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| 2002 News and Press Releases |
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HEADLINE ARCHIVED:
Florida Judge Compares Milberg To Squeegee Boy
By: Jason Hoppin
The Recorder. April 16, 2002
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Excerpt: If there's a class action settlement that provides no money for the class, is it really a settlement? Not according to a Florida judge, who rejected a deal tentatively struck between Milberg Weiss Bershad Hynes & Lerach and Florida Progress Corp., which faced a shareholder suit filed in state court over its 1999 merger with another power company. "All of the evidence suggests that class members are in precisely the same financial and legal position today, as they would have been had this litigation never been filed," wrote W. Douglas Baird, a circuit judge in Pinellas County, Fla. "This action appears to be the class litigation equivalent of the 'squeegee boys' who used to frequent major urban intersections and who would run up to a stopped car, splash soapy water on its perfectly clean windshield and expect payment for the uninvited service of wiping it off." The deal might have gone through if a member of the class didn't happen to be retired University of Arizona securities law professor Junius Hoffman. He persuaded his colleague, Arizona law professor Elliott Weiss - whose ideas helped shape 1995's Private Securities Litigation Reform Act - to pen an objection to the proposed settlement. "We do this, I would say, as a public service, as a matter of principle," Weiss said last week. "The whole thing is a holdup." Weiss said the problem with the proposed settlement was not just that class members obtained no recovery, but that Milberg did. The deal called for the firm to receive as much $375,000 in fees and expenses. "Whatever you do, don't give them a fee," Weiss said, summing up his client's objection. Furthermore, the deal not only contained a broad release from any future liability for Florida Progress, but language from Milberg partner Abraham Rappaport approving of the merger. That language may come back to haunt Milberg, Weiss said. Now that the firm has spoken favorably of the merger to the court, can it continue to claim a breach of fiduciary duty by the company?
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