CHAPTER 13: A TROJAN HORSE NAMED KEATING
forthright in his testimony: Excerpts of McCain statement to Senate Ethics Panel, New York Times, February 28, 1991.
“I guess we’re going to ruin”: Kevin Roddy, interviews by PD, August 28, September 4, 26, 2008.
more than 100,000 Lisas: For sales history of the Apple Lisa, see http://oldcomputers.net/lisa.html.
Popofsky was prepaid to argue: M. Laurence Popofsky, interview by PD, April 9, 2009.
“He’s named as a defendant”: Lexecon v. Milberg Weiss Bershad Hynes & Lerach, U.S. District Court, Northern District of Illinois Eastern Division, November 10, 1997, to March 3, 1998.
“I heard you called me a crook”: Patrick Coughlin, interview by PD, April 17, 2008.
“Ladies and gentlemen”: Ibid.
A new, hostile sentiment: Joseph C. Goulden, The Money Lawyers (New York: St. Martin’s Press, 2006), p. 249.
“We’re still going to put”: Lexecon v. Milberg Weiss Bershad Specthrie & Lerach, U.S. District Court, Northern District of Illinois Eastern Division.
“a dishonest scheme”: William Sternberg, “Cooked Books,” Atlantic, January 1992.
“Why Lexecon?”: Ibid.
Why let Fischel stand: Lexecon v. Milberg Weiss Bershad Specthrie & Lerach, U.S. District Court, Northern District of Illinois Eastern Division.
a cool hundred million: Goulden, Money Lawyers, p. 266.
“Ladies and gentlemen, the evidence”: In re: American Continental Corporation/Lincoln Savings and Loan Securities Litigation, March 1, 1992, reporter’s transcript. 190 This is sickening: J. Lawrence Irving, interview by PD, October 29, 2008.
“I went to roll over”: In re: American Continental Corporation/Lincoln Savings and Loan Securities Litigation, June 1992.
more defendants opted to negotiate: Elliott Blair Smith, “Settlement Gives Lincoln Patrons $87 Million More,” Orange Country Register, March 31, 1999. 191
By now some ninety defendants: In re: American Continental Corporation/Lincoln Savings and Loan Securities Litigation, June 1992.
Mark Sauter: “Lincoln Officer Pleads Guilty,” New York Times, March 26, 1991.
Economics and efficiency: William S. Lerach, interview by PD, February 26, 2008.
“forty pages of boiler-plate crap”: Leonard Simon, interview by PD, November 10, 2008.
“Joe overlooked it”: Ibid.
“Three billion three”: William S. Lerach, interview by PD, February 26, 2008.
Kevin Roddy wrote to the National Law Journal: See http://altlaw.org/v1/cases/1064857.
“I’m Dan Fischel”: Alan Salpeter, interview by PD, January 5, 2009.
“First I have a few questions”: Ibid.
CHAPTER 14: THE VISIBLE HAND OF GREED
disengaged the stretched canvas: Los Angeles Police Detective Donald Hrycyk, interview by PD, December 3, 2008.
“Which ones?”: William S. Lerach, interview by PD, October 15, 2008.
the number of class action securities cases: Trial Lawyers Inc. California, A Report on the Lawsuit Industry in California (New York: Manhattan Institute, 2005); Michael A. Perino, ed., Securities Litigation: Fifth Annual Capital Matters: Managing Labor’s Capital Conference (Pensions and Capital Stewardship Project, Harvard Law School), May 2–4, 2007.
“He’s got quite an operation”: Gary Rivlin, “The Man High Tech Would Love to Lynch,” Upside, November 1996.
“He’s an exceptionally smart”: Karen Donovan, “Bloodsucking Scumbag,” Wired, November 4, 1996.
Doerr estimated the cost: Ibid.
“For small and medium-size”: see http://www.wsgr.com/.
Duane and Theodore Roth: Theodore Roth, interview by CMC, December 29, 2008.
“I think I can talk to him”: Ibid.
“Maybe we could save everyone”: Ibid.
Lerach simply dropped the suit: “Alliance Pharmaceutical Corp. Announces Dismissal of Shareholder Suit,” Business Wire, June 3, 1996.
insurance carrier did reimburse: Theodore Roth, interview by CMC, December 29, 2008.
Ann Baskins: Pat Dillon, “Shareholder Lawsuits: A Double-edged Sword?” San Jose Mercury News, October 27, 1996.
“Get ready”: Ibid.
“We’re being sued”: Ibid.
Baskins could say nothing: Ibid.
“We are vulnerable”: Ibid. 203
decided to fold their case: Ibid.
He wanted these companies to settle: Katrina M. Dewey, “Lerach & Co,” California Law Business, April 18, 1994.
“I didn’t know shit”: William S. Lerach, interview by PD, October 15, 2008.
“I need someone on the team”: William S. Lerach, interview by PD, April 15, 2008.
and bear him a son: Star Lerach, interview by PD, October 28, 2008.
“How is a CEO supposed to avoid liability?”: Quoted in Lawrence M. Fisher, “William S. Lerach; The Pit Bull of Silicon Valley,” New York Times, September 19, 1993.
“The fact that you go to church”: William S. Lerach, “Plundering America: How American Investors Got Taken for Trillions by Corporate Insiders and Their Assistors,” Stanford Journal of Law, Business and Finance 8, no. 1 (Autumn 2002).
“Fuck her, we’re not settling”: Boris Feldman, interview by PD, October 6, 2008.
companies were now settling: Larry L. DuCharme, Paul H. Malatesta, and Stephan E. Sefcik, “Earnings Management, Stock Issues, and Shareholder Lawsuits,” University of Washington School of Business, March 10, 1999.
More than $700 million: Donovan, “Bloodsucking Scumbag.”
“How to get rid of this scourge”: Quoted in Peter Elkind and Doris Burke, “The King of Pain Is Hurting,” Fortune, September 4, 2000. 208
“I looked at the age”: Patrick Coughlin, interview by PD, April 16, 2008.
Janet C. Mangini: Nina Siegal, “The Last Days of Joe Camel: How a Team of Lawyers Defeated Big Tobacco,” California Lawyer, November 1998.
What if they could prove: Janet Mangini, interview by PD, November 25, 2008. 209
envision the crossover: William S. Lerach, interview by PD, January 22, 2009. 209
“They’re putting Joe Camel”: Ibid.
“Can you hold an advertiser liable”: Siegal, “Last Days of Joe Camel.”
“It just means we appeal”: William S. Lerach, interview by PD, January 22, 2009.
Lazar’s “legal bills”: In re: United States of America v. Milberg Weiss et al., U.S. District Court, Central District of California, May 18, 2006.
deep into the action: Ibid.
Alan Schulman: William S. Lerach, interview by PD, April 15, 2008.
Lerach would explain impatiently: Elkind and Burke, “King of Pain Is Hurting.”
“You can see from the figures”: William S. Lerach, interview by PD, April 15, 2008.
CHAPTER 15: REVENGE OF THE REPUBLICANS
Eugene Novidvor: Mike Allen, “Judge Approves Great American Case Settlement,” San Diego Daily Transcript, August 12, 1993.
“Give me a hint”: Ibid.
“Plaintiffs seek to represent”: James P. McDonald, “Milberg’s Monopoly: Restoring Honesty and Competition to the Plaintiffs’ Bar,” Duke Law Journal, December 1, 2008.
“to prove every word”: Mark Hansen, “Expert Sues Three Law Firms,” American Bar Association Journal, March 1993.
“She’s a superstar”: Judy Temes, “Trailblazer Lawyer Now Name Partner,” Crain’s New York Business, July 19–25, 1993.
comically excessive: David G. Savage, “GOP Targeting Huge Punitive Damage Awards,” Los Angeles Times, November 25, 1994.
“You wouldn’t have to do this”: Dena Bunis, “Low Key Cox Thrust into Limelight,” Orange County Register, July 17, 2005.
never saying the phrase tort reform: Frank I. Luntz, interview by CMC, January 10, 2009.
“A trial lawyer —that’s Jimmy”: Ibid.
“Bill Lerach was the guy”: Hedrick Smith, “Bigger Than Enron,” Frontline, PBS, June 20
, 2002.
they had donated $49.5 million: Figures compiled by the nonpartisan Center for Responsive Politics, available on their website at http://www.opensecrets.org.
“Man the barricades”: Jonathan W. Cuneo, interview by CMC, January 6, 2009.
“Companies, directors, and auditors”: Common Sense Legal Reform Act, hearings before the Subcommittee on Telecommunications and Finance of the House Committee on Commerce, January 19, 1995.
the GOP argument had been reduced: Jonathan W. Cuneo, interview by CMC, January 6, 2009.
Cox had always felt antipathy: Jeff Gerth, “Overhaul of Securities Laws: A Fast Track to Change or a Hasty Decision?” New York Times, May 26, 1995.
Prior to his appearance: Jonathan W. Cuneo, interview by CMC, March 19, 2009.
the Private Securities Litigation Reform Act: David Henry, “On the Defensive; New Congress’ Securities Litigation Reform Aims to Limit Barrage of Lawsuits against Corporations,” Newsday, February 27, 1995.
the “Get Lerach Act”: Bruce V. Bigelow, “‘Get Lerach Act’ Falls Short of Expectation,” San Diego Union-Tribune, April 10, 2000.
“Crooks and Swindlers Protection Act”: Jonathan W. Cuneo, interview by CMC, January 9, 2009.
“Securities litigation”: Lynne Bolduc, “A Case Without a Client, The Private Securities Litigation Reform Act of 1995,” Federal Lawyer, May 1996.
“There’s a lawyer I know in New York”: Ibid. 227
the PSLRA had ten major components: Lynne Bolduc, “A Case Without a Client.
careful playing a card: William S. Lerach, conversation with both authors, summer 1997.
the Democrats’ rank and file remained: Editorial, “First Veto-Override; Securities-Fraud Bill: Clinton Reversed by Democrats Angry at His Flip-Flop,” Baltimore Sun, December 26, 1995.
“You gotta give me”: Theodore D. Roth, interview by CMC, December 29, 2008.
a statement that read more: “Message to the House of Representatives Returning Without Approval the Private Securities Litigation Reform Act of 1995,” December 19, 1995, Public Papers of the Presidents.
“My opinion is known”: Quoted in John F. Harris and Sharon Walsh, “Clinton Vetoes Measure to Limit Securities Suits,” Washington Post, December 20, 1995.
“The fraudsters and the dishonest people”: Common Sense Legal Reform Act, hearings before the Subcommittee on Telecommunications and Finance of the House Committee on Commerce, January 19, 1995.
CHAPTER 16: REVENGE OF THE NERDS
“Dear Bill, more is coming”: Ed Mendel, “Tort-Reform Fight Is Backed with Personal Bad Blood,” San Diego Union-Tribune, March 13, 1996.
a series of statewide referendums: Tim W. Ferguson, “Tort Retort,” Forbes, February 12, 1996.
visions of a future: Gary Rivlin, “The Man High Tech Would Love to Lynch,” Upside, November 1996.
The mid-1990s: “Year of the Internet,” Newsweek, December 25, 1995. 234
a carjacker: Lawrence M. Fisher, “William S. Lerach; The Pit Bull of Silicon Valley,” New York Times, September 19, 1993.
“He’s a greedy guy”: Dan Morain, “The Lawyer Prop. 201 Backers Love to Hate,” Los Angeles Times, March 21, 1996.
“Imagine the feeling”: Rivlin, “The Man High Tech Would Love to Lynch.”
Proulx helped raise $12 million: Karen Donovan, “Bloodsucking Scumbag,” Wired, November 4, 1996. 235
Proposition 201: Ibid.
a shark-finned Cadillac: Ed Mendel, “Battle Over Tort Reform Hitting Streets, Air: Foes’ TV Ads to Counter Backers’ Shark Car Gag,” San Diego Union-Tribune, February 13, 1996.
the major insurers: Marc Lifsher, “Three Measures, One Target: Lawyers,” Orange County Register, January 14, 1996.
Bill Carrick: Bill Carrick, interview by CMC, February 11, 2009.
“Dianne is in this”: Ibid.
“The Silicon Valley guys”: Ibid.
The facts in Central Bank : Central Bank of Denver v. First Interstate Bank, U.S. Court of Appeals for the Tenth Circuit, November 30, 1993, to April 19, 1994.
In 1975 the Supreme Court agreed to hear an appeal: Blue Chip Stamps v. Manor Drug Stores, U.S. Supreme Court, March 24, 1975, to June 9, 1975. 238
“When we deal with private actions”: Ibid.
“In hundreds of judicial and administrative proceedings”: Ibid.
“Congress gutted the law”: “Rebuttal to Argument Against Proposition 211,” California Secretary of State’s Office, 1996.
“Bill Lerach looks after”: Julie Pitta, “Fighting Prop. 211 Becomes Crusade for High-Tech Execs,” Los Angeles Times, September 23, 1996.
Politics was in Cuneo’s DNA: Jonathan W. Cuneo, interview by CMC, January 9, 2009.
Over the Thanksgiving weekend: Jonathan W. Cuneo, interview by CMC, March 20, 2009.
all summer it held a lead: Ed Mendel, “Proposition 211 Registers a 14 Point Lead,” San Diego Union-Tribune, September 18, 1996.
some unusual political alliances: Jonathan W. Cuneo, interview by CMC, January 9, 2009.
playing both sides of the street: Sara Miles, How to Hack a Party Line: The Democrats and Silicon Valley (New York: Farrar, Straus & Giroux, 2001), pp. 32–33.
“We prefer Apple Democrats”: Evan Thomas, John F. Stacks, and James Kelly, “Basking in Reagan’s Troubles,” Time, June 12, 1982.
gave $100,000 to the Clinton campaign: Jeffrey Birnbaum and Viveca Novak, “The Corporate Dole,” Time, September 23, 1996.
Wade Randlett: Miles, Hack a Party Line, pp. 4–6.
“The wealthy East Coast lawyers”: Quoted in Howard Fine, “Tort Wars II: Dollars Flow in, Negative Ads Roll,” Orange County Business Journal, August 12, 1996. 244
“Jon, do you think”: Jonathan W. Cuneo, interview by CMC, January 9, 2009.
“He believes securities laws”: Quoted in Alison Mitchell, “Clinton Touts Technology on California Visit,” New York Times, August 8, 1995.
a fund-raising dinner in Sunnyvale: Alison Mitchell, “Building a Bulging War Chest: How Clinton Financed His Run,” New York Times, December 27, 1996. 245
“Clinton wants to nail down”: Quoted in Birnbaum and Novak, “Corporate Dole.”
“I’ve learned in politics”: Quoted in Miles, Hack a Party Line, p. 34.
“When we brought up ‘securities’”: Jonathan W. Cuneo, interview by CMC, January 9, 2009.
“They’d been warned about”: Bill Carrick, interview by CMC, February 11, 2009.
the anti-Lerach brain trust gathered: John Markoff, “A Political Fight Marks a Coming of Age for a Silicon Valley Titan,” New York Times, October 21, 1996.
“We are looking at the loss”: Ibid.
a survey of its members: “Forty-Seven Percent of High-Tech Public Member Companies Would Consider Leaving California if Prop 211 Passes, American Electronics Association Survey Shows; 61,000 Jobs, Continued Economic Growth at Risk,” Business Wire, October 3, 1996.
Judy Estrin: Donovan, “Bloodsucking Scumbag.”
“If this passes”: Quoted in Philip J. Trounstine, “California Business Frets over Securities Fraud Measure: Proposition Would Help Shareholder Lawsuits,” San Jose Mercury News, July 29, 1996.
“I’d expect my entire board”: Quoted in Gary Rivlin, “The Man High Tech Would Love to Lynch,” Upside, November 1996.
“We’ve gone from Plan A”: William S. Lerach, interview by PD, June 24, 1997. 249
“We came to believe”: Jonathan W. Cuneo, interview by CMC, March 20, 2009.
California voters buried: Dawn Kawamoto and Christine MacDonald, “Voters Reject Prop. 211,” CNET News, November 6, 1996.
“We took a mortal threat”: Quoted in ibid.
“A sleeping giant”: Quoted in Miles, Hack a Party Line, p. 30. 250
Bill Lockyer: Mary Anne Ostrom and Hallye Jordan, “Execs Flex Muscle in Sacramento Access,” San Jose Mercury News, November 2, 1996. 250
“Bill Lerach has awakened”: Donovan, “Bloodsucking Scumbag.” 250
/> To celebrate its extraordinary year: Janet Rae-Dupree, “Intel Caps Super Year with Bonuses for Workers,” San Jose Mercury News, January 15, 1997.
Intel CEO Andy Grove: Scott Herhold, “Intel’s CEO Andy Grove Raked in $98 Million for ’96,” San Jose Mercury News, April 9, 1997.
nursing a hangover: William S. Lerach, interview by PD, October 4, 1995.
CHAPTER 17: MISTAKE BY THE LAKE
He was tall: This account of Pam Little’s meeting J. J. Little is from interviews by PD with Cleveland FBI agent Richard Wren, November 17; Rocky River Police Sergeant Carl Gulas, November 21, 2008; Los Angeles Police Detective Don Hrycyk, December 3, 2008; and Los Angeles FBI agent Virginia Curry, December 8, 2008.
Pam Davis possessed a résumé: Ibid.
“We found what appeared”: Rocky River Police Sergeant Carl Gulas, interview by PD, November 21, 2008.
“He’s sitting on stolen art”: Ibid.
We can’t pull back: William S. Lerach, interview by PD, October 28, 2007.
“Mel, I’ve been to the museum”: Ibid.
“A good Jew”: The history of the Milberg Weiss firm is detailed in a memo from Stephen Weiss to members of his firm Seeger & Weiss, September 30, 2008. 255
“On my honeymoon with Star”: William S. Lerach, interview by PD, October 15, 2008.
“I don’t know”: Ibid.
Following the rewriting of the rules: William S. Lerach, interview by PD, February 24, 2008.
employee pension funds: Steven E. Abraham, “The Impact of the Taft-Hartley Act on the Balance of Power in Industrial Relations,” American Business Journal 33, no. 3 (1996). 256
institutional investors: William S. Lerach, interview by PD, January 22, 2009.
Dennis Drabek: Rocky River Police Sergeant Carl Gulas, interview by PD, November 21, 2008.
International Foundation for Art Research: For tracking lost art, see http://www.artloss.com/.
Cleveland FBI agents Dick Wren and Scott Brantley: Cleveland FBI agent Richard Wren, interview by PD, November 17, 2008.
“to a lot of wise-guy wannabes”: Los Angeles FBI agent Virginia Curry, interview by PD, December 8, 2008.
Circle of Greed Page 56
