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Head of DOJ Criminal Division admits oversight of prosecutors in some districts lacking

By Jessica Karmasek | Dec 8, 2016

WASHINGTON (Legal Newsline) - An assistant attorney general for the U.S. Department of Justice’s Criminal Division admitted, during a panel discussion Thursday, that some criminal cases brought by the federal government don’t necessarily have merit and that oversight of federal prosecutors, in some districts, is not what it should be.

Assistant Attorney General Leslie Caldwell, who was confirmed in May 2014 and currently oversees nearly 600 attorneys who prosecute federal criminal cases in the United States, made the comments at a luncheon hosted by The Federalist Society.

“I acknowledge that there are cases that get filed that shouldn’t be filed,” Caldwell said. “And there are districts where oversight is not what it should be.”

“The Limits of Federal Criminal Law,” held at the National Press Club in Washington, D.C., included Caldwell and attorneys Cristina Arguedas, Ben Hatch, John Richter and Joseph Savage.

Arguedas is a partner at Arguedas Cassman & Headley LLP, a relatively small boutique firm in Berkeley, California, that recently made a name for itself by successfully defending FedEx Corporation against the Justice Department.

Hatch is a partner in McGuireWoods’ government investigations and white collar litigation group. Prior to joining the firm, Hatch spent nine years as a federal prosecutor with the U.S. Attorney’s Office, serving in the Alexandria, Richmond and Norfolk divisions of the Eastern District of Virginia.

Richter is a litigation partner in King & Spaulding’s special matters and government investigations practices. Before joining the firm, he served as vice president and deputy general counsel at WellCare Health Plans Inc. From 2005 to 2009, he served as the U.S. Attorney for the Western District of Oklahoma.

Savage is a partner in Goodwin Procter’s securities litigation and white collar defense group. His practice focuses on white collar criminal defense, governmental investigations work and complex civil litigation.

At Thursday’s discussion, the panelists debated the limits of federal criminal law.

Within the last year, the DOJ has lost three major cases -- against FedEx Corporation, medical device company Vascular Solutions Inc. and the former president of pharmaceutical company Warner Chilcott.

Critics argue each of the three cases was an example of over-enforcement and over-criminalization by the federal government. Proponents, on the other hand, argue it is important for the government to continue policing and dissuading bad acts by private citizens, corporations and their leaders.

While Caldwell wouldn’t comment on the three specific cases mentioned -- Richter helped represent Vascular Solutions, Savage assisted in the Warner Chilcott case and Arguedas was the lead on FedEx -- she said the DOJ recognizes that not all U.S. Attorney’s Offices are equal.

“I can’t comment on any of these cases,” she said, noting her confirmation date. “But I know the Criminal Division has a lot of oversight. But we do see that there is variation across the districts.”

Hatch said the scope of criminal law, itself, is a factor.

In the last 20 to 30 years, he explained, criminal law has expanded in different areas and to different degrees.

“As a result of that, whenever you have broader criminal laws, you have the fact that prosecutors and agents then have to make decisions about which cases they’re going to prosecute, so there’s an increase in the range of prosecutorial discretion,” he said.

Richter, pointing to his own experience as a federal prosecutor and his role in the Vascular Solutions litigation, said that may be the case, but took issue with certain prosecutorial tactics.

“They essentially came in with their minds made up when they met with witnesses,” he said. “They examined witnesses in a manner that had a tendency to mislead.”

And while he and other attorneys for Vascular Solutions appealed the DOJ’s case against the company -- as suggested and recommended by both Hatch and Caldwell during Thursday’s discussion -- Richter said their letters fell on deaf ears, so to speak.

“As a former U.S. Attorney, I thought I’d save the department from a bad case,” he said. “I thought there would be fair-minded consideration and actual consideration. But nothing changed.”

Minnesota-based Vascular Solutions, which was charged with selling unapproved medical devices, ultimately prevailed against the DOJ -- only after five years and spending $25 million on its defense.

Savage said it was much of the same in his client’s case, with prosecutors refusing to give him a meeting.

“The DOJ genuinely believed they had a clear winner,” he said. “They literally said, there’s nothing to talk about.”

But a federal jury later acquitted W. Carl Reichel, the former president of Warner Chilcott. Reichel had been indicted and charged with a single count of conspiring to pay kickbacks to physicians in violation of the Anti-Kickback Statute.

The DOJ crashed and burned once again in June, when federal prosecutors moved to dismiss the department’s indictment against FedEx. The DOJ, in 2014, had charged the Memphis-based global courier with conspiring to transport illegal prescription drugs.

Judge Charles Breyer, for the U.S. District Court for the Northern District of California and brother to U.S. Supreme Court Justice Stephen Breyer, granted the department’s motion and dismissed the case. The DOJ still hasn’t revealed the reasons behind the dismissal.

Breyer concluded FedEx was “factually innocent.”

“I do credit them for dismissing the case,” Arguedas said, “but it doesn’t do that much to mitigate what FedEx had to do to get to that point.”

Arguedas said she thinks the DOJ is “blinded” by money, in particular the money they receive from companies that decide to settle with the department -- something FedEx simply wasn’t willing to do.

“That’s the first thing [these prosecutors] put on their resume,” she said of such deals. “It’s emblematic of how the DOJ views these checks.

“To them, it’s an admission of wrongdoing. And maybe in some cases, that’s true. But most of the time, it’s just a nuisance, going-away fee that companies are willing to pay.”

From Legal Newsline: Reach Jessica Karmasek by email at

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