Saturday, May 27, 2006

Has the Lawyer Flight Begun at Milberg Weiss?

The indictment of plaintiff class action law firm Milberg Weiss on conspiracy and mail fraud charges did not mean that the firm would necessarily go out of business, but the pressure from the indictment is starting to show.  An article in The Recorder (available on Law.Com here) notes that since the grand jury indicted the firm and two of its name partners on May 18, a member of the executive committee and two members of the management committee have announced plans to move to other firms.  One partner, the head of the corporate practice group, is leaving but has not announced plans regarding where he will practice next.  In a potentially more ominous sign, the health care group at Milberg Weiss, including two partners, six associates, and a staff lawyer will be moving in whole to another firm.  Coupled with the loss of partners have been moves to have the firm removed as lead counsel in various class actions, and the indictment will make it very difficult for Milberg Weiss to obtain new appointments as class counsel from judges leery of appointing a firm that may be convicted of fraud in relation to its representation in other class actions. If other practice groups and their leaders decamp from Milberg Weiss, the financial pressure on the remaining partners to fund the firm's ongoing litigation -- which can be an expensive proposition -- and the continuing expenses defending the indictment may be too great for it to survive.  Unlike Arthur Andersen, which could not survive a conviction, Milberg Weiss may be undermined by the fall-out from the indictment. (ph)

Fraud, Legal Ethics, Prosecutions | Permalink

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