Remember all those shortie gurus that used to know when a class action was going to be filed?
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'King of class actions' pleads guilty in payments case
usatoday.com
By Edward Iwata, USA TODAY
Securities-fraud attorney William Lerach, a champion to shareholders and a bane to businesses for decades, pleaded guilty on Tuesday to a federal charge that he and others tried to conceal secret payments to plaintiffs in shareholders' lawsuits.
Lerach, a legal lightning rod known as "king of the class actions," was charged in federal court in Los Angeles with conspiring to obstruct justice and to making false statements under oath.
Lerach, 61, admits in a plea agreement with the U.S. Attorney's Office that he and other Milberg Weiss partners made payments to plaintiffs who were promised 10% of the attorneys' fees in the lawsuits. The payments were kept secret from judges in the cases, according to the plea agreement.
Lerach will forfeit $7.8 million, pay a $250,000 fine and accept a one- to two-year prison sentence, but he's not required to cooperate with the investigation. He will be arraigned in the next few weeks, prosecutors said.
In a statement, Lerach said, "I have always fought for my clients aggressively and vigorously in order to hold powerful corporations responsible when their actions harmed people. However, I regrettably crossed a line and pushed too far. For my actions, I apologize and accept full responsibility for my conduct." Lerach pioneered securities-fraud lawsuits, suing Apple, Enron and hundreds of other companies since the 1980s, winning billions in judgments and settlements for investors.
FIND MORE STORIES IN: Justice | Milberg Weiss | David Bershad
But corporations accused him of cranking out lawsuits with no merit, and venture capitalist John Doerr called him an "economic terrorist." In 1995, Congress passed a hotly debated litigation reform act that made it harder to file shareholders' lawsuits.
Lerach's plea deal comes amid the Justice Department's ongoing, six-year investigation into Lerach's former law firm, Milberg Weiss. Last year, the firm and two former partners were indicted on bribery, fraud and perjury charges.
The indictment alleged that the firm and former senior partners David Bershad and Steven Schulman paid millions of dollars in kickbacks to people for serving as plaintiffs in class-action lawsuits. Bershad pleaded guilty earlier this year to a conspiracy charge, while Schulman goes to trial in January.
Lerach formed another law firm in San Diego two years ago called Coughlin Stoia Geller, but he resigned last month.
Coughlin Stoia Geller said that plea deal "categorically, definitively and unequivocally confirms that this firm has no exposure or liability in the matter."
Lerach's supporters defended him Tuesday. Jon Haber, CEO of the American Association for Justice, a trade group for trial lawyers, said, "Corporate America will try to exploit this in a cynical attempt to roll back consumer, pension fund and shareholder legal rights."
Posted 15h 17m ago
Updated 12h 13m ago
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