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By PORAC | October 1, 2013 | Posted in Chairman's Message

Chairman’s Message

LDF Chairman

As you may have already been advised, on September 8, 2013, the LDF Board of Trustees received the findings and opinions of an independent certified fraud examiner. Based on the report, the Trustees unanimously concluded that the former panel law firm of Lackie, Dammeier, McGill & Ethir (“LDME”) had committed serious acts of misconduct regarding its billing practices, causing financial harm to the Legal Defense Fund.

As a result of this conclusion, the LDF Board of Trustees voted 4–1 to remove the law firm of LDME from the LDF panel of approved providers effective immediately. LDF will ensure that there is no interruption in the legal services provided to those members with open cases currently being represented by LDME.

Consistent with their duty of providing members with the accurate and appropriate information, the Board of Trustees desired to disclose certain facts that were revealed during the course of this recent investigation. These facts were set forth in an email to the LDF members dated September 10, 2013.

To reiterate, the Trustees concluded that LDME engaged in repeated and systematic over-billing, which includes:

  1. Submitting invoices to LDF claiming to have billed more than 24 hours in one day.
  2. A single attorney engaged in billing 4,275 hours of attorney time from January 1, 2012, through December 31, 2012. To put this in perspective, the next highest non-LDME panel attorney billed LDF 2,590 hours during that same year. The difference between these two is 1,685 hours. The average annual billable hours for a full-time LDF panel attorney is between 1,800—2,000 hours.
  3. Admitting to engaging in not only impermissible double billing but also acts of “triple billing,” meaning working on three separate clients’ cases simultaneously, billing LDF three times for the same period of time spent.
  4. Billing travel time (including extra time for “traffic”) and mileage for trips that did not occur.
  5. Practicing law and billing LDF for a period of time the license to practice law had been suspended.

The independent certified fraud examiner hired by LDF found, “The cumulative nature (month after month, year after year) of billable hours and time entries that do not appear to reflect reality is suggestive of indicia of fraud.” Given the extended period of time over which these widespread acts of over-billing have occurred, numerous experts have estimated the potential damages to be quite substantial. Continued analysis and investigation to more precisely quantify the losses to LDF will be undertaken.

The Board of Trustees takes its responsibility to recover these funds very seriously and to hold those people responsible fully accountable for their actions. The Board is currently evaluating its legal options.