Memorandum

City of Lawrence

Legal Services Department

TO:	David L. Corliss, City Manager
FROM:	Toni Ramirez Wheeler, Director of Legal Services
CC:	Jonathan Douglass, Assistant to the City Manager Ernie Shaw, Interim Director of Parks and Recreation
Date:	September 6, 2007
RE:	Memorial Park Cemetery Litigation

In late July 2007 the Attorney General’s office filed a third amended petition in the case, State of Kansas ex rel. Paul Morrison v. Mike W. Graham & Associates, L.L.C., et al..  The Petition seeks to dissolve the cemetery corporation and transfer title of Memorial Park Cemetery to the City of Lawrence pursuant to the Kansas Cemetery Corporation Act, K.S.A. 17-1366 et seq. The City has been the temporary receiver of the cemetery since May 2005 under an order of the Douglas County District Court. 

In the third amended petition, the state has reduced the number of claims against the defendants from seventeen (17) to four (4).  The claims brought by previous Attorney General Phill Kline alleging deception and unconscionability have been omitted.  A new claim for failing to supply products purchased by Kansas consumers under the Consumer Protection Act has been added.  The remaining claims include allegations of violating the Cemetery Corporations Act and the Cemetery Merchandise Act.  In the third amended petition, the State is no longer pursing Mr. Graham’s wife and daughter.  Three defendants remain: Mr. Mike Graham, Mike W. Graham and Associates, L.L.C., and Lawrence Memorial Park Cemetery Corporation, L.L.C.  According to the Douglas County District Court, the defendants have not yet filed answers with the District Court. 

A staff person from the Kansas Secretary of State’s Office has been conducting a thorough audit of the cemetery files that were located in the office when the City assumed control of the cemetery.  The audit began on July 24^th and is expected to conclude on September 7, 2007.  The Secretary of State’s office will advise the Attorney General’s office of its findings from the audit.  Attorney General Morrison’s office is reluctant to enter into settlement negotiations without sufficient information regarding the financial operations of the defendants in the case. 

Since May 2005 the City has been maintaining the cemetery with general funds.  Through August 31, 2007, our expenditures totaled $223,781.  Upon the advice of the offices of the Attorney General and the Secretary of State, the City has begun selling burial spaces at the cemetery.