Coughlin Stoia Still Dominates (For Now)

A new report out today shows that San Diego’s Coughlin Stoia, the law firm of attorney Bill Lerach, continues to dominate the field of class-action securities lawsuits even with its former superstar out of the picture.

Coughlin Stoia originated a quarter of all cases settled in 2009, according to this report by Cornerstone Research.

coughlin.png

Class-action securities settlements last year totaled $3.829 billion.

The median settlement was $8 million. The study found that the presence of a “highly active” firm like Coughlin Stoia didn’t increase the chances of winning a big settlement.

Coughlin Stoia, formerly the West Coast offices of Milberg Weiss, was renamed after Lerach pleaded guilty to conspiring to conceal kickbacks to plaintiffs.

A separate Cornerstone Research study suggested that the glory days of big class-action settlements — like Coughlin Stoia’s $7.2 billion judgment against Enron Corp. — may be over.

These cases are no longer a race to the courthouse. New class-action filings in 2009 were marked by a much longer lag between the filing date and the end of the period covering the alleged fraud.

Coughlin Stoia was involved in a majority of the cases with long filing lags. Historically, cases with a longer filing lags are more likely to be dismissed.

Cornerstone concludes:

“The recent surge in filing lags potentially suggests that the pool of current litigation opportunities is shrinking and that plaintiff law firms are revisiting cases involving more distant price drops that were previously viewed as being lower in priority because, among other reasons, they are more likely to be dismissed.”

Brent Wilkes, Master of Delay

The appeal of Brent Wilkes, who was convicted in 2007 of bribing former Rep. Randy “Duke” Cunningham, has been delayed again.

The former defense contractor remains free on $2 million bail.

The 9th U.S. Circuit Court of Appeals said earlier this month that it won’t hear the appeal until the U.S. Supreme Court issues its rulings in the appeals of former Enron CEO Jeff Skilling and former Rep. Bruce Weyrauch.

Those cases involve the crime of depriving the public of the right to “honest services,” the same law federal prosecutors in San Diego used against Wilkes.

Wilkes’s briefing papers now are due before the 9th Circuit about a month after the Supreme Court issues its rulings in Skilling and Weyrauch. The earlier deadline was today.

With more arguing back and forth and the average wait of a year for a ruling from the court, it will be a long time before Wilkes sees the inside of prison again.

It’s a pretty sweet deal for Wilkes, who is being represented by the federal public defender’s office in San Diego.

Cunningham is due to be released in 2013, according to the U.S. Bureau of Prisons website.

Amazingly, it’s looking increasingly likely that Duke may finish serving his sentence before Wilkes starts serving his.

Former SD Imam Calls for Jihad on US

Partial transcript of remarks by former San Diego imam and SDSU grad student Anwar al-Awlaki, who’s holed up in Yemen and corresponded with Maj. Nidal Hasan before the Fort Hood shooting (Via Fox News):

… I for one was born in the U.S., I lived in the U.S. for 21 years. America was my home. I was a preacher of Islam involved in non-violent Islamic activism. However, with the American invasion of Iraq and continued U.S. aggression against Muslims I could not reconcile between living in the U.S. and being a Muslim.

And I eventually came to the conclusion that Jihad against America is binding upon myself just as it is binding on every other able Muslim. Nidal Hasan was not recruited by Al-Qaeda. Nidal Hasan was recruited by American crimes and this is what America refuses to admit. America refuses to admit that its foreign policies are the reason behind the man like Nidal Hasan — born and raised in the U.S. turning his guns against American soldiers. And the more crimes America commits the more mujahedeen will be recruited to fight against it. … 

SD County Pension Boosts Leverage

This is probably not a good idea:

The San Diego County Employees Retirement Association has adopted a new asset allocation that adds leverage to the $7.2 billion fund, Pensions & Investments reports. The leverage brings the total target allocation to 135 percent.

Pension funds are supposed to be boring, long-term investors. Not SDCERA. Taking on leverage is not a sure, safe way to save money for retirement. It is an aggressive, high risk strategy. It means you are essentially wagering more money than you have. Ask Lehman Brothers how that feels.

Leverage is a way of boosting returns by taking on more risk. The net expected return from this new strategy is now 10 percent (up from 8.25 8.5 percent), which is supposed to add an additional $1 billion over the next 10 years. But that’s if — and it’s a big if — if everything goes as planned.

A few years ago, the flavor of the month was hedge funds. Investment guru David Deutsch plowed 20 percent of the fund into hedge funds, including winners like Amaranth, which imploded when a single trader lost $6 billion in a bad bet on natural gas prices, and WG Trading, whose managers were arrested for fraud.

Instead of taking its lumps, however, SDCERA has spent two and a half years suing to get its money back from Amaranth. A federal judge in New York threw out SDCERA’s lawsuit against Amaranth today, but the pension says it will appeal.

Well, they don’t have Deutsch to blame anymore.  He got booted out last year when the fund lost 25 percent. The board decided to outsource his job to Lee Partridge, a guy who didn’t even apply for the job and who stands to earn as much as $1.2 million.

Did You Know…

Disneyland is part of the U.S.-Mexico border?

According to federal codes and regulations, it is.

Customs and Border Patrol agents searching for aliens can board any plane, vehicle, railway car, or conveyance a “reasonable distance” from the border.

The Fourth Amendment to the U.S. Constitution typically requires a warrant for such searches, but an exception is written into federal law. (See here.)

To find out how far that is is you have to look at US Code of Federal Regulations. 

Turns out a “reasonable distance” is within 100 “air miles” from any external boundary of the United States.

That includes Huntington Beach, Newport Beach, Irvine, Costa Mesa and half of Catalina Island.