Tainted campaign donations will be kept, Democrats say

WASHINGTON (Map, News) - A spokesman for the Democratic National Committee said more than $1 million in donations from attorneys who pleaded guilty or have been indicted on federal charges for an alleged $11.8 million kickback scheme will not be returned.

The donations, according to Federal Election Commission and state campaign finance databases, come from William S. Lerach, totaling $600,000 between 1998 and 2002, and from Melvyn Weiss, for a total of $25,000 in 1997.

Lerach pleaded guilty in mid-September to one felony count of conspiracy stemming from a seven-year federal investigation into the kickback scheme that began in 1981 and netted the New York law firm Milberg Weiss more than $200 million from verdicts and settlements in an estimated 150 cases.

Weiss was indicted last month on charges of conspiracy, racketeering, obstruction of justice and making false statements for his alleged role in the scheme. The firm bearing his name was indicted in this same federal investigation, the first time Justice Department prosecutors have applied federal anti-racketeering laws against a law firm.

Campaign finance records show contributions to the DNC by Milberg Weiss for $200,000 in 2001 and an additional $535,000 over the course of three years, 1998-2001. Current committee chairman Howard Dean was not in office when those contributions were received.

A standing policy of the DNC prevents money accepted and vetted under previous chairs to be returned, said press secretary Stacie Paxton. Dean has held his title since early 2005.

However, a recently discovered $5,000 contribution from Weiss to the DNC could be returned, depending on what verdict is reached in the attorney’s case, Paxton said.

Officials with the Democratic Senatorial Campaign Committee and the Democratic Congressional Campaign Committee declined to comment on contributions their committees received from the firm and its partners.

The DSCC received $100,275 from four Milberg Weiss attorneys named in the investigation and $230,000 from the Milberg Weiss firm, while the DCCC received $64,520 from the same donors.

More than 90 percent of the donations by attorneys connected with Milberg Weiss went to Democrats, but Steven Schulman, one of the firm’s former partners, gave $5,500 to the Republican National Committee between 1997 and 2006, and $1,875 to the National Republican Senatorial Committee.

Neither GOP committee’s spokesman returned telephone calls concerning the Schulman contributions.

Cheryl K. Chumley is an independent journalist and researcher.

"Lawyers Gone Wild" is a series of special reports by The Examiner looking at the cost and consequences of class action lawsuit abuse in the United States. Read the latest articles in the series.

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