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Former top 40 lawyer loses $9 million
A prominent Arkansas plaintiffs lawyer has landed in hot water over his apparent inability to produce more than $9 million in settlement money he was overseeing for clients.
Kate Gibbs
A prominent Arkansas plaintiffs lawyer has landed in hot water over his apparent inability to produce more than $9 million in settlement money he was overseeing for clients.
Federal Court records show that lawyer Gene Cauley, who specialises in securities litigation, has “either misappropriated or otherwise misallocated these funds”, as New York federal judge Jed Rakoff put it. According to the transcript, the attorney informed his co-counsel last month that he could not produce about $9.3 (AUD$12.2) million in settlement funds that was supposed to be distributed to plaintiffs in April. Cauley’s criminal lawyer, John Wesley Hall, told the judge the missing settlement funds “are presently unavailable”, but declined to elaborate, citing his client’s privilege against self-incrimination. “I trust there will be a prompt investigation of this matter by the US Attorneys office,” Justice Rakoff said. The judged signed off with flourish, addressing the public’s common perception of lawyers, the Wall Street Journal reported. “When I hear people cracking lawyer jokes, I always take umbrage and point out that the profession of Lincoln, the profession of Madison and Jefferson often represents the highest ideals in our society,” he said. “But recent events give me pause about how true that is.” The National Law Journal listed Cauley as one of the “top 40 lawyers under 40” in the United States in 2005. “As countless corporations financially unraveled over the past few years, S. Gene Cauley has been co-counsel on several major securities cases and netted more than $200 million in settlements.
