Lawyer Weiss Gets 30-Month Sentence for Kickbacks

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LOS ANGELES — A legendary figure in New York’s plaintiffs’ bar, Melvyn Weiss, was sentenced yesterday to 2 1/2 years in prison for his involvement in what the sentencing judge called a “breathtaking” conspiracy to pay secret kickbacks to investors who helped his firm file class-action securities lawsuits.

The sentence imposed by Judge John Walter shaved a bit off the prosecutors’ recommendation of 33 months, a suggestion lawyers close to the case expected the judge to follow.

RELATED: Friends Plead for Leniency on Weiss’s Sentence.

Judge Walter made clear that he viewed Weiss’s conduct as more serious than that of his former law partner, William Lerach, who began serving a two-year sentence last month after admitting to his role in the paid-plaintiff scheme. Weiss was accused of obstructing the probe by withholding a fax and of taking part in a meeting to discuss a secret payment even after the investigation of the firm, now known as Milberg LLP, became known to lawyers there.

“The scope and duration of this conspiracy was breathtaking,” Judge Walter said. He said Weiss’s record of devotion to the legal profession made it difficult to fathom how he could have engaged in a crime that spanned decades. “It’s unimaginable,” the judge said. The wrongdoing, which included submitting false statements to courts overseeing the lawsuits, “strikes at the core — at the heart of the judicial system,” the judge said.

However, Judge Walter indicated that he was impressed by an argument from Weiss’s criminal defense lawyer, Benjamin Brafman, that prison time would have a more severe impact on Weiss, 72, than on his former partner, Lerach, 61. The judge also said he had never encountered a defendant with Weiss’s record of service to the community through charitable donations, pro bono legal work, and generosity to others, as demonstrated in nearly 300 laudatory letters filed with the court.

In court papers, Mr. Brafman cited that record to argue for an 18-month sentence with half the time spent in home or community confinement. However, at yesterday’s proceedings it was clear that Mr. Brafman was engaged in a last-ditch effort to hold Weiss’s sentence as close as possible to the two-year term given to Lerach.

“I am on my hands and knees begging you for months,” Mr. Brafman said. “I’m asking you to give him back just some months for all that he has given. I think it’s a fair trade.”

Weiss spoke briefly from notes torn from a yellow legal pad. “My remorse and contrition for my violations of my oath as a lawyer are beyond my ability to adequately express,” he said.

A prosecutor, Douglas Axel, argued that Weiss had needlessly prolonged the investigation and would have been going to jail at a younger age if he had cooperated. “During those seven years, he had opportunity after opportunity to come in,” Mr. Axel said. “He put the firm in the firing line in order to avoid personal responsibility for his own actions.”

Judge Walter said he wasn’t persuaded that was a factor he should consider. “I was somewhat surprised that Mr. Weiss didn’t put the government to its burden of proof at trial,” the judge said. “I don’t think we’re punishing him for being a fighter.”

Judge Walter said he was dubious of arguments that the conspiracy was a “victimless crime” because the firm, best-known simply as Milberg Weiss, vigorously represented investors in the cases that were brought. “In effect, the absent class members were at the mercy of the paid plaintiffs and their corrupt attorneys in this invidious scheme,” the judge said. The lead plaintiffs taking the secret payoffs may have been more interested in boosting Milberg’s fees than in getting the maximum recovery, the judge said.

Standing on a sunny courthouse plaza moments after the sentence was pronounced, Weiss sounded pleased to have received some mercy. “I think the judge took into consideration a lifetime of good works,” he said.

“We came here expecting a 33-month sentence,” Mr. Brafman told journalists. “We’re pleased the court recognized the extraordinary life of Mr. Weiss did count.”

The U.S. attorney based in Los Angeles, Thomas O’Brien, issued a statement calling the prison time “warranted” because Weiss and his associates “compromised the justice system.”

Weiss asked to serve his sentence at a federal prison in Morgantown, W.Va. Judge Walter agreed to that recommendation and ordered the veteran trial lawyer to turn himself in by August 28.

Two other former name partners at Weiss’s firm, David Bershad and Steven Schulman, have entered guilty pleas and are awaiting sentencing.

Prosecutors argued that Weiss deserved the 33-month sentence in part because he showed “criminal arrogance” by trying to negotiate a lower kickback to one investor, Howard Vogel, at a meeting in November 2003, almost two years after prosecutors began serving grand jury subpoenas.

However, Mr. Brafman noted that the prosecutors’ account of that meeting comes almost entirely from Vogel’s representative at that session, a prominent Denver defense lawyer who was referred to only as “Vogel Intermediary A” in most court papers because he was not charged in the case.

Judge Walter said the story the intermediary told investigators was so inconsistent he should have been charged in the case. “I don’t know why it didn’t end up in an indictment,” the judge said.

“His recitation of facts is absurd,” Mr. Brafman chimed in. “If he’s the best criminal defense lawyer in Colorado, then there’s something wrong with that bar.”

Press reports have identified the Denver lawyer as Gary Lozow. In addition, his name appears on message slips prosecutors filed in the court record last week.

Mr. Lozow’s lawyer, John Walsh, did not return a call yesterday seeking comment for this article, but he acknowledged in 2006 that his client was cooperating with prosecutors.

Weiss, who is expected to be disbarred soon, couldn’t help but bring his courtroom skills to bear one last time yesterday. As Mr. Brafman tenaciously pursued an argument that Judge Walter seemed to have accepted, Weiss, out of view of the judge, gently pressed down on Mr. Brafman’s upper thigh, signaling his former colleague to drop the point and move on.


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