Class action king Weiss sentenced to 30 months

By Gina Keating

LOS ANGELES (Reuters) - Melvyn Weiss, who built the New York law firm that turned U.S. class action litigation into a multibillion-dollar business, was sentenced on Monday to 30 months in federal prison after admitting to paying secret kickbacks to clients.

Weiss's plea bargain and sentencing cap a seven-year federal investigation of America's top class action firm and the lawyers who built it. They were considered heroes by many investors and extortionists by the U.S. companies they sued.

In a brief, somber statement to the court, Weiss, 72, apologized to his family, his former colleagues and his former firm "for my wrongful conduct."

"My remorse and contrition are beyond my ability to express," Weiss told the judge. "I promise that my contrition is honest."

The sentence was less than the 33 months requested by prosecutors and more than the 24-month maximum sought by Weiss.

Assistant U.S. Attorney Doug Axel urged the judge to hand down the maximum under the plea deal, saying Weiss could have saved his law firm from the losses of cases and lawyers it suffered as the investigation dragged on.

"He could have done the right thing and stepped forward and deflected (harm) from the firm," Axel said.

Weiss also agreed to pay $10 million in fines and forfeiture under a plea agreement with federal prosecutors in Los Angeles.

The co-founder of the law firm now known as Milberg LLP pleaded guilty to a single racketeering charge in March. His law firm is set for an August 12 trial in the kickbacks scheme, but a plea agreement is in the works, a source has said.

The Bronx-born Weiss made his reputation by winning $1 billion for investors hurt by the 1980s Drexel Burnham Lambert junk bond scandal and an estimated $10 billion from insurance companies accused of misleading sale practices in the 1990s.

In a hearing on Monday, Weiss's lawyer Benjamin Brafman asked U.S. District Judge John Walter to "temper justice with mercy" in sentencing Weiss because of his age and his record of good works. Weiss turns 73 in August.

"If you impose a two-year sentence on a 73-year-old man, it is much more severe a sentence than on a 60-year-old man," Brafman said, referring to the sentence given to Weiss's partner and protege, William Lerach, in February. "I'm on my hands and knees begging for months."

But while admiringly describing Weiss as "a fighter," Walter said he had "serious reservations" about the plea deal reached by prosecutors and Weiss's lawyers, which called for prison time of 18 to 33 months.

The judge said Weiss deserved a prison term because he continued to engage in criminal conduct as much as three years after he learned of the probe and because he tried to hide a document essential to government's case.

Weiss is the fourth attorney from Milberg, which dropped his name from its title earlier this year, to plead guilty to the conspiracy, which prosecutors said involved more than 225 lawsuits that produced $200 million in fees for the firm.