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HEADLINE NEWS:
Former Milberg Weiss Expert Witness Agrees to Plead Guilty to Perjury
Amanda Bronstad - The National Law Journal
Law.com. February 29, 2008
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EXCERPT: John B. Torkelsen, a former expert witness for Milberg Weiss, has agreed to plead guilty to perjury, admitting he lied to a federal court judge in a securities class action case about how he was getting paid. Prosecutors in the Milberg Weiss case have been eyeing Torkelsen for years. His ex-wife, Pamela, has been cooperating with prosecutors in that case. Torkelsen, who ran Princeton Venture Research Inc. and Equity Valuation Advisors Inc., served as an expert witness in hundreds of shareholder derivative and class action lawsuits for several law firms from 1985 to 2003. In an announcement about the plea agreement on Thursday, prosecutors claim that Torkelsen was retained by several firms, including "one with a principal office in New York." According to prosecutors, the law firms told federal judges that Torkelsen was serving as an independent expert. But in secret, Torkelsen was being paid on a contingency fee basis. To maintain that secrecy, the firms would request reimbursement for fees that were never paid to Torkelsen. The firms also caused Torkelsen to lie, stating that he had been retained on a "noncontingency fee basis," and to write off his fees in unsuccessful cases and submit inflated fee requests. For instance, from 1993 to 1996, Torkelsen charged class action law firms more than $60 million in bills. More than $7 million of those fees were written off or adjusted in unsuccessful cases. As a result, the firm overbilled others by the same amount to make up those costs. In the case of the "New York law firm," Torkelsen inflated bills by more than $4 million, prosecutors allege. Torkelsen admits that he falsely told a federal judge in San Jose, Calif., that he was retained on a "noncontingent engagement by plaintiff's counsel" in a 1999 case. The plea agreement, which was filed in U.S. District Court for the Eastern District of Pennsylvania, also resolves related tax matters from 2003 to 2005 and was arranged by prosecutors in the U.S. District Court for the Central District of California who are handling the Milberg Weiss case. |
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