Wall Street legend Milton Pollack is a seemingly mild-mannered judge with a reputation for making high-priced attorneys squirm.
At 87 years of age, U.S. District Judge Milton Pollack has seen his share of financial disasters.
His career as a securities lawyer started two weeks before the 1929 stock market crash. Sixty years later, that experience helped him clean up a multibillion-dollar mess left in the fall of Michael Milken and Drexel Burnham Lambert Inc., one of Wall Street's most powerful investment banks before it collapsed into bankruptcy.``Really, nothing has changed,' Pollack said in an interview, comparing the similarities between 1929 and the Yuppie era of the 1980s. ``The greed incentive still remains as the driving catalyst for the excesses that occur on Wall Street.'\ The Drexel case solidified Pollack's stature as a Wall Street legend, a seemingly mild-mannered, gray-haired judge with a reputation for making high-priced attorneys squirm.
Midnight telephone calls, harsh face-to-face meetings and a piercing intellect are tools he deploys to force resolution of octopus-like litigation.
``I've appeared before him a number of times over the years, and I would say that he's about one of the smartest people I've ever dealt with on the bench,' said Stanley S. Arkin, a veteran defense attorney.
``You have to be very careful to get on the right side of him. He's a man (who) has a lot of common sense, laced with toughness.'
That toughness was displayed last year when he grilled Milken, the ex-Drexel financier and convicted felon who appeared on the witness stand for two former clients, Victor and Steven Posner. The father-and-son investment team later was convicted of civil securities law violations.
In a subsequent decision, Pollack criticized Milken as an evasive witness unable to ``accept the fact that he has done wrong.'
As for the Posners, Pollack ordered them barred from serving as officers or directors of any public company and ordered them to repay about $4 million they gained from one of their businesses. Pollack described the two as ``legendary people in the sense of being barracudas when it came to dealing with other people's money and other people's businesses.'
Pollack clearly enjoys his work, putting in eight-hour days, then plowing through cases after dinner. ``My theory of longevity is the harder you work, the longer you live,' he said.
This is the spirit that led Pollack to resolve what could be one of the most complex financial cases of all time - the civil litigation surrounding Drexel and Milken.
When the Drexel bankruptcy case first came before him in 1990, claims against the fallen junk bond house vastly exceeded the $3 billion in assets set aside for creditors.
About 180 lawsuits were filed against Drexel, which Milken had built into one of the most aggressive securities firms through its dealings in junk bonds, the high-risk, high-yield IOUs that proliferated in the 1980s.
In September, Pollack gave final approval to a $1.3 billion settlement of the Milken-related litigation. Pollack calls resolution of the cases ``his masterpiece.'
Memorabilia of the event decorate his spacious office: There are framed courtroom sketches of a Feb. 18, 1991, hearing (called on the President's Day holiday so attorneys couldn't use the excuse of other conflicting cases) in which the outline of the agreement was concluded. There's also a framed single sheet of legal paper that contains the scribbled terms of the Drexel agreement.
As a judge on senior status, Pollack can refuse to take cases, leaving him to focus on large, complex litigation. Attorneys in the Drexel case also gave him wide discretion.
``This entire group of lawyers got together and gave me carte blanche to talk to anybody on any subject at anytime without the encumberance of anybody else being present,' Pollack said.
Pollack stayed in touch with the numerous attorneys despite a crisis in his personal life, a severe heart attack suffered by his wife, Moselle. While she was hospitalized in Houston, Pollack made telephone calls from a doctor's office to the attorneys to ensure they were meeting his deadlines.
Although he's best known for work on the the Drexel case, Pollack made his mark long before then. As a private practicing attorney, Pollack won a $4.5 million shareholder lawsuit against General Motors Corp. in 1942.
Pollack ran his own law firm, specializing in securities law, from 1945 to 1967, the year President Lyndon B. Johnson appointed him to the bench.
As a judge, not all his cases have involved the arcane world of securities law. In 1975, he gave a 27-month sentence to one of the members of the Weather Underground, convicted of a plot to bomb the federal building as a protest to the Vietnam War.
Pollack also ruled to let the Concorde supersonic jets land at John F. Kennedy airport in New York and issued a decision that allowed regulators access to secretive Swiss bank accounts to prosecute insider-trading cases.
One way he has kept abreast of the fast-moving changes over the years is by paying special attention to the ideas from his young law clerks.
``They bring a new dimension to what you're doing. And you have to keep up with them,' he says.
Pollack remains close to many of his clerks, all of whom gather for annual reunion dinners. At the last gathering, the normally private Pollack gave a short speech offering insight into the sacrifices necessary to be on the bench.