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Lawyer in Plea Deal Was Edwards Bundler
Legal Business | 2007/09/19 19:21

Though his former law firm came under indictment more than a year ago and he himself appeared likely to face criminal charges, prominent trial lawyer William S. Lerach slipped past the vetting of John Edwards' presidential campaign and was permitted to raise large amounts of money for the Democrat's 2008 bid. Lerach, his family and members of his new law Lerach Coughlin law firm accounted for nearly $78,000 in donations to Edwards' campaign in the first half of this year, making the trial lawyer one of the North Carolina Democrat's leading "bundlers" of contributions.

In the midst of that fundraising, Lerach negotiated behind the scenes for a plea deal that was consummated on Tuesday and will send him to federal prison for at least 12 months on a conspiracy charge involving his past legal work as partner in the Milberg Weiss law firm.

Through it all, Edwards stood by his fellow trial lawyer and even took an action this spring that was helpful to his longtime financial supporter in a government matter.

In May, Edwards used the bully pulpit of his presidential campaign to publicly pressure the Securities and Exchange Commission not to oppose Lerach's new law firm in a Supreme Court case over whether Lerach's lawsuits could proceed against banks on behalf of investors who lost millions in the collapse of energy giant Enron.

"The question for all Americans is whether their government will be on the side of those big banks or regular families," Edwards said in a statement released by his presidential campaign that was trumpeted on the Web site of Lerach's law firm.

All of this transpired while Edwards campaigned against what he calls a "corroded and corrupt" Washington system in which politicians raise money from special interests who then seek their help on government matters. To make his point, Edwards campaign is refusing any donations from lobbyists registered in Washington.

The latest salvo on that theme came Tuesday -- the day of Lerach's plea deal -- when top Edwards' aide Joe Trippi publicly criticized rival Hillary Clinton's campaign for hosting a fundraiser targeting companies and lobbyists seeking the government's multibillion dollar business.

"Too many in office have fallen under the spell of campaign money at any cost -- and do not see that when they defend the system, they are protecting those that have rigged the game that puts corporate profits ahead of the interests of working Americans," Trippi wrote.

Trippi's attack made no mention of Lerach, the Edwards' bundler, or the fact that Lerach had just reached a plea deal in a scheme prosecutors alleged involved kickback payments to plaintiffs in class action lawsuits he and his former law firm brought.

Lerach and his former law partner Melvyn I. Weiss were notified in the summer of 2005 that they had become targets in that lengthy criminal investigation, meaning they were likely to be indicted, according to lawyers involved in the case.

Court papers say that they employed the scheme for more than two decades in 150 cases that brought their firm more than $200 million in fees.

Milberg Weiss, the New York based law firm where Lerach served as a partner until a bitter parting in 2004, was indicted on conspiracy, mail fraud and money laundering charges in May 2006. Lerach and Weiss were not charged at that time but they were notified by federal prosecutors in Los Angeles that they continued to be the targets of their investigation. The firm is fighting the charges. Weiss himself has not been charged with a crime and maintains his innocence.

Political donations by Lerach and his partners, as well as a former expert witness named John Torkelson, came under investigators' scrutiny but the government has not filed criminal charges alleging they broke election laws.
In Lerach's Tuesday agreement to plead guilty to a conspiracy charge, Justice Department lawyers agreed not to prosecute him over "election, campaign, or other political contributions" related to the fees he and the firm collected as part of the alleged kickback scheme with plaintiffs and expert witnesses including Torkelson.

Edwards campaign said it donated Lerach's personal donations to charity yesterday after his guilty plea, but isn't returning the money he raised from others.

As for the statement Edwards issued favorable to Lerach's lawsuits earlier this year, Edwards spokesoman Colleen Murray said: "This position is consistent with John Edwards' longstanding support for protecting the retirement savings of middle class families and shared by many others, including the New York Times editorial page, Securities and Exchange Commission, Senate Banking Committee Chair Chris Dodd, and a coalition of consumer groups, to name a few."

Lerach is the latest bundler in the 2008 race whose background has raised questions about how carefully campaigns are vetting those who collect their checks.

Hillary Clinton's campaign earlier this month agreed to give back all $850,000 raised by bundler Norman Hsu after it was learned he had been a fugitive in a 15-year-old criminal case in California.

And Edwards already has faced question about another trial lawyer who raised money from him. Attorney Geoffrey Feiger was indicted on federal charges he conspired to route more than $125,000 in illegal contributions to Edwards' 2004 White House bid .Feiger, a trial lawyer who became famous for representing Dr. Jack Kevorkian during his assisted suicide controversy, has pleaded not guilty. Edwards' campaign said it knew nothing about the alleged scheme and cooperated with the Justice Department. But the campaign has declined to refund the donations in question, choosing instead to wait for the outcome of Feiger's trial to avoid influencing jurors.

"From Day One, the campaign has taken their lead from and cooperated fully with the Department of Justice," spokesman Eric Schultz told The Washington Post in an email earlier this month. "Once this prosecution concludes, if Geoffrey Feiger is found guilty, the campaign will donate all the money is question to charity."



Lerach admits role in kickback scheme
Legal Business | 2007/09/19 07:13
William Lerach, the lead attorney in a New York-based law firm that lodged a $1 billion class-action against the CNMI industry, has pleaded guilty to a criminal indictment filed in Los Angeles, California. According to a Washington Post report, the 61-year-old Lerach agreed to plead guilty to a charge of conspiracy to obstruct justice.

Lerach also agreed to pay the U.S. government fines and penalties of $8 million.

The report stated that under the terms of the plea, the lawyer will serve at least one year and no more than two years in federal prison. The plea agreement requires court approval, the report added.

The guilty plea deal ends a seven-year investigation into allegations that Lerach and his former law firm, Milberg Weiss Bershad & Schulman LLP, secretly paid people to serve as plaintiffs.

“I have always fought for my clients aggressively and vigorously in order to hold powerful corporations responsible when their actions harmed people,” said Lerach in a statement that was included in the Washington Post article.

Lerach said he regrettably crossed a line and pushed too far.

“For my actions, I apologize and accept full responsibility for my conduct,” he said.

According to a May 16, 2006 Wall Street Journal article, a New Jersey businessman pleaded guilty of taking secret payments as a plaintiff in Milberg class-action lawsuits between 1991 and 2005.

The businessman's guilty plea reportedly caused two top partners of Milberg to leave the law firm.

Milberg is known for filing shareholder class-action lawsuits in which investors go against corporate management with big money at stake.

In 2005, Milberg reportedly sued at least 75 companies for securities fraud. In 2004 and 2005, the law firm reportedly settled 90 cases and extracted more than $1.5 billion from investors.

In January 1999, Milberg and other law firms, on behalf of some garment workers, sued several garment factories on Saipan, alleging that workers were made to work in sweatshop conditions.

The garment owners branded the lawsuit as “embellished and unreal.”

After a costly litigations, the class-suit was settled in the U.S. District Court for the NMI. The combined settlement fund reportedly reaches close to $20 million. A total of $8.75 million went to plaintiffs' lawyers.


Two big Missouri law firms in preliminary merger talks
Legal Business | 2007/09/18 07:35

Two of Missouri’s biggest law firms - Blackwell Sanders Peper Martin and Husch & Eppenberger - are engaged in preliminary merger talks, both firms confirmed Monday.

The combination of the two would create a firm with 630 attorneys, ranking it second in size among Missouri-based law firms after Bryan Cave, which has about 800 attorneys worldwide.

Husch, which is based in St. Louis and has a 40-attorney office in Kansas City, has about 300 attorneys. It tallied $124 million in revenues last year, according to The American Lawyer, a legal publication.

Blackwell, which is based in Kansas City, has about 330 attorneys and grossed $116.5 million last year. About half the firm’s attorneys are based in Kansas City.

"Merger discussions are in their early stages, but our intentions are serious and the prospects for this strategic combination are exciting," said Dave Fenley, Blackwell chairman. "As with any merger talks, nothing is final until the deal is signed."

Blackwell is best known for its corporate, litigation, transactional, real estate, and labor and employment practices. Husch is best known for its litigation, commercial finance, environmental and bankruptcy practices.

Both firms have offices in multiple cities; the merged firms would have 16 locations in the United States and London.

Husch held preliminary merger discussions last year with Stinson Morrison & Hecker, another large Kansas City firm, but the talks fell through.

Its talks with Blackwell come little more than a year after eight estate planning attorneys left Husch for Lathrop & Gage, leaving a gaping hole in Husch’s estate planning practice in Kansas City.

Not long before that, four estate planning attorneys at Husch jumped ship for Blackwell, one of several instances in recent years of attorneys migrating from one firm to the other.

Although the cross-fertilization of attorneys may make a merger of the two firms easier to pull off, Fenley said that was not the impetus behind the proposed combination. Rather, he said, a consulting firm used by both firms - Hildebrandt International - recommended the marriage.

"They thought it was a very good fit," he said. "A merger would allow us to become more diverse and more sophisticated and would create greater depth. That’s what clients are looking for these days."



Law firms rethinking retirement age
Legal Business | 2007/09/14 07:40

How old is too old?

That's an issue facing lawyers across the country as the American Bar Association and state organizations consider proposals to eliminate mandatory retirement ages at many of the biggest and most prestigious law firms.
 
Forced retirement at an arbitrary age -- as early as 60 in some cases -- creates openings for new partners and helps firms avoid tough decisions on whether an older partner is still performing up to standards.

"It's easier to have a bright-line test" -- a clearly defined rule -- said Drew Berry, chairman of the executive committee at McCarter & English, New Jersey's largest law firm.

That way you avoid the difficult problem of making distinctions between two partners, he said. "How do you tell one he can stay and one that he can't?"

But forced retirement can also cost firms some of its most skilled and productive members, including some who might take clients with them, Berry said.

Last month, the ABA endorsed a recommendation from the New York State Bar Association that calls upon law firms to discontinue the practice. Law firms should evaluate senior partners individually based upon the performance criteria used to evaluate other lawyers in the firm, the ABA said.

"Senior lawyers should not be forced to leave their firms solely on the basis of age when they have many productive years left and are still making valuable contributions to the firm," said Mark Alcott, a past president of the New York bar association.

"Forcing lawyers to retire solely because of age, regardless of performance, regardless of objective criteria, is not an acceptable practice and not in the interests of the legal profession," he said.

Because law firms are partnerships, the partners are owners, not employees. As a result, firms can have mandatory-retirement policies despite laws that make them illegal for some of their clients.

But change may be coming.

"While young lawyers represent our tomorrow, we also have a cadre of experienced lawyers who still have much to offer our association and our profession," Lynn Fontaine Newsome, president of the New Jersey State Bar Association, said in a statement on the association's Web site.

She has endorsed a program to explore ways to "reengage senior lawyers so that we can all benefit from their accumulated knowledge and expertise, and enable them to continue to be active bar members."

That's what has happened at Hackensack-based Cole Schotz Meisel, Forman & Leonard, Bergen County's largest law firm, which has no mandatory retirement age.

"What we have is a very flexible arrangement," partner Steven Leipzig said. "We recognize that partners and senior members of the firm continue to make valuable contributions to the firm well into their 60s and 70s."

Name partners Morrill Cole and Edward Schotz are both in their 70s "and continue to practice law vigorously and make a valuable contribution to the firm," Leipzig said.

Absent forced retirement, the firm can attract older partners from smaller firms that will give them and their clients continuity, he said. "That certainly benefits the firm."

Practical considerations prompt some firms to rewrite their rules, as happened at Newark-based McCarter & English this year.

"Like many law firms, we are in transition," Berry said. "We have had for many, many, many years -- try 35 years -- a mandatory retirement age for equity partners of 70. That meant after age 70, you would cease being an equity partner. You could be 'of counsel,' meaning you kept your desk and secretary. But it was all very informal, and you didn't get paid" by the firm.

That system "seemed to work for the firm for a long, long time," but when faced this year with the loss of a highly regarded litigator, simply because he turned 70, the firm decided to change its policy, Berry said.

Attorneys must still retire as equity partners at age 70, but if they are "still in the game, want to keep working, and the law firm wants them to keep working," they can remain on an annual contract basis, he said. They no longer share in earnings and don't vote on firm matters, but are expected to continue practicing at high levels.

"Without falling over into cliches, compared with 25 years ago, some people are active and healthy and 'in the game,' " Berry said. "That's the relevant phrase for me as chairman of the firm. If they're in the game and they're engaged and they're doing well, what are you going to do?"



Restaurant group lauds N.Y. court decision
Legal Business | 2007/09/13 07:53

The Washington Restaurant Association, which opposes King County's plan to mandate that chain restaurants label their menus with nutritional information, is lauding a New York court decision that essentially strikes down a similar plan.

In U.S. District Court in Manhattan, a judge ruled in favor of the New York State Restaurant Association, which challenged a similar menu labeling plan enacted by the New York City Board of Health.

The Washington State Restaurant Association (WRA) applauded the New York court decision, with officials saying that King County's mandate that was enacted in July and takes effect next year is in jeopardy.

"We are hopeful that the findings in New York City will compel the King County board of health to come back to the table and work in partnership with the industry. While we believe obesity is an issue we must address as a community, the WRA strongly opposed the board's menu labeling requirement this summer," said Anthony Anton, WRA president and CEO, in a statement.

The King County board of health plan would require chain restaurants with more than 10 national locations to display calorie, fat, sodium and carbohydrate information on menus. Restaurants would have until Aug. 1, 2008 to put the information on menus and menu boards.



Jackson, DeMarco Expands Offices to 50,000 SF
Legal Business | 2007/09/12 05:09
The law firm of Jackson, DeMarco, Tidus, Petersen and Peckenpaugh has restructured and extended the lease on its headquarters at 2030 Main St., according to Studley. The law firm, which formerly occupied 34,358 sf in the building on a lease that began in 2002, has expanded to 50,773 sf and extended its lease by nine years.

Jackson DeMarco was represented by Studley's Royce Sharf, branch manager and executive vice president; Bruce Schuman, senior vice president, and Mike Props, managing director, all from Studley's Orange County office. Sharf and Props represented the firm on its original lease at the same location in 2002.

The law firm recently added 12 attorneys when it expanded its complex litigation practice, according to Sharf. "Maintaining the firm's ability to remain flexible and align its real estate occupancy needs with the business plan has been of paramount importance,” he adds.

The Studley brokers tell GlobeSt.com that Jackson DeMarco wanted to restructure its lease because the firm continues to grow and needed to lock down future expansion space. The deal allows the firm to grow in stages over the next couple years.

Terms of the new lease were not disclosed. Asking rates for space in the 2030 Main St. building, a 16-story tower of nearly 347,000 sf that was built in 1990, are $3.30 per sf per month.

The building's owner, the State Teachers Retirement Board of Ohio, was represented by CBRE's John Weiner in the new lease with Jackson DeMarco. The law firm also maintains an office in Westlake village.



Court upholds bondsmen's right to solicit business
Legal Business | 2007/09/10 11:58

With phone in hand and dialing finger at the ready, bail bondsman Carl Pruett turned out to be a faster gun than the uniformed folks in reaching people with outstanding arrest warrants. That got him in trouble not only with the law, but with his fellow bondsmen. Drumming up business by calling alleged criminals before they were picked up put the lives of officers in danger and gave the bad guys a reason to flee. And someone on the lam who is already carrying a bond could cost some other bondsman dearly.

Six years ago, the Harris County Bail Bond Board, which regulates the bond industry, told Pruett to stop calling. Officials said he was breaking a local rule that banned certain solicitations. And they threatened to suspend his license to do business.

Pruett fought back with a lawsuit against the board and Harris County and recently, after a protracted legal fight, a federal appeals court ruled he and fellow bondsman Scott Martin had a First Amendment right to consult public records, then solicit business by phone.

Calling times restricted

The 5th U.S. Court of Appeals ruled that state-imposed restrictions on "commercial speech" were unconstitutional, but agreed with the state law restricting solicitation calls between 9 p.m. and 9 a.m.

Essentially, Pruett and Martin used public records to troll for people with outstanding warrants, and then called them to offer their services.

Constable offices, the county and other municipalities use those same records to mail thousands of letters every month to people with open warrants for bad checks, unreturned DVD rentals, unresolved traffic violations and other nonviolent criminal cases.

The 5th Circuit ruled that Pruett and Martin had the same rights to contact those people.

"The statute does not prevent attorneys, law enforcement officials or anyone else from alerting someone that he's the subject of an open warrant," the court said. "Harris County cannot give such notice itself and then claim that restricting notice by others is necessary to the safety of its officers and the public and the prevention of flight."

County Attorney Mike Stafford said the county didn't create or enforce the state law, but intervened to prevent bondsmen from "tipping off" alleged criminals. He said protecting officers from possible violence is a legitimate objection and the county will likely appeal the latest decision to the U.S. Supreme Court.

David Furlow, who represents Pruett and Martin in the federal lawsuit, hailed the decision as a "vindication of First Amendment rights." But he said perhaps more importantly, the courts action sent a loud message to fellow bondsmen who saw Pruett and Martin as unscrupulous competitors.

"The largest bail bonding companies with large investments in Yellow Pages ads and large existing bases of criminal defendant clients, they wanted to restrict those and keep other bail bondsmen from contacting them," Furlow said.



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Class action or a representative action is a form of lawsuit in which a large group of people collectively bring a claim to court and/or in which a class of defendants is being sued. This form of collective lawsuit originated in the United States and is still predominantly a U.S. phenomenon, at least the U.S. variant of it. In the United States federal courts, class actions are governed by Federal Rules of Civil Procedure Rule. Since 1938, many states have adopted rules similar to the FRCP. However, some states like California have civil procedure systems which deviate significantly from the federal rules; the California Codes provide for four separate types of class actions. As a result, there are two separate treatises devoted solely to the complex topic of California class actions. Some states, such as Virginia, do not provide for any class actions, while others, such as New York, limit the types of claims that may be brought as class actions. They can construct your law firm a brand new website, lawyer website templates and help you redesign your existing law firm site to secure your place in the internet.
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