Investor Case Produced Big PR Battle
The U.S. Supreme Court hears arguments today in a case that will determine whether investors can sue company advisers—including lawyers—for aiding fraud.
The Wall Street Journal (sub. req.) reports that the case has resulted in a big public relations battle between the securities-class-action trial bar and big business.
Overseeing much of the political strategy for plaintiffs lawyers was William Lerach, who has been at the center of his own public relations storm as of late. Lerach was representing investors suing Enron Corp. before he reached an agreement to plead guilty to paying kickbacks to lead plaintiffs to help obtain lead status in securities suits.
Lerach persuaded a Duke law professor at a cocktail party to help write an amicus brief for investors and hired public relations strategist Dan Newman. They obtained support from key congressmen.
Defendants in the case hired a former commissioner of the Securities and Exchange Commission and hired Mark Corallo, a former Justice Department spokesman, to handle PR. Several corporate trade and legal groups are also backing the effort to put a halt to expanded liability.
Both sides tried to enlist the help of former SEC chair Harvey Pit, who ultimately agreed to help the defendants. Both also tried to win over the U.S. Solicitor General, who decided to back the defendants after a push from the White House.
