Stack sets hearings to hasten old nursing home bond case

By Steve Korris | Aug 26, 2008


To speed up a seven year old class action over nursing home bond issues in Indiana, Wisconsin and Michigan, Madison County Circuit Judge Daniel Stack plans a hearing for plaintiffs one day and a hearing for defendants the next day.

On Sept. 16, Stack will hear a motion of three bond buyers for certification of a class action against brokers, accountants, lawyers and a Chicago nonprofit.

On Sept. 17, Stack will hear a motion of Wells Fargo Bank, the law firm of Gilmore and Bell law firm, and the accounting firm of Blue and Company for summary judgment.

Bond buyers Al Kellerman, Lillard Hedden and William Tennison claim the defendants operated a "Ponzi scheme" that rendered their bonds worthless.

Their lawyers, from the firm of Motley Rice in Mount Pleasant, S.C., recently dropped almost 3,000 pages of expert reports on Stack's bench.

"It's a complicated case," Stack said at a June 11 hearing. "It's an old case but it is not an easy one," he said.

Nothing connects the case to Madison County but Motley Rice's decision to sue there, with the Edwardsville firm of Lucco, Brown, Threlkeld and Dawson as local counsel.

At the hearing Wells Fargo attorney Catherine Schroeder told Stack that plaintiffs submitted reports of experts after missing a deadline to identify the experts.

She moved to strike affidavits that the experts submitted with their reports.

Fred Thompson of Motley Rice responded that, "The defendants have made a mess and now they have come into court and said my heavens, it's a mess."

He said their summary judgment motion jumped a scheduling order by a year and three months.

Stack asked if plaintiffs would introduce the affidavits on both class certification and summary judgment, and Thompson said they would.

Blue and Company attorney Mark Bauman said an affidavit of expert Alan Frank simply relied on pleadings in the case.

Bauman said, "He makes several references to allegations directly from the complaint to support his opinions and conclusions."

He said Frank's affidavit was all based on hearsay.

"If Mr. Frank wanted to be really honest about this affidavit he should simply call it an amicus brief," Bauman said.

Stack said he hadn't seen the affidavits.

He said, "I don't think they should be stricken based upon your argument until I look at them."

He said he wanted to hear the motions in close proximity but not the same day.

Schroeder said he should hear class certification first, and Thompson said Stack should hear summary judgment first.

Stack said he would hear class certification first.

"There is no sense of you going through this preparation twice," he said.

Plaintiff expert Frank, an attorney in Elkins Park, Pa., specializes in personal injury and real estate.

Expert Bruce Dubinsky of Bethesda, Md., specializes in criminal and civil fraud and in commercial damages.

Expert James Tellatin of Chesterfield, Mo., specializes in real estate appraisal.

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