[IP] Lawyers Fought U.S. Move to Curb Tobacco Penalty
Begin forwarded message:
From: "Robert J.Berger" <rberger@xxxxxxx>
Date: June 16, 2005 10:43:55 AM EDT
To: Dewayne Hendricks <dewayne@xxxxxxxxxxxxx>, Dave Farber
<dave@xxxxxxxxxx>
Subject: Lawyers Fought U.S. Move to Curb Tobacco Penalty
[A clear indication of structural corruption in the Bush
Administration -Rob]
Lawyers Fought U.S. Move to Curb Tobacco Penalty
By ERIC LICHTBLAU
http://www.nytimes.com/2005/06/16/politics/16tobacco.html?
hp&ex=1118980800&en=5a00e8fdad7bee79&ei=5094&partner=homepage
WASHINGTON, June 15 - Senior Justice Department officials
overrode the objections of career lawyers running the
government's tobacco racketeering trial and ordered them to
reduce the penalties sought at the close of the nine-month trial
by $120 billion, internal documents and interviews show.
The trial team argued that the move would be seen as politically
motivated and legally groundless.
"We do not want politics to be perceived as the underlying
motivation, and that is certainly a risk if we make adjustments
in our remedies presentation that are not based on evidence,"
the two top lawyers for the trial team, Sharon Y. Eubanks and
Stephen D. Brody, wrote in a memorandum on May 30 to Associate
Attorney General Robert D. McCallum that was reviewed by The New
York Times.
The two lawyers said the lower penalty recommendation ordered by
Mr. McCallum would weaken the department's position in any
possible settlement with the industry and "create an incentive
for defendants to engage in future misconduct by making the
misconduct profitable."
At the close of a major trial that dozens of Justice Department
lawyers spent more than five years preparing, the department
stunned a federal courtroom last week by reducing the penalties
sought against the industry, from $130 billion to $10 billion,
over accusations of fraud and racketeering.
The decision generated protests from health advocates and
Democratic lawmakers, who accused the Bush administration of
political motives, and it prompted an internal departmental
inquiry. But details of the behind-the-scenes debate over the
issue had remained a mystery.
The department has vigorously defended the decision, denying
political motives and saying the $10 billion reflected an effort
to arrive at a figure that would comply with an adverse decision
from an appellate court this year that some officials said
sharply limited the types of sanctions the department could
seek. The department did not dispute the authenticity of the
memorandum but declined to make Mr. McCallum or other lawyers
available to discuss it.
A spokesman for the department, Kevin Madden, said political
considerations were never factored into the decision to reduce
the penalty.
"This was a decision that was made on the merits of the case and
that strictly followed the law," Mr. Madden said.
In light of the appellate court ruling, he said, "a decision was
made by the department that the best argument for the government
to make was one that would preserve credibility in the
government's case with the trial judge, would result in a
favorable decision from the trial judge and would result in a
trial court decision sustainable upon appeal."
The newly disclosed documents make clear that the decision was
made after weeks of tumult in the department and accusations
from lawyers on the tobacco team that Mr. McCallum and other
political appointees had effectively undermined their
case. Mr. McCallum, No. 3 at the department, is a close friend
of President Bush from their days as Skull & Bones members at
Yale, and he was also a partner at an Atlanta law firm, Alston &
Bird, that has done legal work for R.J. Reynolds Tobacco, part
of Reynolds American, a defendant in the case.
"Everyone is asking, 'Why now?' " said a Justice Department
employee involved in the case who insisted on anonymity for fear
of retaliation. "Why would you throw the case down the toilet at
the very last hour, after five years?"
Ultimately, Mr. McCallum overruled the objections from the trial
team, and the documents and interviews suggest that his senior
aides took the unusual step of writing parts of the closing
argument that Ms. Eubanks delivered last week in federal court
in seeking the reduction in penalties.
Officials who insisted on anonymity said the change on the
penalties provoked such strong objections from the trial team
that some lawyers threatened to quit. Department officials have
now proposed that a lower-level lawyer who has outlined the
reasons for reduced penalties take over crucial parts of the
remainder of the trial.
In another memorandum sent on Tuesday that was also reviewed by
The Times, a senior official in the criminal division of the
department recommended that the lower-level lawyer on the team,
Frank Marine, who has supported the $10 billion penalty
internally and publicly, "be in charge of preparing" the final
briefs and the proposed order on penalties.
That work would normally go to Ms. Eubanks, director of the
team. Department officials said Wednesday that there had been no
decision to replace Ms. Eubanks.
Mr. McCallum, in an op-ed article last week in USA Today, said
the new decision on the penalties had been driven by an
appellate decision in February that found any damages had to be
"forward looking" to prevent future wrongful acts.
"The trial court and the government are bound by this decision,"
he wrote, and that led the department to propose the $10 billion
penalty to pay for a stop-smoking program.
A judge will make the final decision on the penalty.
The explanations have not quieted complaints from Democrats. A
group of 50 lawmakers sent a letter to Attorney General Alberto
R. Gonzales on Wednesday urging him not to agree to an accord
with the tobacco industry "based on the unreasonably weak
demands made by the government last week."
This week, in response to Democrats' protests, the department
disclosed that its Office of Professional Responsibility, which
handles ethics complaints, planned to investigate accusations,
largely by Democrats, of interference in the case.
Although Ms. Eubanks and Mr. Brody said in their May 30
memorandum that the lower penalty could create a perception of
interference, they gave no direct evidence to show that the
decision was politically motivated. Still, the disclosure that
career lawyers strongly objected is highly likely to provoke
further accusations by antismoking advocates and Congressional
Democrats.
In saying the decision was politically motivated, critics have
pointed not only to Mr. McCallum's role at a law firm tied to
the industry, a role that a Justice Department ethics office
ruled did not prevent him from overseeing the case, but also to
the industry's political contributions to the Republican
Party. The industry gave $2.7 million to Republicans last year
and $938,000 to Democrats.
In their seven-page memorandum, Ms. Eubanks and Mr. Brody
offered a point-by-point rebuttal to what they characterized as
Mr. McCallum's "watered down approach." They said the higher
penalty, as outlined by a health expert last month, was in
keeping with the appellate court's "forward looking" approach
and would help millions of people quit smoking in the next 25
years.
The trial team lawyers also suggested that resistance to the
$130 billion plan by senior Justice Department officials grew
out of "sticker shock" over the costs that the industry would
pay for the stop-smoking program.
The lawyers also expressed some frustration that Mr. McCallum
had already reached a preliminary decision to reduce the
proposed penalty "without reviewing the evidence that supports
our factual and legal arguments." They said "it is regrettable
that no one would even review" their rationale "and tell us
where it went wrong."
The memorandum also questioned the handling of some government
witnesses who were asked to alter their written testimony to
reflect the department's concerns.
One witness, Matthew Myers, president of the Campaign for
Tobacco-Free Kids, said in an interview Wednesday that
Ms. Eubanks called him last month, hours before his final
written testimony was due to be filed, and told him that
Mr. McCallum and other senior officials wanted him to eliminate
part of the testimony. The part the department wanted to omit,
Mr. Myers said, centered on antismoking steps that he believed
were wrongly omitted from the tobacco settlement in 1997,
including limits on advertising.
"Eubanks was the good trouper, and she didn't let on at all what
she thought of the request" to omit part of his testimony,
Mr. Myers said. "But I said: 'No, I won't change it. It is what
it is.' "
In the end, the only change he agreed to was an additional line
that he did not know the steps the department would seek in the
current case. Mr. Myers said he remained troubled by the case.
"To have the lawyers work on a case this long," he said, "and
then just have the department basically throw it out seems
despicable to me."
---
Robert J. Berger - Internet Bandwidth Development, LLC.
Voice: 408-882-4755 eFax: +1-408-490-2868
http://www.ibd.com
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