June 26, 2005
Are Milberg Weiss and William Lerach The Next Targets?
The Milberg Weiss firm, in its various incarnations, is one of the leading plaintiff securities class action and shareholder derivative firms in the country. The firm and William Lerach, once a name partner and now the lead partner at Lerach Coughlin Stoia Geller Rudman & Robbins, may be the unindicted coconspirators in the prosecution of Seymour Lazar for accepting kickbacks in connection with his service as a representative plaintiff in various civil cases (see earlier post here). The indictment refers to "a New York law firm with principal offices in New York and California," which certainly is a description of Milberg Weiss before it broke up in May 2004. Milberg Weiss had represented Lazar as one of the representative plaintiffs in class actions, including Churchill Village LLC v. GE, In re MCA Shareholder Derivative Litigation, In re Xerox Corp. Securities Litigation, and In re Biogen Securities Litigation; the firm also represented the plaintiffs in a class action against Hertz in California in which one Adam Lazar was the named plaintiff (Lazar v. Hertz Corp.). An article in The Recorder (here) states that the government is trying to pressure Lazar, who is accused of using family members in addition to himself as the representative plaintiff, to cooperate against Milberg Weiss and Lerach. In a statement, Milberg Weiss asserted that "[w]e are outraged that these allegations have been made against the firm and reject them as baseless." (See AP story here) This case could get a whole lot more interesting, and have a major impact on the securities bar, if some of the leaders of that bar -- who are also large political contributors in the fight against restrictions on class actions -- are linked to improper payments. (ph)
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