Founding and History
Founded in 1965 by attorneys Larry Milberg and Melvyn I. Weiss, Milberg LLP (formerly known as Milberg Weiss LLP and Milberg Weiss Bershad & Schulman LLP) is a U.S. plaintiffs' law firm. In the Firm’s early years, its founding partners built a new area of legal practice in representing shareholders’ interests under the then recently amended Rule 23 of the Federal Rules of Civil Procedure, which allowed securities fraud cases, among others, to proceed as class actions.
Based in New York City and with offices in Los Angeles, Tampa and Detroit, Milberg is widely known as one of the first law firms to represent investors in class actions in federal courts. It focuses on litigation involving securities fraud, shareholder derivative cases, bankruptcy, consumer protection, antitrust, insurance, mass tort/environment, False Claims Act (Qui Tam), human rights, employee rights and ERISA. In addition, Milberg prosecutes general complex commercial litigation involving contract disputes, business torts, and disputes involving the Uniform Commercial Code, business dissolutions, and other commercial and financial relationships.[1]
Before its split in May 2004 with the firm now known as Coughlin Stoia Geller Rudman & Robbins LLP, it was the largest plaintiff law firm in the United States, with over 200 attorneys, responsible, at least in part, for over 50 percent of all securities class action cases settled in 2002.[2]
According to the firm's website, Milberg currently employs 75 attorneys. Industry trade site Lawyers.com lists 63 profiles of Milberg attorneys.[3]
Recent Cases
Milberg is currently co-lead counsel in a securities fraud class action case against French conglomerate Vivendi. After nearly eight years of litigation, the case was tried to a jury for three months in late 2009, and resulted in a verdict for plaintiffs in January 2010. The jury found Vivendi liable for 57 false or misleading class period statements. The case is now in post-verdict proceedings. Even with claimants who made foreign purchases removed from the class after the Supreme Court’s Morrison v. National Australia Bank Ltd decision, total damages claims exceed $1 billion. [4]
On August 24, 2011, the U.S. District Court for the Southern District of New York approved a $180 million settlement to resolve antitrust claims brought by a class of consumers, represented by Milberg, against Sirius XM Radio. The case stems from the 2008 merger between Sirius Satellite Radio, Inc. and XM Satellite Holdings, Inc. that created Sirius XM, now the nation’s only satellite radio company. The plaintiffs alleged that the merger of the only two U.S. satellite radio providers was an illegal move to eliminate competition and monopolize the satellite radio market.[5]
Milberg represented a healthcare worker in a whistleblower suit against his former employer Medline Industries, Inc., along with its charitable arm, The Medline Foundation. The Firm negotiated an $85 million settlement on behalf of the federal government, announced on March 11, 2011. The suit was filed under the False Claims Act (“FCA”), which allows private citizens to sue companies that are defrauding the government and to receive an award for their efforts when the case is successful. Although a party to the settlement agreement, the U.S. Department of Justice chose not to intervene in the lawsuit. Milberg pursued the case and obtained one of the largest settlements of an FCA case in which the government declined to intervene. [6] [7]
In 2010, Milberg won a victory before the United States Supreme Court, which issued a decision (Merck & Co., Inc. v. Reynolds) addressing when an investor is placed on “inquiry notice” of securities fraud violation sufficient to trigger the statue of limitations under 28 U.S.C. § 1658(b).[8]
Other milestones in the Firm’s history include its involvement in the U.S. Financial litigation in the early 1970s, one of the earliest large class actions, which resulted in the $50 million recovery for purchasers of the securities of a failed real estate development company; Other cases included the Ninth Circuit decision in Blackie v. Barrack [9] in 1975, which established the fraud-on-the-market doctrine for securities fraud actions; the Firm’s co-lead counsel position in the In re Washington Public Power Supply System (WPPSS) Securities Litigation [10], a seminal securities fraud action in the 1980s in terms of complexity and amounts recovered; the representation of the Federal Deposit Insurance Corp. in a year-long trial to recover banking losses from a major accounting firm, leading to a precedent-setting global settlement; attacking the Drexel-Milken “daisy chain” of illicit junk-bond financing arrangements with numerous cases that resulted in substantial recoveries for investors [11]; and representing life insurance policyholders defrauded by “vanishing premium” and other improper sales tactics and obtaining large recoveries from industry participants. Milberg’s attorneys also argued another important case 2007 before the high court in Tellabs Inc. v. Makor Issues & Rights Ltd [12].
Recoveries
| CASE | RESULT |
| In re Tyco International Ltd. Securities Litigation (D.N.H.)[13] | Milberg served as co-lead counsel in this litigation, which involved federal securities claims against Tyco and its former CEO, CFO, general counsel and certain former directors arising out of alleged insider trading and the overstatement of billions of dollars in income. In 2007, the court approved a record $3.2 billion settlement that was recovered from Tyco and its auditor PricewaterhouseCoopers. |
| In re Nortel Networks Corp. Securities Litigation (S.D.N.Y.)[14] | Milberg served as lead counsel for the class and the court-appointed lead plaintiff, the Trustees of the Ontario Public Service Employees’ Union Pension Plan Trust Fund in this federal securities class action. In January 2007, the court approved a settlement valued at more than $1.14 billion. |
| Carlson v. Xerox, No. 00-1621 (D. Conn.)[15] | Milberg served as plaintiffs’ co-lead counsel in these consolidated cases alleging that Xerox and several officers violated the federal securities laws by issuing false financial statements. Plaintiffs’ claims survived three motions to dismiss and a motion for summary judgment, ultimately resulting in a $750 million settlement in 2009. It ranked among the largest recoveries in securities litigation history. |
| In re Initial Public Offering Securities Litigation, No. 21-92 (S.D.N.Y.)[16] | Milberg represented investors in 310 securities class actions alleging a market manipulation scheme involving hundreds of initial public offerings and approximately 55 defendant investment banks. As a member of the court-appointed liaison counsel, Milberg oversaw the efforts of approximately 60 plaintiffs’ firms and helped in the recovery of a $586 million settlement. |
| Lucent Technologies, Inc. Securities Litigation, No. 00-621 (D.N.J.)[17] | Milberg served as co-lead counsel in this securities action, which alleged that Lucent and its senior officers misrepresented the demand for Lucent’s products and improperly recognized hundreds of millions of dollars in revenues. The case resulted in a $600 million settlement. |
| Raytheon Co. Securities Litigation, No. 99-1349 (E.D. Pa.)[18] | Milberg served as lead counsel in this case, which alleged that a major defense contractor failed to properly write down assets on construction contracts. In 2004, Raytheon and its auditor, PricewaterhouseCoopers LLP, settled the case for a total of $460 million. |
| In re Sears Roebuck and Co. Securities Litigation (N.D. Ill.)[19] | This case involved allegations that Sears concealed material adverse information concerning the financial condition, performance, and prospects of Sears’ credit card operations, resulting in artificially inflated stock prices. Class action resulted in a $215 million settlement in 2007. |
| In re CMS Energy Securities Litigation (E.D. Mich.)[20] | $200 million was recovered for purchasers of CMS stock in securities class action alleging failure to disclose “round-trip” trading of energy contracts. Milberg served as co-lead counsel for the class. |
| In re Biovail Corp., Securities Litigation (N.D.N.Y.)[21] | Milberg, serving as co-lead counsel, achieved a $40 million settlement on behalf of current and former G.E. employees who claimed that G.E.’s 401(k) Plan fiduciaries imprudently invested more than two-thirds of the Plan’s assets in company stock. The settlement included important structural changes to G.E.’s 401(k) plan valued at more than $100 million. |
| Managed Care Litigation (S.D. Fla.)[22] | Recoveries of over $1 billion and major changes in HMO practices of CIGNA Healthcare and Aetna. The settlement stems from a series of lawsuits by physicians and medical associations alleging that insurers engaged in a scheme to obstruct, reduce, delay, and deny payments and reimbursements to health care providers. |
| In re Washington Public Power Supply System Securities Litigation (D. Ariz.)[23] | A massive securities fraud litigation in which Milberg served as co-lead counsel for a class that obtained, after several months of trial, settlements totaling $775 million, the largest ever securities fraud settlement at that time. |
| NASDAQ Market Makers Antitrust Litigation (S.D.N.Y.)[24] | In the largest antitrust settlement in history, $1.027 billion was obtained in 2007 for plaintiffs who alleged that market-makers conspired to set and maintain wide spreads in securities transactions. |
Recognition and rankings
In 2009, 2010 and 2011, The National Law Journal included Milberg in its “Plaintiffs’ Hot List.”[25][26][27]
In June 2010, RiskMetrics Group’s Securities Class Action Services (SCAS) unit ranked Milberg first in its survey of top plaintiffs lead/co-lead counsel in the top 100 securities cases. [28] According to the SCAS, in 2009, Milberg LLP ranked second overall among the top 50 plaintiffs’ law firms for total dollars achieved in final securities class action settlements. Milberg ranked fourth in the number of settlements. The annual survey, the “SCAS 50,” tracks settlements in which firms were either lead or co-lead counsel.[29]
On January 1, 2010, Law360 selected Milberg as one of its “plaintiff-side securities firms of the year.”[30]
Four Milberg attorneys were selected for the 2010 Top Attorneys List by the legal media company Lawdragon. Ariana J. Tadler was included in Lawdragon’s 500 Leading Lawyers in America. Lawdragon also selected partners Arthur R. Miller, Robert A. Wallner and Jeff S. Westerman for inclusion in the Lawdragon Top 3,000.[31]
In March 2010, Chambers & Partners included Milberg Chairman Sanford P. Dumain in its “Chambers USA 2010 - America’s Leading Lawyers for Business.”[32]
Legal issues involving the firm
On May 18, 2006,[33][34] the firm and two of its named partners, David J. Bershad and Steven G. Schulman (Schulman resigned in December 2006), were indicted by United States Attorney Debra Wong Yang of the United States District Court for the Central District of California on various counts, including racketeering, mail fraud, and bribery. The charges include claims that Milberg Weiss paid portions of its legal fees to plaintiffs in order to induce them to sue.[35][36] By January 2007, more than half of the firm's partners had left the firm. As of June 2008, the firm's website lists only 53 full-time attorneys (29 partners and 24 associates).
On June 16, 2008, U.S. prosecutors in Los Angeles dismissed the indictment against the firm, under a non-prosecution agreement, and a statement by the government that “no attorney currently a partner or associate with Milberg LLP is criminally culpable” with respect to conduct charged in the indictment. Milberg agreed to pay $75 million to settle the charges.[37]
However, four longtime Milberg Weiss partners pleaded guilty to federal charges, including Steven Schulman, David Bershad, William Lerach, and Melvyn Weiss. Melvyn Weiss pleaded guilty in exchange for an 18- to 33-month prison sentence and fines and restitution of $10 million.[38] Lerach was sentenced to two years in federal prison, two years' probation, fined $250,000 and ordered to complete 1,000 hours of community service. Bershad paid $250,000 in fines and forfeited $7.75 million. Bershad was sentenced to six months of incarceration in October 2008.[39] Weiss was sentenced to 30 months of incarceration on Monday June 2, 2008.[40] He was released in February 2010. Bershad was released from custody on July 2, 2009, and Schulman was released on July 10, 2009. Lerach was released on March 8, 2010.