The Washington Post is reporting that Bill Lerach is leaving his firm Lerach Coughlin, which he formed three years ago in a celebrated split from Milberg Weiss. The article by Carrie Johnson suggests that Lerach's departure might be linked to the reported decision by former Milberg partner David Bershad to explore possible cooperation agreements with prosecutors in the government's ongoing investigation of alleged improper payments to securities class action plaintiffs:
In May 2006, the Milberg Weiss law firm and partners Steven Schulman and David J. Bershad were indicted by the U.S. attorney in Los Angeles on multiple criminal charges stemming from what prosecutors called a more than 25-year-long scheme to pay people to serve as plaintiffs in large class-action lawsuits. At least one former client has been assisting the government with that case. The firm has been fighting the charges, and the individual partners, who held high-ranking positions and earned tens of millions of dollars in their heyday there, have presented a forceful defense.
Bershad may be interested in exploring settlement possibilities with the government, according to an article on the Wall Street Journal's Web site last night. The Journal reported that he may cooperate with prosecutors in exchange for leniency at sentencing.
Johnson also points to the link between Lerach and the pending Stoneridge case that Ted wrote about in today's Wall Street Journal:
As recently as last week, Lerach was prodding regulators. He published opinion pieces and joined with prominent union leaders to press the Securities and Exchange Commission to file court briefs that would make it easier for investors to collect money from investment banks and accounting firms that watched silently while their corporate clients engaged in misconduct.
Does the solicitor general's office really want to follow a guy like Lerach in its approach to Stoneridge? One would only hope that his sudden departure might cause the government, at a minimum, to discount his heavy-handed tactics.