4 Lawyers in ‘Alliance’ Case Are Sentenced : Courts: Attorneys were convicted of defrauding insurance companies of amounts that prosecutors estimated in the millions.

Four lawyers convicted in “the Alliance” insurance fraud and legal corruption case were sentenced Monday to prison terms of 37 to 46 months for taking part in the scheme to bilk insurance companies of millions of dollars in legal fees.

U. S. District Judge Clarence C. Newcomer also ordered the lawyers to pay unspecified restitution to insurance companies that were billed for phony or spurious litigation.

But relatives and friends who had expected to see the men hauled off to prison erupted in applause and tearful embraces when Newcomer allowed the lawyers to remain free on bond pending appeals.

Those sentenced were:

* Lewis M. Koss of Woodland Hills to a term of 46 months--or three years and 10 months--plus a $100,000 fine.

* Richard B. Noyer of Calabasas to three years and six months and a $50,000 fine.

* Leonard T. Radomile of La Jolla to three years and one month and a $100,000 fine.

* Monty G. Mason II of Sherman Oaks to three years and 10 months, plus a $25,000 fine.

The four were convicted of mail fraud and racketeering in June after a 12-week trial in which four other attorneys were acquitted. Mason also was convicted of perjury for lying to a grand jury probing the group of Los Angeles-area lawyers whom prosecutors called “the Alliance.”

Under federal sentencing guidelines, the men must serve at least 85% of the prison time unless their appeals are successful.

The sentences were the stiffest yet in the Alliance case, in which 14 other people--eight of them lawyers--pleaded guilty to reduced charges prior to trial. Previously the worst punishment was a 16-month prison term, and most sentences were limited to a few months in home detention or a halfway house. Six more defendants are to be sentenced here next month.

Assistant U.S. Atty. William Q. Hayes said he was satisfied with the sentences, although he had asked for longer prison terms.

“This scheme would not have worked without attorneys,” Hayes said. Lenient sentences would “absolutely send the wrong message . . . to society and the legal profession itself.”

Hayes said defendants deserved stiff sentences because the insurance companies suffered huge losses. Prosecutors said the scheme had cost the insurers $50 million to $200 million, but Newcomer agreed with defense lawyers that no proof had been given to support the estimate.

From 1984 to 1988, the lawyers initiated or joined at least 10 civil lawsuits in Los Angeles, San Diego and Orange counties in which insurance companies were obliged to pay defense fees for policyholders who had been sued.

Unlike staged traffic accidents or other such scams, the disputes in these cases were real. But prosecutors said that the lawyers worked together to resist settlements and manufacture new legal controversies so the cases would grow in size and cost.

The alleged mastermind of the scheme and its chief beneficiary--attorney Lynn B. Stites--disappeared shortly before he was indicted last year and remains a fugitive. Stites essentially franchised the litigation, secretly assigning the lawyers their clients and directing legal strategy in return for a share of the lawyers’ insurance billings, prosecutors and witnesses said.

Koss, who received the heaviest sentence, was the only defendant to address the judge during the nearly five-hour sentencing hearing. In a rambling, tearful speech in which he spoke of the loss of his career, the breakup of his marriage and his estrangement from his young daughter, the 47-year-old Koss urged the judge to recognize that his role had been minimal.

“I was led, I don’t think I led,” said Koss. He said Stites told him what to do in certain instances and “I was wrong to listen to him.”

“I was not the heavy in this case,” he said. “I believe I really didn’t do anything in an intentional way to hurt anybody.”

Koss pleaded for an alternative sentence that would allow him to use his legal skills on behalf of the poor. “Let me be something more than somebody who’s going to--what?--play cards . . . or make license plates?” he said.

“If there was a way . . . to get on my knees to beg you, I would.”

Although Radomile was convicted on more counts than any of the others, he received the lightest sentence. The only non-Los Angeles lawyer charged in the case, it was Radomile who reported the existence of the Alliance--only to be charged himself when prosecutors concluded that he had lied about his role in the scheme.

But Radomile’s lawyer, John Heisner, told Newcomer that his client deserved leniency because “if he hadn’t gone to the government . . . the government may well never have challenged the Alliance.”

Newcomer appeared to agree. “In spite of what his motives might have been, nonetheless, he did blow the whistle on this whole fraud, didn’t he?” Newcomer said.