Arthur Andersen all but admitted: Senator Joe Lieberman, “Enron Insecurity and Social Security,” United States Senate, February 13, 2002.
“There’s billions in this case”: William S. Lerach, interview by PD, April 16, 2008.
“the most far-reaching reforms”: Elisabeth Bumiller, “Bush Signs Bill Aimed at Fraud in Corporations,” New York Times, July 31, 2002.
“Glass-Steagall law is no longer”: William J. Clinton, “Remarks on Signing Legislation to Reform the Financial System,” November 12, 1999, Public Papers of the Presidents.
“I think we will look back”: Stephen Labaton, “Congress Passes Wide Ranging Law Easing Bank Laws,” New York Times, November 5, 1999.
“Even in those halcyon days”: William S. Lerach, guest lecture in course number 429, Stanford Law School, spring 2002.
he wasn’t alone: William Greider, “Is This America’s Top Corporate Crime Fighter?” Nation, August 22, 2002.
Other laudatory stories: Jeffrey Toobin, “The Man Chasing Enron,” New Yorker, September 9, 2002.
“It wasn’t as if”: William S. Lerach, “The Chickens Have Come Home to Roost,” internal document, 2002.
“Someone said loud and clear”: Michelle Ciccarelli, interview by PD, January 15, 2008.
anonymous plaintiffs: Ibid.
the stock of Halliburton: S. C. Gwynne, “Did Cheney Sink Halliburton? (And Will It Sink Him?),” Texas Monthly, October 2002.
“I think it will be fair”: William Greider, “Cheney and HAL,” Nation, June 22, 2006.
“issuing a series of false”: Richard Moore et al. v. The Halliburton Co., complaint, June 3, 2002. 342
“For now, let’s do”: William S. Lerach, interview by PD, February 26, 2008.
CHAPTER 23: “NOBODY CAN STOP ME”
“It’s about Milberg Weiss”: John Ryan, “Milberg Weiss Faces Probe into Conduct: Grand Jury Investigates Whether Law Firm Solicited Stock Investors for Class Actions,” Los Angeles Daily Journal, January 24, 2002.
“It doesn’t jibe”: Michael Kinsman, “Newspaper Says Milberg Weiss Is Grand Jury Target,” San Diego Union-Tribune, January 25, 2002.
“Milberg Weiss Bershad”: Christian Berthelsen, “Law Firm Being Investigated: Federal Grand Jury Looking into Dealings with Plaintiffs,” San Francisco Chronicle, February 13, 2002. 344
beginning to ring hollow: Ibid.
they decided to hire a consultant: Christopher Patti, interview by PD, December 17, 2008.
“We’re looking for an independent”: J. Lawrence Irving, interview by PD, December 12, 2008.
“So they want adult supervision”: William S. Lerach, interview by PD, January 22, 2009.
one of the best business attorneys: Robert Fairbank, interview by PD, January 6, 2009.
the team would review: J. Lawrence Irving, interview by PD, December 12, 2008.
“I don’t want to use the term”: William Greider, “Is This the Nation’s Top Corporate Crime Fighter?” Nation, August 22, 2002.
“The CEO ultimately”: Larry Mackinson and Larry Noble, “Returning the Favor: Bush Huddles with Big Campaign Donors,” Center for Responsive Politics, January 2, 2001.
private attorneys delivered: William S. Lerach, “Proposal re: Auditor Independence,” comments to the SEC, September 25, 2000.
“We regard this settlement”: Quoted in Trey Davis, “UC Settles with Arthur Andersen’s International Firms in Enron Lawsuit,” University of California News Release, August 27, 2002.
Explicit guidelines: For Private Securities Litigation Reform Act of 1995 text; see http://www.law.cornell.edu/uscode_sec_15_00000078—u004-.html.
Jeffrey Isaacs: Larry D. Thompson, Deputy Attorney General, “Principles of Federal Prosecution of Business Organizations,” memo superseding that of Deputy Attorney General Eric Holder, January 20, 2003.
“Do we want massive litigation”: Jeff Isaacs, interview by PD, January 7, 2009.
For economy’s sake: Michael Emmick, interview by PD, February 25, 2009. 349
a cast of witnesses: Ibid.
Nancy Cooperman told: Richard Robinson, interview by PD, January 21, 2009. 350
credibility of the star witness: Myron Levin and Molly Selvin, “Divorce Sheds Light on Probe,” Los Angeles Times, August 7, 2005.
Were those kickbacks?: Richard Robinson, interview by PD, January 21, 2009.
could destroy Cooperman: Jeff Isaacs, interview by PD, January 7, 2009. 351
So far the only kickbacks: Ibid.
mission would be to: Robert McGahan, interview by PD, January 15, 2009.
“Bill was like a dog”: Alexandra Bernay, interview by PD, April 16, 2008.
“Please, can I just go”: Ibid.
the banks, underwriters, and accountants: In re: Enron, First Amended Complaint, May 14, 2003.
“schemed” or “scheming”: William S. Lerach, interview by PD, October 15, 2008.
“Mel Weiss is manipulative”: Robert Lenzner and Emily Lambert, “Mr. Class Action,” Forbes, February 2, 2004.
indicted Andrew Fastow: Michael Hedges and Mary Flood, “Fastow Faces 78 Counts: Indictment Includes Obstruction of Justice Charge,” Houston Chronicle, November 1, 2002.
one of the shrewdest criminal defense: William S. Lerach, interview by PD, October 15, 2008.
one article caught his attention: Michael A. Drummond, “Lerach Strikes Back,” California Lawyer, September 4, 2002.
“He uses fraud to fight fraud”: Joseph A. Grundfest, interview by PD, November 11, 2007.
“This sounds like something”: Boris Feldman, interview by PD, October 6, 2008.
“This decision confirms”: Quoted in Trey Davis, “Federal Court Rules to Keep Most Defendants in Enron Shareholders’ Lawsuit,” University of California Press Release, December 20, 2002.
“The lids are off”: William S. Lerach, interview by PD, February 26, 2008.
an eight-year-old internal memo: Robert McGahan, interview by PD, December 12, 2008.
“This just smells bad”: Justin Scheck, “Indicted Lawyer’s Firm Smelled Trouble,” Recorder, January 3, 2006.
CHAPTER 24: THE PATIENCE OF JOB
“Sure things”: William S. Lerach, interview by PD, January 22, 2009.
“I just got a call”: William S. Lerach, interview by PD, April 18, 2008.
“The thing that has helped me”: Quoted in Tim Padgett and Alice Jackson Baughn, “The Rise and Fall of Bernie Ebbers,” Time, May 13, 2002.
spilling the beans: Walter Hamilton, “Ebbers Pushed Others to ‘Hit Numbers,’ CFO Says,” Los Angeles Times, February 9, 2005.
patented chart with its jagged timeline: WorldCom stock prices from October 1, 1996, to September 30, 2002, a timeline, exhibit filed with the court in WorldCom litigation, http://www.worldcomlitigation.com/html/kdm.html.
“Forget class action”: William S. Lerach, interview by PD, April 18, 2008.
“What about suing Citibank”: Ibid. 362
“I just talked to Carl McCall”: Ibid.
“Mel, quit it”: Ibid.
home field advantage: Ibid.
female federal judges: For biographies of Federal District Judges Denise Cote and Barbara Lynn, see Federal Judicial Center, http://www.fjc.gov/public/home.
Barbara S. Jones: Gretchen Morgenson and Ken Belson, “The Sisterhood Judging WorldCom,” New York Times, January 30, 2005.
Denise L. Cote: Ibid.
they retained the mind-set: William S. Lerach, interview by PD, April 18, 2008.
Sean Coffey: John P. “Sean” Coffey, interview by CMC, February 24, 2009.
studied diligently: John P. “Sean” Coffey, interview by CMC, February 20, 2009.
never miss a McCall fund-raiser: Shaila K. Dewan, “Accountants Gave to McCall After Getting State Contract,” New York Times, August 23, 2002. 367
would New York be ousted: William S. Lerach, interview by PD, April 18, 2008. 367
“He might as well”: Ibid.
“The New York S
tate Common”: In re: WorldCom Litigation, U.S. District Court Judge Denise Cote, order regarding August 12 pretrial conference, August 15, 2002.
“I’m appealing”: William S. Lerach, interview by PD, April 18, 2008. 368
“We wish to pursue”: Anthony Lin, “Milberg Weiss Taken to Task for Conduct in WorldCom Case,” New York Law Journal, November 19, 2003. 368
a flurry of complaints: For key events in WorldCom litigation, see http://www.worldcomlitigation.com.
“a de facto class action”: William S. Lerach, interview by PD, April 18, 2008.
clients who had opted out: Copies of both letters obtained by the authors.
“He’s telling us not”: John P. “Sean” Coffey interview with CMC, February 20, 2009.
“Has Bill Lerach lost”: William S. Lerach, interview by PD, April 18, 2008. 370
“All Mel cares about”: Ibid.
“Bill, will you cut”: John P. “Sean” Coffey, interview by CMC, February 24, 2009.
“I think you’re a terrific lawyer”: Ibid.
The case settled for $4.75 million: United States v. Milberg Weiss Bershad & Schulman LLP et al., U.S. District Court, Central District of California, May 18, 2006.
“in order to participate”: Ibid.
Each side made its case: Stephen Taub, “Class Action and ‘Opt Out’ Lawyers Duke It Out,” Compliance Week, November 8, 2005.
a stern nineteen-page ruling: Lin, “Milberg Weiss Taken to Task.”
Lerach’s gambit: On key events in WorldCom litigation, see http://www.worldcomlitigation.com.
Mel Weiss viewed the whole: William S. Lerach, interview by PD, April 18, 2008.
split in two: Renée Beasley Jones, “Milberg Weiss Makes Its Case for Splitting in Two,” San Diego Business Journal, June 30, 2003.
to begin drafting the terms: William S. Lerach, interview by PD, April 18, 2008.
They would divide: Patrick Coughlin, interview by PD, December 12, 2008. 376
the agreement: United States v. Milberg Weiss Bershad & Schulman LLP et al., U.S. District Court, Central District of California, May 18, 2006.
Job Lazar, Robert McGahan, interview by PD, December 12, 2008.
Tracing the flow of money: United States v. Milberg Weiss Bershad & Schulman LLP et al., U.S. District Court, Central District of California, May 18, 2006. 377
referred all entreaties: Thomas Bienert, interview by PD, February 18, 2009.
nearly impenetrable circle: Robert McGahan, interview by PD, December 12, 2008.
“your participation in our fee”: James Harbin, interview by PD, January 16, 2009.
“What am I going to do”: Robert McGahan, interview by PD, December 12, 2008.
“I do not want to go”: James Harbin, interview by PD, January 16, 2009.
Seymour Lazar was a serial plaintiff: United States v. Milberg Weiss Bershad & Schulman LLP et al., U.S. District Court, Central District of California, May 18, 2006.
strong circumstantial evidence: Richard Robinson, interview by PD, February 26, 2009.
Canadian Imperial Bank of Commerce: In re: United States v. Richard A. Causey, Jeffrey K. Skilling, Kenneth L. Lay, et al., U.S. District Court for the Southern District of Texas, July 7, 2004.
“We’ve seen recently”: “Canadian Imperial Bank of Commerce Agrees to Cooperate with Enron Investigation, Exit Structured Finance Business, Implement Reforms, with Oversight by Monitor,” U.S. Justice Department, press release, December 22, 2003.
proportionate liability: William S. Lerach, interview by PD, October 15, 2008. 380
The consulting and mediating team: Hon. J. Lawrence Irving, interview by PD, November 18, 2008.
“We anticipate this settlement”: Simon Bowers, “Bank of America Settles Enron Lawsuit for $69 million,” Guardian, July 3, 2004.
“We expect that we will achieve”: Trey Davis, “UC Reaches $222.5 Million Settlement with Lehman Brothers in Enron Securities Case,” UC Newsroom press release, October 29, 2004.
“We had a gun”: Alan Salpeter, interview by PD, October 26, 2008.
“My clients have authorized me”: Ibid.
“It’s a joke, right?”: William S. Lerach, interview by PD, October 15, 2008.
“It wasn’t unexpected”: Alan Salpeter, interview by PD, March 23, 2009. 382
Douglas Axel: Douglas Axel, interview by PD, January 13, 2009. 382
spring the trap on an insider: Michael Thomas, blog, Daily Caveat, May 22, 2006; Peter Elkind, “The Fall of America’s Meanest Law Firm,” Fortune, November 3, 2006. 384
“Let’s go to lunch”: Jeffrey Isaacs, interview by PD, January 7, 2009.
“Let’s indict”: Robert McGahan, interview by PD, December 12, 2008.
CHAPTER 25: THE NOT-SO-PERFECT CIRCLE
guilty plea of Paul L. Tullman: Richard Robinson, interview by PD, January 21, 2009.
some seventy cases: Anthony Lin, “Milberg Agrees to Pay $75 Million in Settlement over Kickback Scheme,” New York Law Journal, June 17, 2008. 386
more than $9 million: Ibid.
deputized as a special assistant: Richard Robinson, interview by PD, January 21, 2009.
Torkelsen, the expert witness: Peter Elkind with Doris Burke, “The King of Pain Is Hurting,” Fortune, September 4, 2000.
They’d subpoenaed him: Richard Robinson, interview by PD, January 21, 2009.
campaign contribution: Don Van Natta, Jr., “Memorandum Suggests That Clinton Made $50,000 Call from the White House,” New York Times, September 23, 1997. 387
a significant player: Richard Robinson, interview by PD, January 21, 2009.
The more he dragged his feet: “U.S. Files Suit Against John Torkelsen, Richard Propper, Daniel Beharry & Sovereign Bank Alleging Fraud of $32 Million Against Small Business Administration,” press release, U.S. Attorney’s Office, Philadelphia, December 29, 2006.
for scheming to fraudulently obtain: “John Torkelsen, Liar, Thief, Drunk,” New Jersey Justice, June 9, 2006.
on the ropes: Justin Scheck, “Federal Prosecutors Put Pressure on Milberg Weiss’ Star Expert,” Recorder, June 9, 2006.
purchased Halliburton stock for their grandchildren: Lisa Sanders, “Halliburton Judge Recuses Himself,” Market Watch, August 10, 2004. 389
“What made your case”: Ibid.
proceed vigorously: Ibid.
CHAPTER 26: ALL FALL DOWN
“secret and illegal payments”: United States v. Seymour Lazar and Paul Selzer, U.S. District Court for Central District of California, June 24, 2005.
“I never paid a plaintiff”: Robert Lenzner and Emily Lambert, “Mr. Class Action,” Forbes, February 16, 2004.
“The government is fifteen years”: Peter Burrows, “Payback Time for Bill Lerach,” Business Week, June 30, 2005. 391
“a malicious-prosecution theory”: Ibid. 391
“baseless”: Ibid.
“Neither Milberg Weiss”: Timothy O’Brien and Jonathan D. Glater, “Robin Hoods or Legal Hoods,” New York Times, July 17, 2005. 391
“This sounds like another example”: Ibid.
“I thought I was doing”: Quoted in David Olson, “Attorney Facing Federal Charges,” Press Enterprise, June 24, 2005.
“powerful enemies”: Quoted in Joseph Nocera, “The Lawyer Companies Love to Hate,” New York Times, July 2, 2005.
“Once you go out”: Quoted in Molly Selvin and Myron Levin, “Indictment Heats Up Probe of Law Firm,” Los Angeles Times, July 8, 2005.
the Enron settlements: For Bernstein Litowitz and WorldCom settlement, see http://www.blbglaw.com/cases/00108.
immunity to Alan Schulman: John R. Wilke and Scott J. Paltrow, “Wide Net Cast in Milberg Case,” Wall Street Journal, June 8, 2005.
“The Justice Department is investigating”: Quoted in Roger Parloff, “Lerach Firm Will Fight Client to Stay in Halliburton Case,” Fortune Legal Pad, December 13, 2006.
had not been named: Ibid.
a federal grand jury in Los Angeles: “Truth in Corpo
rate Justice LLC Attorney Denied Access to Annual Halliburton Meeting,” Rothstein’s account to shareholders and clients, published at PRWEB.com, May 22, 2006.
Another set of indictments: Roger Parloff, “Firm Ejected as Lead Counsel in Fallout from Milberg Weiss Indictment,” Fortune Legal Pad, February 26, 2007.
he would fight: Ibid.
“This case is about”: John R. Wilke, Nathan Koppel, and Peter Sanders, “Milberg Indicted on Charges Firm Paid Kickbacks,” New York Times, May 19, 2006.
The indictment covered activity: United States v. Milberg Weiss Bershad & Schulman LLP et al., U.S. District Court, Central District of California, May 18, 2006. 394
“I did a lot of stuff”: William S. Lerach, interview by PD, January 17, 2008. 394
considerations of self-preservation: John P. “Sean” Coffey, interview by CMC, October 9, 2008.
Eliot Spitzer: Peter Lattman, “Why Wasn’t Spitzer Involved in the Milberg Weiss Investigation?” Wall Street Journal Law Blog, May 24, 2006.
Such bravura did little: Julie Creswell, “Another Prominent Lawyer Departs from Milberg Weiss,” New York Times, August 25, 2006.
Pamela Rogers Chepiga: “Lawyer Global 100,” American Lawyer, November 2006.
upgrade its U.S. practice: Creswell, “Another Prominent Lawyer Departs.” 395
her full partner’s share: William S. Lerach, interview by PD, October 15, 2008.
“She knew a lot”: Ibid.
“It’s heartbreaking”: Anna Schneider-Mayerson, “Save This Firm! Milberg Weiss Is Nearing Iceberg,” New York Observer, August 25, 2006. 396
Bill’s sixtieth birthday: Michelle Ciccarelli, interview by PD, March 3, 2009.
Ken Feinberg was cheered: Bob Van Voris and Jeff Feeley, “Firms Request Enron Class Status Be Voided,” Bloomberg News, February 5, 2007.
In Lerach’s mind, the scenario: Ibid.
petitions in the Fifth Circuit: “Banks Appeal Ruling Allowing Enron Investors to Sue as Class,” New York Times, February 6, 2007.
Its headquarters was in New Orleans: Jack Bass, Unlikely Heroes (New York: Simon & Schuster, 1981), pp. 46–51.
fitting venue for shareholder plaintiffs: William S. Lerach, interview by PD, January 22, 2009.
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