Milberg LLP in settlement talks over kickback scheme charges: report Mike Rosen-Molina at 5:37 PM ET
[JURIST] US law firm Milberg LLP [firm website], formerly Milberg Weiss, is in negotiations with federal prosecutors to settle accusations related to an alleged kickback scheme, sources told Reuters on Tuesday. The firm pleaded not guilty [JURIST report] in 2006 to fraud and conspiracy charges for allegedly paying up to $11.3 million since 1984 to individuals to serve as lead plaintiffs in class-action and shareholder derivative lawsuits. The lead plaintiffs were allegedly promised 10 percent of the attorney fees eventually gathered by the firm.
Earlier this month, firm partner and co-founder Melvyn Weiss pleaded guilty [agreement, PDF; JURIST report] to one count of racketeering conspiracy in connection with the kickback scheme. Weiss' sentencing is scheduled for June 2; he faces up to 33 months in prison. In February, former partner William Lerach was sentenced to two years in prison for his part in the scheme; he pleaded guilty last year to conspiracy to obstruct justice after reaching an agreement [JURIST reports] with prosecutors in September. Three individuals pleaded guilty in connection with the scheme in May 2006 after the firm was indicted [JURIST reports]. Partner David J. Bershad pleaded guilty [JURIST report] to conspiracy charges in July 2007. Reuters has more.
Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible, ad-free format.