Steven G. Schulman, the disbarred lawyer who was once a partner at class action powerhouse Milberg, has reached a settlement in a $15 million suit he filed against the firm for falling behind on its scheduled payments to him.
In 2007, Schulman pleaded guilty to racketeering conspiracy. He was made to pay $2 million and served six months in prison after he was implicated in a scheme to pay named plaintiffs in class actions that also led to prison time for several of his partners.
In a suit Schulman filed earlier this year, he said the firm owed him $15 million for capital account and other withdrawal payments, noting he was the firm’s biggest creditor.
In his suit against Milberg LLP and its operating successor, Milberg Tadler Phillips Grossman, Schulman said the payments suddenly dried up last year because of what he alleged was a scheme to shift Milberg’s assets to Milberg Tadler amid the firm’s 2018 reorganization.
According to a document filed June 7 in Manhattan Supreme Court, Schulman has agreed to withdraw his suit against both firms for now. The terms of the deal were not made public.
Whatever the terms are, they didn’t result in Schulman indicating in a related case that his beef with the two Milberg firms is completely over. In a 2009 case in which he won a multimillion-dollar judgment against the firm, as of Tuesday, he had not filed papers indicating that the judgment was satisfied.
It also isn’t clear whether Schulman’s deal will affect others. David Bershad, another former Milberg partner implicated in the paid-plaintiffs scandal who also sued the firm this year for allegedly stopping agreed-to payments, appears to still be litigating against the firms and their partners Ariana Tadler, Glenn Phillips, Marc Grossman and Peggy Wedgworth as of Tuesday.
Bershad’s lawyer, Samuel Portnoy of Gibbons, said in an April letter filed in court records that the parties were in settlement talks. He did not respond to a comment request.
“Glenn Phillips and Marc Grossman look forward to the continued success of their firm,” their lawyer Cliff Robert of Robert & Robert said in an email. Robert also represented the Milberg Tadler firm.
Leslie Corwin, Schulman’s lawyer at Eisner, declined to comment. David Piedra of Morrison Cohen, who represents Milberg and partners Tadler and Wedgworth, didn’t respond to a comment request.