Legal Ethics

Fen-Phen Lawyer Should Be Disbarred, Disgorge $7.5M of His $20M Fee, Hearing Officer Suggests

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Updated: Unlike three colleagues who worked on the fen-phen diet drug litigation, Stanley Chesley is still an active practitioner. But that could change, if attorney disciplinary authorities in Kentucky follow a hearing officer’s recommendations in a report today.

Despite the prominent Ohio lawyer’s hitherto unblemished attorney disciplinary record, a former Kentucky judge serving as a trial commissioner in a legal ethics case against Chesley is recommending that he be disbarred in that state, reports the Cincinnati Enquirer. The newspaper links to a copy of today’s opinion (PDF)

Former Franklin Circuit Judge William Graham also recommends that Chesley be required to disgorge $7.5 million of the $20 million he was paid for helping to settle the case, reports the Lexington Herald-Leader.

Graham said the $20 million fee was “unreasonable,” explaining that it represented a 49 percent contingency fee, in violation of a contractual fee agreement that called for 21 percent to be paid upon successful settlement of the case. He also cited in his report, among other alleged ethical violations on Chesley’s part, the lawyer’s involvement in a 2002 meeting with a judge in the Boone Circuit Courthouse, “behind closed doors and off the record,” with “no notice given.”

The recommendations will now go to the Board of Governors of the Kentucky Bar Association and the Kentucky Supreme Court, which could accept or reject them.

In a written statement provided to the Enquirer, attorneys Scott Cox and Sheryl Snyder, who represent Chesley, expressed surprise and disappointment about Graham’s report and vowed to fight its recommendations.

“His findings are directly contrary to the findings of federal authorities, who fully investigated this case and never considered Mr. Chesley a target of their investigation,” the two lawyers say.

A Fox 19 article lists some of the high-profile matters in which Chesley has been involved over the years.

If Chesley were to be disbarred in Kentucky, that would trigger an Ohio attorney disciplinary case that likely would result in his disbarment there as well, Jonathan Coughlan tells the Enquirer. He serves as disciplinary counsel for the Ohio Supreme Court.

Earlier coverage: “How a Kentucky Solo Exposed the Fen-Phen Lawyers” “Kentucky Bar Investigates Ohio Plaintiffs Lawyer Stan Chesley” “Ken Feinberg’s Retracted Affidavit Cited in Appeals Ruling Favoring Fen-Phen Lawyers”

Updated at 11:11 p.m. to include Cincinnati Enquirer and Fox 19 coverage and link to additional coverage.

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