Taming the Corporate Sharks: Securities-Law Master Bill Lerach
by Mary Waldron
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<<Attending law school and sprouting up in the law community on the East Coast, Lerach was an eager and diligent young law professional who took the time to savor his studies and learn the ropes in law. His continuous dedication to and respect for the legal profession and his clients have carried him to astounding and fulfilling career heights.
As a young adult in the 1960s, Lerach was sure that he wanted to pursue a profession that would "make a difference and impact things" during a time of global turmoil. "I thought law was the profession that gave you the ability to affect society, change things, make it better," he said. Lerach attended the University of Pittsburgh as an undergraduate and for law school. He earned his J.D. in 1970.
Once he completed law school, Lerach started out at the Pittsburgh branch of the giant international firm Reed, Smith, Shaw & McClay and was immediately taken under the wing of senior litigator Walter McGough. McGough was a prime example for Lerach because he had risen dramatically from "extremely ordinary beginnings" to be the head of the firm's litigation department.
McGough was not your typical hotshot attorney; he was more grounded, according to Lerach, who was fond of him because he was not one of the "prickly, uptight, right-winged, WASPy types" sometimes found in large firms.
"Walter befriended me, guided me, taught me, let me sit beside him as he debated and made decisions," he said. "I thought it was the most valuable practical experience of my life." Lerach has based much of his career on the essential teachings he learned from McGough, who shaped his "view of the legal world."
Lerach agrees with many other outstanding large-scale attorneys that having a willing and knowledgeable mentor during one's first years in a career field is priceless. "I think for any young professional, whether it's law, business, or medicine, to get the benefit of working side-by-side with an able, experienced, ethical mentor is a great deal of good luck, and it worked for me," Lerach said.
Although Lerach never sought a clerkship after law school, he wishes that he had. Lerach advises any aspiring litigation attorney to attempt to get a clerkship at the federal district court level. Working on the opposite end in the courtroom provides "unique insight" and experience for attorneys who want to understand and know the process.
During the five years he spent at Reed, Smith, Shaw & McClay, Lerach not only found tremendous opportunity to build his legal foundation, but he also became a partner, which was very important to him. He then proceeded to join Milberg, Weiss & Bershad, where he stayed for many years before moving on to his own firm, Lerach, Coughlin, Stoia, Geller, Rudman & Robbins, where he is currently chairman.
What do you do for fun?
I love gardening and working in the yard. I have also developed an interest in tribal art.
What CD is in your CD player right now?
Elton John's Goodbye Yellow Brick Road, which shows how hopelessly dated I am.
What is the last magazine you read?
What is your favorite TV show?
I watch the news channels and the History Channel.
Who is your role model?
Abraham Lincoln. I thought he was quite a man.
<<Lerach found his practice niche early on in his career while at Reed, Smith, Shaw & McClay. There, he frequently took corporate transactional cases representing corporations in securities and mergers, and he did litigation for defendants in securities cases. It was there and then that the young Lerach realized there was something fishy going on in corporate America. Although there were good cases being fought in the courtroom, it was Lerach's understanding that many were not going anywhere because of the sea of poor lawyers handling them and the lack of finances to support them. Lerach set out to change all that.
Staying true to his humane and just aspirations, Lerach has built his entire career on looking out for the little guys and battling large, corrupt companies. He has prosecuted cases involving Dynegy, Qwest, WorldCom, and AOL Time Warner, to name a few. His team of approximately 160 lawyers at Lerach Coughlin devotes much of its time to institutional investor clients who usually will bring forth cases that Lerach and others will prosecute.
Lerach is probably best known for serving as the chief counsel in the Enron scandal that shook the corporate world in 2002. The former monster energy company and Fortune's "America's Most Innovative Company" for six consecutive years filed for bankruptcy in 2001. The company's previous façade of immaculate financial success was created by the top executives of the company, who had developed and sustained a sneaky accounting-fraud scheme for years. With a group of 25 prosecutors, the case has been a tremendous example to the law community and Enron has become a household name. To date, Lerach's work on the "factually and legally complicated" case has recovered $7.3 billion for the prosecuting clients.
<<The Enron experience has taught Lerach and his team not to be afraid to take on a huge company that could potentially find a loophole. The team fought despite the facts that it did not represent the largest-loss client, that there was a Supreme Court decision that many critics said would hold back their victory, and that many huge firms and banks said they would not pay.
"One lesson we learn over and over in life is that you can only succeed if you fight hard. You must suffer your defeats and disappointments along the way, but if you're confident that what you're doing is right, then put your head down and fight," Lerach said.
Having fought many good fights, Lerach knows that no good lessons are learned until you fall down in your career. "We don't learn anything from our victories; we only learn from our mistakes," he said. "Our victories make us think how smart we are, and our mistakes are what keep us humble."
Referring to himself as "the Willie Horton of securities law," Lerach has come to accept the widespread disdain for him in the corporate world. Critics have said that he looks for sharp downturns in stock and runs to court to file a lawsuit.
"If you're going to attack and call to justice the kinds of rich, powerful, and influential people that we do, they are going to use their power to smear you and attack you in the media and try to destroy you in other ways," he said. "You have to accept it, and that's the way life is."
Among his various legal triumphs and achievements, Lerach has also been recognized by President Clinton, who appointed him to be a member of the United States Holocaust Memorial Council in December 1998. He is a frequent public commentator and lecturer on securities and corporate law, as well as the author of numerous related articles.
As a bona fide master of law, Lerach can trace his own path to success, and he suggests that a young law professional must have legal role models to emulate. "If you want to be successful, you'd better be determined to be successful, and you'd better work hard to achieve your success," Lerach said. "Get into an environment where you are surrounded by excellence, and you can learn and hone your skills and advance your ability. No 24-year-old person is going to go out and conquer the world—at least no one that I know is. Spend that period of time improving yourself."