In what was dubbed the “Moonlight Fire” case, the tables are now turned. The defendants have discovered new evidence and filed a stunning motion.
The new evidence and disclosures are being taken seriously by the Chief Judge of the Eastern District of California—as they should be. In a shocking action, Judge Morrison C. England Jr. ordered the recusal of every federal judge in the Eastern District of California.
Now that settlement may go up in smoke because of the new evidence of outrageous misconduct by the federal prosecutors and the investigators from state and federal offices, as well as findings earlier this year by a state judge.
To avoid any appearance of partiality, he has referred the case to Ninth Circuit Chief Judge Alex Kozinski to appoint a judge from outside the Eastern District to handle the case going forward.
Judge Kozinski has excoriated prosecutors for failing to meet their legal and ethical obligations.
Smoke rises from the Moonlight fire, which burned in Plumas and Lassen counties in California for 22 days in September 2007. (Office of U.S. attorney)
Question: What happens when lawyers uncover what could be explosive evidence of misconduct in a $122 million case by attorneys in the Department of Justice? Answer: the Department of Justice tries to have all defense lawyers who have even read about the alleged government misconduct removed from the case and gagged from discussing what they know.
What’s at stake here? In a word, justice, including the ability of many lawyers to continue to represent their clients. And it is ultimately about our justice system—about the very rule of law.
This is not a hypothetical issue. It happened last month in a California federal court, where a local timber company is trying to pursue charges of fraud against federal prosecutors and investigators as well as win back millions in imposed penalties. The company has already won a major victory in California’s state court—which may be why the Department of Justice is trying so hard to make this case of allegedly profound prosecutorial abuse vanish.
A state audit lead to the discovery of piles of evidence that Cal Fire had hidden concerning the case–including an unauthorized, off-the-books “slush fund” that Cal Fire maintained for the profits of such actions.
The story starts on Labor Day weekend 2007, near Westwood, California, where a wildfire destroyed 65,000 acres of countryside. Some 45,000 of those acres were national forest, and it cost millions for state and federal governments to extinguish the blaze. State and federal investigators and prosecutors set about to identify the cause and find someone to blame.
They quickly focused on a “deep pocket”—Sierra Pacific, a family-owned company that is the country’s second largest timber supplier and a huge local land-owner.
The government agencies decided that a bulldozer used by Sierra Pacific created a spark that started the blaze, and a massive litigation assault forced Sierra Pacific to sign a settlement of cash and land valued at $122 million to end the federal litigation alone against it. Sierra Pacific has already paid millions toward the settlement and transferred 1,500 acres of its valuable land to the feds.
But when push came to shove on a parallel state court case brought against Sierra Pacific by Cal Fire, the California investigative authority, it was the civil prosecution that went up in smoke. A state audit lead to the discovery of piles of evidence that Cal Fire had hidden concerning the case–including an unauthorized, off-the-books “slush fund” that Cal Fire maintained for the profits of such actions.
California Judge Leslie C. Nichols found that Cal Fire “had engaged in the pervasive and systematic abuse of the California discovery rules” and “egregious” conduct affecting the integrity of the court itself.
He assessed $32 million in fees and court expenses against the state. Although the U.S. government was not a party to the state case, the U.S. Forest Service, Cal Fire and their attorneys had all worked together on the investigation and litigation under a joint prosecution agreement.
More was soon to come. Former Assistant U.S, Attorney E. Robert Wright read the widely publicized orders of Judge Nichols, and on June 12, 2014 gave Sierra Pacific’s defense a 15-page sworn statement for use in the federal case against the timber firm. In it, he raised serious questions about possible suppression of evidence that would clear the company.
Sierra Pacific has now asked a federal court to set aside its $122 million settlement agreement because of fraud on the court—by the federal prosecutors and agents. A federal judge has the case, and held his first hearing on its status on November 24. California Senior Federal District Judge William Shubb, himself a former U.S. Attorney, is reputedly a no-nonsense jurist who expects the government to follow the law—a novel and welcome application of Article III of our Constitution.
Shockingly, the Department of Justice moved to disqualify all of the defense attorneys who even read Robert Wright’s sworn declaration. The government asked the court to remove the entire defense team because Wright’s declaration contains confidential and privileged information belonging to the government.
The Department also claims that former Assistant United States Attorney Wright breached his duties of loyalty and confidentiality to his former client, the United States, by disclosing that the government may have been hiding evidence that undermined its case. Calling Wright’s duty of loyalty to his client “absolute,” and his breach “inexcusable,” they claim that he should have brought any concern to the attention of his superiors.
Unfortunately for the government counsel, Assistant U.S. Attorney David Shelledy, Sierra Pacific’s motion to set aside the judgment states that it did bring the entire problem to the Justice Department’s Office of Professional Responsibility—only to have the evidence of misconduct smothered as effectively as the evidence that someone less wealthy than Sierra Pacific had caused the original fire.
So far, Judge Shubb is not impressed. He’s ignoring the Department’s motion to disqualify all the defense attorneys, and instead, requested more briefing on the real issues of government misconduct and possible fraud on the court.
A 1935 Supreme Court decision entitled Berger v. United States enshrines the notion that U.S. Attorneys are representatives “not of an ordinary party to a controversy, but of a sovereignty” whose interest is not “that it shall win a case, but that justice shall be done.”
If so, perhaps Assistant U.S. Attorney Shelledy will wind up disqualified. Specifically named in Wright’s affidavit and implicated in possibly improper ethical decisions, he has a glaring conflict of interest. Why is he still involved in pleadings for the United States?
Fraud on the court infects our entire judicial system and renders public confidence impossible. What happens in Judge Shubb’s Sacramento federal courtroom will matter to all Americans.
Sidney Powell is a former federal prosecutor who served in three districts under nine United States Attorneys from both political parties. She is the author of “Licensed to Lie: Exposing Corruption in the Department of Justice.”
News Censorship: Massive Fraud In California Federal Court Exposed By Judge, Going Unreported
Corrupt federal prosecutors presenting false evidence in order to shake down a blameless company and bring in tens of millions of dollars seems like a pretty dramatic story. Especially when former prosecutors support the charge and a chief judge acts on the allegations and takes dramatic action. Yet the media silence is deafening.Eric Holder’s Justice Department is implicated in a dramatic and shocking case of alleged corruption that is so bad that the Chief Judge of the Eastern District of California has taken what can rightly be called the “nuclear option” and recused all the judges in the district from the case because they may have been defrauded by the DoJ prosecutors.
So far, aside from the local paper, the Sacramento Bee
, it is only Sidney Powell of the New York Observer,
writing in the opinion pages of that publication that has paid attention to what should be a prominent national media scandal. In brief, the Sierra Pacific Industries, a lumber producer, was accused by the federal government of starting a large wildfire, and fined $55 million, and compelled to hand over title to 22,500 acres of land. The only problem is that the prosecution was allegedly corrupt, and knowingly submitted false evidence.
In an extraordinary development, Judge England, Chief Judge of the United States District Court for the Eastern District of California, ordered
the recusal of all the Eastern District judges from the case because of serious allegations that the Court itself was defrauded by the government in the original prosecution. To avoid any appearance of partiality, he has referred the case to Ninth Circuit Chief Judge Alex Kozinski to appoint a judge from outside the Eastern District to handle the case going forward. Judge Kozinski
prosecutors for failing to meet their legal and ethical obligations.The order
notes that the defendants filed an action this week to set aside the $55 million settlement because, as the defendants allege, “the United States presented false evidence to the Defendants and the Court; advanced arguments to the Court premised on that false evidence; or, for which material evidence had been withheld, and obtaining court rulings based thereon; prepared key Moonlight Fire investigators for depositions, and allowed them to repeatedly give false testimony about the most important aspects of their investigation;
The Sacramento Bee reported on the Defendant’s filing. Indeed, the Defendants’ motion informs us that a former Assistant United States Attorney came forward and disclosed that he believes that he was removed from the original prosecution by “his boss, David Shelledy, chief of the civil division in the United States Attorney’s office,” because he “rebuffed” pressure to “engage in unethical conduct as a lawyer.” What punishment has Shelledy received?, like other former prosecutors who were unethical, Mr. Shelledy is to receive Attorney General Holder’s highest award for excellence—this week.
– Read More: http://aun-tv.com/2014/10/news-censorship-massive-fraud-in-california-federal-court-exposed-by-judge-going-unreported/
Read more at http://www.liveleak.com/view?i=999_1414274642#ZrwGZvzRLtAbHBwy.99
The Scandals at Justice
Did Justice “steamroll the truth” in attempt to extort a settlement?
Attorney general Eric Holder (Alex Wong/Getty)
Lynch was properly grilled on her views on immigration enforcement, executive orders, and terrorist prosecutions. But so far no senator has dug deep into some of the most abusive cases that Justice has filed, and asked why lower-case justice hasn’t been done.
One of the most notorious is Justice’s role in California’s “Moonlight Fire,” a conflagration on Labor Day 2007 that burned 20,000 acres of state forest in the Sierra Nevada along with 45,000 acres of federal forest. The California Department of Forestry and Fire Protection decided that Sierra Pacific Industries, a family-owned company that is the nation’s second-largest timber supplier, was responsible for the damage. Government investigators claim the blade of one of the company’s bulldozers hit a rock, creating a spark that started the blaze. Sierra Pacific pointed out clear holes in that theory, but Cal Fire nonetheless fined the timber company $8 million to pay for related costs. Because the fire burned more than 40,000 acres of national forest, the federal government also went after Sierra Pacific; in 2012, after five years of litigation, Sierra Pacific reluctantly agreed to a settlement that entailed paying the feds $4 million and giving Uncle Sam 22,500 acres of forest land.
But since then, there has been discovery in the related state lawsuit, which has uncovered a shocking claim of dereliction of duty: that Justice’s prosecutors “sat on their hands” and allowed fire investigators to frame Sierra Pacific. The possible motive? Sierra had deep pockets, and any settlement would create substantial revenue. In the state’s case, a substantial chunk of the money would go to an off-the-books slush fund run by Cal Fire, in which some of its official investigators had interests.The misconduct was so egregious that California Superior Court judge Leslie Nichols threw out the state’s case. Last year, he further ruled that the government’s case was “corrupt and tainted. Cal Fire failed to comply with discovery obligations, and its repeated failure was willful.” The judge charged that the state hid key photographs and tried to “steamroll the truth” in order to pin the fire on the company. Investigators lied under oath about what they knew, and federal prosecutors allegedly knew about their perjury and did nothing.” When Sierra Pacific lawyers questioned the bulldozer driver, he denied making a statement about the blaze’s origins, and he couldn’t have properly signed a document given to him by prosecutors because he can’t read. The U.S. Forest Service had evidence that one of its fire spotters may have been high on pot and missed the fire’s start. His supervisor wanted to fire him, but the supervisor’s superiors covered it all up by insisting the spotter get a satisfactory performance rating and stay on the job.
“The misconduct in this case is so pervasive,” Judge Nichols wrote, “that it would serve no purpose to attempt to recite it all here.”
Nichols also didn’t spare the office of California Attorney General Kamala Harris, now a candidate for Barbara Boxer’s U.S. Senate seat and a national Democratic star. Nichols wrote that he can recall “no instance in experience over 47 years as an advocate and a judge, in which the conduct of the Attorney General so thoroughly departed from the high standard it represents, and, in every other instance has exemplified.” Judge Nichols then ordered the state to pay Sierra Pacific a whopping $32 million in damages and expenses. Cal Fire denies any wrongdoing, while the offices of Harris and Governor Jerry Brown aren’t talking.
The Nichols ruling prompted Sierra Pacific to enter federal court, charging fraud, and to demand that its settlement money be returned. Ben Wagner, the U.S. Attorney responsible for the federal case, insists there is no fire behind all the smoke of a legal coverup, but he hasn’t properly explained why Robert Wright, his top assistant in charge of fire litigation, was removed from the Moonlight Fire case after he stated that he believed it was his duty to disclose material seriously damaging to the government’s case. In fact, Wright was removed by his immediate boss, David Shelledy, because he was honest and would not have gone along with the program. Wagner defends his subordinate Shelledy in part by noting that he was recently given an award for distinguished service by Eric Holder. Color me less than impressed.
Another federal prosecutor, Eric Overby, left the Midnight Fire probe in 2011 because he was shocked at the conduct of his colleagues. In Sierra Pacific’s brief he is quoted as saying: “In my entire career, yes, my entire career, I have never seen anything like this. Never.” He says that as he left he told his colleagues: “It’s called the Department of Justice. It’s not called the Department of Revenue.”
Justice’s response to Sierra Pacific’s demand for its money back has been to demand that U.S. District Judge William Shubb order the removal from the case of all of the company’s lawyers who have even read Robert Wright’s sworn declaration, a document that Justice says includes privileged information. Justice says Wright’s whistleblowing is “inexcusable.”
What’s inexcusable is that Justice has ignored the message of a 1935 Supreme Court opinion that ruled that Justice’s interest is not “that it shall win a case, but that Justice shall be done.” In 2013, Chief Judge Alex Kozinski of the Ninth Circuit Court of Appeals, which includes California, noted that an epidemic of prosecutorial abuse is “abroad in the land”; “Only judges,” he said, “can put a stop it it.”
Not quite right. It should be the responsibility of Loretta Lynch, the likely new attorney general, to address the excesses and ethical breaches in the Justice Department. And it is the responsibility of senators who will vote on her confirmation to go beyond the headline issues of immigration and terrorism and ask her some serious and probing questions about the Moonlight Fire fiasco and other troubling cases on Justice’s plate.
— John Fund is national-affairs columnist for National Review Online and the co-author of Obama’s Enforcer: Eric Holder’s Justice Department (Broadside Books, 2014).