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Commonwealth of Massachusetts

NO. BD-2007-115

IN RE: JOHN J. GRADY

S.J.C. Order of Indefinite Suspension entered by Justice Botsford on December 10, 2007, with an effective date of January 9, 2008.1

SUMMARY2

Between 2002 and 2005, the respondent was retained by a third-party insurance administrator (TPA) to represent certain clients of the TPA as monitoring counsel in toxic tort litigation against a number of the clientsí insureds. The TPA administered the clientsí payments to the respondent for his services.

From about 2003 through the summer of 2005, the respondent submitted bills to the TPA for payment by the clients. These bills included claimed fees for fictitious services and for expenses that had not been incurred in closed or non-existent cases. When he submitted the bills, the respondent intentionally misrepresented his services and expenses to the TPA and the clients for the purpose of receiving funds to which he knew he was not entitled. The respondent thereby converted to his own use $250,000 of his clientsí funds. In addition, the fees charged by the respondent and collected from the clients were clearly excessive.

During about the summer and fall of 2005, the TPA conducted an audit of the respondentís bills, discovered the fictitious charges, terminated the respondentís services, and, on behalf of the clients, made demand on the respondent to account for and return payments to which he was not entitled. Between about December 2005 and June 2006, the respondent made restitution of the converted funds to the clients.

The respondentís conduct in submitting and procuring payment of fraudulent bills and in converting $250,000 of client funds violated Mass. R. Prof. C. 8.4(c). His conduct in charging and collecting a clearly excessive fee violated Mass. R. Prof. C. 1.5(a).

The respondent was admitted to the Massachusetts bar in 1969 and had no history of discipline. He assumed inactive status in January 2006.

The matter came before the Board of Bar Overseers on a stipulated recommendation for an indefinite suspension and the respondentís acknowledgement that the facts and rule violations alleged could be proved by a preponderance of the evidence. On December 10, 2007, the Supreme Judicial Court for Suffolk County entered an order for the respondentís indefinite suspension with the suspension to take effect on January 9, 2008.


FOOTNOTES:

1 The complete Order of the Court is available by contacting the Clerk of the Supreme Judicial Court for Suffolk County.

2 Compiled by the Board of Bar Overseers based on the record before the Supreme Judicial Court.



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