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Former Milberg Weiss partner pleads guilty
Steven Schulman faces up to 33 months in prison and will pay more than $2 million in connection with a kickback scheme that the class-action law firm is accused of running.
From Bloomberg News
Los Angeles Times
Wednesday, October 10, 2007

Former Milberg Weiss partner Steven Schulman pleaded guilty in a Los Angeles federal courtroom Tuesday to one count of conspiracy in connection with a kickback scheme that allegedly netted millions of dollars in illicit legal fees.

Under the terms of his plea agreement, Schulman, 56, faces 27 to 33 months in prison and will pay the government more than $2 million.  U.S. District Judge John F. Walter set June 23 as the sentencing date.

Schulman was indicted last year along with the New York law firm and former partner David Bershad, who pleaded guilty in July.

Milberg Weiss and the lawyers were charged with making secret and illegal payments to plaintiffs in cases in which the class-action firm reaped more than $251 million in fees.  Co-founder Mel Weiss was indicted Sept. 20, the same day prosecutors said Schulman had agreed to plead guilty.

Schulman was the sixth person connected with the federal investigation, which began eight years ago, to make a deal.  William S. Lerach of San Diego, a Weiss protege with a reputation as a ruthless class-action lawyer, agreed last month to plead guilty to one count of conspiracy in the case.

The government contends that Milberg Weiss maintained and paid a stable of ready-made plaintiffs, positioning itself to be the first to file lawsuits against corporations that allegedly defrauded investors.

The first-to-the-courthouse filings gave Milberg Weiss a leadership role in class actions, according to prosecutors, and entitled the firm to the largest share of legal fees.

Weiss was charged with conspiracy, racketeering, obstruction of justice and making false statements. If convicted, the 72-year-old could be sentenced to 40 years in prison.

http://www.latimes.com/business/la-fi-milberg10oct10,1,7068691.story?coll=la-headlines-business