Questions about a payday

MINNEAPOLIS - Convicted class-action lawyer Bill Lerach is no longer working on the lawsuit against UnitedHealth Group Inc. But will he be paid anyway?

UnitedHealth attorneys want Lerach's former firm to say whether he will profit from an eventual verdict in the shareholder lawsuit over UnitedHealth's backdated stock options.

Lerach stands personally to receive $50 million from the $7 billion payout in a shareholder class action he led against Enron, the Wall Street Journal reported last month. A federal judge in Texas is weighing whether to award nearly $700 million in attorneys fees in that case.

In court yesterday, attorneys for UnitedHealth referred to Lerach's reported Enron payout as they pressed U.S. Magistrate Judge Franklin L. Noel to order Lerach's former firm, Coughlin Stoia Geller Rudman & Robbins L.L.P., to disclose its billing arrangements.

"If a convicted felon is litigating this matter, that's of interest to the defendants, and it's certainly of interest to the court," UnitedHealth attorney Katie C. Pfeifer told Noel.

Coughlin Stoia lawyer Andrew Brown said in court that Lerach did not have any say in the case. The firm formally withdrew his name from the case Dec. 4. Asked by Noel whether Lerach still had a financial interest in the case's outcome, Brown replied: "I don't know."

Lerach did not return a phone message. Coughlin Stoia spokesman Dan Newman declined to discuss what payments, if any, Lerach might receive for the Enron or UnitedHealth cases.

Noel sounded skeptical of the need to require Coughlin Stoia to disclose its billing arrangement with the plaintiffs, the California Public Employees' Retirement System and the Alaska Plumbing and Pipefitting Industry Pension Trust. The case is not scheduled for trial until July.

The pensions are suing UnitedHealth, contending they lost money on their UnitedHealth investments because of the backdating scandal, where stock options were dated inaccurately to maximize their value.