Editorial: Are they hiding something?

WASHINGTON (Map, News) - The blinders are off the marks in the scam run for too many years in American courtrooms and boardrooms by plaintiffs lawyers like William Lerach and his fellow felons at Milberg Weiss. For years, these people told us they were courageous white knights armed with legal pads, nobly protecting defenseless shareholders against the massive corruption and deception of the executive criminals running America’s biggest corporations. They further told us that they alone, as private litigators driven solely by the desire to right wrong and expose injustices, could defend shareholders because the government was the tank for the evil corporate interests. But this week Americans were reminded that truth is not found in such fairy tales.

On Monday, Lerach stood before Judge John F. Walter and was sentenced to two years in prison and two years of probation, the maximum possible under the disgraced former Milberg Weiss partner’s plea agreement the Justice Department. He was part of a kickback scheme that netted the firm more than $200 million in legal fees from at least 150 cases, going back to 1979. Walter called the scheme “breath-taking” and said it “corrupted the firm and corrupted it in the most evil way.” In his sentencing papers, Lerach was quoted saying he had done it because “everybody was paying plaintiffs.”

On Wednesday, another chapter in the fairy tale began to be exposed with The Examiner’s three-part series — Warning Signs Missed — on the Institute for Law and Economic Policy (ILEP), an obscure tax-exempt foundation overseen mainly by Lerach and other Milberg Weiss lawyers.The foundation used law professors to construct a façade of academic respectability even as the foundation helped Milberg Weiss cultivate key federal and state judges and federal securities enforcement officials. Three things stand out here: ILEP principals refuse to discuss its funding or operations; the foundation’s federal tax returns, which the IRS designed to help the public evaluate such exempt groups, are notably uninformative, and the few officials who would talk professed a less-than-credible ignorance about Milberg Weiss’s links to ILEP. The question must be asked: Are these people hiding something?

At stake here are the integrity and credibility of the U.S. justice system. Surely if Congress can hold hearings on whether Roger Clemens used steroids, they can also get answers to far more important questions like these: Who financed ILEP besides Lerach, a $50,000 contributor? Why were judges on the Southern District of New York of such interest to ILEP? Why did so many SEC commissioners and senior staff attend ILEP events year after year? Why were so many cases with Milberg Weiss as counsel assigned to judges who attended ILEP events? It’s time somebody is required to give some answers.

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