KENTUCKY BAR ASSOCIATION V. MELBOURNE MILLS
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MODIFIED: AUGUST 26, 2010
ENTERED : MAY 20, 2010
TO BE PUBLISHED
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2010-SC-000148-KB
MOVANT
KENTUCKY BAR ASSOCIATION
V.
IN SUPREME COURT
MELBOURNE MILLS
RESPONDENT
OPINION AND ORDER
The Board of Governors of the Kentucky Bar Association has
recommended to this Court that Respondent, Melbourne Mills, Jr., KBA
Member No . 48720, be permanently disbarred as a result of numerous
violations of our Rules of Professional Conduct. Mills was admitted to practice
law in Kentucky on April, 18, 1958, and his last known bar roster address is
Barrister Hall, 163, E. Main Street, Ste . 103, Lexington, KY 40507. We agree
with and adopt the Board's recommendation .
The original twenty-three charges against Mills stem from his actions in
two cases . One of the charges comes from his failure to properly answer
interrogatories in William H.
Tucker v. Adrian Park. 1
1 Fayette Circuit Court, Case No. 98-CI-3185 .
His failure to properly
respond led to the case's dismissal. The twenty-two other charges stem from
his actions during Darla Guard, et. al. or Jonetta Moore, et. al. v. A.H. Robins
Company, et. al.2 Most of these charges are related to a series of dishonest and
fraudulent acts in the handling of a $200,450,000 aggregate settlement of the
claims of 440 clients . Mills's co-counsel in this case have already been
permanently disbarred . See Cunningham v. Kentucky Bar Association, 266
S.W .3d 808 (Ky. 2008) ; Gallion v. Kentucky Bar Association, 266 S .W.3d 802
(Ky. 2008) .
After initial investigations by the Inquiry Commission, the twenty-three
charges against Mills were presented to Trial Commissioner Marcia Ridings .
She entered findings of fact and conclusions of law which found Mills guilty of
seventeen of the twenty-three charges, and recommended that Mills be
permanently disbarred.
Pursuant to SCR 3 .370(6), the Board of Governors decided, by a vote of
fourteen to one, that the findings and conclusions of the Trial Commissioner
were supported by substantial evidence and not clearly erroneous, and that the
punishment of permanent disbarment was appropriate. We will now outline
each of the charges the Board of Governors found Mills guilty of:
1 . Mills violated SCR 3.130-1 .3 during his representation of William
Tucker by failing to comply with the Fayette Circuit Court's pretrial
orders, by failing to supplement his prior responses to discovery
requests, and by failing to properly manage his client's case .
2
Boone Circuit Court, Case No. 98-CI-795
2 . Mills violated SCR 3 .130-1 .4(a) by failing to adequately communicate
with the clients he represented in the Guard case . He never informed his
clients that he certified the case as a class action, or that he
subsequently had the class action decertified . He also never informed
them of the true nature of the settlement that had been reached with the
defendants .
3 . Mills violated SCR 3 .130-1 .4(b) by delegating most of the
responsibility of dealing with his clients in the Guard case to his
secretary/ paralegal. He also knew that the people to whom he delegated
authority were not fully informing his clients of their rights under the
settlement agreement.
4 . Mills violated SCR 3.130-1 .5(a) by taking in excess of $100,000,000 of
the total settlement amount as attorney's fees for himself and his cocounsel. This amount represented a far greater percentage of the
settlement amount than the actual contingency fee agreed to by the
clients .
5. Mills violated SCR 3 .130-1 .5(c) by failing to provide his clients with a
written statement explaining the outcome of the matter; to provide each
of his clients with an accounting stating how the client's settlement, the
attorney's fees, and reimbursement for costs were calculated ; and to
provide correct information as to the method of determination of the
client's portion of the settlement .
6. Mills violated SCR 3 .130-1 .5(e) by dividing the attorney's fees
amongst himself and his co-counsel by a method not in proportion to the
services performed; by not giving his clients the opportunity to approve
or object to the participation of all of the attorneys in the case; and by
retaining an unreasonable amount of the settlement for attorney's fees .
7 . Mills violated SCR 3 .130-1 .8(a) by acquiring an ownership interest in
the settlement funds beyond his written fee agreement. This was
accomplished when he and his co-counsel devised or participated in a
method of distribution which made their attorney's fees greater by
convincing their clients to accept less then their allotted settlement
amount. The attorneys then pocketed the difference between the
settlement amount the client was to receive and the amount the
attorneys convinced them to receive.
8 . Mills violated SCR 3 .130-1 .8(g) by failing to explain to his clients that
the defendant made a lump sum settlement offer to the entire group of
clients and that the attorneys would be responsible for determining the
amount of money each client would receive from the total settlement
amount .
9 . Mills violated SCR 3 .130-1 .86) by acquiring a proprietary interest in
the litigation created by his co-counsel's unethical and dishonest scheme
which vested Mills with a financial interest directly in opposition to that
of their clients. This interest existed because by convincing their clients
to accept less money for their settlement, the amount which the
attorneys got to keep increased.
10 . Mills violated SCR 3 .130-1 .15(b) by failing to turnover to his clients
funds to which they were entitled and by failing to provide his clients a
requested accounting of the distribution of the total settlement as well as
the individual client's settlement distribution .
11 . Mills violated SCR 3.130-2 .1 by failing to exercise professional
judgment independent of his co-counsel regarding the distribution of the
settlement funds to clients . Mills was aware of and had misgivings about
the propriety of the settlement distribution to his clients but took no
immediate steps to stop it .
12 . Mills violated SCR 3 .130-5 .4(a) by sharing his fees in this case with
a paralegal he employed at his law firm and a non-lawyer consultant .
13 . Mills violated SCR 3 .130-8 .3(c)3 by deceiving his clients into
accepting the individual settlement amounts devised by a fraudulent
method; misrepresenting to the Boone Circuit Court that his clients had
agreed to donate a substantial portion of the total settlement received to
charity; failing to inform the Boone Circuit Court that he had contingent
fee contracts with all of his clients which set a specific fee; providing, or
assisting in providing, false or misleading information to the Boone
Circuit Court about the fees and expenses, as well as the manner in
which the settlement had been reached by each of his clients; and
3 Now SCR 3 .130-8 .4(c)
misappropriating, or participating in the misappropriation of, his clients'
funds and the subsequent cover-up .
14. Mills violated SCR 3 .130-5 .3(a) by failing to have in effect policies
and procedures to ensure that his non-lawyer employees were acting in
accordance with the lawyer's ethical duties in their dealings with clients
and discussions about settlement matters.
15 . Mills violated SCR 3 .130-5 .3(b) by failing to appropriately supervise
his non-lawyer employees in order to ensure that their conduct was
compatible with his ethical duties in their dealings with the clients and
discussions about their cases, their settlement, and the creation of the
charity.
16. Mills violated SCR 3 .130-5 .3(c) by being professionally responsible
for any and all of the misconduct of his non-lawyer staff in this case.
17. Mills violated SCR 3 .130-5 .1(c) by being professionally responsible
for any and all of the misconduct of his co-counsel in the Guard litigation
that he ratified with knowledge . Two of his co-counsel, Cunningham and
Gallion, were disbarred for their conduct and he is responsible for their
actions since he knew of their actions, but took no steps to prevent them.
CONCLUSION
Upon a review of the record, we agree with the Board of Governor's
findings and in light of the numerous ethical violations adopt their
recommendation to permanently disbar Mills .
ACCORDINGLY, IT IS HEREBY ORDERED that:
1) Mills is found guilty of violating SCR 3 .130-1 .3, SCR 3 .130-1 .4(a),
SCR 3.130-1 .4(b), SCR 3 .130-1 .5(a), SCR 3.130-1 .5(c), SCR 3 .130-1 .5(e),
SCR 3.130-1 .8(a), SCR 3 .130-1 .8(g), SCR 3 .130-1 .86), SCR 3.130-1 .15(b),
SCR 3 .130-2 .1, SCR 3 .130-5 .4(a), SCR 3 .130-8 .3(c), SCR 3 .130-5 .3(a), SCR
3 .130-5 .3(b), SCR 3 .130-5 .3(c), and SCR 3 .130-5 .1(c) (1) ;
2) For these violations Mills is hereby permanently disbarred from the
Kentucky Bar Association. Mills may never apply for reinstatement to the
Bar under the current rules ;
3) Mills, in accordance with SCR 3.390, shall notify all Courts in
which he has matters pending and all clients for whom he is actively
involved in litigation and similar matters, of his inability to continue
representation ;
4) Mills shall immediately cancel and cease any advertising activities
in accordance with SCR 3.390;
5) In accordance with SCR 3 .450, Mills is directed to pay all costs
associated with these disciplinary proceedings in the amount of $35,773 .97
for which execution may issue from this Court upon finality of this Order.
All sitting. All concur.
ENTERED : May 20, 2010 .
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2010-SC-000148-KB
KENTUCKY BAR ASSOCIATION
V.
MOVANT
IN SUPREME COURT
RESPONDENT
MELBOURNE MILLS
ORDER MODIFIYING OPINION
The Motion of the Kentucky Bar Association, to modify the Opinion and
Order, rendered May 20, 2010, is hereby GRANTED .
The Court, modifies the Opinion and Order to reflect the following : the
word "class" is deleted from the sentence in Paragraph 8 that reads, "Mills
violated SCR 3.130-1 .8(g) by failing to explain to his clients that the defendant
made a lump sum settlement offer to the entire class of clients . . . ." and in its
place, the word "group" is inserted, so that as modified the sentence reads,
"Mills violated SCR 3 .130-1 .8(g) by failing to explain to his clients that the
defendant made a lump sum settlement offer to the entire group of clients . . .
." Paragraph 13 is also modified by adding a footnote to note that SCR 3.1308 .3(c) is now SCR 3 .130-8 .4 . The attached pages 4 and 5 are substituted in
lieu of the original pages 4 and 5 .
All sitting. All concur.
ENTERED : August 26, 2010.
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