Truth in Corporate Justice LLC: Lead Plaintiff in Halliburton Securities Litigation Sends Attorneys Packing
As Lead Plaintiff attempts to maintain dignity to all, facts continue to mount justifying substitution of counsel.
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Oakland, CA – January 3, 2007–Truth in Corporate Justice LLC (“TCJ”)(www.worldwidetree.org) issues this press release to advise shareholders and the public that the Archdiocese of Milwaukee Supporting Fund, Inc. (“AMS Fund”), Lead Plaintiff in the Halliburton Securities Litigation matter, is seeking to substitute lead counsel.
On December 27, 2006, AMS Fund filed its Reply Brief on its Motion to Substitute Counsel. The brief cites numerous reasons for AMS Fund’s request to remove the firms of Scott + Scott and Lerach, Coughlin, Stoia, Geller, Rudman & Robbins as lead counsel in this matter.
Three of the most important reasons are the failure of lead counsel to keep AMS Fund fully informed about the status of the case, which violates the Court’s pre-trial order number 2 and both federal and state law. Next, the potentially negative impact on the litigation as a result of the proliferation of media attention surrounding William S. Lerach and the Department of Justice’s ongoing criminal investigation of him and his former firm, Milberg, Weiss, Bershad , Hynes & Lerach which has lead to the indictment of two of Lerach’s former partners and his predecessor firm, and insurmountable conflicts of interest which continue to mount as Scott + Scott and Lerach Coughlin try to hold on to their lead counsel position.
The AMS Fund is requesting the court to substitute the firm of Boies, Schiller & Flexner as lead counsel. The Court has not yet ruled on the motion. Neil Rothstein, founder of TCJ, says that it is unfortunate that this has grown to a level lead plaintiff did not desire. However, the flow of undisclosed information that it receives clearly does not comport with what is in the best interest of the client or the class. “While all the Lead Plaintiff sought was to have this transition maintain the dignities of those involved, the realities amount to far more than the loss of dignity”, stated Rothstein. “This is not about guilt or innocence; it is about appearance, conflicts of interest and ethical behavior.” This case is entitled : Archdiocese of Milwaukee Supporting Fund, Inc., et al. v. Halliburton Company, et al. (Master Docket No. 3:02-CV-1152-M), a consolidated class action pending in the Northern District of Texas before U.S. District Judge M.G. Barbara Lynn.
To read more about this situation, please visit www.halliburtonsecuritieslitigation.com
Truth in Corporate Justice can be reached at 800/610-4998.
Mr. Rothstein can also be reached at 619/251-0887.
Truth in Corporate Justice LLC: Lead Plaintiff Will Substitute Counsel in Halliburton Litigation (NYSE:HAL) Securities Litigation
This is an update concerning the Halliburton Securities Litigation. Truth in Corporate Justice LLC is Special Counsel to the AMS Fund, Inc. on Securities Matters
This article is to keep those who desire to know more about this litigation up to date and it does not speak for any party to this action except to the extent that it has been authorized or that is qualified to explain. It states representations and facts in this ongoing case.
On November 22, 2006, the Archdiocese of Milwaukee Supporting Fund, Inc. (“AMS Fund”) moved for an order substituting counsel in a consolidated class action against Halliburton, Inc., where AMS Fund serves as sole Lead Plaintiff representing more than 800,000 absent class members. After months of attempting to amicably resolve its differences with the law firms of Lerach, Coughlin, Stoia, Geller, Rudman & Robbins, LLP (“Lerach Coughlin”), of San Diego, California, and Scott + Scott, LLC (“Scott + Scott”), of Colchester, Connecticut (collectively referred to as “Co-Lead Counsel”), AMS Fund was forced to seek the replacement of these firms as lead counsel in this case. Truth in Corporate Justice LLC, Special Counsel to the AMS Fund, stated this is an unfortunate but necessary change that was unexpected at the time Mr. Lerach’s firm first intervened in this case.
AMS Fund’s Special Counsel and former lead counsel, Neil Rothstein, tried to handle this in a most professional and ethical manner so as to not impede direct, productive contact between Lead Plaintiff and its Co-Lead Counsel. Over the last few months, AMS Fund asked Scott + Scott several times for copies of all correspondence, but Scott + Scott refused. AMS Fund also advised Scott + Scott of its concerns about Lerach Coughlin continuing as lead counsel while the Department of Justice is concurrently investigating both Halliburton and Mr. Lerach (a fact which Mr. Lerach did not disclose to AMS Fund, and which AMS Fund only learned through the press). AMS Fund requested Lerach Coughlin withdraw quietly, and only requested the Court’s substitution of counsel when Lerach Coughlin refused.
On November 21, 2006, in response to AMS Fund’s concerns, Lerach and Scott “invited” Paula N. John, the President-Elect of the AMS Fund (effective January 1, 2007), to meet with them at such convenient locations and times as “November 28, 2006, in the early morning or late afternoon—preferably at the Minneapolis Airport” or more interestingly, “…Friday, December 1, 1006,” in San Diego. Ms. John found flight reservations to San Diego on the latter date impossible to find. Co-Lead Counsel never even suggested meeting in AMS Fund’s boardroom in Milwaukee.
AMS Fund and others were alarmed that Lerach and Scott stated in this letter they would “arrange the presence of retired Federal Judge Lawrence Irving” who had joined Lerach’s firm as an attorney and Joe Kendall, “a retired federal judge and local counsel in this case who knows Judge Lynn and the Dallas federal courthouse quite well.” This statement demonstrates a course of disturbing behavior and veiled threats, as Judge Irving had or still does serve as Guardian Ad Litem for the Court and Class, and Judge Kendall acted as AMS Fund’s liaison counsel earlier in the litigation. Please note that it was Co-Lead Counsel, Lerach and Scott, which put the correspondence regarding the Court and Judges Irving and Kendall into the record, thus making the statement public. AMS Fund had no intention of making any of this public.
AMS Fund does not accept this comment by Lerach as a reflection upon the Court It has great faith, deference and knows the independence of the Honorable Barbara M.G. Lynn. AMS Fund believes it to be an insult to the Court and the Lead Plaintiff. Therefore, Lerach and Scott must depart this case for having such disrespect. Further, while unfortunate, Judges Kendall and Irving should withdraw as they were not only mentioned in this light, but they were copied on the letter, and have never stated their opposition to such a comment. AMS Fund now understands their conflicts, as both former judges work either for or with Lerach’s law firm. Mr. Lerach had an obligation to disclose this to the Court. While no harm has come upon the class, it would become impossible for any independent lead plaintiff to fully protect the due process rights of all absent class members, if such behavior continues.
As stated in its Reply Brief filed recently, and as summarized in the Fortune.com article published recently (available at http://money.cnn.com/blogs/legalpad/index.html), the firms of Lerach Coughlin and Scott + Scott face d insurmountable conflicts of interest and/or breaches of important fiduciary duties to AMS Fund and the Class, which make it impossible for these firms to continue to serve as Co-Lead Counsel or to continue to litigate this action.
Co-Lead Counsel’s conflicts are further amplified by Mr. Lerach seeking the spotlight and acting self-servingly in the Enron Securities Litigation where the AMS Fund is a Certified Class Representative for the Debt Bondholders. In the news recently, the Honorable Melinda Harmon ordered Lerach, in an unprecedented situation, to pay the costs and legal fees of a defendant bank for continuing to prosecute claims against that defendant after the point they were shown to be without merit. Lerach went to defendant’s attorneys and brokered a deal that served only his self-interest: he would not appeal Judge Harmon’s decision as long as he did not have to pay these fees or costs as ordered by that Court.
AMS Fund will not allow any attorney that represents it to usurp the power of the Court; it also has no intention of leaving the Enron case. Enron is different than Halliburton: in the case of Halliburton, the conflict exists that the U.S. Government is investigating Lerach and investigating a company where the sitting Vice President was Chief Executive Officer during the class period. This situation, which raises a conflict, will probably never occur again.
AMS Fund was the only investor to oppose the previous inadequate settlement of the Halliburton action and it has always acted to promote the best interests of the Class. It will not waiver from this course under any circumstances. AMS Fund has taken these necessary measures to protect and preserve the interest of the Class and is seeking the substitution of Boies Schiller & Flexner as Lead Counsel in this action.
As with all actions taken by AMS Fund in prosecuting this class action, the substitution of counsel was not made in haste and only after consultation with various experts. Contrary to current Co-Lead Counsel’s position, this necessary change will serve to promote the best interests of the Class by limiting costs, expenses and ultimate delay. As admitted by current Co-Lead Counsel, the case has not progressed lately (On November 10, 2006, Mr. Scott characterized the case as being in “limbo”). Therefore, Lead Plaintiff finds this the perfect time to change counsel, especially as current Co-Lead Counsel continue to violate Pre-Trial Order No. 2 by failing to turn over documentation and take direction from the Lead Plaintiff. The requested substitution will provide the Class with counsel who face no conflicts of interest, who are attentive to Lead Plaintiff’s direction, and who are diligent in responding to requests of Lead Plaintiff.
For further information please contact:
Truth in Corporate Justice LLC