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Law Firm Calls Allegation 'Frivolous' Franklin Chief's Attorney Denies Conflict - Dec 13, 1988 - Omaha World-Herald

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Dec 13, 1988 Law Firm Calls Allegation 'Frivolous' Franklin Chief's Attorney Denies Conflict; [Sunrise Edition] Paul Goodsell. Omaha World - Herald. Omaha, Neb. pg. 8

Full Text (535 words)
(Copyright 1988 Omaha World-Herald Company)

Two stories on one Basis record.

Omaha attorney William Morrow denied Monday that it is a conflict of interest for his law firm to represent Lawrence E. King Jr. and called for sanctions against the attorneys who made the allegation.

In documents filed Monday in U.S. District Court, Morrow said the motion to disqualify the Erickson & Sederstrom law firm from representing King was "frivolous, unreasonable, without foundation and with ulterior motives."

Morrow also said in the documents that the action by the law firm of Fitzgerald, Schorr, Barmettler & Brennan "amounted to an unreasonable and vexatious expansion of cost in this matter."

The National Credit Union Administration, represented by the Fitzgerald firm, has filed a $34 million civil lawsuit against King, former chief executive of the failed Franklin Community Federal Credit Union.

Part of Lawsuit

The lawsuit alleged that Franklin, under King's direction, sold certificates of deposit to investors but did not record them on the credit union's books. King later used the money on personal and business expenditures, the lawsuit alleged.

As part of the lawsuit, the NCUA and its attorneys have sought to disqualify Erickson & Sederstrom from representing King because the firm has handled Franklin issues in the past. The NCUA filed its lawsuit against King in its role as Franklin's liquidating agent.

Morrow's response said the Erickson & Sederstrom firm has represented King for more than three years and has supplied legal advice and representation to Franklin and other corporations affiliated with King.

But the law firm has not represented Franklin "on any matter relating to the financial concerns or operations of the credit union" or "on any matter substantially the same as those involved in this proceeding," the response said.

Hearing Sought

Morrow said in an affidavit that when Franklin's interests became affected by "developments or proceedings in which the firm was representing Mr. King, the firm recommended and required" that Franklin hire its own attorney.

Morrow asked U.S. District Judge William Cambridge to hold a hearing on the disqualification motion and on Morrow's request for sanctions.

Attorney C.L. Robinson, who is representing the NCUA in the case, said he had not seen the court filing. After portions of the documents were read to him, Robinson said: "Obviously, we disagree with it in its entirety."

Ownership of Property At Apartment Disputed

An attorney for Lawrence E. King Jr. suggested to a federal judge Monday that he tell a court-appointed receiver for King's assets to stop trying to seize property at a west Omaha apartment.

Attorney William Morrow said the receiver, attorney Keith I. Frederick, should "restrain himself from any further actions regarding the property sold by Mr. King to Mr. Omar Tinsley on an installment contract."

Frederick was appointed receiver in a $34 million lawsuit filed against King, chief executive of the failed Franklin Community Federal Credit Union. The lawsuit was filed by the National Credit Union Administration.

Frederick received a court order last week to take possession of property in an Embassy Park apartment at 9405 Burt St. The apartment was leased by King's catering business.

U.S. District Judge William Cambridge has scheduled a hearing Friday to determine ownership of the property.

Lawyer Misconduct Real Estate

Credit: World-Herald Staff Writer

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