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Scandal-ridden law firm is big Democratic donor

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May 23, 2006


Milberg Weiss Bershad & Schulman LLP, the securities class action law firm indicted last week on fraud charges stemming from corporate lawsuits it filed, made large political contributions almost exclusively to Democrats since 1999, records show.

The firm and individuals there made $2.78 million in campaign donations to Democrats since 1999 compared to about $22,000 to Republicans, according to the Center for Responsive Politics, which tracks money in politics.

Among the recipients were New York Sen. Hillary Rodham Clinton, who is a possible 2008 presidential candidate, senior New York Senator Charles Schumer and Sen. John Kerry, the Democratic presidential candidate in 2004.

On top of the $2.78 million, lawyers in the firm made contributions to New York Attorney General Eliot Spitzer, who is the Democratic candidate for governor. Spitzer’s office said on Monday that he plans to return $124,455 in contributions.

Larry Sabato, director of the University of Virginia’s Center for Politics, said Republicans would likely use the donations as ammunition in the November congressional elections and to blunt criticism about recent corruption scandals involving Republicans.

They will target “every individual Democrat in a competitive race in 2006 to begin with,” Sabato said.

They also will mount “a P.R. offensive to make certain that this helps to balance the Democrats’ charges of a culture of corruption that affects only Republicans,” he said.

The Center for Responsive Politics, a nonpartisan group, compiled information about the law firm’s campaign contributions at the request of Reuters.

The Democratic National Committee was one of the primary beneficiaries, receiving almost half the money, $1.28 million. Most of that was from the firm itself and included $500,000 for the DNC’s new headquarters.

“We are looking into the matter,” said DNC spokeswoman Stacie Paxton.

Milberg Weiss and two partners, David Bershad and Steven Schulman, were indicted last week on 20 counts of perjury, bribery and obstruction of justice. They were accused of illegally paying clients to act as plaintiffs in lawsuits against corporations.

The firm and the two lawyers have called the charges unjust.

President George W. Bush campaigned to limit the kinds of lawsuits filed by Milberg Weiss, and the Republican-controlled Congress last year passed a law that seeks to curb class-action lawsuits by shifting them to federal courts from state courts and linking attorneys’ fees with the payouts for clients.

Class-action cases allow plaintiffs to combine claims into one suit against a common defendant. Democrats have defended the suits as a way for consumers to hold multi-billion corporations accountable.

Hillary Rodham Clinton and her political action committee received almost $24,000 in contributions from individuals at Milberg Weiss since 1999, according to the data.

“We will not be taking any action at this stage,” Clinton’s spokeswoman Ann Lewis said in an e-mail.

Schumer received $57,750 from individuals at the firm. His spokesman did not respond to requests for comment.

The House and Senate Democratic campaign committees received $440,365 and $350,650 respectively from the firm and individuals there since 1999, the data showed.

Milberg Weiss Bershad & Schulman LLP once reached number six in 2002 on the Center for Responsive Politics top 20 list of law firms and lobbyists that were contributors to lawmakers and political parties since 1999.

President Bush received $2,000 during the 2004 campaign in individual donations within the firm but his Democratic rival, Sen. Kerry, received $54,900 in individual contributions, the Center found.

Republicans and Democrats have returned more than $200,000 in contributions from clients of lobbyist Jack Abramoff, who pleaded guilty in January in a wide-ranging investigation into possible attempts to bribe lawmakers.

(Additional reporting by Herb Lash in New York)

© Reuters 2006