I'm amazed that this comes from California and that it was reported in, of
all places, the New York Times. Perhaps there's hope for us after all.
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Leading Class-Action Lawyer Is Sentenced to Two Years in Kickback Scheme

By MICHAEL PARRISH

LOS ANGELES - William S. Lerach, a former partner of the law firm now known
as Milberg Weiss, was sentenced Monday to two years in prison and ordered to
forfeit $7.75 million for concealing illegal payments to a plaintiff in the
class-action lawsuits for which the firm became famous.

Mr. Lerach, 61, who pleaded guilty in October to a charge of conspiracy to
obstruct justice, appeared contrite before Judge John F. Walter of Federal
District Court, and called his conduct "felony stupid" in brief comments
before he was sentenced.

Mr. Lerach added that even at the time, "I knew what I did was wrong" but
that he lacked the "strength of character" to not join with other lawyers in
the scheme.
Judge Walter said that he would have liked to sentence Mr. Lerach to a
"substantially" longer prison term, but deferred to a plea agreement with
prosecutors that was reached Sept. 18, which called for a maximum of two
years. Had the case gone to trial, Mr. Lerach could have faced up to 50
years.

The judge said he was particularly concerned that Mr. Lerach and his paid
plaintiffs had lied to judges.

"What Lerach and others did goes to the core" of the legal system, Judge
Walter said, adding that Mr. Lerach, who accepted disbarment, would never
again be able to do "what he was obviously so good at."

Mr. Lerach, of La Jolla, Calif., admitted to an arrangement in which his law
firm made payments to people to be on call as plaintiffs in class-action
lawsuits that were filed against publicly traded companies when their stock
dropped in price.

Prosecutors for the United States attorney's office of the Central District
of California, who worked on the case for seven years, say that Mr. Lerach
and others lined up the plaintiffs ahead of time to gain an illegal
advantage over other law firms engaged in the same suits. By being
designated the lead plaintiff, the law firm stood to reap a larger share of
any eventual lawyers' fees.

In his guilty plea, Mr. Lerach admitted to concealing from federal judges
his secret payments to one such plaintiff, Dr. Steven G. Cooperman.

Prosecutors say that in more than 150 of the firm's class-action cases from
the 1970s to 2005, the law firm earned more than $216 million in lawyers'
fees, paying $11 million to these on-call plaintiffs. The bases for the
lawsuits were never in question.

"Mr. Lerach has stepped up and accepted responsibility," Mr. Lerach's
lawyer, John W. Keker, of Keker & Van Nest in San Francisco, told the court.
An assistant United States attorney, Robert J. McGahan, prompted a testy
exchange with the judge when he called the plea agreement a "reasonable
compromise" and added: "In several respects, Mr. Lerach is a volunteer."

Judge Walter responded: "Mr. Lerach was certainly not a volunteer. He didn't
come up and knock on the government's door."

"This whole conspiracy corrupted the law firm and it corrupted it in the
most evil way," Judge Walter added.

Mr. McGahan conceded: "I agree that Mr. Lerach wasn't on his way to
Damascus."

Much of the hearing, which lasted nearly two and a half hours, was devoted
to arguments over which sentencing guidelines, if any, the judge should
follow, or whether sentencing should be based on the plea agreement already
reached.

A presentencing report from the United States Probation Office for the
Central District recommended a prison term of 15 to 21 months. Prosecutors
called for 24 months, citing a different set of sentencing guidelines.

Judge Walter also agreed to a request by The Los Angeles Times and Bloomberg
L.P., on behalf of Bloomberg News, to release information from 23 letters of
support for Mr. Lerach that the judge had sealed to protect "confidential
medical information." All but the medical information will be released.

Describing Mr. Lerach as "an extremely hard-working attorney" who "cared
about his colleagues and his family," Judge Walter said it was difficult "to
reconcile the glowing letters with the seriousness of his conduct."

Mr. Lerach was also sentenced to two years of probation and 1,000 hours of
community service and ordered to pay a $250,000 fine in addition to
forfeiting the $7.75 million. He agreed not to appeal his sentencing, but
declined to cooperate with the government on forthcoming prosecutions in the
case.
He is to report for prison on April 21. Judge Walter agreed to request that
Mr. Lerach serve his sentence at a minimum-security federal prison at
Lompoc, Calif.
The remaining defendants are the law firm, Milberg Weiss; a former partner,
Melvyn I. Weiss; and Paul T. Selzer, a Palm Springs, Calif., lawyer who is
charged with laundering payments from the law firm to the on-call
plaintiffs. That trial is set to begin on Aug. 12.

Mr. Lerach and Mr. Weiss dissolved their partnership in 2004, and Mr. Lerach
opened his own practice in Southern California.