Kentucky Supreme Court orders that fen-phen attorney be disbarred

bmusgrave@herald-leader.comMay 21, 2010 

FRANKFORT — The Kentucky Supreme Court on Thursday unanimously ordered that fen-phen attorney Melbourne Mills Jr. be permanently disbarred from the practice of law.

The Kentucky Bar Association Board of Governors voted in January to recommend disbarment after Mills was found guilty of 17 of 23 ethical charges.

Thursday's order also says that Mills must pay $35,773 for costs associated with the disciplinary hearings.

Mills' disbarment is the latest twist in the case, which started in 2001.

Mills, William Gallion and Shirley Cunningham Jr. were charged with conspiring to steal millions of dollars from 440 clients they represented in a 2001 Boone Circuit Court case over whether the diet drug fen-phen had damaged the clients' hearts and lungs. Mills was acquitted by a federal jury of all charges in July 2008.

But Gallion and Cunningham were retried and convicted of stealing millions of dollars, then trying to cover it up. Gallion and Cunningham settled with the Kentucky Bar Association and have been permanently disbarred. All three were temporarily suspended in 2006 while the bar investigated claims against them.

James Shuffett, an attorney for Mills, argued in a January hearing before the Kentucky Bar Association Board of Governors that Mills should be punished for his role in the fen-phen case but should not be permanently disbarred.

Mills was the least culpable of the three lawyers, Shuffett argued. Mills was not part of the day-to-day negotiations regarding the settlement because he had a drinking problem at the time. Mills did not even know that the settlement was for $200 million until months after it was reached, Shuffett said. Mills thought the settlement was only for $150 million, Shuffett said.

When Mills found out that the settlement was much higher, he made Cunningham and Gallion return some of the money to the clients, Shuffett said.

But a hearing officer ruled, among other findings, that Mills never told his clients the total amount of the settlement and never reported to the clients that other lawyers on the case were withholding some of the settlement money.

Shuffett said at the January hearing that Mills, 79, did not want to practice law but wanted to retain his license because he had been a member of the bar for 50 years.

Shuffett said Thursday that the Supreme Court's decision was not a surprise. Mills could not afford to appeal the January Kentucky Bar Association decision. The state Supreme Court generally follows the recommendations of the bar unless an appeal is filed, Shuffett said.

Shuffett said that because of a more than $42 million civil judgment against his client, it's unlikely that Mills will be able to afford to pay the $35,773.

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