Trials & Litigation

Top court reinstates $42M award against 3 lawyers who plundered $200M fen-phen settlement

After six years of litigation, it appears that over 430 plaintiffs are back on track to collect a $42 million verdict against three lawyers who took more than their fair share of attorney’s fees from a $200 million settlement of diet-drug litigation.

Reversing an intermediate appeals court, which had ruled in 2011 that a trial was required, the Kentucky Supreme Court on Thursday unanimously upheld a judge’s initial award against now-disbarred Lexington attorneys Shirley Cunningham Jr., William Gallion and Melbourne Mills Jr., according to the Associated Press and the Courier-Journal.

The supreme court also agreed with the judge, in its Thursday opinion (PDF), that similar breach-of-contract and fiduciary duty claims made in a lawsuit against a fourth now-disbarred lawyer involved in the fen-phen case, former class-action specialist Stanley Chesley of Cincinnati, must be tried.

The path is now clear for that case to proceed to trial in Boone County, Ky., plaintiffs’ attorney Angela Ford tells the newspaper. Her clients believe Chesley masterminded the fraud and cover-up that stripped them of their rightful award, she said, and hence “we will be seeking a very large verdict on punitive damages.”

Attorney Sheryl Snyder is one of the lawyers representing Chesley. She said he is pleased that the courts have differentiated his conduct from that of the other lawyers involved in the fen-phen settlement and expects that the result of the ongoing case will also reflect that distinction, the Courier-Journal reports.

Lawyers representing the other three fen-phen attorneys did not immediately respond to requests for comment.

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