JURIST - Paper Chase: Former Milberg Weiss partner pleads guilty to racketeering

[JURIST] Milberg Weiss [firm website] partner and co-founder Melvyn Weiss pleaded guilty [plea deal text, PDF] Wednesday to one count of racketeering conspiracy stemming from a long-running US Attorney investigation into an alleged kickback scheme. Weiss was indicted last year for conspiracy, racketeering, obstruction of justice and making false statements and initially pleaded not guilty [JURIST reports] in October 2007. Under the agreement [JURIST report] reached with prosecutors last month, Weiss will receive an 18-33-month sentence, some of which may be served as home confinement, and must pay $10 million in fines and penalties. Sentencing is scheduled for June 2. Reuters has more.

The indictment alleged that since 1984, Milberg Weiss paid up to $11.3 million in illegal kickbacks under a scheme where individuals agreeing to serve as lead plaintiffs in class action and shareholder derivative lawsuits were promised 10 percent of the attorney fees eventually gathered by the firm. In February, former Milberg Weiss partner William Lerach was sentenced to two years in prison for his part in the scheme; he pleaded guilty last year to conspiracy to obstruct justice after reaching an agreement [JURIST reports] with prosecutors in September. Three individuals pleaded guilty in connection with the scheme in May 2006 after a federal grand jury indicted [JURIST reports] the firm. Partner David J. Bershad pleaded guilty [JURIST report] to conspiracy charges in July 2007.

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