Tuesday, June 06, 2006

When it came to investing, Howard J. Vogel seemed to possess a perverse kind of Midas touch.

In early October 1997, he bought 50 shares of Oxford Health Plans. Three weeks later, the stock nose-dived, and Mr. Vogel lost about $3,000 of his investment. Still, Mr. Vogel reaped $1.1 million.

How was that possible?

Mr. Vogel was a plaintiff in a shareholder lawsuit filed by the New York securities litigation powerhouse Milberg Weiss Bershad Hynes & Lerach against Oxford Health. In 2003, the company, along with other parties that were sued, paid $300 million to settle.

Most of the investors received pennies on the dollar for their losses. But Mr. Vogel, then a real estate mortgage broker in Englewood, N.J., was not just a hapless investor who bought the wrong stock at the wrong time.

Mr. Vogel now says, according to a plea agreement with federal prosecutors, that he and members of his family were actually linchpins in a long-running arrangement that helped Milberg Weiss snare the lucrative lead counsel position in the Oxford Health and many other securities lawsuits, reaping hundreds of millions of dollars in legal fees.