The insurance company that provided malpractice coverage to jailed Nashville attorney John E. Clemmons is asking a federal judge to declare they have no responsibility to help pay back his victims who lost more than $1 million.
If the judge agrees, the amount Clemmons’ victims would receive could be smaller than expected.
In a suit filed last week in U.S. District Court in Nashville, lawyers for the Hanover Insurance Company stated that Clemmons’ policy does not apply in cases where he broke the law. Clemmons pled guilty in Davidson and Rutherford counties to theft from his clients.
Clemmons is currently serving an 18-year prison sentence at the state prison at the Charles B. Bass Correctional Complex in Nashville.
In its complaint, the insurance company cited several provisions of the policy they say Clemmons violated, including “any intentional, dishonest, criminal, malicious or fraudulent act or omission.”
The suit cites pending legal actions against Clemmons in three Davidson County cases, his guilty pleas to theft charges and the suspension of his license to practice law.
“Clemmons admitted his misappropriation,” the suit states.
Though the move by the insurance company was not unexpected, one of the lawyers who now represents some of the victims says he is concerned that some may never be fully repaid. The malpractice policy could have provided an estimated $300,000.
“I’m worried about it,” said Paul Gontarek, who was appointed to take over some of the cases by Probate Judge David “Randy” Kennedy.
An even grimmer assessment came from Michael Hoskins, who represents the heirs of another former Clemmons client.
“The estate’s prospects for a full recovery are bleak because Clemmons apparently blew all the money financing his lavish and reckless lifestyle,” Hoskins said in an email response to questions.
Prosecutors in the Clemmons criminal cases have stated that Clemmons spent his clients’ money on gambling at casinos in a number of states.
Court records show that bond insurance that Clemmons was required to purchase has provided at least partial reimbursement in three of the cases including the one being handled by Hoskins.
The victim in Rutherford County, Russell Church, has been repaid all that he was owed, a little over $120,000, according to court officials. Church’s was the first case to become public.
Gontarek said his next step will be to get judgments against Clemmons in the cases of Donald E. Griggs and William C. Link.
“Then we’ll attempt to recover from him personally,” said Gontarek.
The victims also can collect from the Tennessee Lawyers Fund for Client Protection, but the maximum amount that can be claimed for any one attorney, regardless of how many victims there are, is $250,000.