Over the last 25 years, few high-tech companies with IPO or merger plans failed to meet up with the law firm of Milberg Weiss. Brocade, Cisco, Nortel, Microsoft, Legato, Sun, Portal Software, and Box Hill Systems were all the targets of class-action shareholder lawsuits filed by the firm.
In an irony rivaled only by the recent scandalous demise of Eliot Spitzer's political career, the founder of Milberg Weiss, Melvyn Weiss, has agreed to plead guilty to participating in an elaborate and longstanding kickback scheme. Authorities say Weiss's firm made about $250 million over 20 years by procuring the "lead plaintiffs' counsel" position in shareholder suits through payoffs and the use of professional plaintiffs.
One of Weiss's former partners, William Lerach, whose firm sued Dot Hill a couple of years back and was active in the Enron case, was sentenced to two years in jail last month after pleading guilty to charges of making false statements and obstructing justice.
Wherever there's money to be made, there will always be the potential for malfeasance. The Spitzer and Weiss debacles show we need to widen the scope of scrutiny to include a lot more folk who were previously trusted with making and enforcing the law.
That may be the saddest and most demoralizing revelation of all.