Palm Springs lawyer resigns after guilty plea in IRS case

A Palm Springs lawyer who was one of the last defendants in the Milberg Weiss kickbacks case has submitted his resignation with charges pending to the State Bar. PAUL SELZER [#38288], 68, pleaded guilty to filing false documents with the IRS last summer. Last month, he was sentenced by U.S. District Judge John Walker to two years' probation, including a period of home detention, and ordered to pay $250,000 in fines and perform 1,000 hours of community service. He could have served up to three years in prison. Selzer was placed on interim suspension on Oct. 13 following his conviction and ordered to apply with Rule 9.20 of the California Rules of Court. Selzer's resignation is pending a recommendation from the Board of Governors to the Supreme Court as to whether the resignation should be accepted by the court. If the resignation is not accepted by the Supreme Court, disciplinary proceedings based upon the conviction will proceed.

Selzer was the attorney for Seymour Lazar, a former Milberg client who pleaded guilty to filing false tax returns and obstruction of justice. Prosecutors said that Selzer helped launder kickbacks to Lazar and accepted almost $50,000 from Milberg but did not inform the IRS that part of that amount had been transferred to Lazar.

Eleven individuals, including four ex-Milberg Weiss partners – Melvyn Weiss, William Lerach, David Bershad and Steven Schulman – have been convicted of felonies in the case, according to Assistant U.S. Attorney Richard Robinson. Fines for defendants have totaled more than $100 million.

Prosecutors said that partners at Milberg Weiss, which is now known as Milberg LLP, obtained more than $250 million in attorney fees by paying kickbacks to lead plaintiffs in shareholder and class action cases, who were told to lie about the arrangement.

The firm admitted paying $11.3 million in kickbacks in more than 175 class action lawsuits from 1979 to 2005. Prosecutors said the kickbacks allowed Milberg Weiss to file its suits before other firms and gain the advantage of becoming lead attorney and reaping higher fees. Lerach, known as a lion of the bar for battling for workers and victims of big corporations, won $7.2 billion in settlements on behalf of Enron investors and employees. At his February sentencing, he said he knew what he had done was wrong. He was sentenced to two years in federal prison for obstruction of justice and making false statements.