Another victim in the Kentucky fen-phen settlement fraud

by Ted Frank on June 1, 2008

The press is starting to catch on to the scandal of Judge Bamberger not being charged in the Kentucky fen-phen settlement scandal, and we have criminal trial updates after the jump.

Little noted: while the attorneys stole at least $65 million from their clients, it’s very likely that they stole at least that much from Wyeth in getting a class certification in a personal injury case:

On the stand, [Bamberger] played the country judge who was in over his head in his first class-action lawsuit. But the evidence painted a shabbier picture.

It showed a judge who boasted about having the heaviest caseload in the state – perhaps because he was a plaintiffs’ judge, hand-picked by the fen-phen lawyers to take their side. On tape in his courtroom, Bamberger ranted about being “embarrassed” by low jury awards in Northern Kentucky.

At another taped hearing, Bamberger badgered the drug company’s attorney and pushed the plaintiffs’ case. He gave his local lawyer friends the class-action status they wanted, multiplying the liability jackpot.

Bamberger admitted that top class-action judges “said I shouldn’t be doing this, that it was not a class action.”

(Peter Bronson, “Even fen-phen horse has its own lawyer”, Cincinnati Enquirer, Jun. 1). Bronson also has more details on the bullying and buyout of an objecting plaintiff and appears to be the first print media to note that Bamberger has fingered Stan Chesley as being just as involved in the scam as the three Kentucky lawyers in the dock.

The WSJ Law Blog reports that the trial was delayed for a day due to health problems with defendant Melbourne Mills, who claims that the entire scam happened while he was hospitalized for alcoholism.

Separately, on Friday, legal assistant Rebecca Phipps testified that William Gallion told her to destroy documents; she denies claims that she threatened plaintiffs with jail for disclosing settlement terms. (Andrew Wolfson, “Diet-drug case witness says lawyer wanted documents destroyed”, Louisville Courier-Journal, May 31).

Two American Home Products defense attorneys refuted the plaintiffs’ attorneys claims that they were saving money in the $200 million settlement to handle future claims; AHP paid additional moneys to new claimants. One of the plaintiffs has testified that the firm told her to lie about where she got her settlement money from. (Andrew Wolfson, “Key diet-drug witness expected,” Louisville Courier-Journal, May 31).

What sort of straws are the criminal defense attorneys clutching at? “Phipps also acknowledged that she had exaggerated her role in the case when she asked the presiding judge to put her on the board of a charitable fund to which $20 million in settlement funds were transferred. [Gallion's lawyer, O. Hale] Almand suggested that she lied so she could get $5,000 a month in director’s fees, as the lawyers were getting, but she said it was not about the money.” Aside from the humor of the “not about the money” claim, it’s interesting that the criminal defense attorneys are trying to discredit witnesses by indicating that they also wanted to steal money from clients for themselves.

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06.04.08 at 1:54 am

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1 Clem 06.02.08 at 12:54 pm

Not that it is critical to your post, but I believe the Bronson article from which you quote was his editorial comment.

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