Who would have thought we'd be handing out kudos to Milberg LLP three years after firm predecessor Milberg Weiss Bershad & Schulman was indicted for kicking back legal fees to class action plaintiffs? Who would have thought the firm would survive in any way, shape or form -- much less that it would continue scoring significant settlements?
Funny thing about plaintiffs attorneys: They're a tenacious bunch. Milberg partner Brad Friedman summed up the mindset when the National Law Journal's Jeff Jeffrey asked him recently why he hadn't jumped ship during the drama.
"I was going to be good and damned if the government was going to chase me out of my firm and away from the people I liked working with," he said.
The other firms we included in this eighth annual National Law Journal Plaintiffs' Hot List didn't tend to have Milberg's kind of problems, but they had plenty to contend with. To name one cause of action, securities class action filings declined by 22.3 percent during the first half of 2009, according to Stanford Law School's Securities Class Action Clearinghouse. That organization counted 87 filings during the period, compared to 112 in each half of 2008. Of course, 2008 saw a 19 percent surge in such filings compared to 2007, with almost half targeting -- surprise! -- the financial sector. Financial services firms remain a frequent target this year, representing 66.7 percent of filings through June. Still, U.S. securities filings during the second quarter fell 11 percent below the average for the past 12 years. Plaintiffs, the clearinghouse explained, were running out of major financial houses to sue.
We asked our readers to nominate firms in the United States that did exemplary, cutting-edge work on the plaintiffs' side between the summer of 2008 and the summer of 2009. Firms needed at least one significant win and an impressive track record within the previous three to five years. A "significant" win meant prevailing in a bench or jury trial when the stakes were high, meaning that a substantial amount of money was at issue, or that the case could affect the litigation strategy or outcome of similar cases nationally. We also looked for wins that could effect significant social change or civil rights gains. Firms needed to devote at least 50 percent of their litigation resources to plaintiffs' work.
We don't pretend this is anything but our subjective take on the major players in the plaintiffs' bar. We looked for firms that struck us as representing the bar's best qualities and that demonstrated unusual flair and creativity. We understand that major class litigation is a collaboration and regret that space doesn't permit us to credit every firm that contributed to the cases we highlight here.
Milberg, for example, has been missing from this list since the indictment, even as it continued to score in court. By this time, the firm has purged its ethically-challenged attorneys and otherwise cleaned up its act. Beyond that, it helped win a $750 million recovery in a case alleging accounting shenanigans by Xerox Corp. As Jeffrey explains in his article, the firm threw lawyers with serious accounting skills at the Xerox files. "It was possible to look at a highly incriminating report and not know you had gold in your hand without some pretty sophisticated knowledge of accounting principles and practices," Friedman said.
Less money but plenty of principle was at stake in litigation undertaken on behalf of an aging cadre of Mexican "braceros," laborers recruited to work in U.S. fields, beginning during World War II. Their employers withheld part of their wages, ostensibly to save it on the workers' behalf, but government-affiliated Mexican banks refused to hand over the money. The challenge against powerful defenses including sovereign immunity scared off the plaintiffs' bar until 2001, when Chicago-based Hughes Socol Piers Resnick & Dym and San Francisco's Lieff Cabraser Heimann & Bernstein joined forces on the workers' behalf.
The team prevailed, regular NLJ contributor Emily Heller reports. But it was a matter of refusing to take "no" for an answer through three -- count 'em -- reversals in federal court. The U.S. government extracted itself from the litigation. The Mexican government and banks finally bowed to moral pressure that the litigation helped to stoke.
"I actually expected, to tell you the truth, at some point that the plaintiffs would just give up because it was so hard, but they never did," U.S. District Judge Charles R. Breyer remarked.
Speaking of tenacity, here's Coughlin Stoia Geller Rudman & Robbins (formerly affiliated with Milberg Weiss; we must note that former partner William Lerach is now in jail for participating in the kickback scheme). The firm took long odds in 2002 that any money it could squeeze out of Enron Corp.'s enablers would cover its litigation expenses in a climate growing ever more hostile to scheme-liability suits. The firm extracted $7.2 billion in settlements and a nice share of $688 million in attorney fees.
"It was the biggest securities fraud going on, and we're the biggest securities class action firm, so we wanted to be involved, even with those risks," Coughlin told the NLJ's Amanda Bronstad.
Yeah. That's what we're talking about.
See THE 2009 PLAINTIFFS' HOT LIST (Subcription required).