LOS ANGELES (AP) – One of the nation’s highest profile class-action law firms, two of its top partners, and two other individuals were indicted Thursday by a federal grand jury on charges alleging a scheme that paid millions of dollars in illegal kickbacks to plaintiffs and others.

In a 102-page indictment, New York-based Milberg Weiss, Bershad & Schulman, and attorneys David J. Bershad and Steven G. Schulman were charged with secretly paying about $2.4 million to co-defendant Seymour M. Lazar, a Palm Springs lawyer, and others to act as plaintiffs in class-actions since 1984 and concealing the payments. Paul L. Seltzer, another lawyer in Palm Springs, was also charged.

The indictment’s charges included conspiracy, money laundering and mail fraud.

The charges follow years of investigation into the way Milberg Weiss conducts shareholder lawsuits against major corporations, which the indictment alleges generated hundreds of millions of dollars in attorneys’ fees.

The indictment alleged that “unlike other class members in the lawsuits, the paid plaintiffs purchased the securities at issue anticipating that the securities would decline in value, in order to position themselves to be named plaintiffs in securities fraud class actions and to obtain kickbacks” from Milberg and the others.

The firm was a lead plaintiff in more than half the federal shareholder suits settled from 1997 to 2004.

On Tuesday, the firm announced that Bershad and Schulman were taking leaves of absence

AP-ES-05-18-06 1749EDT