Legal Ethics

Paralegal Testifies Fen-Phen Lawyer Told Her to Destroy Documents

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A legal assistant testified Friday that a lawyer accused of misappropriating fen-phen settlement money told her to destroy legal documents showing how clients were paid.

Rebecca Phipps said she ignored the directive by lawyer William Gallion and instead locked the records in a cabinet and hid the key, the Louisville Courier-Journal reports.

Gallion is charged with conspiracy to commit fraud along with lawyers Shirley Cunningham Jr. and Melbourne Mills Jr. They are accused of keeping $45 million in settlement money for themselves and putting another $20 million into a charity they controlled.

Phipps’ testimony was among the most dramatic of the trial, the Cincinnati Enquirer reports.

On cross-examination Phipps said she was promised immunity from prosecution and was not required to return $1.4 million in fees she was paid by the lawyers. She worked for Mills and said he was drinking “around the clock” when the case settled. Mills’ lawyers have argued he was so impaired by alcohol that he was not aware of any illegality, the Kentucky Post reports.

Phipps said Mills believed Cunningham and Gallion had tried to cheat him out of his fair share of the fees. She said he was furious with Gallion because he told him the settlement was only for $150 million, $50 million less than the actual number.

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