire transmissions in a scheme to defraud their clients. [R. 1:

Indictment; see R. 599: Superseding Indictment.] On August 16, 2007, the district

court appointed Ford to serve as an advocate for the victims of Gallion’s and

Cunningham’s crimes. [R. 54: Order.]

Thereafter, Ford obtained assets in partial satisfaction of the state court

judgment and made three distributions – in May 2008, February 2010, and

September 2010 – to her clients from the funds that she had collected. [R. 1268:

Motion.] The distributions were made pursuant to Ford’s contingency fee

arrangement with her clients. [Id.]

On April 4, 2009, Gallion and Cunningham were convicted in federal court

of defrauding their clients of a substantial portion of the $200,450,000 settlement.

[R. 820: Redacted Jury Verdict; R. 821: Redacted Jury Verdict.] On August 24,

2009, the district court sentenced Gallion to imprisonment for 300 months,

Cunningham to imprisonment for 240 months, and ordered Gallion and

Cunningham to pay $127,671,314.63 in restitution to 421 victims. [R. 971:

Amended Judgment at 2, 5; R. 972: Amended Judgment at 2, 5.]

On February 4, 2011, the state court of appeals reversed the $42,000,000

summary judgment, prompting the United States to request a complete accounting of all funds collected by Ford pursuant to the summary judgment, including monies “retained or distributed pursuant to fee agreements.” [R. 1283: Motion, (Emphasis added by LawReader throughout this brief.)

Attachment 1 (opinion), Attachment 2 (e-mail to Ford requesting a “complete

accounting of all funds. . . retained or distributed pursuant to fee agreements, or

otherwise held”), Attachment 4 (e-mail to Ford requesting, inter alia, a “complete

accounting of all funds. . . retained or distributed pursuant to fee agreements, or

otherwise held”), & Attachment 5 (letter to Ford requesting, with detailed

supporting law, “the status of funds collected pursuant to your contingent fee

agreements and funds not distributed to victims.”).] The district court granted the

United States’s motion and ordered Ford to provide a “full and complete

accounting” of all the funds, including the location of the funds, she had collected

in the state court case that had not been distributed to the victims. [R. 1284:

Order.]

Ford objected and moved the district court to alter, amend or vacate its order

to provide the accounting. [R. 1286: Motion to Alter Judgment.] Ford also filed

a motion to stay the district court’s order requiring her to submit the full and

complete accounting pending the resolution of her motion to alter or amend this

same order. [R. 1287: Motion.]

The district court denied Ford’s motion to stay, but permitted her to file the accounting in camera and under seal pending further orders. [R. 1288: Order.] On September 9, 2011, the court denied Ford’s motion to alter, amend or vacate and made Ford’s accounting available to the United States. [R. 1303: Memorandum Opinion and Order.] See United States v. Gallion,

No. 2:07-39-DCR, 2011 WL 4015586 (6th Cir. Sept. 9, 2011).

SUMMARY OF THE ARGUMENT

The district court did not abuse its discretion by ordering Ford, the court appointed crime victims’s advocate, to provide the United States with a full and complete accounting of the funds, which include her contingent legal fees, that she obtained pursuant to a reversed state court judgment. The district court had

jurisdiction under either the Mandatory Victims’ Restitution Act or the All Writs

Act to issue the order.

Ford erroneously argues that she could never become a judgment debtor.

Ford ignores the uncertainty of the state and federal court judgments, which are on appeal, and the legality of retaining legal fees paid by a client from a judgment that is subsequently reversed on appeal. Although the law of restitution generally will not require an attorney to repay legal fees paid by a client from a judgment that is subsequently reversed on appeal, restitution by the attorney is appropriate when such a payment is made, as here, pursuant to a contingent fee.

ARGUMENT

The Mandatory Victims’ Restitution Act (MVRA) requires a sentencing

court to award restitution to crime victims for property offenses involving fraud.

18 U.S.C. § 3663A(c)(1). The primary goal of the MVRA is to fully compensate

victims for their losses. United States v. Gordon, 393 F.3d 1044, 1053 (9th Cir.

2004) (citing United States v. Simmonds, 235 F.3d 826, 831 (3d Cir. 2000)).

A crime victim has “[t]he right to full and timely restitution as provided in law.”

Crime Victims’ Rights Act, 18 U.S.C. § 3771(a)(6). The United States must make

“best efforts to see that crime victims are notified of, and accorded,” this and other

enumerated rights. Id. § 3771(c)(1). The “crime victim or the crime victim’s

lawful representative, and the attorney for the Government may assert the

[victim’s] rights . . . .” Id. § 3771(d)(1). But the United States is “responsible for

the collection of unpaid restitution.” United States v. Witham, 648 F.3d 40, 45 (1st

Cir. 2011) (citing 18 U.S.C. § 3612(c)).

An order of restitution becomes a lien in favor of the United States on all property of the defendant at the time of entry of judgment. 18 U.S.C. § 3613(c); see United States v. Mills, 991 F.2d 609, 612 (9th Cir. 1993). The MVRA authorizes the United States to enforce an order of restitution in the same manner that it recovers fines, and “by all other available and reasonable means.” 18 U.S.C. § 3664(m)(1)(A)(i)(ii); Witham, 648 F.3d at 45

(citing 18 U.S.C. §§ 3611-3615). The MVRA also makes “‘all provisions’ of

§ 3613 ‘available to the United States for the enforcement of an order of

restitution.’” Witham, 648 F.3d at 45-46 (citing 18 U.S.C. § 3613(f)). And the

MVRA allows the United States to enforce a restitution order “in accordance with

the practices and procedures for the enforcement of a civil judgment under Federal

law or State law[,]” including the Federal Debt Collection Procedures Act

(FDCPA). Witham, 648 F.3d at 45-46 (citing 18 U.S.C. § 3613(a)) (internal

quotations omitted). The FDCPA authorizes the court to use the All Writs Act in

support of the FDCPA’s post-judgment remedies. 28 U.S.C. § 3202(a).

The All Writs Act provides the courts with the authority to issue and enforce

orders. “[T]he All Writs Act specifically authorizes a federal court ‘to issue such commands . . . as may be necessary or appropriate to effectuate and prevent the frustration of orders it has previously issued in exercise of jurisdiction otherwise obtained.’” United States v. City of Detroit, 329 F.3d 515, 522-23 (6th Cir. 2003) (citing United States v. New York Tel. Co., 434 U.S. 159, 174 (1977)). “The Supreme Court and all courts established by Act of Congress may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law.” The All Writs Act, 28 U.S.C. § 1651(a). The ancillary jurisdiction provided by the All Writs Act is proper “to enable a court to function successfully, that is, to manage its proceedings, vindicate its authority, and effectuate its decrees . . . .” Kokkonen v. Guardian Life Ins. Co. of America, 511 U.S. 375, 379-80 (1994).

And “[t]he All Writs Act permits courts to issue orders to nonparties . . . .” City of Detroit, 329 F.3d at 523. “The power conferred by the Act extends, under appropriate circumstances, to persons who, though not parties to the original action or engaged in wrongdoing, are in a position to frustrate the implementation of a court order or the proper administration of justice, and encompasses even those who have not taken any affirmative action to hinder justice.” New York Tel. Co., 434 U.S. at 174 (internal citations omitted); see also Sandpiper Vill. Condo. Ass’n Inc. v. Louisiana-Pacific Corp., 428 F.3d 831, 841 n.14 (9th Cir. 2005) (holding that Act provides district court with jurisdiction “to protect a prior judgment from threats by parties and nonparties alike”).

The district court ordered Ford to provide a “full and complete accounting”

of all the funds, including the location of the funds, she had collected in the state

court case that had not been distributed to the victims, and the court denied Ford’s

motion to alter, amend or vacate the order. [R. 1284: Order; R. 1286: Motion to

Alter Judgment; R. 1303: Memorandum Opinion and Order.] See Gallion, 2011

WL 4015586, at *1-6. The Court will review the district court’s initial assertion of

jurisdiction under the All Writs Act de novo. See United States v. Perry, 360 F.3d

519, 533 (6th Cir. 2004). The district court’s denial of Ford’s subsequent motion

to alter, amend or vacate is reviewable for abuse of discretion. See Shelby Cnty.

Health Care Corp. v. Majestic Star Casino, 581 F.3d 355, 375 (6th Cir. 2009).

A district court abuses its discretion when it applies an incorrect legal standard,

misapplies the correct legal standard, or relies upon clearly erroneous findings of

fact. United States v. Pugh, 405 F.3d 390, 397 (6th Cir. 2005).

Although the district court did not clarify the basis of its jurisdiction, stating only, assuming jurisdiction, that “the MVRA sets forth the exclusive procedures for enforcing a restitution order[,]” a “prevailing party may, of course, assert in a reviewing court any ground in support of his judgment, whether or not that ground was relied upon or even considered by the trial court.” Dandridge v. Williams, 397 U.S. 471, 476 n.6 (1970); see also United States v. Davist, 481 F.3d 425, 427 (6th Cir. 2007) (recognizing that Court “may affirm on any grounds supported by the record, even though different from the grounds relied on by the district court”). [See R. 1303:

Memorandum Opinion and Order at 6.]

The district court did not abuse its discretion by ordering Ford to provide the

United States with a full and complete accounting of the funds she obtained

pursuant to the reversed state court judgment. The district court had jurisdiction

under either the MVRA or the All Writs Act to issue the order. “The All Writs Act

is a residual source of authority to issue writs that are not otherwise covered by

statute. Where a statute specifically addresses the particular issue at hand, it is that

authority, and not the All Writs Act, that is controlling.” Pennsylvania Bureau of

Corr. v. U.S. Marshals Serv., 474 U.S. 34, 43 (1985); see Perry, 360 F.3d at 533

(citing Pennsylvania Bureau of Corr., 474 U.S. at 43). The MVRA authorizes the

United States to enforce an order of restitution in the same manner that it recovers

fines, and “by all other available and reasonable means.” 18 U.S.C.

§ 3664(m)(1)(A)(i)(ii); Witham, 648 F.3d at 45 (citing 18 U.S.C. §§ 3611-3615).

The MVRA specifically allows the United States to enforce a restitution order “in

accordance with the practices and procedures for the enforcement of a civil

judgment under Federal law or State law[,]” including the FDCPA. Witham, 648

F.3d at 45-46 (citing 18 U.S.C. § 3613(a)) (internal quotations omitted). And the

FDCPA authorizes the court to use the All Writs Act in support of the FDCPA’s

post-judgment remedies. 28 U.S.C. § 3202(a). Regardless, in the absence of

a controlling statute, the courts have found that the district court has jurisdiction

under the All Writs Act to enforce restitution orders. In United States v. Yielding,

657 F.3d 722, 726 (8th Cir. 2011), the court noted that the MVRA expanded the

Attorney General’s authority to enforce a sentencing court’s restitution order. The

court, also noting that a number of courts have upheld “as necessary and

appropriate in aid of this jurisdiction, orders issued under the All Writs Act

restraining a restitution debtor from diverting or concealing assets to avoid paying

restitution[,]” concluded that “a sentencing court has jurisdiction to enforce its

restitution order and may use the All Writs Act, when necessary and appropriate, to

prevent the restitution debtor from frustrating collection of the restitution debt.”

Id. at 727; see also United States v. Beckner, 16 F. Supp. 2d 677, 678-79 (M.D. La.

1998) (holding that court has jurisdiction under All Writs Act to require United

States to return restitution paid by defendant to non-federal victim when

defendant’s conviction set aside); United States v. Venneri, 782 F. Supp. 1091,

1094-95 (D. Md. 1991) (holding that court has jurisdiction under All Writs Act to

order putative crime victim to restore restitution). But the district court’s authority

under the All Writs Act is not unlimited. See Perry, 360 F.3d at 538 (holding that

district court does not have authority to vacate existing lien based on court’s right

to enforce MVRA orders under All Writs Act).

“In New York Telephone, the Supreme Court considered four major factors

for determining whether a writ issued to a nonparty under the All Writs Act was

within the district court’s discretion.” City of Detroit, 329 F.3d at 524. “[T]he

Court first examined the nonparty’s relationship to the controversy” and

“conclud[ed] that the phone company was not ‘a third party so far removed from

the underlying controversy that its assistance could not be permissibly

compelled.’” Id. at 524-25 (citing New York Tel. Co., 434 U.S. at 174). “A district

court may issue such a writ against any person with the ‘minimum contacts’ with the forum necessary to the court’s exercise of personal jurisdiction.” United States v. Int’l Bhd. of Teamsters, 266 F.3d 45, 50 (2nd Cir. 2001). “Second, the Court considered the burden that cooperation would impose on the nonparty.

Third, the court examined the nonparty’s interest in not providing assistance both from an ideological and financial perspective” and “conclud[ed] that because the telephone company had used pen registers in the past and because the FBI would compensate the company for its assistance, the company had no interest in not assisting.” City of Detroit, 329 F.3d at 525 (citing New York Tel. Co., 434 U.S. at 174-75).

“Lastly, the Court looked at the importance of the nonparty’s assistance to

fulfilling the goals of the order.” City of Detroit, 329 F.3d at 525 (citing New York

Tel. Co., 434 U.S. at 175).

Ford meets the New York Telephone test. Ford was not “so far removed

from the underlying controversy” that the court could not permissibly compel her

to provide an accounting of the funds that she had obtained in the state action. See

City of Detroit, 329 F.3d at 524-25 (citing New York Tel. Co., 434 U.S. at 174).

Indeed, Ford was “an active participant” in the case. [R. 1303: Memorandum

Opinion and Order at 6.] The district court appointed Ford to be the crime victims’

advocate pursuant to the Crime Victims’ Rights Act (CVRA), and she filed

numerous pleadings in the federal criminal case on behalf of the crime victims.

[Id. at 6; see R. 58: Response; R. 182: Motion to Quash; R. 580: Response;

R. 723: Motion in Limine; R. 726: Motion in Limine; R. 875: Motion for Order;

R. 893: Notice of Filing; R. 896: Reply; R. 920: Reply; R. 926: Motion for

Leave to Appeal; R. 929: Motion for Leave to File; R. 935: Response; R. 962:

Notice; R. 1224: Response; R. 1249: Motion for Victim Rights; R. 1260: Notice

of Filing; R. 1270: Response; R. 1285: Notice; R. 1286: Motion to Alter

Judgment; R. 1287: Motion; R. 1289: Sealed Document; R. 1290: Notice of

Filing.] Thus, Ford has the requisite “‘minimum contacts’ with the forum

necessary to the court’s exercise of personal jurisdiction.” See Int’l Bhd. of

Teamsters, 266 F.3d at 50.

Second, Ford should not be unduly burdened by the court’s order. The

information that Ford filed with the district court indicates that Ford has ready access to the information that the government seeks. [See R. 1286: Motion to Alter Judgment, Attachment 6; R. 1289: Sealed Document at 1-2.]

Third, any interest that Ford has in not complying with the court’s order is

secondary to the victims’ right to restitution. City of Detroit, 329 F.3d at 525

(citing New York Tel. Co., 434 U.S. at 174-75). Ford’s right is contingent on the

victims’ right to restitution. See Mohamed v. Kerr, 91 F.3d 1124, 1126-27 (8th

Cir. 1996). And to the extent that Ford’s personal privacy interests are implicated,

see Ford’s Brief at 24-25, she can redact any unrelated account information. The

United States did not seek “unfettered” access to Ford’s “personal assets” as Ford

claims. See Ford’s Brief at 24-25. The government’s request, consistent with the

district court’s order, sought only an accounting of undistributed funds that Ford

collected in the state court case. [See R. 1283: Motion; R. 1284: Order; R. 1303:

Memorandum Opinion and Order.]

Lastly, Ford’s assistance is important to fulfilling the primary goal of the

MVRA to fully compensate victims for their losses. City of Detroit, 329 F.3d at

525 (citing New York Tel. Co., 434 U.S. at 175). The MVRA and the Crime

Victims’ Rights Act require the United States to protect the crime victims’ rights.

Morever, no matter how unlikely Ford believes a final reversal of the state court

action, or an overturning of the federal court conviction, may ultimately be, the

United States is required to protect any funds, including contingent fees held by

Ford, that could revert to Gallion and Cunningham. In the event Ford is required

to restore restitution, the United States will need to know the identity, location, and

amount of the funds in order to enforce its right as the lien holder on behalf of the

victims. Indeed, Ford, as the court-appointed crime victims’ advocate, and as she

has acknowledged, has an affirmative duty to protect the victims’ rights. See 18

U.S.C. § 3771; 18 U.S.C. §§ 3663A, 3664. [See R. 875: Motion for Order at 1.]

Ford’s claim that the district court lacked jurisdiction to order her to provide

an accounting because “the MVRA . . . does not provide a statutory basis for

compelling discovery of Ford’s personal funds that cannot become the property of

Gallion and Cunningham[,]” see Ford’s Brief at 14-15, fails. As shown, the district

court’s order for an accounting of undistributed, yet collected, funds is enforceable

under either the MVRA or the All Writs Act. Moreover, Ford erroneously assumes

that she could never be a legitimate debtor. See Ford’s Brief at 15-17. The

possibility that a claim could be made by Gallion and Cunningham to the

undistributed funds collected by Ford has not been foreclosed by the state or

federal proceedings. And there is a possibility that these funds could become

subject to collection efforts by the United States. Not only could the state civil

case be overturned, but as indicated by the district court, even if the issue of

judgment priority is ignored, the argument that the federal restitution judgment

prevents a return of judgment funds collected by Ford ignores the possibility,

however remote, that Gallion’s and Cunningham’s federal criminal conviction

could be overturned. [R. 1303: Memorandum Opinion and Order.]

As the district court noted, “the fact remains that the judgment may eventually be reversed.

Moreover, this argument ignores the possibility that the reversal affected the

priority of the judgments, which would entitle the United States to the accounting regardless of the final outcome of the state case.” [Id. at 4.]

Notwithstanding her arguments, Ford has acknowledged the uncertainty of the state court judgment.

[R. 1300: Notice of Filing, Attachment 3 (transcript of Dec. 6, 2010, hearing) at

18-19.] And she recognizes that her argument rests on the validity of Gallion’s and

Cunningham’s convictions. See Ford’s Brief at 19 (“The Supremacy Clause

ensures that as long as the defendants’ convictions stand, no state court could order

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

been determined to be part of the defendants’ [federal] restitution obligation.”).

Gallion and Cunningham have appealed their convictions and sentences and until

those appeals are final, an uncertainty remains. [See R. 957: Notice of Appeal;

R. 970: Notice of Appeal.] See, e.g., Ramdass v. Angelone, 530 U.S. 156, 176

(2000) (noting “that the availability of postjudgment relief in the trial court or on

appeal renders uncertain the finality and reliability of even a judgment in the trial

court”).

Thus, Ford’s reliance upon the absolute certainty of the federal restitution

judgment is misplaced and potentially detrimental for the victims.

Ford’s argument that the attorney fees that she collected in the state court

can never become the property of Gallion and Cunningham because those fees

offset the amount of restitution that Gallion and Cunningham owe in the federal

case, see Ford’s Brief at 17-19, and her related claims that the federal court order

of restitution nullifies any state court order requiring her to restore restitution, see

Ford’s Brief at 19-21, and that the government’s request for an accounting was not

“reasonable” under the MVRA because “the funds in question could never become

the property of . . . Gallion and Cunningham,” see Ford’s Brief at 21-22, ignore the

uncertainty of the state and federal court judgments and the legality of retaining

legal fees paid by a client from a judgment that is subsequently reversed on appeal.

“Although . . . the law of restitution generally will not require an attorney to repay

legal fees paid by a client from a judgment that is subsequently reversed on appeal,

restitution by the attorney is appropriate where such a payment is made pursuant to a contingent fee.” Mohamed, 91 F.3d at 1126. An attorney has no greater right than the validity of the restitution award. See id. at 1126-27.

Ford also erroneously claims that the government’s request for an

accounting was not an “available” means of enforcing a restitution order under the

MVRA because “[n]o court has held that this provision allows the government to

subject a non-party to discovery by merely filing a motion.” See Ford’s Brief at

22.

The government, by statute, is entitled to “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.” 28 U.S.C.

§ 3015(a).

Under Rule 69 of those rules, a “judgment creditor . . . may obtain

discovery from any person[,] including the judgment debtor . . . .” FED. R. CIV. P. 69(a)(2) (emphasis added). Ford’s reliance on Burak v. Scott, 29 F. Supp. 775, 776 (D.D.C. 1939), see Ford’s Brief at 23, is misplaced. As that court has since

recognized, Burak is not applicable when there is a close relationship between the nonparty and the judgment debtor and the judgment creditor is seeking business records rather than personal records. See Falicia v. Advanced Tenant Servs, Inc.,

235 F.R.D. 5, 8-9 (D.D.C. 2006).

CONCLUSION

The district court should be affirmed.

Respectfully submitted,

KERRY B. HARVEY

UNITED STATES ATTORNEY

CHARLES P.WISDOM JR.

APPELLATE CHIEF

By: s/ Cheryl D. Morgan

Wade T. Napier

Assistant United States Attorneys

260 W. Vine Street, Suite 300

Lexington, Kentucky 40507-1612

(859) 233-2661

FAX (859) 233-2658

Cheryl.Morgan@usdoj.gov

Wade.Napier@usdoj.gov

18

Case: 11-6187 Document: 006111215214 Filed: 02/14/2012 Page: 24

CERTIFICATE OF SERVICE

On February 14, 2012, I electronically filed this brief through the ECF

system, which will send the notice of docket activity to:

R. Kenyon Meyer

Stephen J. Mattingly

Attorneys for Angela Ford

s/ Cheryl D. Morgan

Assistant United States Attorney

Case: 11-6187 Document: 006111215214 Filed: 02/14/2012 Page: 25

APPELLEE’S DESIGNATION OF DISTRICT COURT DOCUMENTS

Record Entry Description of Document

1 Indictment

54 Order

58 Response

182 Motion to Quash

580 Response

599 Superseding Indictment

723 Motion in Limine

726 Motion in Limine

820 Redacted Jury Verdict

821 Redacted Jury Verdict

875 Motion for Order

893 Notice of Filing

896 Reply

920 Reply

926 Motion for Leave to Appeal

929 Motion for Leave to File

935 Response

957 Notice of Appeal

962 Notice

970 Notice of Appeal

971 Amended Judgment

972 Amended Judgment

1224 Response

Case: 11-6187 Document: 006111215214 Filed: 02/14/2012 Page: 26

1249 Motion for Victims Rights

1260 Notice of Filing

1268 Motion

1270 Response

1283 Motion

1284 Order

1285 Notice

1286 Motion to Alter Judgment

1287 Motion

1288 Order

1289 Sealed Document

1290 Notice of Filing

1300 Notice of Filing

1303 Memorandum Opinion and Order

1308 Notice of Appeal

Circuit Judge Tyler Gill of Russelville,  is seeking an amendment to KRS 610.340, the statute which makes most juvenile records confidential.

Judge Tyler Gill notes that pre-trial release officers who should be supplying the court with copies of a defendant’s prior juvenile criminal history for use by the Judge in setting bonds, are not being allowed to provide the Judge with the defendants prior juvenile criminal history.

Judge Gill was informed by AOC that their staff attorneys have advised that juvenile records may be released for the purpose of sentencing defendants, but may not be released to judges who are asked to set pre-trial bonds for defendants. The practice of the AOC is to deny access to such records for judges being asked to set pre-trial bonds. Gill’s proposed amendment would allow this information to be released in bond setting hearings.

Our review of KRS 610.340 notes the exemption in the statute which says confidentiality does not apply to persons identified in KRS 610.340 Section (1) (b) Juvenile court records which contain information pertaining to arrests, petitions, adjudications, and dispositions of a child may be disclosed to victims or other persons authorized to attend a juvenile court hearing pursuant to KRS 610.070.

Surely the District Judge is entitled to attend a juvenile hearing. Judge Gill, a Circuit Judge says in his opinion KRs 610.340 does not permit a circuit judge to have such information.

KRS 610.070 provides a laundry list of persons who may review the arrest and conviction records of juveniles, and judges are certainly included in that list. There is stronger limitation on psychological and medical records in the statute.

The pre-trial officers are refusing to supply to circuit judges these records in bond hearing. This limits the ability of the trial judge to consider important evidence before making bond decisions.

It is understandable why he has requested that the legislature clarify that judges are entitled to view these records to assist them in their sentencing decisions.

LawReader has obtained a copy of a letter from Judge Gill to the LRC, the Chief Justice and Laurie Dudgeon, the Director of the Administrative Office of the Courts, which explains his request for new legislation on this important subject.

From: Gill, Tyler

Sent: Tuesday, November 22, 2011 11:27 AM

To: ‘John.Tilley@LRC.ky.gov’

Cc: Chief Justice John D. Minton, Jr.; Dudgeon, Laurie

Subject: Statutory clarification of KRS 610.340 (confidentiality of juvenile records)

Dear Representative Tilley,

I am seeking a statutory amendment to clarify the intent of KRS 610.340 which directs the confidentiality of juvenile court records. I suggest the following language:

“Criminal court judges determining felony bonds for adult defendants shall be provided with a Pretrial Services History Report and a Pretrial Risk Assessment that include Kentucky juvenile records of charges or adjudications of public offenses. In the event of a dismissal of all criminal charges, any written reference to the juvenile records in the adult criminal case may be sealed or purged from the record.”

Kentucky Judges are not informed about a criminal defendant’s juvenile records of public offense charges and adjudications in determining the amount of bond to set on felony crimes.

The Pretrial Release office of the Administrative Office of the Courts as a matter of unwritten policy excludes from the History Report and Pretrial Risk Assessment the defendant’s Kentucky juvenile history of public offense charges and adjudications. It sounds strange but Court of Justice records are hidden from Court of Justice judges by the Court of Justice. I am told that the reasoning behind the policy is fear that, in giving judges this information, AOC employees would be violating the confidentiality requirements regarding juvenile records.

I doubt whether anyone familiar with the current juvenile statutes would strongly oppose this clarification of law. I do not believe that there has ever existed a specific legislative intent that juvenile records should not be used in making bond decisions in felony criminal cases. To the contrary, the statutory framework suggests a legislative intent that criminal court judges be provided all relevant and available information to make informed bond decisions. KRS 610.340 requires confidentiality of juvenile court records except for “good cause” – plus other notable exceptions. The juvenile records of juveniles tried as adults are statutorily open to the public (See KRS 635.120) and admissible as evidence at trial (See KRS 610.320(5). Juvenile records of an adult criminal defendant may be presented to the jury in the sentencing phase of a criminal trial (KRS 610.320) and may be considered by a judge conducting a felony final sentencing hearing. The fact of juvenile adjudications of guilt of violent crimes is provided to school districts where those juveniles attend school. KRS 610.345(2). Subsection 2 of KRS 610.340 makes juvenile records available to “public officers or employees engaged in the investigation of and in the prosecution of cases under . . . the Kentucky Revised Statutes.”

In setting bonds on defendants between the ages of about 18 and 25 years old, the nature of the charge or other circumstances can make his or her juvenile history, or lack of it, one of the most important factors in determining the risk of flight and risk to others. For example, an adult defendant charged with a felony assault and the criminal history appears completely clean would ordinarily be low risk of new criminal conduct while out on bond and should be released. But with young defendants, the hidden truth may be that he or she has been adjudicated guilty of multiple prior violent offenses. The adult charge may be a sex crime. With no prior history the defendant appears low risk. But the truth represented by the juvenile records may be that the defendant is a serial sex offender. As you can imagine, the negative consequences of a bad decision here could be great. There should never be a hidden truth in this process. The process of judges setting bonds in felony criminal cases is not one where the public would expect or excuse institutionalized incompetence.

This year the Legislature enacted KRS 466.101 (33) which defines a Pretrial Risk Assessment as an “objective, research based, validated, assessment tool that measures a defendant’s risk of flight and risk of anticipated criminal conduct . . .” An assessment that by policy omits available relevant information about the defendant’s past criminal conduct can never be truly objective or validated. The bottom line is that withholding important information from criminal court judges can jeopardize the public and undermine public confidence in the judiciary. The fix appears easy and, if there is a significant downside, I have not been able to find it.

I would appreciate your assistance in addressing this issue as soon as possible. Thank you for your attention to this matter.

Tyler L. Gill, Judge

Seventh Judicial Circuit

The statute that Judge Gill seeks amendment of, is KRS 610.340 which states;

KRS 610.340 Confidentiality of juvenile court records.

(1) (a) Unless a specific provision of KRS Chapters 600 to 645 specifies otherwise, all juvenile court records of any nature generated pursuant to KRS Chapters 600 to 645 by any agency or instrumentality, public or private, shall be deemed to be confidential and shall not be disclosed except to the child, parent, victims, or other persons authorized to attend a juvenile court hearing pursuant to KRS 610.070 unless ordered by the court for good cause.

(b) Juvenile court records which contain information pertaining to arrests, petitions, adjudications, and dispositions of a child may be disclosed to victims or other persons authorized to attend a juvenile court hearing pursuant to KRS 610.070.

(c) Release of the child’s treatment, medical, mental, or psychological records is prohibited unless presented as evidence in Circuit Court. Any records resulting from the child’s prior abuse and neglect under Title IV-E or Title IV-B of the Federal Social Security Act shall not be disclosed to victims or other persons authorized to attend a juvenile court hearing pursuant to KRS 610.070.

(d) Victim access under this subsection to juvenile court records shall include access to records of adjudications that occurred prior to July 15, 1998.

(2) The provisions of this section shall not apply to public officers or employees engaged in the investigation of and in the prosecution of cases under KRS Chapters 600 to 645 or other portions of the Kentucky Revised Statutes. Any record obtained pursuant to this subsection shall be used for official use only, shall not be disclosed publicly, and shall be exempt from disclosure under the Open Records Act, KRS 61.870 to 61.884.

(3) The provisions of this section shall not apply to any peace officer, as defined in KRS 446.010, who is engaged in the investigation or prosecution of cases under KRS Chapters 600 to 645 or other portions of the Kentucky Revised Statutes. Any record obtained pursuant to this subsection shall be used for official use only, shall not be disclosed publicly, and shall be exempt from disclosure under the Open Records Act, KRS 61.870 to 61.884.

(4) The provisions of this section shall not apply to employees of the Department of Juvenile Justice or cabinet or its designees responsible for any services under KRS Chapters 600 to 645 or to attorneys for parties involved in actions relating to KRS Chapters 600 to 645 or other prosecutions authorized by the Kentucky Revised Statutes.

(5) The provisions of this section shall not apply to records disclosed pursuant to KRS 610.320 or to public or private elementary and secondary school administrative, transportation, and counseling personnel, to any teacher or school employee with whom the student may come in contact, or to persons entitled to have juvenile records under KRS 610.345, if the possession and use of the records is in compliance with the provisions of KRS 610.345 and this section.

(6) No person, including school personnel, shall disclose any confidential record or any information contained therein except as permitted by this section or other specific section of KRS Chapters 600 to 645, or except as permitted by specific order of the court.

(7) No person, including school personnel, authorized to obtain records pursuant to KRS Chapters 600 to 645 shall obtain or attempt to obtain confidential records to which he is not entitled or for purposes for which he is not permitted to obtain them pursuant to KRS Chapters 600 to 645.

(8) No person, including school personnel, not authorized to obtain records pursuant to KRS Chapters 600 to 645 shall obtain or attempt to obtain records which are made confidential pursuant to KRS Chapters 600 to 645 except upon proper motion to a court of competent jurisdiction.

(9) No person shall destroy or attempt to destroy any record required to be kept pursuant to KRS Chapters 600 to 645 unless the destruction is permitted pursuant to KRS Chapters 600 to 645 and is authorized by the court upon proper motion and good cause for the destruction being shown.

(10) As used in this section the term “KRS Chapters 600 to 645″ includes any administrative regulations which are lawfully promulgated pursuant to KRS Chapters 600 to 645.

Effective: June 8, 2011

History: Amended 2011 Ky. Acts ch. 2, sec. 105, effective June 8, 2011. — Amended 2006 Ky. Acts ch. 182, sec. 69, effective July 12, 2006. — Amended 1998 Ky. Acts ch. 493, sec. 16, effective April 10, 1998; and ch. 606, sec. 23, effective July 15, 1998. — Amended 1996 Ky. Acts ch. 358, sec. 38, effective July 1, 1996 and July 15, 1997. — Created 1986 Ky. Acts ch. 423, sec. 53, effective July 1, 1987.

Legislative Research Commission Note (7/12/2006). This statute, as amended by 2006 Ky. Acts ch. 182, sec. 69, contained an internal reference in subsection (3) to “KRS 446.010(24).” Under KRS 7.136(1)(e), this reference has been changed in codification to “KRS 446.010(25)” by the Reviser of Statues to reflect the insertion of a new subsection (24) in KRS 446.010 and the resulting renumbering of succeeding subsections in 2006 Ky. Acts ch. 149, sec. 237

KRS 610.340 refers to the persons exempt from the confidentiality rule of KRS 610.340 sections (1)(b) and as being persons identified in KRS 610.070.

KRS 610.070 states:

Hearings.

(1) All cases involving children brought before the court whose cases are under the jurisdiction of the court shall be granted a speedy hearing and shall be dealt with by the court without a jury.

(2) The hearings shall be conducted in a formal manner, unless specified to the contrary by other provisions of KRS Chapters 600 to 645.

(3) The general public shall be excluded and only the immediate families or guardians of the parties before the court, witnesses necessary for the prosecution and defense of the case, the probation worker with direct interest in the case, a representative from the Department of Juvenile Justice, the victim, his parent or legal guardian, or if emancipated, his spouse, or a legal representative of either, such persons admitted as the judge shall find have a direct interest in the case or in the work of the court, and such other persons as agreed to by the child and his attorney may be admitted to the hearing.

(LawReader: . It is Judge Gill’s opinion that Circuit Judges who did not hear a juvenile case are not entitled to disclosure of juvenile records.)

A parent, legal guardian, or spouse if a witness shall be admitted to the hearing only during and after his testimony at the hearing, and witnesses shall be admitted to the hearing only for the duration of their testimony. The court may order the exclusion of a parent, legal guardian, or spouse, if it is shown to the satisfaction of the court that the parent, legal guardian, or spouse may physically disrupt the proceedings or may do violence to any participant therein. The mere presence of a parent, legal guardian, or spouse shall not be deemed to be a disruption of the proceedings merely because their presence may make the defendant uncomfortable; the court shall find a potential for actual physical disruption of the proceedings before an exclusion may be granted for this reason.

(4) The court may order the parents, guardians, or persons exercising custodial control over the child to be present at any hearing or other proceeding involving the child.

Effective: July 15, 1998

History: Amended 1998 Ky. Acts ch. 443, sec. 15, effective July 15, 1998. — Amended 1996 Ky. Acts ch. 358, sec. 21, effective July 15, 1997. — Amended 1994 Ky. Acts ch. 407, sec. 1, effective July 15, 1994. — Amended 1988 Ky. Acts ch. 350, sec. 19, effective April 10, 1988. — Created 1986 Ky. Acts ch. 423, sec. 26, effective July 1, 1987.

Legislative Research Commission Note (7/15/94). In 1994 Ky. Acts ch. 407, sec. 1, the sentence beginning

Judge Gill reports to LawReader;

“ I have never entered an order requiring anyone to give me the records. I would not know who to direct the order to.

Let me explain.

These juvenile records are court records in the possession of the Administrative Office of the Courts – available statewide on computer records at the touch of a button. The Pre-trial Release office is a branch of AOC.

Withholding the information from both pretrial officers and judges is a longstanding practice of AOC since the system was developed. Keep in mind that the AOC computer data base that allowed the records to be accessible easily statewide was not created until the mid 1990’s.

A couple of years ago I asked AOC Director Laurie Dudgeon if this situation could be fixed. She was unaware that judges did not get juvenile records in setting bonds and said she would look into it. She later told me that AOC lawyers told her that, because someone might argue that the act of giving judges juvenile records to set bond violates KRS 610.340, then AOC supervisors should not put its own pretrial officers in the position of possibly violating the law.

I refer to this as an unwritten policy because you cannot tell who created it or who is in charge of enforcing it. Who is directing the supervisors? …the legislature needs to clarify the statute

Assisting judges and making the system work should be AOC’s problem. If criminal trial judges cannot trust that they are getting the whole truth from pretrial officers, fewer people will get out of jail on bond.

The irony is that by statute, Judges can already use juvenile records at the trial and sentencing of the adult defendant. It is only in setting the initial bond that Circuit and District judges are blindfolded about the defendants juvenile history. Now District Judges in single judge rural communities who initially set bonds on felony cases may recall the defendant’s juvenile case in that county and set the bond appropriately. But that information is not given to the Circuit Judge when he reviews the bond after indictment.

…I do not think that as Circuit Judge, I am …entitled to attend a juvenile court hearing.

…In theory this is a matter of maintaining public confidence in the judiciary. In reality it is only about making the system work in the way it is supposed to. I do not know how many criminal court judges across Kentucky are aware that that the criminal history given to them with every bond decision omits the juvenile history. I have spoken to some who were not aware of this. I became aware of it by chance. I feel certain that the public is unaware of this and will remain blissfully ignorant. If a judge releases a defendant on bond – who then commits an atrocity – and it is discovered that a look at our own records would have predicted the conduct, maybe then the issue will be addressed. But then, since the records are confidential, who would make public the judicial incompetence? Secrecy perpetuates itself.”

By LawReader Senior Editor Stan Billingsley Feb. 12, 2012

When you put on a robe, the authority you assume is real, but it is not personal power that earns you respect from those who appear before you. It is the robe they are saluting. It is the office of judge, they pay respect too.

When a judge acts, he or she is using the power of the robe, and nowhere is there a rule that says if you don’t like the law, the party or the attorney who appears before you, that you can use the power of the judicial office to punish them for an act which is supported by statutory authority.

In the Army Officer Candidates School I attended (many years ago), I was taught that it was your uniform your men were saluting, not you personally. The job of an officer or a judge is to implement public policy, not to implement their personal likes and dislikes of the officer. We were taught that every disciplinary action we took against an inferior status soldier, should be on the basis of military law and should never be based merely on our personal dislikes.

When we see a case like the Amelia “Mikki” Adams case, we raise an eyebrow in wondering why District Judge Annette Karem imposed a six month jail sentence for contempt of court on attorney Adams.

The harshness of the sentence in view of the three laws that applied to this fact situation raises the possibility of …….

(Note: Under the current Rules of the Supreme Court, the author being a lawyer cannot complete this sentence, and express the facts or his opinions on this subject . Attorneys are forbidden to share with the public or other lawyers their opinions even if truthful, if the comments can be considered “reckless” and appear to be critical of a judge or public officer. The Kentucky Bar Association ethics prosecutors apparently get to define the meaning of “reckless” in this context. The Bar Counsel investigated John M. Berry Jr. for two years for writing a letter to the legislature! The Berry case is still on appeal. )

The Courier-Journal article suggests that the statute Judge Karem relied upon to sanction attorney Adams was in conflict with the child abuse reporting statute.

The Courier-Journal reports that attorney Adams refused to disclose to District Judge Karem the name of Adams 17 year old client who had sought permission from the court to have an abortion without her parent’s consent. The “adoption bypass proceeding” as the law is sometimes called, guarantees the right of Adam’s client to apply for an abortion anonymously. See: KRS 311.732. Under this abortion by-pass statute it is the courts duty to keep the petitioner’s name anonymous.

On the other hand a conflicting law requires the reporting of possible child neglect, and the Judge felt the law required Adams to ignore the secrecy of the abortion by-pass law in order to allow an investigation of possible abuse of Adams client, and the younger sister of Adams client.

We don’t have before us the facts of this case. That of course limits our ability to understand all of the issues raised in the Courier-Journal article.

Judge Karem apparently relied on KRS 311.631, which creates a duty to report suspicion of child abuse, including sexual abuse. It is reported that Adams client was l7 years of age.

Judge Karem presumably relied on KRS 620.030 which imposes on any citizen or official the duty to report abuse of a child. That authority is recognized in: Doe v. Potter, 225 S.W.3d 395 (Ky. App., 2006) which states….

“KRS 620.030 mandates the reporting of the dependency, neglect or abuse of a child…”.

The cited statute requires:

“KRS 620.030 Duty to report dependency, neglect, or abuse — Husband-wife and professional-client/patient privileges not grounds for refusal to report — Exceptions — Penalties.

1. Any person who knows or has reasonable cause to believe that a child is dependent, neglected, or abused shall immediately cause an oral or written report to be made to a local law enforcement agency or the Department of Kentucky State Police; the cabinet or its designated representative; the Commonwealth’s attorney or the county attorney; by telephone or otherwise. Any supervisor who receives from an employee a report of suspected dependency, neglect, or abuse shall promptly make a report to the proper authorities for investigation.”

It is troubling to the author, that the very statute cited by Judge Karem to sanction attorney Adams for not reporting her “suspicion of child abuse” contains a specific exemption from reporting when there is an attorney/client relationship between the attorney (Adams) and the minor (the l7 year old) client.

3. Neither the husband-wife nor any professional-client/patient privilege, except the attorney-client and clergy-penitent privilege, shall be a ground for refusing to report under this section or for excluding evidence regarding a dependent, neglected, or abused child or the cause thereof, in any judicial proceedings resulting from a report pursuant to this section. This subsection shall also apply in any criminal proceeding in District or Circuit Court regarding a dependent, neglected, or abused child.

KRS 311.732 provides a right of a pregnant minor to petition the court for permission to obtain an abortion. That statute was relied upon by attorney Adams.

“KRS 311.732 Performance of abortion upon a minor — Definitions — Consent requirement — Petition in District or Circuit Court — Medical emergencies.

(1) For purposes of this section the following definitions shall apply:

(a) “Minor” means any person under the age of eighteen (18);

(b) “Emancipated minor” means any minor who is or has been married or has by court order or otherwise been freed from the care, custody, and control of her parents; and

(c) “Abortion” means the use of any instrument, medicine, drug, or any other substance or device with intent to terminate the pregnancy of a woman known to be pregnant with intent other than to increase the probability of a live birth, to preserve the life or health of the child after live birth, or to remove a dead fetus.

(2) No person shall perform an abortion upon a minor unless:

(a) The attending physician or his agent secured the informed written consent of the minor and one (1) parent or legal guardian;

(b) The minor is emancipated and the attending physician or his agent has received the informed written consent of the minor; or

(c) The minor elects to petition any Circuit or District Court of the Commonwealth pursuant to subsection (3) of this section and obtain an order pursuant to subsection (4) of this section granting consent to the abortion and the attending physician or his agent has received the informed written consent of the minor.

(3) Every minor shall have the right to petition any Circuit or District Court of the Commonwealth for an order granting the right to self-consent to an abortion pursuant to the following procedures:

(a) The minor or her next friend may prepare and file a petition setting forth the request of the minor for an order of consent to an abortion;

(b) The court shall insure that the minor prepares or her next friend is given assistance in preparing and filing the petition and shall insure that the minor’s identity is kept anonymous;

(c) The minor may participate in proceedings in the court on her own behalf or through her next friend and the court shall appoint a guardian ad litem for her. The court shall advise her that she has a right to court-appointed counsel and shall provide her with such counsel upon her request;

(d) All proceedings under this section shall be anonymous and shall be given preference over other matters to insure that the court may reach a decision promptly, but in no case shall the court fail to rule within seventy-two (72) hours of the time of application, provided that the seventy-two (72) hour limitation may be extended at the request of the minor; and

(e) The court shall hold a hearing on the merits of the petition before reaching a decision…. “

We would suggest that the knowledge that attorney Adams apparently had, that her client had had sex with someone, is not per se defined as child abuse. The criminal code places the age of consent for sex by a minor at the age of l6.

KRS 510.020 Lack of consent. “ 3) A person is deemed incapable of consent when he or she is: Less than sixteen (16) years old;…”

KRS 510.020 is interpreted to hold that a child who is 16 years of age or older may consent to sexual conduct. Adams client was l7. In the absence of forcible compulsion, it is not a crime for a l7 year old child to consent to sexual conduct with another. We have found no authority for the conclusion of Judge Karem that a l6 year old or a l7 year old may not legally consent to sex.

If such consensual sexual relationship is not illegal, any attempt to allege that this permitted conduct is “child abuse” is tenuous. This interpretation of KRS 510.020 by Judge Karem is in conflict with the public policy of the legislature as expressed in KRS 510.020.

KRS 311.732 provides a procedure where a minor may seek permission from a District or Circuit Court to obtain an abortion. The statute imposes a duty on the court to keep the name of the petitioner “anonymous”.

We understand the duty of the court is to interpret two laws allegedly in conflict, so as to uphold both of them if possible.

We first conclude that attorney Adams was exempt from the duty to report child abuse of her client, and Judge Karem (a member of the court) was under a duty to keep her name anonymous.

The Courier-Journal article of Feb. 11, 2010 suggests that the two laws (cited above) were apparently in conflict. We disagree. The reporting statute specifically exempts the attorney from reporting suspected abuse if an attorney/client relationship existed. The second statute imposes a duty on Judge Karem to keep the client’s name “anonymous”. There is no conflict in these two statutes, they both can exist without violation of any public policy of the legislature.

In light of the application of these statutes, we note that Judge Karem’s sentence of six months for contempt of court is troubling. We don’t understand the reasoning for the Ky. Court of Appeals December order, refusing to hear attorney Adams appeal on this important legal issue.

We acknowledge one fact that raises doubts a legal question that appears novel to Kentucky jurisprudence. Judge Karem supported her contempt order on additional grounds that raises the question of whether or not a reporting duty involving Adam’s clients sister. Judge Karem stated she needed to know the name of Adam’s client, “…because the girl and her sister were possibly being neglected.”

If we assume that the sister was a minor, under the age of l6, and that there was proof or suspicion that she had been sexually abused, then there possibly could be a legitimate legal issue and a possible conflict. Does the attorney/client exemption present in KRS 620.030 apply to information the attorney receives in the process of representing her client? If attorney Adams was to reveal the name of the sister, would it not violate her duty under KRS 311.732?

We would suggest that before sentencing attorney Adams to six months in jail, Judge Karem could have delayed her sanctions until Adams had been able to seek appellate guidance.

Judge Karem ordered attorney Adams to do an act which she was prevented to do under the statutes enacted by the legislature. Does such a fact situation come close to justifying a six month jail sentence?

We note that the Kentucky Bar Association will probably now commence an investigation of attorney Adams and may attempt to sanction her for having been sentenced to jail for contempt of court.

Strangely the Supreme Court Rules which may cause an investigation of attorney Adams by the Bar Counsel of the Kentucky Bar Association, may also lead to an investigation of Judge Karem by the Judicial Conduct Commission. She apparently offered to reduce attorneys Adams six month jail sentence in consideration of an agreement by Adams to pay the Judges attorney fees in this case. Adams attorney Sheryl Snyder is reported to have: “asked the Chief Justice to disqualify Karem in part for injecting ‘her own pecuniary interest into her decision…creating a conflict of interest and the appearance if not the actuality of impropriety. ”

Every attorney member of the Ky. Bar Association is under a duty to report any discipline imposed on the attorney by anyone other than the KBA. Attorney Adams must serve a jail sentence (although reduced to two days by a subsequent judge upon Judge Karem’s recusal).

If the Bar Counsel seeks to investigate and prosecute attorney Adams, then they will be assuming the role of an appellate court and will be interpreting the meaning of KRS 311.732 and KRS 620.030.

If the Judicial Conduct Commission chooses to investigate the actions of Judge Karem, they may find they are drawn into a situation where they must interpret a law. It is troubling to conceive of either the Bar Counsel or the Judicial Conduct Commission assuming appellate jurisdiction of actions by attorneys and judges in the trial courts.

The duty to report suspected transgressions of Judges and Attorneys is generally known as the Squeal Rule. That rule reads:

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.

(b) A lawyer who knows that a judge has committed a violation of applicable rules of judicial conduct that raises a substantial question as to the judge’s fitness for office shall report such violation to the Judicial Conduct Commission.

(c) A lawyer is not required to report information that is protected by Rule 1.6 or by other law. Further, a lawyer or a judge does not have a duty to report or disclose information that is received in the course of participating in the Kentucky Lawyer Assistance Program or Ethics Hotline.

(d) A lawyer acting in good faith in the discharge of the lawyer’s professional responsibilities required by paragraphs (a) and (b) or when making a voluntary report of other misconduct shall be immune from any action, civil or criminal, and any disciplinary proceeding before the Bar as a result of said report, except for conduct prohibited by Rule 3.4(f).

(e) As provided in SCR 3.435, a lawyer who is disciplined as a result of a lawyer disciplinary action brought before any authority other than the Association shall report that fact to Bar Counsel.

(f) As provided in SCR 3.166(2), a lawyer prosecuting a case against any member of the Association to a plea of guilty, conviction by judge or jury or entry of judgment, should immediately notify the Director of such event.

HISTORY: Amended by Order 2009-05, eff. 7-15-09; adopted by Order 89-1

Mikka Adams, upheld her duty to protect her client’s rights as long as she could. She presented her arguments to the trial court and timely sought an appeal of Judge Karem’s order. That appeal was denied, and Adams then complied in a timely manner to comply with Judge Karem’s order.

Still Mikka Adams will have to go to jail for two days for attempting to uphold her clients statutory rights. She will be jailed for an act of not reporting an act cited by Judge Karem which was not an act of child abuse, and therefore the reporting statute most likely did not even apply to her. If Adams revealed the name of the other sister she would have violated the intent of KRS 311.732. The public does not know if the other sister was abused, does not know her age, and does not know if attorney Adams correctly or incorrectly withheld the name of the sister…or even if she knew the name of the sister. The Cabinet for Human Resources wall of secrecy hides that information.

It is unfortunate that the appellate court refused to hear Adam’s appeal, and thereby leaves the bar and the public in ignorance of the correct interpretation of these statutes.

If ethics charges are filed against Judge Karem or attorney Adams, then the Supreme Court may be presented with this issue.

Factoid: The U.S. Attorney’s office for the Western District of Kentucky ( in Louisville) has 80 employees including 30 lawyers. This office handles prosecution of crimes for about half the state or for about 2,000,000 citizens. We compare the workload and staffing of the U.S. Attorney’s Office to the Bar Counsel’s office of the Kentucky Bar Association and discover that the KBA employs nine full time lawyers and a total staff of 24, to investigate and prosecute only ethics offenses for the 17,000 members of the Kentucky Bar Association.

So the U.S. Attorney has 30 lawyers to oversee offenses by 2,000,000 Kentucky citizens. That is one lawyer for every 66,666 citizens. The KBA has nine full time lawyers to oversee only ethics complaints against 17,000 lawyers. That works out to one KBA lawyer for every 1,888 lawyers. That reveals that the potential caseload of the U.S. Attorney’s office is 35 times greater than the workload of the KBA Bar Counsel’s office.

And of course we should note that the U.S. Attorney’s office handles far more potential offenses that may be prosecuted.

The KBA also hires outside counsel, particularly in cases appealed to the Federal Courts. Apparently these outside lawyers are hired because the KBA Bar Counsel’s office does not have lawyers skilled in pleading cases in the Federal courts. The KBA only oversees ethics violations of lawyers. (Example: Outside counsel has been hired by the KBA in the Deters case and the John M. Berry Jr. and ACLU cases which are both pending in the U.S. Circuit Court of Appeals.)

Judge Tyler Gill | Governor shouldn’t shield cabinet

Child-abuse secrecy is only designed to protect officials Written by Tyler Gill | Special to The Courier-Journal Feb. 7, 2012

Last week, an article appeared in several Kentucky newspapers authored by Gov. Steve Beshear. In it, he defended the idea of maintaining state secrecy about circumstances surrounding children who have died after citizens reported suspected child abuse to state officials. He said he is fighting alongside the Cabinet for Health and Family Services and its lawyers and seeks to justify the state’s appeal of judicial rulings of the Franklin Circuit Court. In January, that court ordered the Cabinet to disclose information about cases where children died after complaints of child abuse were made to state authorities. I urge the Governor to reconsider his allegiance to the Cabinet on this issue and to see the bigger picture of what is in the best interest of the people of Kentucky.

The Governor argues that, if we make public the identities of those who reported child abuse before the children were killed, this will make people afraid to report child abuse. His article raises myriad concerns about negative consequences that will be suffered if we do not maintain secrecy in child abuse investigations and in legal actions to terminate parental rights. If we open these records, there would indeed be some negative consequences, and I agree with the Governor that the answer must ultimately come from the General Assembly and not the courts.

The publicity surrounding recent tragic deaths of children in Kentucky, and the now public shenanigans of the Cabinet, caught lying about what it knew and when it knew it, have triggered a rare public anger.

The death of 9-year-old Amy Dye of Todd County has become a focal point of statewide anger about the senseless deaths of children and a symbol of state incompetence. People seem eager to find out what went wrong and want to fix the problem. They feel that the safety of children is at stake and secrecy stands in the way. As the Governor said in his article, some are arguing that the veil of secrecy surrounding the Cabinet should be stripped away. Some are even suggesting that the Cabinet be accountable for its actions

Accountability and openness in government — what novel ideas!

Openness should always be the rule where government is involved and secrecy the rare and carefully considered exception to that rule. I have come to believe that secrecy in courts of law should be eliminated in every adversarial action initiated by any agency of the state. Non-adversarial actions, such as private uncontested adoptions or adoptions after parental rights have previously been terminated, should remain confidential.

My disagreement with the Governor arises from perspective and experience. I have been a circuit judge in Western Kentucky for 17 years. Before that, I was district judge. There is one circuit judge in Todd and Logan counties with no separate family court and so I handle all circuit level cases involving family conflict. Judges have a front-row seat to every variety of real-life struggle involving children and families in confidential cases initiated by the Cabinet. I am directly involved in the matters about which the Governor speaks and see firsthand the practical application of law to people.

In confidential cases, Cabinet lawyers can take action against the interest of the very citizens it is supposed to protect. The Cabinet is directed by statute to protect children, the mentally ill and the elderly. Over the years, I have observed an infrequent but persistent pattern of bizarre actions by lawyers and high-level officials employed by the Cabinet for Families and Children that occur almost exclusively in confidential cases such as juvenile cases, termination of parental rights and involuntarily hospitalizations. Secrecy allows people to do things in ways that they would not dare do in a public setting.

For example, in 2008 one of the Cabinet’s lawyers, with full knowledge of the Secretary of the Cabinet, intentionally fought to release a committed patient from a state psychiatric hospital even though the lawyer openly admitted that, in the opinion of the state’s physicians, the patient was still likely to harm himself or another person upon release. The Cabinet lawyer argued in this secret court setting that the State owed no duty to protect the mentally ill person or to protect others he might harm when released.

This was done because the patient was troublesome to the state employees and hospital administrators who then put pressure on the Cabinet to get the patient out of the hospital. The lawyer admitted that she acted on behalf of the doctors and administrators of the state hospital. This is how the Cabinet protects citizens when secrecy prevails. This same Cabinet lawyer is one of the lawyers now working alongside the Governor to maintain Cabinet secrecy.

I have concluded that the Cabinet is consumed with a bureaucratic mentality and an institutional incompetence instilled by Cabinet leaders. Cabinet leadership is greatly influenced by a small group of senior Cabinet lawyers. Cabinet employees are directed to blindly follow its own internally created “guidelines” ignoring all else. The guidelines are to be followed whether or not doing so hurts children, the mentally ill, the elderly or the public. Reason, pleading, common sense, and sometimes not even a court order can dissuade a Cabinet supervisor from strictly following these guidelines. The Cabinet has become a law unto itself.

I have also come to believe that confidentiality imposed by our statutes is more often used to hide state incompetence or misconduct than to protect the citizens of Kentucky. Do not be misled. The Cabinet’s appeal of the Franklin Circuit Court ruling is not a high-minded effort to protect the privacy of persons who report child abuse. It is to protect the Cabinet.

While we can always find some downside to open government, the consequences of government secrecy are far worse. We need only look to the courts and governments of totalitarian regimes such as China, North Korea, Iran or Cuba for this lesson.

Social workers are not the problem. Almost all of the social workers with whom I have worked over the years are good, hard-working people dedicated to helping others. Many are overworked and underpaid. Yet more social workers and more money will not solve the primary issues.

As for the Governor’s concern that releasing the names of people who report child abuse will cause people to be afraid to report it, I believe that, in the long run, we will protect more children if we focus on getting the Cabinet to respond to the reports that are made

Full disclosure is the only way the public can know whether reports of abuse have been ignored. The people of Todd County are painfully aware of the likelihood that a multitude of reports of suspected abuse were made by teachers and school officials about Amy Dye in the years before her death, several of which may have been mishandled or misplaced. I seriously doubt any of those who made reports would have allowed fear for their personal safety to keep them from speaking out. Their fear was for Amy.

Generally speaking, teachers and school officials who report child abuse are neither afraid for themselves nor ashamed of their actions. Fearful people have always, and will always, have the option to report suspected child abuse anonymously. I see no evidence that cowardice in reporting child abuse is a widespread problem.

Gov. Beshear is correct that the General Assembly should address these issues. I hope that the public outcry will continue and that its focus will be directed towards real issues and positive change. The Governor concluded his article by saying that he would continue to battle in court alongside the Cabinet and its lawyers. I urge Gov. Beshear to stop listening to the Cabinet’s lawyers and to start battling for the people of Kentucky. Our children deserve an open and accountable government

This week a LawReader reader informed us of HB 361, which if passed will impose on Kentucky a medical review panel.  We have read the
Kentucky bill and recognized the similarity of this draft with the existing law in Indiana.

The wording of the Kentucky bill is taken almost ver batim from a similar law in Indiana  (IC 34-18-10  – Chapter 10. Medical
Review Panel).

The main difference in the Indiana law and the proposed H.B. 361 is that the Kentucky bill would be applied only to claims
brought against “long-term-care facilities.”  The Indiana law applies to all medical malpractice tort claims.

Indiana to our knowledge is one of the worst environments for tort claims in the United States.

If H.B. 361 is adopted, the enemies of medical malpractice rights will in the future only have to change a few words in order
to completely adopt the Indiana law in Kentucky which will apply to all Medical Malpractice claims.

The proposed Kentucky bill will require an entire legal process before the Medical Review Panel would issue a ruling. This could
add at least six months of litigation to claims, and it is possible that it might add up to a year before a final ruling is issued.

The voting members of the Medical Review Panel will consist of three physicians.  While one attorney is on the panel he is denied voting rights.

We also note that all panel members will be entitled to “a reasonable fee’ to be determined by the “Kentucky Board of Medical Licensure” shall be paid to each of the panels physicians.   These
fees are to be paid by “the parties”.

This “reasonable fee” for each of the physicians does not include a fee he may charge if he is called as a witness at the med mal trial.

Many doctors charge in excess of $500 and their work in reading files, and attending hearings will almost certainly cost the parties
thousands of dollars in doctor’s fees.   Further they are awarded travel expenses.  The non-voting member of the Panel is to be
paid $250 an hour not to exceed $2000, plus his travel expenses.

The bill outlines numerous time periods in which motions must be made and evidence presented. Some of the time periods imposed
by the bill give the attorney as little as five days to respond after notice of certain actions are mailed to them.  This
is an invitation for errors and late filings, and potential lawyer malpractice claims.

So after the Medical Review Panel has rendered their written opinion what does it mean?

Well very little. The finding is not binding, but may be “…admissible as evidence in any action subsequently brought by the claimant in a court of law. However, the
expert opinion is not conclusive, and either party, at the party’s cost, may call any member of the medical review panel as a witness. If called, a witness shall appear and testify”.

It is reasonable to assume that the cost of the typical hearing process before the Panel reaches a decision will be in the neighborhood of $15,000 to $20,000 …and this fee must be paid before he filing of a lawsuit by the plaintiff.

Assuming three physicians charge “a reasonable fee of $500 an hour” and the minimum time they bill is ten hours, the bill would be $5000 X three physicians for a total of $15,000, plus $2000 for the panel
chairman – total $17,000.

For twenty hours billing per physician, the bill could easily come to $30,000, with another $2000 to the panel chairman.

It is reasonable to assume that the cost of the hearing process would average $27,000 plus court filing fees of several hundred
dollars per case.

If that fee is evenly divided between the plaintiff and the defendant, then a typical cost of the proceeding would be $13,500 for each party.

Of course, if you called one of the panel members to testify in your behalf at trial, you would have to pay a separate medical
expert witness fee.  We would opine that this would add another $3000 to $5000 to the cost.

Again remember that the final opinion of the Medical Review Panel is not binding on the civil court.

The final result of such a panel would be that the tort claim would be delayed from six months to a year, and each party would be
billed anywhere from $14,000 to $28,000.

Don’t forget, the members of the panel are all physicians.  Some would claim that is like making the “Fox the Warden of the Hen House.”

The Kentucky bill was introduced by:

SPONSORS OF: HB 361 (BR 1404) – M. Henley, D. Floyd, R. Bunch, J. Carney, B. DeWeese, J. Gooch Jr., R. Henderson, B. Housman, K. King, S. Lee, F. Nesler, T. Thompson, B. Waide, D. Watkins

We would suggest that this bill will financially harm the victims of medical malpractice in Long-Term-Care Facilities cases, and the final ruling of the panel will have little value.
We would ask if this bill is a plot to let the camel place his nose under the tent, and that in the near future the legislature will attempt to remove the limitations to “Long-Term-Care Facilities”, and to apply this law to
all medical malpractice claims.

The bill is expensive, imposes unnecessary delays in litigation, will vastly increase the work load of the parties, and the real intent of this bill is to price victims of malpractice out of the
courtroom.

One of the sponsors of H.B. 361 is Rep. Floyd from Bardstown.  He owns a long-term-care facility called Windsor Garden Retirement Community.  He is certainly in a good position to lobby
for this attack on victims of nursing home abuse. This bill, if adopted will provide a direct financial benefit to Rep. Floyd.  Another sponsor, Rep. DeWeese of Louisville, is a physician and general surgeon.

In a letter-to-the-editor of the Louisville Courier Journal published on Feb. 9, 2012, Robert Flatt the Central District Director of the Kentucky Association of health Care Facilities, writes that this bill if
adopted will “end frivolous suits”.  He incorrectly claims that Kentucky has no law that punishes frivolous from being filed.  He neglects to mention CR 11 which allows for
financial sanctions to be imposed against attorneys filing “frivolous suits” and for damages to be awarded against parties for “malicious prosecution” of civil claims.   He also ignores the
procedures for the courts to grant summary judgments in medical malpractice if the plaintiff fails to produce an expert witness who supports the claim of medical malpractice.   Flatt asks that
the legislature, “tell the trial attorneys to take their frivolous lawsuits elsewhere by supporting H.B. 361.”

This bill would limit “frivolous lawsuits” but it also limits legitimate claims by victims of nursing home abuse and malpractice.  The cost of this
unnecessary review panel is nothing more than a Trojan Horse submitted by the nursing home industry.

In other legislation supported by the medical profession, there is a bill which would repeal the current law that allows all patients of a physician to obtain one free copy of the medical records
accumulated by the physician who has treated the patient.  The cost of photocopying medical records by the physician is hardly a burden.  But the repeal of this free records law, is of great benefit to the doctors
patient.  The revelation of how the doctor recorded his treatment of the patient is the very information the patient and his attorney need to determine if the claim of the patient is
indeed frivolous.  This law protects the doctor as much as it does the patient.  The repeal of the free copy of medical records law is an apparent attempt by the
medical profession to hide their secrets from their patient.

If you have an opinion about this bill, you can contact your legislator at:

Find your legislator: http://www.lrc.ky.gov/Legislators.htm

By David Kramer | dkramer@dbllaw.com

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Eric Deters and Charles Lester Jr. have filed petitions for certitori review by the U.S. Supreme Court in a
case seeking damages against police who tasered the plaintiff some 35 times, and allegedly beat so severly that he has medical bills exceeding $100,000.

The police argue that the defendant resisted arrest and their conduct was proper, and was protected by qualified immunity.

To learn more about the case and to view the brief select on of the following links:

• Opinion below (6th Cir.)
• Petition for certiorari
• Brief in opposition

Petitions of the day,
SCOTUSblog (Jan. 23, 2012, 7:00 PM),

http://www.scotusblog.com/2012/01/petitions-of-the-day-3/

Sent from my BlackBerry
device from Cincinnati Bell Wireless

The petitions of the day are:

Sandel
v. Williams

Docket: 11-736

Issue(s): (1) Whether criminal proceedings that result in conviction
preclude a federal civil rights claim for excessive use of force, under
circumstances where the use of excessive force would provide a complete
affirmative defense to an offense of conviction in the forum where the
conviction is adjudged; and (2) whether a claim of excessive use of force is
barred on grounds of qualified immunity to the extent such claim is premised
upon allegations of fact that are conclusively rebutted by documentary video
footage of the incident giving rise to the claim.

Certiorari
stage documents:

Docket: 11-610

Issue(s): (1) Whether police officers’ conduct is “objectively
unreasonable” and therefore violates a clearly unarmed misdemeanant’s right to
be free from excessive force under the Fourth Amendment when the officers
stunned the misdemeanant thirty-seven times with a Taser, without warning, and
severely beat him with batons, while incapacitated, rather than securing him;
and (2) whether a court errs when it fails to consider the second prong of Saucier v. Katz if the plaintiff in a Section
1983 action can establish that a particularized constitutional right is clearly
established in other Circuits and its own, especially considering this Court’s
recent holding in Pearson v. Callahan , that the prongs need
not be considered sequentially?

Certiorari
stage documents:

• Opinion below (6th Cir.)
• Petition for certiorari
• Brief in opposition