Legal News

Milberg Weiss files 5 motions to dismiss kickback charges

By Jason Siegel

Los Angeles -- Milberg Weiss filed five motions this week to dismiss the federal government?s kickback charges. The firm?s founding partner, Melvyn Weiss, has joined in most of the motions.

Prosecutors allege that Milberg Weiss and seven of its lawyers, including Weiss, paid more than $11 million in illegal kickbacks to lead plaintiffs.

In one motion, Milberg Weiss denies that the firm deliberately withheld a fax that was subpoenaed in 2002 as part of the government¹s investigation. In September, prosecutors brought obstruction-of-justice charges against Milberg Weiss and Weiss, claiming they failed to provide the fax. Prosecutors also claim that Weiss lied to prosecutors about the location of the fax but later provided the document from a safe at Milberg Weiss.

The fax, dated more than 12 years ago, was sent to then-Milberg Weiss partner David Bershad from Steve Cooperman, a named plaintiff in several Milberg Weiss cases, and relates to an arrangement in which Weiss agreed to pay Cooperman $175,000 for having served as a plaintiff in a case. Weiss disguised the payment as a refundable option on the purchase of a painting owned by Cooperman called ?Reclining Nude,? by Pablo Picasso, according to prosecutors.

Cooperman and Bershad pleaded guilty last year. In its motion filed this week, Milberg Weiss said: ?The count must be dismissed because the undisputed fact is that Mr. Weiss did produce the document to the government. The government cannot prosecute the defendants for obstructing justice by failing to produce a document that Mr. Weiss produced.? Further, the firm cannot be held liable for the actions of a partner in personal matters, Milberg Weiss adds.

In separate motions, the firm refutes the government?s ?honest services? mail fraud theory, noting that ?the alleged scheme caused no tangible harm to any cognizable victim,? particularly class members and shareholders. Milberg Weiss also asserts that the indictment alleges a conspiracy when in fact it details separate schemes involving several different plaintiffs. And the firm disputes that it violated New York?s commercial bribery statutes or paid plaintiffs for their testimonies. The firm also disputes a money laundering count. U.S. District Judge John Walter, who is overseeing the Milberg Weiss case, rejected similar motions brought by Milberg Weiss last year.

- Amanda Bronstad

Full post as published by Legal Pad | LA on January 17, 2008 (boomark / email).