If anyone doubted the utter depravity of the disgraced Milberg Weiss class-action plaintiffs’ law firm, the final proof came to light Monday on The Wall Street Journal editorial page. Readers should understand that this situation isn’t just a morality play about a single law firm, but is instead the backstory of how one deeply corrupt firm set the template for class-action securities lawsuit abuse generally.
It was already known that four former Milberg partners and several business associates were convicted of crimes relating to a vast, three-decade-long kickback scheme. The firm as a whole also had been under indictment until last month, when it agreed to pay $75 million in return for the Justice Department suspending the charges.
What the Journal reported Monday was that even after top partner Melvyn Weiss pleaded guilty to his crimes, the firm was scrambling to give him a sweetheart deal that could pay him well in excess of the $9.75 million he agreed to forfeit as part of his plea bargain with the government. With or without Weiss, this firm clearly has no shame.
At the very least, this corrupt bargain between the firm and Weiss appears to violate the spirit of Milberg’s subsequent agreement with Justice. A judge blessed that agreement, the Journal noted, “upon belief that the firm had disassociated itself from its criminal masterminds.” Yet future payments — or should we say payoffs? — of more than $10 million are anything but disassociation. Funny, that $10 million looks an awful lot like hush money. In form, at least, it recalls what criminal organizations call “omerta,” meaning a code of silence involving extreme solidarity against legal authorities.
What’s worse is that this code of silence seems to extend to the trial lawyers’ marionettes in the Democratic congressional leadership. When corporations such as Enron get involved in fraud, Congress rushes headlong into hearings. But a whole series of trial lawyer criminality, spanning Milberg, Dickie Scruggs and a host of others, has yet to inspire the congressional leadership to utter a peep of protest, much less convene the investigation that so clearly is called for by the facts.
Yet, when corporations are sued, their stocks lose value. Shareholders and pensioners suffer. And, as one example of terrible results, scores of good companies have closed their doors as a result of what later proved to be fraudulent claims of asbestosis — costing thousands of innocent workers their jobs. A Democratic Congress that does not lift a finger to rein in such abuses is complicit in the economic hardship that results.
