When he was on top of the world, flamboyant class-action plaintiffs lawyer William S. Lerach made more than $100 million during the 1990s for himself and even more for his now-disgraced firm, Milberg Weiss.
Silicon Valley tech executives shuddered and Fortune 500 chief executive officers reached for their checkbooks at the mere mention of being “Lerached.” At one point, Lerach boasted that he had won more than $4 billion in damages for shareholders in 400 class-action securities suits.
Lerach once called himself “the Willie Horton of securities law.” Bullying, foul-mouthed, he ran roughshod over corporations, fishing for real and imagined malfeasance against shareholders. His courtroom thrashings were aimed at such high-tech giants as Apple Computer, Symantec, Conner Peripherals, Intel Corporation and Seagate Technology.
At one point, Seagate’s former CEO admitted to The New York Times that he “has Lerach’s picture on my wall right in front of me, I hate him.”
And no wonder. Lerach even sued Mickey Mouse.
Lerach owns a lavish California mansion in the third-richest ZIP code in the nation, a neighborhood also home at various times to the singers Jewel and Juice Newton, brewer Joseph Coors, McDonald’s heiress Joan Kroc, and golfer Phil Mickelson.
At 12,500 square feet, the Tuscan-style house sits on 12 acres with a lemon grove, a swimming pool, a tennis court, and a walk-in aviary with hornbills and toucans. It is filled with American Indian art, modern sculpture, and an eclectic collection of other art from various galleries in the United States and Europe.
Lerach also owns vacation homes in Steamboat Springs, Colo., and in Hawaii, and often flew on a private jet. His immense, 18th-floor office sported a huge tropical fish tank, marble-topped bar and exquisite, panoramic views of the San Diego Harbor.
As a prolific and generous contributor to Democratic office holders, seekers and causes, he enjoyed sleepovers in the White House’s Lincoln Bedroom during Bill Clinton’s presidency, and once raised $400,000 at a single fundraiser at his mansion.
Between the years 1993 and 1995, he was the nation’s second-largest political donor, as he and his then-wife, Star Soltan, gave $480,083 to mostly Democratic candidates and causes.
With such prolific contributing, Lerach was able to rub elbows routinely with Hollywood celebrities like Barbara Streisand, Tom Cruise and Steven Spielberg who shared his political sympathies.
Now he sleeps in another federally owned bedroom, as federal convict #46683-112. The former star litigator is paid not the thousands of dollars per hour that he often garnered, but between 12 and 40 cents each hour, working about seven and a half hours per day — about half of the daily hours he formerly sometimes worked by choice. He reported May 19 to the low-security federal prison in Lompoc, Calif., to reside in one of the facility’s two military-style barracks shared with 351 other federal inmates.
He’ll be there for two years, having pleaded guilty in February to participating in a massive kickback scheme in which he and three other senior Milberg Weiss partners paid more than $11 million in bribes to plaintiffs in an estimated 150 cases, then lied about it in court filings. Federal officials say the firm got $250 million in tainted fees in the bribery scheme.
The scheme began in 1981 and continued until 2005 after the Justice Department’s multiyear investigation became known. Lerach’s sentencing judge called the scheme “evil” because it subverted the entire judicial system.
Lompoc is in an often foggy, inland valley an hour north of Santa Barbara. The nearby Santa Ynez River usually runs dry (at least above the ground), so Lerach likely sees no fish, tropical or otherwise. But he presumably hears lots of planes from the adjacent Vandenberg Air Force Base.
Lerach’s daily schedule is not his own. Lights come on at 6 a.m., breakfast 30 minutes later and work 30 minutes after that. Among the jobs for Lompoc inmates are food serving, orderlies, plumbing, painting, groundskeeping, warehouse work, or farming chores, according to Bureau of Prisons spokeswoman Traci Billingsley. Inmates can ask for a particular job, but must do whatever is assigned. Wages vary with jobs.
At 11 a.m., Lerach gets a half-hour lunch break. Work continues until 3:30 p.m. Dinner is at 5. Then, finally, comes a bit of somewhat free time. Until 10, inmates can use physical recreation areas, take advantage of various educational opportunities, or use the library.
A chaplain is available, and inmates write letters — all of which, except those to their lawyers, are subject to inspection by prison officials. Inmates can make phone calls — but only to people on a list pre-approved by prison officials, and no more than 300 minutes per month. They cannot accept incoming calls, but they can see pre-approved visitors.
At 10, the prisoners line up for the last of four or five daily official “counts” — after which, overhead lights go out. Inmates are able to keep small lamps at their beds. On weekends, lights stay on until 11.
At least the property doesn’t feature the well-armed patrols, walls, searchlights, towers, and multiple barbed-wire fences of the neighboring maximum-security prison for more dangerous criminals. Instead, a single fence marks the property line of Lerach’s new “home.”
The Examiner does not know what Lerach thinks about his change in fortunes. On July 18, he signed a prison form agreeing to a July 22 phone interview with The Examiner, and Warden Linda Sanders approved it.
But at the appointed hour, Lompoc Executive Assistant Katie Shinn called to report that Lerach “said he changed his mind. He does not want to give the interview.” Requested to reconsider, Lerach again declined, and signed another official form withdrawing his consent.
Ironically for somebody who owns a Hawaii vacation home he cannot now visit, Lerach once famously warned a defendant in a settlement hearing that “I’m going to take away your f***ing condo in Maui! I’m going to take away every penny you own.”
And in 2002, Lerach wrote a 27-page essay triumphantly claiming that then-recent accounting scandals showed that he had been right all along about corporate malfeasance. The essay’s title: “The Chickens Have Come Home to Roost.”
