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Prison, as Promised

William S. Lerach, the scourge of corporate America, receives the maximum sentence in a client-kickback case. Character references from friends and employees are no help.

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William S. Lerach
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Two years means two years.

A federal judge sentenced prolific plaintiffs' lawyer William S. Lerach to two years in prison in a criminal prosecution in which he and his former law firm, Milberg Weiss, were accused of paying kickbacks to plaintiffs in securities-fraud lawsuits against major corporations.

The prison term was the maximum allowed under a plea deal that Lerach struck with federal prosecutors last October. As part of that deal, Lerach, 61, pleaded guilty to one count of conspiracy to obstruct justice and make false statements to a federal court. The plea agreement had called for a one- to two-year sentence, and the probation department had recommended 15 months.

U.S. district judge John Walter in Los Angeles also fined Lerach $100,000 and ordered him to serve two years of probation and to perform 1,000 hours of community service upon his release from custody. Under his plea deal, Lerach must also forfeit $7.8 million in profits from his crimes.

"The whole conspiracy corrupted the law firm and it corrupted it in the most evil way," Judge Walter said during the hearing, according to the Associated Press.

Prosecutors said that Lerach's former firm paid clients a total of $11.5 million to serve as plaintiffs in lawsuits against corporate giants such as Lucent and WorldCom. The firm, in turn, made more than $250 million in lawyers' fees over two decades, according to prosecutors.

Lerach headed up the San Diego office of Milberg Weiss. Following Lerach's bitter split with partner Melvyn I. Weiss in 2004, after the federal probe of the kickback scheme had begun, the firm split.

Seven people, including three former partners of Milberg Weiss, have pleaded guilty. Weiss himself has vowed to defend himself at a trial scheduled to take place in Los Angeles in August.

Judge Walter apparently was unmoved by Lerach's sentencing memo, which included more than 150 letters of support from fellow plaintiffs' lawyers, his adversaries in the defense bar, employees, lawyers who handled two of his divorces, as well as his drivers, gardener, and contractors who worked on his aquariums.

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