Bershad Agrees to Cooperate with Prosecutors
July 9, 2007. The U.S. Attorney's Office for the Central District of California announced in a release that David Bershad has agreed to plead guilty in a criminal action arising out of the payment of kickbacks to named plaintiffs in class action lawsuits filed by law firm of Milberg Weiss Bershad & Schulman (MWBS).
The release states that Bershad "has agreed to plead guilty to a federal conspiracy charge and acknowledge that he and others agreed to conceal from judges in state and federal courts Milberg Weiss' secret payment arrangements with named plaintiffs in class actions and shareholder derivative actions".
See also, story titled "Milberg Weiss Indicted for Paying Illegal Kickbacks to Class Action Plaintiffs" in TLJ Daily E-Mail Alert No. 1,375, May 22, 2006.
Moreover, the release states that Bershad has agreed "to cooperate in the government's ongoing investigation and prosecution of other participants in the conspiracy". The release does not identify any of the "other participants".
However, one possible object of the ongoing investigation could be William Lerach, who was previously a name partner in the predecessor law firm of Milberg Weiss Bershad Hynes & Lerach. He is now the lead partner in the law firm of Lerach Coughlin Stoia Geller Rudman & Robbins. Over many years he has been associated with numerous class action securities fraud suits against technology and communications companies.
The release adds that "Bershad’s expected guilty plea stems from an
indictment returned by a federal grand jury in May 2006 that accused Milberg
Weiss, Bershad, former Milberg Weiss name partner Steven G. Shulman, and others
with participating in a scheme to pay millions of dollars in secret and illegal
kickbacks to named plaintiffs in more than 150 class actions and shareholder
derivative actions. The indictment alleges that the firm received well over $200
million in attorneys' fees from these lawsuits over the past 20 years".