More on this low life:
redherring.com
Another small piece:
I have no lawsuit
FOUR YEARS AGO we profiled William
Lerach, the San Diego-based king of
class-action securities lawsuits ("I have no
clients," Oct. 11, 1993). His firm, Milberg Weiss
Bershad Hynes & Lerach, files lawsuits,
supposedly on behalf of investors, when
companies don't meet analysts' expectations.
Companies usually settle rather than fight, with
little money going to individual
shareholders-and lots going to Lerach and
crew.
Lawyers are supposed to report to their clients,
but Lerach pretty much decides whom to sue,
when to settle and for how much. "I have the
greatest practice of law in the world," he said.
He even acknowledges saying, "I have no
clients."
His quote, as it turns out, had legs. U.S. Senate
and House committee reports picked it up and
used it two years ago to push limits on such
lawsuits. One reform established a presumption
that the lead plaintiff, who normally hires the
class lawyers, be the willing shareholder with the
largest financial stake. The Republican-led
Congress passed the reform into law. Bill Clinton
vetoed it-Lerach is a big Democratic
contributor-but Congress overrode the veto.
In August Dallas' chief federal judge, Jerry
Buchmeyer, specifically cited the Lerach quote
and our profile in denying Milberg Weiss clients
the right to be co-lead plaintiffs-and Milberg
Weiss, presumably, to be co-lead plaintiff
lawyers-in a class action against CellStar Corp.
Milberg Weiss' clients owned just 58,000
shares. The plaintiff-the State of Wisconsin
Investment Board-alone owns more than 1.6
million shares.
Every once in a while a FORBES story makes a
difference.
-William P. Barrett
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