Updated with correction explained here.
Recall that the Luckey and Wilson cases were claims for asbestos fees, and (with some variations) that the proceeds of those long-owed fees were spent by Scruggs as an involuntary investment in the tobacco litigation. Ultimately, Luckey collected in a judgment before Magistrate Judge Davis on the asbestos fees but not a share of the tobacco litigation.
Scruggs charged his fellow tobacco lawyers a share of the fees to fight those cases (I can see that, because he was protecting the tobacco fee from their constructive trust claims). But once done in Luckey he charged his compatriots for the pay-back of the loan he took out to pay the Luckey judgment.
They didn’t like it and have filed suit, a suit that’s been posted on the YallPolitics site. There’s a huge amount of interest there, and I’ll be posting more about it The thing that caught my eye first was a letter (among the exhibits to the complaint) from Rex DeLoach, an accountant who has handled Scruggs’s financial affairs, to two of the tobacco lawyers, in which he expresses his and Dickie Scruggs’s shared contempt for the federal bench (or at least some members of it– presumably Judge Lee who retained the federal court Wilson and Luckey cases, and perhaps Magistrate Judge Davis, before whom Luckey was originally tried). DeLoach, after retiring from Arthur Anderson, was a Vice Chancellor for Administration and Finance out at Ole Miss under Chancellor Khayat.
Here’s what Rex DeLoach says in a letter to Scruggs’s fellow tobacco lawyers:
The nature of the Luckey/Wilson litigation makes their situation appear somewhat different from the others. Wilson’s is somewhat different; Luckey’s is not. Luckey’s and Wilson’s cases would have long since been gone except for the tobacco fee award and the decision by the federal judiciary to accept and retain the cases. The federal judiciary accepted and retained the case because of the tobacco fee award, and I believe, as does Dick, with ill intent.
Emphasis supplied. DeLoach then calls the decision to go before Magistrate Davis in Luckey a “grevious error” and the award “obscene and sickening”.
Oh, and in addition to deducting the defense costs and the Luckey judgment pay-off, Scruggs deducted the $3M that went to Langston and Peters.
Good catch, YallP Intern Alan!
In Dickie’s world “with ill intent” means “to do justice” and to not genuflect before his millions.
Southman, I just did a long post on something like that theme.
Once upon a time there was an accountant who left an accounting firm in medium to large size Southern city and went to work for a university. The accountant, however, retained a pecuniary interest in his former firm. While working for the university, at every opportunity possible, when any outside reports or studies or audits, etc., etc., were needed by the university — sometimes even things the university could have done in-house — the accountant funneled the university’s business to his old firm. The university paid the firm, thus increasing the value of the accountant’s pecuniary interest in his former firm. There are some descriptive terms for arrangements like that. There’s also an old saying about ‘bird of a feather.’
And Observer@ 11:44, a very courageous University Attorney finally put a stop to it. She remains my hero to this day, Quiet and gentle with nerves of steal! Go up to campus and see what the accountant’s nicknames are…”Dr. Death” comes to mind.
Spill the beans please. I did not know this and received an accy degree from Ole Miss. Are you referring to JD?
From what I know about Robert Khayat, he shared and still shares Scruggs’ and DeLoach’s contempt for the federal judiciary.
Khayat’s reign was full of arrangements like that of DeLoach. It would be interesting to see the list of boards Khayat sits on in his fake retirement.
When did Dr. D. leave the University and go to work for Scruggs?
Mrs. D was going to be Scruggs’s expert in the Wilson trial. They were both working for Scruggs well before that. By 2006 certainly, but that’s the latest possible– it could have been well before that.
What’s the significance of the date, A Lurker?
No Miss, I am confident RK holds no contempt for the federal judiciary. Don’t lump him into that category with the few who do.
DeLoach was not just any partner at Andersen. He was the managing partner of the Memphis office, and he was also a “senior” Andersen partner. There were only a handful of Andersen partners worldwide who were allowed that designation and the financial benefits that followed from it. He made Andersen’s Memphis office the most profitable, on a per partner basis, of any Andersen office in the World. Andersen rewarded him handsomely. The office’s clients included giants like Fed Ex, International Paper and Promus Hotel Corp. When he retired from Andersen, he began work at Ole Miss for compensation that was a small fraction of what Andersen paid him. The work that Ole Miss gave Andersen while DeLoach was at Ole Miss was relatively insignificant to Andersen or even the Memphis office. DeLoach’s motivation for the changes he made at Ole Miss was not pecuniary. He was simply very dedicated to the University. The back office functions of the University were sub par when he got there. He wanted the University to operate more efficiently.
There are several bags of beans that could be spilled relating to matters mentioned in this post.
Just sitting here wondering when ‘appearance of impropriety’ become ‘conflict of interest,’ and when ‘conflict of interest’ becomes a ‘kickback.’
Folks, GOB deals have been going on at the University of MS for a long time, and still continue to this day (although it is getting harder and harder for them to get away with such things —- it is a lot less open these days, and even more behind the scenes). This will not change until we have a major, overdue house cleaning within our administration. The current Chancellor Jones is RK’s hand-picked successor —any pretense of a real “national search” having been conducted for this key post is belied by the facts and GOBism confirmed by RK’s new “retirement” post as “consultant” to the Chancellor. The new Chancellor is nothing more than an interim figure head, with the same folks as before still in charge of things. I had hoped (perhaps naively) that RK’s retirement would have triggered a true national search for a highly qualified candidate, with an ensuing house cleaning of a lot of dead wood in the administration, and a fresh start with new, competent, creative people with lots of energy to pick up where the old guard left off (and plans to sit for a while patting themselves on the back) and move aggressively forward. This did not happen, and won’t for at least another decade.
These revelations about our accounting program come as a surprise to me. I am a graduate of UM’s accountancy program and have a masters degree in accountancy from UM (one of the first classes after the masters program was created). I had great respect and admiration for all of my professors who taught me well — and still do. UM’s accountacy program is considered to be one of the best in the nation. So, forgive me if my fondness for the professor being talked about so cryptically in this thread leads me to demand more details before I would be inclined to accept such at face value. My BS detector is on high alert.
AFOTL, I think the cryptic talk is about an accountant, not a professor of accountancy.
In response to NMC at 9:40 p.m., the relationship between Deloach (and Andersen’s Memphis office) and Scruggs reaches back into the 1990′s.
NMC, the successive posts made by Observer @11:44, A Lurker @9:36, and osa canuc @2:46 led me to think otherwise. It seemed that they were referring to a certain accounting professor who was affectionately called “Dr. D” by accounting students and sometimes “Dr. Death”; and whose name fits the initials “JD”. Hopefully, they did not actually intend to refer to the professor I thought they were discussing. That is why my BS detector went up. It had nothing to do with your comment to start this thread.
NMC, the successive posts made by Observer @11:44, A Lurker @9:36, and osa canuc @2:46 led me to think otherwise. It seemed that they were referring to a certain accounting professor who was affectionately called “Dr. D” by accounting students and sometimes “Dr. Death”; and whose name fits the initials “JD”. Hopefully, they did not actually intend to refer to the professor I thought they were discussing. That is why my BS detector went up. It had nothing to do with your comment to start this thread.
A Friend of the Law, I was merely asking for clarification on the individual being pilloried. I have no idea who it is other than the suggestion that his nickname is “Dr. death”. I asked if it was “JD” since he is a “Doctor”. I see now these folks appear to be speakng about someone else which makes more sense. I too have an accy degree and have utmost respect for the fine folks at our school. The accolades about OM’s School of Accountancy are well deserved. Pillorying someone associated with it in an anonymous fashion is unacceptable. But, NMC suggests it is not someone with the school which is good to hear.
“Dr. Death” did not refer to any professor. UM was trying to determine who would do the entire information package back then… It was a HUGH change in operations. Dr. Death was supposedly trying to steer it one way but after some intervention the deal went to SAP but there was some talk at the time that maybe that was not a clean deal either. I just watch as a worker bee, I am not privy to the internal workings of such decisions.
afotl at 11:11am, Your comment is totally correct. RK personally suggested to several people that they apply for the position of chancellor to replace him, while being fully aware that Jones was already selected to be the new chancellor. This was done, of course, to create multiple applicants for the position so that it would appear to be a “national search.” Those applicants now feel that they were duped—which they were.
observer at 11:09am, there are several bags of beans that could be spilled about matters mentioned in this post.