Monday, June 2, 2008
Today's Wall Street Journal reports that prosecutors are close to reaching a $75 million deal with Milberg LLP, although both sides declined to comment. Here's an excerpt:
If the amount under discussion in the Milberg talks holds, the government will be able to claim more than $100 million in fines and penalties in the case -- factoring in the more than $30 million that other defendants in the case have agreed to pay. That total figure would make the case one of the largest-netting prosecutions of a law firm. Last year, Jenkens & Gilchrist, a now defunct Dallas firm, agreed to pay $76 million to resolve a federal tax-shelter investigation.
Milberg has asked Coughlin Stoia Geller Rudman & Robbins LLP, a powerful San Diego law firm that spun off from Milberg several years ago, to chip in part of its payout in the settlement, but the Coughlin firm has refused, say two people familiar with the matter. The Coughlin firm hasn't been charged in the case.
Since its 2006 indictment, Milberg has lost many lawyers and considerable business, but it has continued to earn fees, including some large sums from its previously filed class actions. This year, it was paid more than $120 million as part of a settlement of a class action alleging securities fraud at Tyco, according to two lawyers in the case.