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Attorney General Eric Holder issued a Department Policy on Charging and Sentencing on May 19, 2010. The new policy modifies and supersedes three prior DOJ memos on charging and/or sentencing, one from then AG Ashcroft (issued 9-22-03) and two from then Deputy AG Comey (7-2-04 and 1-28-05). The May 19 memo calls for prosecutors to consider “the merits of each case” when making decisions regarding charging, plea agreements, and sentencing advocacy, “taking into account an individualized assessment of the defendant’s conduct and criminal history and the circumstances related to the commission of the offense (including the impact of the crime on victims), the needs of the communities we serve, and federal resources and priorities.” Here is a copy of the memo, via Ellen Podgor’s White Collar Crime Prof Blog. The memo clearly gives prosecutors greater leeway to consider the individual circumstances and characteristics of particular defendants and targets, within an overall framework of treating those who commit similar crimes, with similar culpable mental states, similarly. Professor Podgor’s detailed analysis is here. Main Justice’s take is here, in a story by Ryan J. Reilly.

Notably, pursuant to the memo, “[c]harges should not be filed simply to exert leverage to induce a plea.”

I also note that certain U.S. Attorney Offices and units within DOJ  have developed policies in the post-Booker era requiring defendants entering into plea agreements to forego arguing for Booker-Gall-Kimbrough downward variances. It would seem that the May 19 memo implicitly prohibits any such unvarying policy by a DOJ unit or OUSA. If each individual defendant and case must be examined on a particularized basis, then no DOJ prosecutor should ever tell a defense attorney that ”our policy” prohibits plea agreements that leave defendants free to argue for a downward variance.

Not a sermon. Just an obsession.

According to this story from today’s WSJ, former Paulson & Co. executive Paolo Pellegrini informed ACA Management LLC that Paulson intended to short the ABACUS 2007 AC1 synthetic CDO. Pellegrini apparently told the SEC all about it before the Commission filed civil fraud charges against Goldman Sachs and Fabrice Tourre.

If Pellegrini tipped off ACA, what does it mean? For one thing, it helps to explain why Paulson & Co. wasn’t added to the  SEC’s suit based on aider and abettor liability. For another, it will substantially weaken the SEC’s case. If key players at ACA knew that Paulson was going short, it will be virtually impossible for the Government to show that ACA was misled. Even if Goldman misled and intended to mislead ACA as to Paulson’s role, such activity would have been rendered immaterial once ACA in fact learned of Paulson’s role.

Although the Pellegrini revelation, if substantiated, may not theoretically affect the part of the SEC’s suit related to the alleged misleading of investors, ACA’s knowledge of Paulson’s role, along with its participation in the deal, will undoubtedly change the atmospherics of the case.

It should be a happy Thanksgiving in the Kuehne household this year. The U.S. Attorney’s Office for the Southern District of Florida dropped its misguided money-laundering prosecution of the prominent Miami attorney today, following a devastating opinion from the Eleventh Circuit Court of Appeals last month. The Miami Herald has the story here.

According to this story last week in the Anchorage Daily News, Hank Schuelke, court-appointed prosecutor in the Ted Stevens trial debacle, requested and received authority from Judge Emmet Sullivan to subpoena and compel the testimony of the Stevens prosecutors, government witness Bill Allen, Allen’s attorney, and lead case agent Mary Beth Kepner. Hat Tip to Dave Westheimer for sending this my way.

Giving Thanks by Jennifer James in the Los Angeles Times.

If only Beltway politicians could understand as well as a child!

The Columbus Dispatch reports that the Office of Congressional Ethics, created earlier this year by the House, will be led by AUSA Leo Wise (.pdf), who successfully prosecuted former National Century Financial Enterprises CEO Lance Poulsen in both his fraud and witness tampering trials. Wise was named staff director and chief counsel. He’ll have his hands full.

Chief US District Judge Edward Nottingham of the District of Colorado has resigned effective October 29. Here’s the statement from Chief Circuit Judge Robert H. Henry posted on the Tenth Circuit website:

In response to complaints of judicial misconduct lodged in August 2007, the Tenth Circuit Judicial Council initiated misconduct proceedings against Judge Edward Nottingham. As additional allegations developed and subsequent misconduct complaints were filed, the Judicial Council expanded the initial misconduct proceedings.

The Judicial Council, through its appointed Special Committees, conducted a thorough and extensive investigation, interviewed many witnesses, considered voluminous documentation, and conducted two hearings. At this critical time in the investigation of these multiple complaints of misconduct, Judge Nottingham has stepped down, effective immediately, as Chief Judge of the District of Colorado, has ceased judicial duties, and has resigned his commission as a United States District Judge effective Wednesday October 29, 2008. The Council will have no further statement until Judge Nottingham’s resignation is effective.

9News, which broke the latest allegations involving Nottingham and a prostitute, has more, including speculation that he could face obstruction of justice charges.

UPDATE: The  US District Court has issued a statement (.pdf) on the resignation, announcing that Judge Wiley Daniel will be the new chief judge in the district.

US District Judge Edward Nottingham, embroiled in misconduct allegations (earlier), notified the court that he will be off all week despite a scheduled caseload. He called in sick Wednesday through Friday of last week. However, there is no indication yet that he has resigned. 9News now reports that the FBI has contacted the former Bada Bing of Denver escort agency prostitute who filed a complaint with the Tenth Circuit; a criminal investigation has begun.

As a result of the August 1 ruling by the US Court of Appeals for the Third Circuit in the Cyril Wecht case (earlier), Chief US District Judge Donetta Ambrose of the Western District of Pennsylvania has revoked her 2006 rule that kept juror names secret. Although the Third Circuit decision only specifically addressed the bizarre rulings of US District Judge Arthur Schwab, it also said that an anonymous jury goes against American judicial tradition. Judge Ambrose decided that meant that juror names should no longer be protected (Pittsburgh Post-Gazette).

Chief US District Judge Edward Nottingham of Denver is reportedly resigning under pressure, possibly as early as today. Nottingham has been the subject of prior misconduct complaints and in March was removed from the case of former Qwest CEO Joe Nacchio (more).

The latest allegations against Nottingham involve a former prostitute who claims the judge asked her to lie to investigators and not tell them he paid her for sex. Last Friday she filed a written complaint with the US Court of Appeals for the Tenth Circuit. According to 9NEWS:

The former prostitute claims he initially paid her $300 an hour for sex, but became a VIP member after 25 visits and was then only charged $250 an hour for his weekly sexual visits.

This frequent flier discount was given by the (I’m not making this up) Bada Bing escort agency, where the woman worked in 2003 and 2004. Nottingham’s name also appeared on a list of clients from Denver Players, an alleged prostitution operation raided early this year. The Rocky Mountain News has more.

Still crazy after all these years: most of the world has long since stopped wondering what happened to Melvin Dummar in the 30 years since a Nevada probate court ruled the so-called Mormon Will of Howard Hughes was a fake. But Melvin Dummar never went away. In 2006 he filed a federal suit in Salt Lake City alleging that a Hughes relative and an executive of the holding company that controls Hughes’ estate conspired to coordinate false testimony to discredit the handwritten will. The suit was dismissed last year but Dummar appealed.

On Friday, the US Court of Appeals for the Tenth Circuit upheld the dismissal. The Salt Lake Tribune’s story quotes Dummar’s attorney Stuart Stein: “Perhaps it comes down to the rich and the powerful always win and the poor and powerless always lose.” And perhaps he said that with a straight face. Too bad for Paul Le Mat, who perhaps was waiting for a Melvin and Howard sequel.

As expected, US District Judge Samuel Kent on Wednesday pleaded not guilty to one count of abusive sexual conduct and two counts of attempted aggravated sexual abuse. He entered his pleas in Houston before Judge Edward Prado of the US Court of Appeals for the Fifth Circuit. Kent, who was indicted last week (earlier), said “For the record I absolutely intend to testify, and we are going to bring a horde of witnesses.” The charges arise from complaints made his former case manager Cathy McBroom. Kent claims their relationship was consensual.

Although Prado was not on the panel that late last year reassigned and suspended Kent over the allegations, he stated that a judge from outside the Fifth Circuit would be appointed. He released Kent on his own recognizance. Kent is continuing to hear cases (Houston Chronicle).

A federal grand jury in Houston on Thursday indicted (.pdf, explicit language) US District Judge Samuel Kent on one count of abusive sexual conduct and two counts of attempted aggravated sexual abuse. Kent becomes the first federal judge to face federal sex charges. Count one of the indictement describes a 2003 incident, counts two and three date from 2007 and all three involve Cathy McBroom, Kent’s former case manager who had previously made public allegations against Kent. She is identified as “Person A” in the indictment.

After McBroom’s harassment complaint became public last fall, Kent was reprimanded and reassigned from Galveston to Houston effective January 2008. He has been confined to handling civil cases, other than sexual harrassment cases. It has been no secret that a federal investigation was begun late last year. The Houston Chronicle reported last month that the investigation had expanded to include allegations that he accepted but failed to report gifts and also sold his home in a deal arranged by a lawyer with dozens of cases in his court.

Kent is represented by Dick DeGuerin, while Rusty Hardin is representing McBroom. Kent apparently will contend that the relationship was consensual (Houston Chronicle, with more background here).

Abraham Lesnik of Valley Village, California has pleaded guilty to unauthorized possession of defense information for taking documents classified as secret and top secret from his office. Lesnik, a former engineer at a Boeing facility in El Segundo, pleaded guilty on July 1 before US District Judge Florence-Marie Cooper in Los Angeles. He was charged on June 16, nearly two years after the investigation into his activities began. Lesnik, who held a Top Secret DOD security clearance, admitted repeatedly downloading the classified documents to a USB thumb drive so he could work on them at home. He also admitted retaining 11 documents including one top secret document. Judge Cooper scheduled sentencing for October 6. Lesnik faces a statutory maximum often years in prison. but the plea agreement calls for no more than five years (LA Times, DOJ).

“The very essence of a free government consists in considering offices as public trusts, bestowed for the good of the country, and not for the benefit of an individual or a party.” — John C. Calhoun, Speech (February 13, 1835)

He that would make his own liberty secure must guard even his enemy from oppression; for if he violates this duty he establishes a precedent that will reach to himself.” — Thomas Paine, First Principles Of Government (1795)

“If a nation expects to be ignorant and free, in a state of civilization, it expects what never was and never will be.” — Thomas Jefferson, Letter to Colonel Charles Yancey (January 6, 1816)

“Real Patriots, who may resist the intrigues of the favourite, are liable to become suspected and odious; while its tools and dupes usurp the applause and confidence of the people, to surrender their interests.” — George Washington, Farewell Address (1796)

“The only maxim of a free government ought to be to trust no man living with power to endanger the public liberty.” — John Adams, Notes for an oration at Braintree (Spring 1772)

“I believe there are more instances of the abridgment of the freedom of the people by gradual and silent encroachments of those in power, than by violent and sudden usurpation.” — James Madison, Speech at the Virginia Convention to ratify the Federal Constitution (June 6, 1788)

“Those who would give up essential liberty, to purchase a little temporary safety, deserve neither liberty nor safety.” — Benjamin Franklin, Historical Review of Pennsylvania (1759)

“The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by an endless series of hobgoblins, most of them imaginary.” — H. L. Mencken, In Defense of Women (1917)

“I would remind you that extremism in the defense of liberty is no vice. And let me remind you also that moderation in the pursuit of justice is no virtue.” — Barry Goldwater, Acceptance Speech at the 1964 Republican Convention

The US Supreme Court on Monday declined to review last August’s decision by a three-judge panel of the US Court of Appeals for the DC Circuit regarding the FBI raid on the Washington office of Rep. William Jefferson (D-La.). The appellate court ruled that the raid violated the Speech and Debate Clause of the US Constitution and that Jefferson was entitled to the return of privileged legislative documents. Jefferson was indicted last June on 16 counts including including bribery, racketeering, money laundering and obstruction of justice. His trial is currently delayed while he seeks to suppress certain evidence and statements arising out of the search of his Washington home (earlier). The Washington Post story is here.

The Washington Post reports here (story by Barry Svrluga and Amy Shipley) on today’s showdown in Congress between pitching great Roger Clemens and his accuser Brian McNamee. The Wall Street Journal also has a good piece here by Allen Barra which helps set the stage, and includes some insightful analysis from Bob Costas, who was interviewed by phone for the piece. Costas looks at Clemens’ career pitching stats, noting that they don’t corroborate McNamee’s allegations. One thing is fairly clear from all the hoopla. Representative Henry Waxman’s goal of using the proceedings to browbeat Clemens is likely to backfire. The House Committee on Oversight and Government Reform’s decision to excuse Andy Pettite and Chuck Knoblauch from testifying live also seems dubious to me. I suspect that Waxman wants a rigged game, and that Pettite’s and Knoblauch’s testimony would not have damaged Clemens enough to suit Waxman. Waxman is infamous, even in Washington circles, for his publicity hound stunts. This just in. The Journal runs its first report of McNamee’s actual testimony. The Washington Post is also streaming the testimony live on its website.