The Next Page: William Lerach, the dethroned 'King of Pain' for corporate America

North Side native Bill Lerach, once one of America's most formidable attorneys, is making the most of a forced retirement, post-prison


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Sitting comfortably on his couch, stroking the head of the rescued whippet napping in his lap, Bill Lerach seems far different from the man Fortune Magazine once called the "King of Pain" because of the legal torture he inflicted.

The North Side native was referred to as the "King of Torts" before John Grisham's novel by that name was published. The New York Times speculated that the book could very well be based on Mr. Lerach, but The Wall Street Journal said, "John Grisham would have to struggle to invent a character as brilliant and unethical as Bill Lerach."


As one of the most powerful lawyers in the country, he crossed paths, or swords, with almost everyone of prominence of the last 25 years. Photos of him with Bill Clinton, Joe Biden and the like line the walls of his home movie theater. Mr. Lerach sued Ken Lay and Enron for their "pump and dump scheme" and won an astounding $7.2 billion judgment. He sued Charles Keating and Lincoln Savings over their casino that was masquerading as an S&L. The list of companies he sued reads like the Fortune 500. But some believe that Dick Cheney and Halliburton may have been one court case too far.

He was loathed and feared and loved. While he was on the prowl, he collected billions in settlements for investors, large and small, sometimes with a tactic that became known as "Leraching" -- demanding so much paperwork during discovery that it was cheaper to settle than to spend the months of staff time to assemble the evidence. His staff combed news reports and stock tickers to see whether major shareholders and corporate officers just happened to sell their shares in the immediate aftermath of the company making some major announcement, only to have the stock crash, often taking the life savings of the little guys down with it.

Now the 68-year-old seems content for the most part to collect art and tend what he calls the Richard E. Lerach Memorial Raspberry Patch, named for his father, who grew berries in their backyard on Kennedy Avenue.

The younger Lerach's berries have to be among the most expensive organic produce on the planet, given the land on which they're cultivated. Lerach owns 6 acres of prime La Jolla, Calif., real estate -- the largest single-family oceanfront property in San Diego County.

At least 2 acres are used to grow much of the food that he and his wife, Michelle Ciccarelli, eat. More land is occupied by the pool with its spectacular view of the Pacific and the 16,000-square-foot house with one of the largest private collections of African and pre-Columbian art in the world. For a coffee table, he uses the antique carved wooden funeral bed of an African chief.

Then there is a large aviary where he feeds some of the berries to his birds (and taught one of them to say a Pittsburgh word that some consider an obscenity). His cousin, Jimmy Kerr, who lives in Imperial, said, "The aviary was a result of his father taking us to the aviary in Pittsburgh after church on Sunday."

Not bad digs for an ex-con.


In September 2007, Mr. Lerach and other members of his firm were convicted of illegally paying plaintiffs and expert witnesses. His net worth was estimated to be $700 million before he did 18 months in federal prison and was forced to surrender his law license.

Bill's older brother, Richard, who lives in Mt. Lebanon and is a retired corporate counsel for U.S. Steel, said of the case, "There has been a lot of legal opinion that it was wrong for him to have gone to prison. But 'selective prosecution' is not a defense. If five people run the stop sign in front of you and you get the ticket, you can't say that because they ran it, too, you shouldn't get the ticket. A lot of people went through the stop sign at a much greater speed than Bill, but he did run the stop sign. And I think he'd tell you that. But I have the feeling my brother may have been a case of selective prosecution. I think it's possible and maybe even likely."

It's been speculated that taking on Dick Cheney in the Halliburton fraud suit and being a thorn in the side of too many prominent people may have been his undoing. The government spent seven years investigating the firm of Milberg, Weiss, Bershad, Hynes & Lerach before finding a case to prosecute.

When he was on top, magazines sang his praises. The Economist asked, "Is Bill Lerach on the Side of Angels?" The Nation ran a cover story about him with the headline, "Is This America's Top Corporate Crime Fighter?"

Richard Lerach definitely would answer in the affirmative. "He was a real crime fighter as far as I am concerned." He added, "How you characterize things depends on which side of the ball you're on."

You'd think Dennis Unkovic of McCandless would be on the other side of the ball. He acknowledged that it might sound odd coming from a Republican who makes his living as an attorney for some of the largest corporations in the world, but Mr. Unkovic said, "I thought what he did as a lawyer was beneficial to America."

Mr. Unkovic is a partner in the Downtown firm his father started, Meyer Unkovic & Scott. "Look at the bankers, the venture capitalists, that took billions and got away. It's ironic that the only people who went to jail were Martha Stewart and Bill Lerach."

It's also ironic that Bill Lerach sued Martha Stewart Living Omnimedia on behalf of people who had purchased securities and suffered when their value dropped, while she used her insider information to sell before the fall.

Mr. Unkovic's father gave Mr. Lerach a job as a law clerk when the young man needed it to avoid dropping out of the University of Pittsburgh Law School for lack of money. Mr. Unkovic said of his former classmate, "He made mistakes. I'm not an apologist for Bill Lerach. What he did was wrong. But very few people could say he wasn't a great lawyer."


After graduating from Pitt Law and spending a few years at the Unkovic firm, Mr. Lerach got a much better offer from another bastion of corporate law in Pittsburgh, Reed Smith. On a trip to San Diego handling a case for Mellon Bank, Mr. Lerach fell in love with the city on the ocean and started making plans to move.

Richard Lerach said their mother "drove with him to California in his old Pontiac, got him set up in San Diego." Fifteen years after their mother's death, Bill still is pained to speak of her passing. Richard was already out of the house when their father died suddenly on Father's Day in 1963, three days before Bill's graduation from Pittsburgh Perry High School. In their grief, Bill and his mother clung together. She moved to Oakland with him when he started his undergraduate studies at Pitt.

"My memories of it are uniformly favorable," Bill Lerach said of his hometown. "Mainly because of memories of my childhood. Pittsburgh was a simple small town -- going to Forbes Field to see baseball games, streetcars and West View Park. You knew everyone around you. Pittsburgh was a real town I thought, at least the part I grew up in -- the North Side."

He pronounces it "Nor Sahd," his rough voice dripping with a Pittsburgh accent that even 37 years in San Diego haven't dulled. "I loved the University of Pittsburgh," he said. "It was a great school with a wonderful location. It was hard for me to leave Pittsburgh. But California worked out."


He maintains ties to the Steel City. He has spoken at Pitt's law school several times and gave the 2003 commencement address. He endowed a scholarship in memory of his family. He has written op-eds for the Post-Gazette on his favorite topic -- how corporate greed is destroying America.

As fierce as his detractors -- and there are many of them -- are in denouncing him, his family and friends are doubly fierce in their praise. He engenders strong feelings, good and bad, because of his passion. How many people have stacks of magazine and newspaper articles devoted to their sins, not to mention an entire 2010 book, "Circle of Greed"? But how many people also have friends who stand by him and rush to say nice things about him?

Mr. Unkovic said, "Bill's greatest regret is not being a lawyer any more. Taking away his ability to be a lawyer was the worst punishment that he suffered."

Spending his time enjoying his art and gardens and traveling the world, Mr. Lerach doesn't seem to be suffering much. His wife also has given up practicing law, and her pursuits include operating an organic bakery and cooking school in La Jolla.

When she isn't supervising cupcake production, Ms. Ciccarelli works with Mr. Lerach's daughter, Shannon, in helping the women of Liberia. Mr. Lerach supports their efforts with his time and money -- the family just spent nearly a month in that war-torn African nation where, he said, the infrastructure is "nonexistent." Their hotel was surrounded by barbed wire and heavily armed guards.

Ms. Ciccarelli is working to get equal rights into the constitution of that country, which has lost too many of its men to the civil wars that left widows and single women with little legal or economic power. Mr. Lerach helps support a group that extends micro-loans to women there who want to start small businesses. As a lawyer, Ms. Ciccarelli won a landmark case to protect sweatshop workers overseas.

The Liberian effort is only one of the many charities he supports. He often opens his mansion to fundraisers for causes and candidates he supports. He remains politically active by speaking to Democratic clubs and expounding about issues.


He loves showing off his art and can recite details of the collection in a way that would qualify him as a docent at any art museum. He recently invited students from a low-income section of San Diego to enjoy the priceless works, but unlike a museum, he let his visitors touch some of the sculptures. After the tour, he told them his story of how he rose from modest Pittsburgh beginnings to own the massive estate. He does it not to say "look at how great I am" but to try to inspire them to think that they, too, could work hard and some day land in the 1 percent.

His cousin tells the story about playing baseball on a tennis court and Bill sliding into a metal pole used as a base. He split his head open and, as Mr. Kerr recalled, "Blood was spurting about 20 feet in the air." That headlong dive, Mr. Kerr says, trying at all costs, consequences be damned, was how Bill Lerach seemed destined to live his life.

opinion_commentary - legalnews

Walter G. Meyer, a Bethel Park native and freelance writer, lives in San Diego (wmeyer516@aol.com). He is the author of a novel, "Rounding Third."


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