According to a recent ruling in the case of Counsel Financial Services v. Melkersen Law, Counsel Financial Services, an institution that specializes in loans for legal firms to help finance litigation, was within their rights to call in a loan they made to Michael J. Melkersen once they discovered the money they leant him was in part being used to fund his poker bankroll.

Coverage of the recent case, which can be found at The National Law Journal website (www.nlj.com), seems to suggest that Melkersen believed that the loan was available for him to use as he saw fit, and since he has had success playing poker over the years, the money used in that regard could reasonably be expected to increase his overall profits, thus making it a perfectly acceptable way to use some of the funds.

Melkersen argued that auditors from Counsel Financial gave him the distinct impression that some of the money could be used for personal expenses and how he used that money would barely be noticed as long as he continued to make his monthly payments on time - which he did. As such, Melkersen believes Counsel Financial breached their loan agreement when they prematurely called in the loan.

Unfortunately for Melkersen, Western District of New York Judge Richard J. Arcara disagreed, and ruled with U.S. Magistrate Judge H. Kenneth Schroeder Jr., who recommended the court grant summary judgement to the lender and reject Melkersen's attempts to begin a counterclaim against Counsel Financial.


Story by Mark Anderson