Ex-Partner at Milberg Pleads Guilty to Conspiracy

NEW YORK – A seven-year federal investigation into accusations that a leading securities class-action law firm, Milberg Weiss, paid secret kickbacks to plaintiffs gained traction yesterday when David J. Bershad, a former partner with extensive knowledge of the firm’s finances, pleaded guilty to conspiracy and agreed to cooperate with prosecutors, reported The New York Times.

According to The Times, Bershad’s guilty plea is the latest blow to a powerhouse firm that once dominated the landscape for class-action securities lawsuits and spurred fear as well as contempt in corporate boardrooms.

Yesterday’s guilty plea also put renewed pressure on William S. Lerach and Melvyn I. Weiss, two of the industry’s leading lawyers who founded the New York-based law firm and have long been the focus of the federal investigation, reported The Times.

Lerach split from Milberg Weiss in 2004 to form a firm in San Diego, and last month, he announced that he was considering retirement. Neither Lerach nor Weiss has been indicted, reported The Times.

According to the paper, Bershad was indicted last year along with the law firm and another named partner, Steven G. Schulman.

Yesterday, the firm changed its name from Milberg Weiss & Bershad to simply Milberg Weiss and said that Bershad, who had been on a leave of absence, had been terminated, reported The Times.

-- NYSSCPA.org News Staff

Posted on 7/10/07