Congress blind to four guilty pleas 

Mel Weiss threw in the towel Thursday and copped a plea in the Justice Department’s prosecution of the firm that bore his name for decades. Weiss and three former partners — William Lerach, David Bershad and Steven Schulman...

Mel Weiss threw in the towel Thursday and copped a plea in the Justice Department’s prosecution of the firm that bore his name for decades.

Weiss and three former partners — William Lerach, David Bershad and Steven Schulman — were charged in 2006 with multiple felony counts in connection with an $11.7 million kickback scheme. The Justice Department said the scheme netted the firm at least $200 million in tainted fees in an estimated 150 securities class-action lawsuits against Fortune 500 and other firms beginning in 1979.

Lerach, Bershad and Schulman previously pleaded guilty, as did two kickback recipients. Weiss joined them by pleading guilty to one count of conspiracy. Under the deal announced Thursday, the government will recommend that the court impose a 33-month prison sentence and three years of probation. Weiss also agreed to pay a $250,000 fine and to make restitution of $9.75 million.

It is puzzling that Congress seems so uninterested in this case, which first came to public attention in January 2002. As the Justice Department observed Thursday, the Milberg Weiss "kickback scheme lasted 25 years and had a severely detrimental effect on the administration of justice across the nation as lies were routinely made to judges overseeing significant cases."

It is impossible not to wonder what else might have been false in the Milberg Weiss cases. The answer to that question is critically important because Milberg Weiss pioneered the securities class-action lawsuit and for decades has provided the template for other plaintiffs’ firms. And Lerach, who enters federal prison today, said he paid kickbacks because "everybody was paying plaintiffs." Doesn’t anybody in Congress wonder about copycat crimes?

The explanation for the silence on Capitol Hill may have something to do with the fact that Milberg Weiss and its four former partners were extremely active and generous donors to Democrats in Congress, Democratic campaign committees and political action committees such as Emily’s List.

As The Examiner’s Quin Hillyer reports elsewhere in today’s edition, nine of the most reliable congressional opponents of proposals to curb class-action lawsuit abuse received substantial contributions from Milberg Weiss. Some of these legislators are now returning the contributions or giving them to charity.

Most of the recipients — including the top recipient, Sen. Hillary Clinton — refuse to answer questions about what they plan to do with the dirty money. If the silence is to be broken, it should start with Senate Judiciary Committee Chairman Patrick Leahy and House Judiciary Committee Chairman John Conyers — after they rid themselves of the nearly $8,000 they got from Milberg Weiss, that is.

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Staff Report

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A daily newspaper covering San Francisco, San Mateo County and serving Alameda, Marin and Santa Clara counties.
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