Federal prosecutors in the criminal case against the securities powerhouse firm now called Milberg LLP have agreed not to sanction Melvyn Weiss for violating his supervised release following his arrest for drunken driving in Florida.
Weiss, 77, who spent more than a year behind bars after pleading guilty to charges that his firm paid kickbacks to lead plaintiffs, was scheduled to complete his three years of supervised release on February 5. Under his 2008 plea agreement, Weiss agreed not to commit any crime while on probation.
But on December 20, he was arrested in Boynton Beach, Fla., for driving 90 miles per hour while intoxicated. On April 18, he pleaded guilty in Palm Beach County, Fla., to driving under the influence and was sentenced to 12 months probation and 50 hours of community service.
In a stipulation filed on May 2, federal prosecutors in the kickback case agreed not to seek further sanction against Weiss, given his sentence of probation in the Florida case. U.S. District Judge John Walter in Los Angeles had scheduled a hearing for Friday.
Both sides agreed that, "given the sentence imposed in the Florida matter, and to avoid the duplication of supervision resources by both the United States Probation Office and the State of Florida, to a joint recommendation that Mr. Weiss’ supervision by the United States Probation Office be terminated, with no additional sanction for his supervised release violation," the stipulation says.
"In light of developments in the Florida DUI case, we believe our recommendation appropriately resolves Mr. Weiss’ violation," Thom Mrozek, a spokesman for the U.S. attorney’s office in Los Angeles, said via email. "Mr. Weiss addressed the court, and he found that it was appropriate to terminate the supervised release," said Weiss’s attorney, Alfredo Jarrin, a partner at Brown White & Newhouse in Los Angeles. He declined to comment further other than to say "we’re pleased with the result."
His attorney in the drunken driving case, Guy Fronstin, a solo practitioner in Boca Raton, Fla., said in an email that Weiss "accepted responsibility for his actions and at sentencing the court imposed the statutory minimum sentence."
Fronstin has been nationally recognized for his criminal defense work and has represented former NFL player David Boston, Wall Street billionaire Jeff Epstein and 67 victims of Bernie Madoff. He also represented John Goodman, owner of the International Polo Club, who was convicted last year in Florida on vehicular manslaughter charges and sentenced to 16 years in prison.
According to the arrest report filed by the Palm Beach County Sheriff’s Office, submitted by federal prosecutors, Weiss was pulled over in the late night hours of December 19 after a deputy sheriff saw his blue Lexus SUV swerving and driving in two lanes at once while traveling south on Interstate 95.
According to the arrest report, Weiss had a passenger in the car and told an officer he had had one drink and was coming from a golf club. The officer reported that Weiss’s speech was slurred and his eyes were red and glossy. Weiss later said he’d had two drinks.
After getting out of the car, Weiss failed to maintain his balance while walking a painted white street line and was unable to recite the alphabet, though he stated that he had a law degree, the arrest report says.
Weiss, upon being arrested, asked an officer from the back of his patrol car: "Why are you doing this to me, what did I do that was so wrong?" and "Do you know who I am?" His blood alcohol level turned out to be between 0.13 and 0.14.
In the kickback case, federal prosecutors had alleged that Milberg Weiss Bershad & Schulman and several of its then-partners, including Weiss, obtained $251 million in attorney fees by paying kickbacks to lead plaintiffs. The firm paid $75 million in 2008 to settle the charges.
Weiss was sentenced to 30 months in prison after pleading guilty to one count of racketeering conspiracy. He paid a $250,000 fine and forfeited $9.7 million. He served about 18 months in a federal prison facility in Morgantown, W.Va., followed by time in a halfway house and home confinement.
Three other partners, including William Lerach, were sentenced to prison terms, as were two lead plaintiffs, an expert for the firm, and a former lawyer who served as an intermediary in the scheme.
Contact Amanda Bronstad at email@example.com.