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Unreasonable Fee: 'Master of Disaster' Stanley Chesley Disbarred

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By Robyn Hagan Cain on March 22, 2013 12:59 PM

When you develop a reputation as the “master of disaster” for winning billions of dollars for tort victims, you have to expect that the those people you defeated in court will delight in watching you fall.

The people who had a bone to pick with “famed tort lawyer” Stanley Chesley must be rather delighted this week. Thursday, the Kentucky Supreme Court permanently disbarred Chesley for accepting an “unreasonable” $20 million fee on a $200 million settlement, the ABA Journal reports.

And there's more bad news for Chesley: The Courier-Journal reports that it is "virtually automatic that Chesley will be disbarred" in Ohio, too. According to the Ohio Supreme Court's disciplinary counsel, no Ohio lawyer has ever been permanently disbarred in another state without being disbarred in Ohio as well.

Chesley is not the only lawyer to take a hit in the Fen-Phen litigation. William Gallion and Shirley Cunningham Jr. were convicted of wire fraud and wire fraud conspiracy after reportedly taking more than their agreed-upon rate of 30-to-33 percent plus expenses in the cases. The 440 clients in the class action lawsuit should have received $135 million; instead, they were left with $74 million while the lawyers walked away with the lion's share of the sum.

Compared to the $106 million that Gallion and Cunningham claimed, Chesley's $20 million fee looked like pocket change. Nontheless, it was more than he was entitled to. The Courier-Journal reports:

[The] hearing officer who recommended Chesley's disbarment found that he was "fully aware" that most of the settlement didn't make its way to the victims and should have known by "fifth-grade arithmetic" that he had been paid $7.6 million more than he was entitled to under his contract.

Let this be a reminder. Gordon Gecko may be a pop culture icon, and greed might even "be good," but an unreasonable fee is a guaranteed way to jeopardize or even kill your career.

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