Lawyer Loses Claim to Class Action Fees

By Jim Hannah
Cincinnati.com
August 27, 2012

http://news.cincinnati.com/article/20120827/NEWS010704/308270083/Lawyer-loses-claim-class-action-fees

A Northern Kentucky lawyer and past president of the Kentucky Bar Association has lost her battle to share in the about $18.5 million in fees famed Cincinnati attorney Stan Chesley received from the Diocese of Covington sex-abuse settlement.

The Kentucky Supreme Court ruled on Thursday that Barbara Bonar, who has a law office in Covington, was not entitled to a portion of the attorney's fees in the class-action settlement.

An attorney for Chesley, James Gary of Louisville, said he was pleased with the decision but declined further comment.

Bonar sued Chesley, his firm and another lawyer in the firm, Robert Steinberg, five years ago in Boone Circuit Court. She claimed Chesley forced her out of the sex-abuse litigation and refused to pay her for critical work that brought about the class-action settlement. The roughly $84 million settlement was distributed among about 200 people, with the amount each received determined by the severity of the abuse.

The justices upheld a lower court's ruling that Bonar voluntarily withdrew as co-counsel and therefore wasn't entitled to any of the fees. The high court also let stand a finding that Bonar committed numerous ethical violations during her participation as co-counsel, which would have constituted grounds for removal and forfeiture of any fees due.

The trial judge was upset that Bonar tried to represent victims in the class-action litigation while also representing victims settling claims on an individual basis. She collected $1.3 million in lawyer fees for 25 individual claims totaling about $4 million, according to court records. That hurt the remaining members of the class because it drained money from the diocese that could have gone to settle the class-action litigation, the trial judge said.

Bonar has argued that the lower court judge was unfair to her because he said from the bench that the bar association had requested all records in the sex-abuse case once it was resolved. The trial judge said he would have referred the case to the bar association, regardless of the request, due to "numerous ethical problems" he perceived.

Bonar and her attorney, William Rambicure of Lexington, couldn't be reached for comment, but have vigorously disputed in court that Bonar committed ethical violations. In doing so, Bonar's lawyer made repeated references to alleged ethical violations he said Chesley committed in other cases.

The Kentucky Supreme Court is considering a state bar association recommendation that Chesley be disbarred for taking excessive fees and covering up colleagues' misconduct in a $200 million settlement reached in 2001 between makers of the diet drug fen-phen and those who suffered health problems from it.

It appears troubles started between Bonar and Chesley in September 2003 when Chesley filed a memorandum in the sex-abuse case claiming the diocese was continuing to place sexual predators in positions involving contact with children.

"Evidently, Bonar was uncomfortable with the allegations contained in the memorandum and was unaware that the class claim would implicate existing programs in the diocese," Justice Bill Cunningham wrote in the opinion. "It is clear that Bonar wished to distance herself from these allegations because it jeopardized her relationship with her client base and her professional colleagues."

Chesley had argued that Bonar objected to the memorandum because it created a conflict with the diocese that was referring her clients to negotiate individual settlements. The diocese, at the time, was opposing the class-action litigation because its public policy was reconciliation. Chesley's lawyers said for that policy to be accepted the diocese needed to maintain there was no active cover-up.