Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 7 of 30

intended to help ensure that investigations are pursued in a way that respects both
individual voting rights and the states’ primary responsibility for administering the
electoral process.

2. Consultation Requirements for Campaign Financing Crimes.

Additional considerations come into play in cases involving possible campaign
financing violations under FECA, notably, the concurrent jurisdiction of the FEC to
conduct parallel civil proceedings in this area and the resulting need to coordinate
criminal law enforcement with the commission. Therefore, consultation with the
Public Integrity Section is required to:

. conduct any inquiry or preliminary investigation in a matter
involving a possible campaign financing offense;

. issue a subpoena or search warrant in connection with a
campaign financing matter;

. present evidence involving a campaign financing matter to a
grand jury;

. file a criminal charge involving a campaign financing crime;
or

. present an indictment to a grand jury that charges a campaign

financing crime.

The Election Crimes Branch [of the Public Integrity Section] also serves as the point
of contact between the Department of Justice and the FEC, which share enforcement
jurisdiction over federal campaign financing violations.

Manual, at 18 (emphasis added).

The Manual lists, three categories of election crimes: Election Fraud, Patronage Crimes and
Campaign Financing Crimes. The Manual first states that as to Election Fraud and Patronage
Crimes (not at issue in the instant case):

United States Attorneys’ Offices and FBI field offices may conduct preliminary

investigations of an alleged election fraud or patronage crime without consulting its
Public Integrity Section. .... However, a preliminary investigation does not include

interviewing voters during the pre-election or balloting periods concerning the
circumstances under which they voted, as such interviews have the potential to


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 28 of 30

jocal U.S. Attorney from proceeding with any such campaign finance investigation without prior
consultation with the DOJ’s Public Integrity Section. The Public Integrity Section was not consulted
by the Detroit office prior to, or apparently even early on in the investigation.’

The Government concedes that the overwhelming majority of election campaign finance
violations proceed first to the FEC. (Hearing Trans. 10/16/07, at 102-03, Helland). The failure of
the local U.S. Attorney’s office to consult immediately with the DOJ Public Integrity Section
prevented the DOJ from initially consulting with the FEC. Manual, at 18; Hearing Trans. 11/7/07,
at 125, Day. Indeed, it was the Defendant Fieger who first consulted with the FEC. It was only after
Defendant Fieger’s attorney Thomas Cramner sent a letter to the FEC about the instant federal

criminal investigation that the FEC opencd a case. Thereafter, the prosecutors convinced the FEC

7 At the hearing on November 7, 2007, the following exchange occurred:

Helland: 1 did not consult with Washington . . . . 1 assigned [AUSA Chris Varner]
in my office to work on it for a period of time. . . . Roughly
simultaneously, the case also went to the Public Integrity Section.

Court: . It went to Washington but you didn’t consult?

Helland: No.

Court: When was your first conversation with [Public Integrity Attommeys] Mr.
Day or Hillman whoever was there?

Helland: Boy, I’m not going to be able to remeinber when | first spoke with Mr.

Day, it was substantially after that.

Helland: Mr. Varner, probably, | would hope, had contact with Public Integrity, but
1 did not.
Court: But you can find out because there will be a trail list of whatever he did.

(Hearing Trans. 11/7/07, at 111-14) (emphasis added). No information of any contacts between
AUSA Varner and the Public Integrity were subsequently provided to the Court.

28


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 24 of 30

recusal — is essential to permit the Defendants to argue their claim, of Government misconduct. This
information — the reason for the recusal — is not otherwise available to the Defendants.

The Court, in balancing the Defendants’ critical need for this information in pursuing their
claim of vindictive prosecution, against the effect of the disclosure on the government, concludes
that this minimal disclosure is required.

The Court has had the benefit of being provided the reason for recusal by the Government
ex parte, in camera, and the Court concludes that providing this information to the Defendants will
not interfere with future open and frank discussion within the DOJ. This Order will not stop United
States Attorneys from being open and candid, and honoring their obligations to the legal profession’s
Canons of Ethics or to DOJ Rules/Standards, to recuse themselves on their own, or through the DOJ
process, when circumstances so require.

The Court does not accept the Government’s suggestion (Government’s Brief Conceming
Privileged Nature of Recusal Information at 5) that the possibility of disclosure of the reason “would
create a significant disincentive for Department of Justice employees to be candid conceming
potential conflicts of interest, substituting an incentive to shade the facts created by the possibility
of public disclosure.” (emphasis added).

This Court does not for a moment believe that the thousands of outstanding attorneys within
the Department of Justice would “shade the facts” when critical issues of professional responsibility
arise. For the local Assistant United States Attorney, and no less than an attorney in the Public
Integrity Section of the Justice Department, to suggest that the Court’s ordering discovery of this
limited reason for the recusal, will result in shady practices by Department of Justice attorneys, does

not honor and respect the tradition and good name of the United States Department of Justice.

24


FIEGER, FIEGER, KENNEY, JOHNSON & GIROUX

Mr. Leonard Green

United States Court of Appeals
Sixth Circuit Case No. 07-2291
Page Two

jurisdiction by taking a back seat to the Justice Department. The Attorney General’s response to this
Court appears to be an attempt to hide the ball from the Court.

Respectfully submitted,

FIEGER, FIEGER, KENNEY, JOHNSON
& GIROUX, P.C.

Michael R. Dezsi

MRDjjn
Enclosure

ce: Eric Fleisig-Greene, Esq.
Greg J. Mueller, Esq.


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 1 of 30

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION

UNITED STATES OF AMERICA,
Plaintiff, CASE NO. 07-CR-20414

-Vs- PAUL D. BORMAN

UNITED STATES DISTRICT JUDGE
D-1 GEOFFREY FIEGER,
D-2 VERNON JOHNSON,

Defendants.

J
/

AMENDED! OPINION AND ORDER:

(1) DENYING GOVERNMENT’S MOTION FOR RECONSIDERATION OF INTERIM
ORDER OF NOVEMBER 16, 2005 RE GOVERNMENT’S EX PARTE SUBMISSIONS;

(2) GRANTING IN PART, DENYING IN PART DEFENDANTS’ MOTION FOR
RECONSIDERATION OF INTERIM ORDER:

(a) ORDERING THE GOVERNMENT TO DISCLOSE TO DEFENDANTS
THE REASON FOR RECUSAL FROM THE INSTANT CASE OF THE TOP
THREE PRINCIPALS OF THE DETROIT UNITED STATES ATTORNEYS’
OFFICE; UNITED STATES ATTORNEY STEPHEN J. MURPHY; FIRST
ASSISTANT UNITED STATES ATTORNEY TERRENCE G. BERG; SENIOR
COUNSEL TO THE UNITED STATES ATTORNEY JONATHAN TUKEL.
(ATT. 1). THIS DISCLOSURE SHOULD BE PROVIDED TO DEFENDANTS
WITHIN SEVEN (7) DAYS OF THIS ORDER.

(b) ORDERING THE GOVERNMENT TO PROVIDE TO DEFENDANTS
WITH ITS REDACTED LIST OF E.D. MI CASES INVOLVING THE USE OF
SIGNIFICANT NUMBERS OF FEDERAL AGENTS IN EFFECTUATING
SIMULTANEOUS SEARCHES/INVESTIGATIONS.

(c) DENYING DEFENDANT’S REQUEST FOR IDENTIFICATION OF A
TRIAL LAWYER, INVESTIGATED BUT NOT PROSECUTED, FOR

' There are three amendments to this Opinion and Order, one on page 11, and two on
page 26.


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 11 of 30

advertisements against the state reelection campaign of Michigan Supreme Court Justice Stephen
Markman, a former U.S. Attomey.’ The instant grand jury also investigated Defendant Fieger’s
contributions to a second state reelection campaign, that of Michigan Democratic Governor Jennifer
Granholm.

Yet additional evidence that this is not just an ordinary prosecution is that there was, at a
minimum, scheduling coordination efforts between the local U.S. Attorney’s office and the
Michigan Attorney General's office with regard to the investigation, of Defendant Fieger on the
federal level (Edwards campaign), and on the state level (Markman and Granholm campaigns). The
Federal prosecutors acknowledged that when a state special prosecutor, who had been appointed by
the State Attorney General to investigate Fieger, declined to pursue a state prosecution, the Detroit
U.S. Attorneys office immediately sent an FBI agent with a search warrant, identical to the previous
state subpoena, to seize all of the state-seized records for use in the federal investigation.
Defendants contend that there was more than merely scheduling coordination, but rather a more
significant continuing relationship. (Hearing Trans. 12/14/07, at 62).

Defendants assert that this prosecution violates their constitutional rights to free speech and
political association. Defendants contend that the record provides “some” —enough- facts showing
vindictive prosecution to permit them to proceed with discovery. Cf United States v. Jones, 159
F.3d 969, 978 (6th Cir. 1998) (finding a defendant had produced sufficient evidence to meet the

“some evidence” standard applied to selective prosecution cases where he showed that eight non-

5 Although the election ballot designates judicial races as non-partisan, candidates for the
Michigan Supreme Court are nominated at party conventions. Justice Markman was nominated
by the Republican Party Convention. The Court recognizes that there has been an independent
Supreme Court candidate/justice nominated by petition; that, however, that did not occur in the
state election at issue.

ll


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 29 of 30

not to proceed with a parallel civil investigation of this case: “the FEC came to us and we agreed
that they would not pursue their investigation.”* (Hearing Trans. 11/7/07, at 125, Day).

The belated recusal from this case by the DOJ of the three principal executives in the Detroit
U.S. Attorney’s office after the investigation had been ongoing for seven months provides additional
facts, that, combined with that office’s violations of the DOJ Manual’s mandatory strictures, meet
the “some evidence” threshold to permit Defendants to seek discovery to pursue their claim of
prosecutorial vindictiveness. This supports the Court's order that the reason for the recusal be
provided to the Defendants to allow them to argue their vindictive prosecution claim.

The Government’s refusal to provide Defendants with a redacted list of other E.D. MI cases
that utilized a large complement of federal agents, is based solely on its argument that Defendants
have not met the threshold necessary to entitle them to any discovery. The Court has concluded that
Defendants have met that threshold. Accordingly, the Court orders that the Government provide
Defendants with that redacted list within seven days.

The Court, therefore, DENIES the Government’s Motion for Reconsideration, and

GRANTS IN PART AND DENIES IN PART Defendant’s for Reconsideration.

* Three 527 Groups (two Republican, one Democrat) that raised and illegally spent
millions of dollars in federal election campaigns were not criminally prosecuted. All three cases
were resolved civilly by the FEC through the payment of civil fines. According to Defendant’s
counsel, Veterans and POWs for Truth raised and spent more than 25 million in the 2004
presidential campaign; Progress for American Voters Fund raised more than 44 million in the
same election. (Hearing Trans. 10/16/07, at 23, Cranmer). None of the three 527 Groups were
“referred for criminal prosecution by the FEC.” (/d. at 53, Helland).

° The Court recognizes that both the local Detroit U.S. Attorney’s office and the DOJ
Public Integrity Section signed the indictment. The dual signatures do not eliminate the fact that
the investigation was initiated, and initially carried forward by the Detroit office. Further, the
Public Integrity Section and the local Detroit U.S. Attorney’s office are both arins of the same
entity and do not constitute two independent prosecutions.

29


+ FAN (MB) SS SEH

+ TELTPHONE (218) 385 S855

SOUTIFIFI 9, SICHIGAN 49075-7483

+ 19390 WEST'TPS MILL ROAD +

4 PROFESSIONAL CORPORATION = ATLORNEYS AND COUNSELORS AT LAW

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The Attorney General and FEC cannot re-write the statute in a manner that
erases the FEC’s exclusive jurisdiction. Nor should the Attorney General and
FEC be able to treat as dead letter law the provisions of the Act with a nod and
a wink.

Recently, the Sixth Circuit Court of Appeals in Cincinnati, Ohio heard
oral arguments on this same issue and ordered the Attorney General to provide
the court with a list of cases in which it had secured similar agreements with the
FEC to treat as dead letter law the FEC’s exclusive jurisdiction. Fieger v.
Gonzales, Sixth Cir. Case No. 07-2291. In response to the Sixth Circuit’s order,
the Attorney General provided a list of irrelevant cases having nothing to do
with the Court’s order. See Addendum B.

In short, Appellant Marcus prays that this Honorable Court review Judge
Borman’s attached Opinion and Order which reveals that the Attorney General
and FEC are treating as dead letter law those provisions of the Act which confer
“exclusive civil jurisdiction” to the FEC and the referral mechanism set forth in
the Act.

Furthermore, in their briefs on appeal, Defendants rely on either irrelevant
or outdated law to support their arguments. For instance, Defendants cite

United States v. Int'l Union of Oper. Eng’rs, 638 F.2d 1161 (9th Cir. 1979),



Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 22 of 30

Defendant is not basing his claim for discovery under Rule 16 which deals with trial
discovery and trial preparation of the defense at trial. Instead, Defendant is seeking discovery for
his pretrial constitutional due process claim which is not cabined by Rule 16.

The Supreme Court recognized in United States v. Armstrong, 517 U.S. 456, 462-63 (1996),
that a selective prosecution claim cannot be construed as a defense:

[I]n the context of Rule 16 “the defendant’s defense” means the defendant’s response

to the Government's case in chief... . A selective prosecution claim is not a defense

on the merits to a criminal charge itself, but a independent assertion that the

prosecutor has brought the charge for reasons forbidden by the Constitution.

Id. at 463. The Supreme Court further noted that “[o]f course, a prosecutor’s discretion is “subject
to constitutional constraints’”. Jd. at 464.

A similar constitutional due process constraint applies with regard to a vindictive prosecution
claim, as the Supreme Court recognized in Blackledge v. Perry, 94 S.Ct. 2098, 2101 (1974). Thus,
Rule 16 does not contro} Defendant's request.

b. Deliberative Process Privilege

In Department of the Interior v. Klamath Water Users Protective Assoc., 532 U.S. 1, (2001),
the Supreme Court stated:

The deliberative process privilege rests on the obvious realization that officials will

not communicate candidly among themselves if each remark is a potential item of

discovery and front page news, and its object is to enhance “the quality of agency

decisions . . . by protected open and frank discussion among those who make them

within the Government... .

Id. at 8-9.
The discovery ordered by the Court in the instant Order requires only that the Government

provide the reason for the recusal. The Court does not require the Government to divulge any

communication the three local U.S. Attorneys sent to the DOJ, or any DOJ communications in

N
nN


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 8 of 30

interfere with the election process or inadvertently chill the exercise of an
individual’s voting rights.

Manual, at 17 (emphasis added). Thus, the DOJ Manual permits local federal investigations of vote
fraud and patronagecrimes without prior consultation with the DOJ’ s Integrity Section. The Manual
treats campaign finance investigations differently: prior to beginning any such investigation, the
local AUSA must first consult with and be cleared by the DOJ Public Integrity section. The
Manual’s mandated prior consultation with the DOJ Public Integrity Section by the Detroit U.S.
Attorney’s office did not occur in the instant case.

The Government contends that this is an ordinary prosecution by ordinary local line
prosecutors. (Gov’t Supp. Resp. Mot. Dismiss, at 12-13; Hearing Trans. 10/16/07, at 8, 10, 77, 79).
Yet, the Government acknowledges that this is not an ordinary prosecution; it is the first such
prosecution ever brought by the Detroit office. The Government also acknowledges that this
investigation was initiated locally in Detroit, and that the local prosecutors did not follow the DOJ

Manual by consulting with the DOJ’s Public Integrity Section before beginning the investigation.

The fact that the DOJ Manual required prior consultation with Washington before even beginning
a local investigation establishes that the DOJ does not treat this as an ordinary prosecution.

Indeed, in addition to the admonition on page 18, the Manual sets forth the prior consultation
requirement with the DOJ for campaign finance investigations a second time:

Accordingly, the Department requires that the Public Integrity Section be consulted

before beginning any criminal investigation. including a preliminary investigation,
of a matter involving possible violations of the FECA USAM § 9-85.210. This
consultation is also required before any investigation of campaign financing
activities under one of the Title 18 felony theories discussed above, as these
prosecutive theories are based on FECA violations.


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 14 of 30

The Government’s Motion for Reconsideration now requests that the Court return the recusal
information, and further, that the Court not rely upon it in evaluating the Defendants’ Motion to
Dismiss based on Selective and Vindictive Prosecution. The Court rejects both requests.

This Court recognizes that district judges examine matters in camera, and if they find the
matter to be privileged, or not relevant, do not disclose the information. The matter, however,
becomes part of the record — it does not revert back to the party that submitted it and disappear. The
Court will not destroy that part of the record in this case. Further, the Court recognizes that if the
information provided is relevant to the Court’s ruling, the Court must consider the information in
reaching its ruling.

The Court finds that the reason for the recusal of the three principal Detroit U.S. Attorneys
relevant to Defendants’ ability to muster the argument in support of their claim of
selective/vindictive prosecution, and will therefore consider it in arriving at its ruling. The Court
is not concluding that this evidence, by itself, establishes a constitutional violation, but rather that
it is evidence which Defendants are entitled to discover to argue their claims.

The third matter provided by the Government to the Court ex parte, in camera relates to the
Government’s assertion, to undercut Defendant’s selective/vindictive prosecution claims, that
another Democrat trial lawyer, investigated by the DO] for federal campaign finance violations, was
not prosecuted by the Federal Government for utilizing conduit contributions to the federal 2004
Edwards for President campaign. The Government, while providing the name of the trial attorney
to the Court ex parte, in camera, objected to public release of this individual’s name because he was
not prosecuted. The Court agrees that it would be improper to publicly set forth the name of a

subject of a grand jury investigation who was not prosecuted.

14


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 10 of 30

Attorney Terrence G. Berg, and Senior Counsel to the U.S. Attomey Jonathan Tukel, were ordered
recused by the DOJ in response to their request to the DOJ for consideration of recusal.

The timeline regarding the eventual recusal of the top three officials of the Detroit U.S.
Attorneys’ office is significant. This local investigation began in April 2005;the top three official
did not immediately recuse themselves from the case. The request to the DOJ for consideration of
recusal did not occur until seven months later, in November, 2005. During that seven month period,
the case investigation was ongoing, including grand jury proceedings.

In response to the Court’s questions as to why the three principals did not immediately recuse
themselves from the case, AUSA Helland stated that he could not answer the question without
getting into information which he did not believe should be disclosed. (Hearing Trans. 12/14/07,
at 46-47).

In response to the Court’s follow-up questions as to whether an AUSA can recuse himself
without asking Washington, e.g. if the case involves an AUSA’s uncle or cousin, Mr. Helland stated
“1 don’t know the answer to that.” (/d. at 52).

As to Mr. Helland’s relationship to the top three principal U.S. Attorney during that period,
in response to the Court’s questions did you talk with any of them, he stated that he “talked”, but
did not get “any direction.” (Hearing Trans. 11/7/07, at 49). Ata subsequent hearing, Mr. Helland
admitted that he works for Mr. Murphy: “That’s that chain of command.” (Hearing Trans. 12/14/07,
at 49).

Further evidence that this is not an ordinary prosecution is the faet that the instant federal
grand jury proceedings went beyond inquiring into Federal election campaign finance violations,

but also were directed at examining Defendant Fieger’s role in the funding of opposition

10


Case 2:07-cr-20414-PDB-MKM Oocument 162 Filed 02/01/2008 Page 23 of 30

response; just the specific reason for recusal. Thus, the instant discovery order does not reveal any
candid communications between any officials or any “deliberative process.” Accordingly, the
deliberative process privilege does not apply.
In Rugiero v. United States Department of Justice, 257 F.3d 534, 550 (6th Cir. 2001), Sixth
Circuit Court of Appeals Judge Alice Batchelder explained the deliberative process privilege:
To come within this exception on the basis of the deliberative process privilege, a
document must be both “predecisional”, ineaning it is “received by the
decisionmaker on the subject of the decision prior to the time the decision is make,”
and “deliberative”, the result of the consultative process ... . [T]he key issue in
applying this exception is whether disclosure of the materials would “expose an
agency’s decisionmaking process in such a way as to discourage discussion within
the agency and thereby undermine the agency’s ability to perform its functions.
(citations omitted). Again, in the instant case, this Court orders only the reason for the recusal — not
papers relating to the process. Thus, disclosure of the reason does not expose the DOJ’s
decisionmaking process so as to discourage discussion within the agency and undermine its ability
to perform its functions.
The Seventh Circuit noted in United States v. Farley, 11 F.3d 1385, 1389 (7th Cir. 1993),
that even if the deliberative process privilege was applicable to the reason for the recusal, that
privilege may be overcome when there is a sufficient showing of a particularized
need outweigh the reasons for confidentiality. C.F. Costal States Gas Corp. v. Dep't
of Energy, 617 F.2d 854, 868 (D.C. Cir. 1980) (the privilege should be applied “as
narrowly as consistent with efficient government opcration.”*)
The deliberative process is overcome — the privilege is routinely denied — “where there is reason to
believe the documents sought may shed light on government misconduct. ...” Hinckley v. U.S., 140
F.3d 277, 285 (D.C. Cir. 1998), citing Jn re Sealed Case, 121 F.3d 729, 737 (D.C. Cir. 1997).

In the instant case, the Court is not concluding that there has been governmental misconduct.

However, the Court does conclude that the information at issue — the reason for the November

23


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 5 of 30

Prosecution of Election Offenses, 7th Ed. 2007, published by the U.S. Department of Justice, at 5-8
(hereinafter “Manual”).

The Manual notes, that it is harder to obtain federal jurisdiction when there is no federal
candidate on the ballot — no federal election process. Manual, 6-7. The Manual recognizes that
“federal campaign financing law does not apply to violations of state campaign laws.” Jd. at 7.
Nevertheless, the Manual states that while violation of state campaign financing “statutes are not
by themselves, federal crimes, they may be evidence of other federal crimes,” listing the “Hobbs
Act, Travel Act or honest service offenses.” /d. at 8.

The instant Government investigation in addition to the Edwards campaign, has also
examined Defendant Fieger’s financing regarding Michigan state election campaigns, but none of
the charges relate to state campaigns.

The Court finds significant that from the initiation of the federal investigation in April 2005,
the state judicial re-election campaign of former U.S. Attorney, now Michigan Supreme Court
Justice, Stephen Markman was involved in this investigation. Specifically on April 13, 2005, when
Eric Humphries, a former Fieger employee, walked into Detroit FBI offices and provided
information that launched this investigation, he alleged campaign violations by Defendants Fieger
and Johnson with regard to the 2004 Federal Edwards for President campaign, and the state re-
election campaign of Michigan Supreme Court Justice Markman.

The local Assistant U.S. Attorney (“AUSA”) who initiated this investigation, Lynn Helland,
chief of the Special Prosecutions Unit, stated that the instant prosecution is the first such local
federal election criminal case he had seen during his 25 ycar career. (Hearing Trans. 10/16/07, at

52). The instant case is not the usual federal criminal prosecution because it relates to activity —


: aimed at redressing.” Fieger v. Ferry, 471 F.3d at 644 n.3 (6th Cir.

2006)(emphasis added)(quoting AmSouth Bank v. Dale, 386 F.3d 763, 786 (6th
Cir. 2004); see also Steffel v. Thompson, 415 U.S. 452 (1974) (finding that
plaintiff had standing to seek prospective declaratory relief under § 2201 to
prevent future constitutional violations).

In the end, Defendants fail to explain the most obvious problem with their
interpretation of the statute. Under their theory, if the FEC votes 5 to | against
referral, the lone disgruntled FEC member can simply walk aeross the street to
the Attorney General and ask the Attorney General to prosecute the matter.
Such an interpretation would render meaningless the referral provision of the
Act. This is the crux of the issue before this Court, and Defendants fail to offer
any convincing explanation of this problem.

Respectfully submitted,

FIEGER, FIEGER, KENNEY, JOHNSON
& GIROUX, P.C.

MICHAEL R. DEZSIP64530)
Attorneys for Plaintiffs-Appellants
19390 W. Ten Mile Road
Southfield, MI 48075

(248) 355-5555

Dated: August 7, 2008

FIEGER, FIFGER, KENNEY. [OfINSON & GIROUX + 8 PROFFSSIONAL CORPORATION + ATTORNEYS AND COUNSELORS AT LAW + [9390 WEST FEN MILL ROAD + SOUTHFIELD, MICUIGAN 48075-2463 + TLLLPIIONE (248) 195 5855 © FAX

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7



Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 20 of 30

The issue before the Court today is whether Defendants are entitled to discovery of the
reason for the recusa]. Thereafter, Defendants can utilize that information in their argument to the
Court.

The Court questioned the Government regarding the recusal:

Q. Court: Did the U.S. Attorney, Mr. Murphy, give a reason when he
recused himself on this case?

A. Mr. Helland: There is a reason. At this point, I’m trying to get clearance to
disclose that reason, but ’m not allowed to do it yet. It won’t
come from hin. There’s the office that does the recusing, the
Executive Office of United States Attorneys and they’re the
ones that have to decide this. So if they did write something
up and that something, they have to decide whether or not I
can disclose it or its contents and they haven’t authorized
that.

{Hearing Trans. 10/16/07, at 90-91). On October 23, 2007, Detroit AUSA Helland sent a letter to
the Court setting forth the Government’s position on the recusal issue:

I have been advised by the Executive Office for United States Attorneys that the

policy of that office is not to discuss publicly the reasons for any recusal action.

However, they have also advised that I am authorized to disclose those reasons to

you ex parte and in camera. If that is acceptable to the Court, [ am prepared to do

$0.
In response, the Court issued its Interim Order accepting the Government offer, and the information
was provided to the Court ex parte, in camera. Now Defendants seek that information.

Is there a legal basis to deny Defendant’s request for discovery of the reason for the recusal?

Initially, the Court finds that the DOJ policy of not revealing that issue publicly, is nota legal

basis for the Court to foreclose disclosure of the reason for the recusals to Defendants.

20


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 17 of 30

Barnwell found that ex parte communications with a trial court occurred during a

“critical stage” of a trial and, therefore, required a compelling state interest. It is an

open question, however, whether evidence regarding a claim of selective and

vindictive prosecution would qualify as a critical stage of trial. As the Sixth Circuit

has recognized, such claims have nothing to do with the merits of the underlying

criminal case. United States v. Abboud, 438 F.3d 554, 580 (6" Cir. 2006)... .

(Gov't Br. at 2, nl).

The instant case is now post-indictment, pre-trial. Defendants have made a claim of
selective/vindictive prosecution, which must be decided pre-trial. The Court finds this is a critical
stage for a defendant facing trial because if this claim succeeds, there will not be a trial. Indeed, the
Government has filed a motion to prevent any mention of selective or vindictive prosecution at trial;
Defendants’ sole opportunity to address this issue is pre-trial.

The Government’s Motion for Reconsideration states that absent Defendant Ficger’s
objections to its ex parte, in camera submissions, the Government would have addressed
“information conceming Defendants’ funding a campaign against Michigan Supreme Court Justice
Stephen Markman,” at the in camera hearing held on November 27, 2007. This did not occur
because Defendant has not withdrawn his objections.

At the same time, the Court notes that information about the Government’s investigation of
the Markman state reelection campaign has already surfaced in these proceedings. The Government

has stated, in response to Defendants’ assertions that grand jury witnesses claimed they were asked

about the Defendant Fieger’s financing of an anti-Markman campaign, that “one can assume” that

the anti-Markman state campaign financing issue was part of the federal investigation.®

° “L]et’s assume witnesses were asked about Markman campaign money and witnesses
were asked how they voted for.” (Hearing Trans. 12/14/07, at 29, Helland).

17


248) 285 5148

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=

FIEGER, FILGER, KENNEY, JOHNSON & GIROUX + 4 PROFESSIONAL CORPORATION. + ATTORNLYS AND COUNSFI ORS ATI AW + [9390 \WEST TEN MILF ROAD +» SOUTHIIELD. MICHIGAN 4807

Also without merit is Defendants’ reliance on United States v. Hsia, 24
F. Supp. 2d 33 (Dist. D.C. 1998), rev'd on other grounds, 176 F.3d 517 (D.C.
Cir. 1999). There, the defendant challenged her indictment on the grounds that
the more specific provisions of the FEC impliedly repealed the more general
provisions of the criminal code and thus she could not be charged under both.
The court rejected Hsia’s argument and stated that the “Attorney General . . . is
in no way limited by the FEC.” Like the language lifted from Galliano, the
language cited by Defendants from Hsia is dicta and does nothing to shed light
on the question before this Court.

Defendants’ rcliance on United States v. Palumbo Brothers, Inc., 145 F.3d
850 (7th Cir. 1998), is also misplaced. There, the defendants were charged in
a multiple count indictment with violating the criminal RICO statutes.
Defendants argued that, if at all, their conduct violated the National Labor
Relations Act and the Labor Management Act and that those labor statutes
preempted any criminal prosecution under the criminal RICO statutes. Unlike
the instant case, Palumbo dealt with two sets of laws, the criminal laws under
RICO and civil laws under the NLRA. Palumbo is not remotely relevant to the

question before this Court.



United States v. Jackson, 433 F. Supp. 239 (W.D. N.Y. 1977), and United States
vy. Tonry, 433 F. Supp. 620 (E.D. La. 1977), but each of these cases were decided
prior to the 1980 amendments which substantially and significantly altered the
referral provision of the Act. Given the statutory amendments to the Act in
1980, the decisions and discussions in /nt'l Union, Jackson, and Tonry were
limited to the pre-1980 amendments and should not be relied on in interpreting
the current statutory scheme.

Also misplaced is Defendants’ reliance on dicta from Galliano v. U.S.
Postal Serv., 836 F.2d 1362, 1368 n.6 (D.C. Cir. 1988). There, the court
considered whether the FEC’s exclusive jurisdiction displaced pro tanto the
application of certain fraud proscriptions contained in the United States Postal
Service’s regulations. In a footnote unrelated to the issue presented in the case,
the court noted that criminal enforcement of the FEC may originate either with
= the FEC or the Department of Justice. 836 F.2d 1362 n.6. In support of this
footnote, the court cited the /nt’] Union case from 1979. Defendants’ reliance
on the Galliano decision is hardly a smoking gun. The footnote was pure dicta
unrelated to the issues presented therein, and based on the 1979 decision of /nt’/

Union which has been superceded by the 1980 amendments to the statute.

KENNEY JOHNSON & GIROUX +

a



Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 6 of 30

political contributions — recognized by the Supreme Court as protected by the First Amendment.
See FEC v. Colo, Republican Fed. Campaign Comm., 533 U.S. 431, 440 (2001) (“[s]pending for
political ends and contributing to political candidates both fall within the First Amendment’s
protection of speech and political association.” (citation omitted)), At the same time, political
contributions are not unregulated. Congress has enacted legislation, Federal Election Campaign Act
(“FECA”), 2 U.S.C. § 431, and created an entity, the Federal Election Commission (“FEC”), to
regulate contributions by limits and sources. Further, Congress has enacted criminal penalties for
FECA violations, and in 2002, Congress passed the Bi-Partisan Campaign Reform Act providing
for enhanced criminal penalties for ccrtain FECA violations. See 2 U.S.C. §§ 437g(d)(1)(A),
437 9(4)(1)(D).

The Department of Justice (“DOJ*) has recognized the unique nature of election offenses by
publishing a comprehensive Manual — Federal Prosecution of Election Offenses — required reading
for Department attorneys and all local U.S. Attorney’s offices. The Manual establishes that the DOJ
has concluded that election campaign investigations, in particular those involving campaign
financing, require special treatment because of First Amendment issues relating to federal elections,
and because of the FEC’s civil enforcement responsibilities. The Manual states in pertinent part:

Justice Department supervision over the enforcement of all criminal statutes and

prosecution theories involving . . . campaign financing crimes is delegated to the

Criminal Division’s Public Integrity Section. Thus, Headquarters’ consultation

policy is set forth in the U.S. Dep’ TOF JusTICE, U.S. ATTORNEYS’ MANUAL (UJAM),
Section 9-85.210.

The Department’s consultation requirements for election crime matters are designed
to ensure that national standards are maintained for the federal prosecution of
election crimes, that investigative resources focus on matters that have prosecutive
potential, and that appropriate deference is given to the FEC’s civil enforcement
responsibilities over canpaign financial violations. The requirements are also



2
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+ STTORNEYS AND COUNSLLORS ATLAW

FIRGER, PIEGER, KENNEY. JONSON & GIROUX + A PROFESSIONAL CORPORATION

certain campaign finance laws because those laws were criminal laws contained
in the federal criminal penal code. But this is no longer the case.

In 1976, congress moved most of the substantive restrictions on campaign
finance from the federal penal code and placed them into the Federal Election
Campaign Act subject to the exclusive civil jurisdiction of the FEC. Therefore,
prior to 1976, there were two sets of laws — one set subject to the jurisdiction of
the FEC and another subject to the jurisdiction of the Attorney General. In
1976, congress changed that scheme so that the FEC would have the first
opportunity to resolve alleged violations of the Act. At the same time, congress
also limited the Attorney General’s jurisdiction to independently prosecute
violations of the Act without a referral by the FEC. These facts support
Plaintiff’ s argument and further expose the anachronistic nature of the Attorncy
General’s position.

Defendants also assert that Plaintiffs are not entitled to declaratory relief.
Plaintiffs disagree. This case presents a substantial question of federal
jurisdiction based on statutory interpretation best addressed by an action, like
this one, for declaratory relief. Indeed, as one court has pointed out, “[t]he
‘useful purpose’ served by the declaratory judgment action is the clarification

of legal duties for the future, rather than the past harm a coercive tort action is



Case 2:07-cr-20414-PDB-MKM Document162 Filed 02/01/2008 Page 12 of 30

African-Americans arrested for crack cocaine were not referred for federal prosecution). The
Government recognizes that Jones illustrates that the “some evidence” standard is not a significant
hurdle, however, it argues that Defendants have not met this “some evidence” threshold. (Hearing
Trans. 11/7/07, at 119-20; 126-28).

I. DISCUSSION

A. Documents Provided to the Court by the Government Ex Parte, In Camera

In response to the Court’s questioning at hearings, the Government has voluntarily provided
the Court with evidence, ex parte, in camera, as to three matters.

The first matter relates to the extensive amount of FBI resources devoted to this case. On
the November 2005 evening when the Government simultaneously executed a search warrant at
Defendant’s law offices, and interviewed 30 election campaign contributors at their homes, the
Government assembled a task force of over 75 agents. Eleven FBI agents went to Defendant
Fieger’s law offices, while 33 two agent teams (66) simultaneously appeared at homes of individual
contributors, many of whom are Fieger employees. The Government elected to interview the
individuals’ at their homes at night, rather than at Defendant Fieger’s office during daytime hours
AUSA Helland stated at a hearing “It’s definitely a surprise to anybody to find out a federal agent
is at the door. There’s virtue in that. There’s virtue in people being candid. It’s — whether you
agree with it or disagree with it, there is, in our opinion, a higher likelihood that witnesses are going
to be candid if they are surprised, okay, not shocked, not destroyed, not distraught, but surprised.”
(Hearing Trans. 10/16/07, at 48, Helland). In addition, a television station was tipped off to the fact
that this federal search warrant execution was occurring at Defendant Fieger’s offices. (Hearing

Trans. 10/16/07, at 36, Cranmer).

12


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FIEGFR, FIRGER, Ki NI Y, JONNSON & GIROUX + \ PROFPSSIONAL CORPOR ANION. + ATTORNEYS AND COLNSEI ORS ATLAW + 19N90 WEST FEN MILT ROAD + SOUTHTIFED MICHIGAN.

Docket No. 07-1284

UNITED STATES COURT OF APPEALS:- > =?
FOR THE NINTH CIRCUIT

(On appeal from the United States District Court, District of Arizona,
Civil Action No. 07-cv-00398-EHC
the Honorable Ear! H. Carroll)

JON MARCUS,
Plaintiff-Appellant,
vs.
UNITED STATES ATTORNEY GENERAL ALBERTO R.
GONZALES, FEDERAL ELECTION COMMISSION CHAIRMAN
MICHAEL E. TONER, In their official capacities,

Defendants-Appellces.

PLAINTIFF-APPELLANT’S REPLY BRIEF ON APPEAL

*** ORAL ARGUMENT REQUESTED ***

Submitted by:

Michael R. Dezsi

Fieger, Fieger, Kenney, Johnson & Giroux, P.C.
19390 W. Ten Mile Road

Southfield, MI 48075

Tel: (248) 355-5555

Counsel for Plaintiff-Appellant



+ FAN 48) #58 SUIS

FIEGER, FIEGER KENNCY, JOHNSON & GIROUX + \ PROFESSIONAL. CORPORATION + ALPORNLYS AND COLNSLLOKS AT LAW + 19100 WEST TEN MILF ROAD + SOU TINIELD. MICITIGAN 48075 2461 © fLELPHONE 1248) 395 5555

Eric Fleisig-Greene, Esq. Gregory J. Mueller, Esq.
Michael S. Raab, Esq. Federal Election Commission
U.S. Department of Justice 999 E. St., N.W.

Civil Division, Room 7214 Washington, D.C. 20463

Washington, D.C. 20530-0001

Michael R. Dezsi

Counsel for Plaintiff-Appellant Jon Marcus
19390 W. Ten Mile Road

Southfield, MI 48075

(248) 355-5555

m.dezsi@fiegerlaw.com



'

FIEGFR, FIFGER, KENNEY. JOTINSON & GIROLX + A PROFESSIONAL CORPORATION + ATTORNLYS AND COUNSELORS AT LAW + 15300. WEST [EX MILE ROAD + SOUTHUELD, MICHIGAN 48075-2403 + ILLLPIIONE (248) 385 S555 © FAN 248) 165.5148

Docket No. 07-1284

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

(On appeal from the United States District Court, District of Arizona,
Civil Action No. 07-cv-00398-EHC
the Honorable Earl H. Carroll)

JON MARCUS,
Plaintiff-Appellant,
vs.
UNITED STATES ATTORNEY GENERAL ALBERTO R.
GONZALES, FEDERAL ELECTION COMMISSION CHAIRMAN
MICHAEL E. TONER, In their official capacities,

Defendants-Appellecs.

CERTIFICATE OF SERVICE

Michael R. Dezsi hereby certifies that on the 7th day of August, 2008 he
caused to be served a copy of Plaintiff-Appellant’s Reply Brief upon the

following individuals by placing same in the U.S. Mail, postage fully prepaid:



Addendum B


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 19 of 30

(Gov’t Br. at 5) (emphasis in original). The Court disagrees with the Government’s conclusion as
to Defendants’ evidence at this stage of the proceedings. The Court must decide whether there is
evidence, including the ex parte submissions, sufficient to proceed further on Defendant's instant
discovery request — specifically whether to order the Government to provide Defendants with the
reason for the recusal
The Court notes, and the Government has recognized, that the focus of Defendants’ claim
has become vindictive prosecution. To establish a claim of vindictive prosecution, must show:
1. aprosecutional stake in the exercise of a protected right
2. unreasonableness of the prosecutor’s conduct, and
3. an intent to punish Defendant for exercise of the protected right.
United States v. Suarez, 263 F.3d 468, 479 (6th Cir. 2001). Further,
[t)here are two approaches to showing prosecutorial vindictiveness: a defendant can
show (1) actual vindictiveness, by producing objective evidence that a prosecutor
acted in order to punish the defendant for standing on his legal rights, or (2) a
realistic likelihood of vindictiveness, by utilizing the framework outlined above
(focusing on the prosecutor’s stake in deterring the exercise of a protected right and
the unreasonableness of his actions). Attempting lo show actual vindictiveness has
been characterized as exceedingly difficult and an onerous burden.
United States v. Dupree, 323 F 3d 480, 489 (6" Cir. 2003) (internal quotations and citations omitted)
(emphasis added).
The Court having viewed the evidence submitted by the Government in camera, the briefing,
and the oral argument, concludes that there is presently sufficient evidence to support Defendants’

vindictive prosecution allegation to entitle them to the instant initial discovery matter — the reason

for recusal — in pursuing their claim.

19


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 18 of 30

At the hearing held December 14, 2007 on the Motion for Reconsideration, Christopher
Yates, co-counsel for Defendant Johnson stated:

The first reference I found in the materials that we’ve received in discovery about
questions concerning the Steve Markman campaign by Mr. Fieger was on April 13,
2005 when Mr. Humphrey met with government agents. So I believe the recusal
occurred in November of 2005.

This FBI 302 indicates that there was discussion of Mr. Fieger’s involvement with
the Markman matters as early as April 13, 2005.

(Hearing Trans. 12/14/07, at 102-03). In response, AUSA Helland stated:

With that in the record, frankly I’d forgotten that with that in the record, that
establishes an overlap of what we were looking at and what the State was looking at,
I believe at least — it puts into the record that it was within our body of knowledge
that there might have been involvement with Mr. Markman. It doesn’t establish any
connection between the state and federal investigation. And I think that’s the point

(dd. at 103). Thus, Defendant Fieger’s alleged financing of anti-Markman campaign was front and
center of the local U.S. Attorney office investigation from its inception, April 13, 2005.

The Government recognizes the possible relevance of the reason for recusal to Defendant’s
vindictive prosecution claim:

It is possible to imagine that this information might become relevant to a claim of
vindictive prosecution in one narrow circumstance — if defendants had offered
credible evidence that we who are prosecuting them were so incensed by their
finding of the anti-Markman campaign that we chose to single them out for
prosecution on that basis. However, there is no such evidence.

The Government’s response as to why individuals were asked for whom they voted — an
invasive question that goes to the heart of an individual’s right to privacy in a democracy — was
if the contributor’s vote went to a candidate other than Edwards, this supported evidence of an
illegal campaign contribution, The Government's rationale for asking that question assumes that
individuals always vote for a candidate to whom they contributed, and ignores many possible
alternatives, e.g. the person contributes to multiple candidates, the contributor had a change of
mind when he got into the voting booth, the contributor gave based on friendship with the
solicitor, not commitment to the candidate.

18


+ 19260 WEST JEN MILE: ROAD + SOUTHFIELD. MICHIGAN 48075 2463,

FIEGR, FIEGER, KENNLY, JOUNSON & GIROUX + A PROFTSSIONAL CORPORATION + ATTORNEYS AND COUNSELORS AT LAW

In short, there are no cases that address the specific issue before this Court
because it is a pure question of statutory construction. In United States v.
LaSalle Nat’l Bank, 437 U.S. 298, 307 (1978), the Court held that a question
similar to the question presented here was not predicated on analysis of
precedent but rather a review of the statutory scheme. In this case, the statutory
scheme provides the FEC with “exclusive civil” jurisdiction which means “to
the exclusion of all others.” The statutory scheme further provides a mechanism
for the FEC to refer a matter to the Attorney General for criminal investigation
and/or prosecution but only after the FEC has exercised its exclusive
jurisdiction.

Furthermore, the gust of Defendants’ arguments stems from provisions of
the Act that existed more than 30 years ago. For example, the Attorney General
relies on a conference report from the 1974 amendments to support its argument
that the FEC has jurisdiction over civil laws while the Attorney General has
jurisdiction over criminal laws. In 1974, Defendants’ arguments would have
made sense because back then the substantive restrictions on campaign finance
were contained in the federal penal code (Title 18 U.S.C.). Thus, in 1974, the

Attorney General would have been correct to argue that he had jurisdiction over



Case 2:07-cr-20414-PDB-MKM Document162 Filed 02/01/2008 Page 9 of 30

Manual, at 201 (emphasis added). The Manual, recognizes that “[t]he FEC is authorized by statute
to conduct a civil inquiry parallel to an active criminal investigation involving the same matter. 2
U.S.C. §§ 437d(a)(9), 437(e). Parallel proceedings present unique challenges to federal prosecutors
and investigators.” Manual, at 202.

The local AUSA’s failure to preliminarily contact the DOJ Public Integrity Section before
beginning an investigation, removed the option of the DOJ initially consulting with the FEC prior
to the investigation, and coordinating enforcement from the beginning between FEC and DOJ.
Indeed, there has been no coordination of efforts between the DOJ with the FEC. The prosecutors
acknowledged at a hearing, that the first contact in this case with the FEC was initiated by Defendant
Fieger’s counsel. This matter “was brought to the Federal Election Commission by Mr. Fieger,
actually, by Mr. Cranmer after we executed our search warrant... . It was not until Mr. Fieger wrote
a letter to the Fedcral Election Commission in. . . . late January of 2006, that the Federal Elections
Commission was involved here.” (Hearing Trans. 10/16/07, at 38). The only coordination between
the DOJ and the FEC in the instant case, has been an agreement subsequently secured by the DOJ,
that the FEC would not proceed with a parallel investigation. (Hearing Trans. 11/7/07, at 124-25,
DOJ Attorney Kendall Day). They were not brought into the case in consultation with the DOJ.
(Hearing Trans. 10/16/07, at39, Helland). The Government conceded that the FEC was “a complete
non-player.” (/d.).

Additional evidence that this is not an ordinary prosecution is the fact that in November
2005, seven months after the local prosecution was initiated, the top three principal executives in

charge of the Detroit U.S. Attomey’s Office, U.S. Attorney Stephen J. Murphy, First Assistant U.S.


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 26 of 30

[A] prosecution which would not have been initiated but for governmental
“vindictiveness” — a prosecution that is, which has an “actual retaliatory motivation”
—is constitutionally impermissible. Blackledge v. Perry, 94 S.Ct. 2098, 2102 (1974).

Jd, at 1145 (emphasis added). Judge Nelson’s opinion further discussed the defendant's claim:

“Some evidence” of vindictive prosecution has been presented here. It is hard to see,
indeed, how the defendants could have gone much farther than they did without the
benefit of discovery on the process through which this prosecution was initiated. It
may well be that no fire will be discovered under all the smoke, but there is enough
smoke here, in our view, to warrant the unusual step of letting the defendants find out
how this unusual prosecution came about. It will be time enough for the district
court to consider whether an evidentiary hearing should be held after discovery has
been completed — and we are confident that the district court will not let the
discovery get out of hand

Id. at 1146.
This Court recognizes the parameters set forth in Judge Nelson’s opinion and finds that
“some evidence” of vindictive prosecution is present here where the local U.S. Attorney’s office

failed to follow the DOJ Manual. Further, at the time period when the federal search warrant was

executed at the Fieger law offices in late November, 2005, thcre was, ata minimum, scheduling

coordination between the state investigation of Defendant Fieger and the federal investigation of
state election contributions by Fieger. Add to this, from Defendant’s point of view, the use of over
75 agents engaging in a nighttime search of Defendants’ law office, and the agents’ home visits of
32 Edwards contributors tied to Defendant Fieger, the threat to prosecute the contributors, and the
Government’s inquiry into whom the individual contributors voted. Therefore, as in Adams,
Defendants cannot proceed further in presenting argument and evidence without the benefit of their

discovering the reason for the reeusal.


Case 2:07-cr-20414-PDB-MKM Document162 Filed 02/01/2008 Page 27 of 30

Also, as in Adams, after the reason is provided to the Defendants, the Court will not allow
broad, sweeping discovery but the next proceeding will be to have argument on Defendant’s Motion
for Discovery.

The present case lacks the traditional hallmarks of a claim for prosecutorial vindictiveness
— namely the substitution or increase in the charges brought by a prosecutor after a defendant has
asserted a right. However, Defendants’ claim relates to the prosecutor’s initial decision to
investigate, and then additional factors on the road to the indictment. The gravamen of Defendants’
vindictive prosecution argument is that Defendant Fieger was targeted for prosecution because of
his exercise of protected First Amendment rights. See LITMAN, PRETEXTUAL PROSECUTION, 92
GEORGETOWN L.J. 1135, 1142 (2004).

Defendants assert that the individual prosecutors, local and national, have a “stake’ in the
exercise of Defendant Fieger’s protected First Amendment rights. The reason for the recusal is
relevant to Defendants’ ability to present that argument to the Court.

Defendants have established evidence that in initiating the investigation in this case, the
Detroit U.S, Attorney’s office acted in violation of DOJ policy, did not recuse the top three
prosecutors instantly, but allowed seven months to elapse before asking the DOJ to determine
whether they should be recused. The DOJ’s answer was yes. These facts support Defendants’ claim
for discovery of the reason for the recusal of the top three officials in the Detroit U.S. Attorney’s
office.

III. CONCLUSION
This first ever campaign finance prosecution by the Detroit U.S. Attorney’s office is unique

both in subject matter, and its failure to follow mandatory DOJ Manual procedures that prohibit a


Case 2:07-cr-20414-PDB-MKM Document162 Filed 02/01/2008 Page 15 of 30

B. Motions for Reconsideration
1. Defendant’s Motion

Citing Barnwell, Defendants contend that ex parte communications between the Government
and the Court can be tolerated only by a compelling government interest, such as national security,
or witness or juror safety, none of which apply here. Accordingly, Defendants request access to all
items submitted by the Government to the Court ex parte, in camera.

The Government contends it made a mistake and should never have provided the inforination
to the Court, and that “the information we have provided in camera should be returned to us and not
considered by the Court.” (Gov’t Resp. to Def. Mot. for Recon. at 1).

Having worked hard to establish the discovery principles in Bass and Thorpe, we

undercut those efforts by providing in this case the very discovery which the case

law holds that we need not provide.

(id. at 5). The Government asserts that Defendants have not met their burden of providing
preliminary evidence of selective or vindictive prosecution necessary to entitle them to discovery.
The Government concludes that it is wasting time responding “to Defendants’ baseless claims.” (id.

at 6). The Government noted that despite Defendants’ lack of entitlement to such evidence, it has

provided some discovery in response to Defendants’ motion:

We described the relationship between the Public Integrity Section and the United
States Attomey’s Office. We acknowledged the recusal of some personnel in the
Eastem District of Michigan. We provided public record information to the Court
conceming other campaign contribution cases, and provided certain additional
information to the Court in camera. We did al] of that in an effort to reassure the
Court that defendants’ failure to establish a colorable claim of improperly selective
prosecution was no mere technical default — the fact is that they are being prosecuted

properly.

(/d. at 3-4 (emphasis added)).


Eventually, the Attorney General brought a ten count felony indictment

2 against Mr. Fieger in Detroit. The Honorable Paul D. Borman presided over Mr.

Fieger’s criminal trial during which he found numerous instances of misconduct

Zz

and credible evidence of selective and vindictive prosecution on the part of the
Justice Department (Addendum A, Opinion and Order of Judge Borman).

Significantly, Judge Borman found that the Justice Department had
secured an agreement with the FEC under which the FEC would stay out of the
Justice Department’s way while the DOJ pressed forward with its case (See
Addendum, pg. 9). By securing such an agreement, the Justice Department and
the FEC were treating as dead letter law the FEC’s congressional grant of
“exclusive” civil jurisdiction. In other words, the FEC, by agreement with the
Attorney General, was simply relinquishing its exclusive jurisdiction so that the
Attorney General could proceed unimpeded.'

Appellant Marcus asserts that both the Attorney General and FEC have
violated the law by stripping the FEC of its exclusive jurisdiction so as to allow

the Attorney General to threaten and harass people like Appellant Jon Marcus.

' Nota Bene, on June 2, 2008 and after several weeks of trial, Mr. Fieger
was acquitted of all charges by a unanimous jury. Following the verdict, many
of the jurors expressed their disbelief that the Justice Department had even
pursued such a case and questioned why the DOJ and FBI sent nearly 100
federal agents to harass American citizens about how and why they voted the
way they did in the 2004 presidential election.

FICGER, FIGGER, KENNEY, JOJINSON & GIROUX + A PROFESSIONAL CORPORATION + ATTORNLYS AND COUNSELORS ATT AW + 19300 WEST TPS MILE ROAD. + SOUTHEIFE D MICHIGAN 48076-2463 +

-2-



FIEGER, FIEGER, KENNEY, JoHNSON & GIROUX

A PROFESSIONAL CORPORATION

ATTORNEYS AND COUNSELORS AT LAW
19390 Wes? TEN MILE Roap
SOUTHFIELD, MICHIGAN 48075-2463

TELEPHONE (248) 355-5555
Fax (248) 355-5148

MiIcuArL R. Dezsr WERSITE: www.fiegerlaw.com. DIRECT DIAL (248) 355-3911
E-Maizt: info@fiegerlaw.com E-MalL: m.dezsi@ fiegerlaw.com

August 4, 2008

Mr. Leonard Green
United States Court of Appeals
For the Sixth Circuit
540 Potter Stewart U.S. Courthouse
100 E. Fifth Street
Cincinnati, OH 45202-3988

Re: Geoffrey N. Fieger, et al. v. U.S. Attorney General Alberto R. Gonzales, et al.
Sixth Circuit Case No. 07-2291
Appellants’ Response to Attorney General’s Additional Citations

Dear Mr. Green,

This case was argued before a panel of this Court on July 24, 2008. During oral argument,
the court ordered the Attorney General to provide a list of cases in which the Justice Department had
secured agreements with the Federal Election Commission under which the FEC relinquished its

jurisdiction.

As Mr. Fieger pointed out in his supplemental letter dated July 17, 2008, Judge Borman ruled
that the Attorney General had secured an agreement with the FEC under which the FEC and Attomey
General treated as dead letter law the FEC’s “exclusive civil” jurisdiction so that the DOJ could
proceed unimpeded with its criminal investigation. Based on Judge Borman’s opinion, this Court
ordered the Attorney General to provide a list of other cases in which the Attomey General and FEC
agreed to have the FEC “step aside.”

On July 30, 2008, the Attorney General provided documents which in no way respond to the
Court’s order. Instead, the Attorney Genera! simply listed inapposite cases in which the Attorney
General prosecuted individuals for wide ranging criminal activity like bribery. We are deeply
saddened by the Attorney General’s refusal to respond to the Court’s Order. None of the cases have
the slightest relevance to the Court’s order that the Attorney General provide a list of cases in which
it has secured agreements with the FEC under which the FEC would relinquish its “exclusive civil”


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 2 of 30

ILLEGAL FEDERAL CONTRIBUTIONS TO THE 2004 EDWARDS FOR
PRESIDENT CAMPAIGN.

Before the Court is Defendant Fieger’s Motion for Reconsideration regarding the Court’s
Interim Order on Discovery (Doc. No. 102), and the Government’s Motion for Reconsideration of
the same Order (Doc. No. 107). The Interim Order relates to Defendant Fieger’s Motion to Dismiss
for Selective and Vindictive Prosecution.”

This case involves a ten count indictment; nine counts charge violations of the Federal
Election Campaign Act (“FECA”) (Johnson is not charged in four of the first nine counts) with
regard to the 2004 Edwards for President Campaign; the tenth count charges Defendant Fieger with
obstruction of justice.

Count I charges that both Defendant conspired to violate the FECA by:

(a) using corporate funds to pay for more than $25,000 in campaign
contributions to the 2004 [John] Edwards for President committee.

(b) making more than $25,000 in contributions to the Edwards
committee in the names of other persons.

(c) causing the Edwards committee to unwittingly file false campaign
finance reports.

(d) defrauding the United States by preventing the Federal Election
Commission (“FEC”) from carrying out its responsibility to enforce
the Election Act and provide accurate information to the public about
amounts and sources of campaign contributions.
Count I alleges that the Defendants used corporate funds to make prohibited contributions

totaling $127,000 and disguised them as legitimate payments. To carry this out, Defendants

allegedly solicited “straw donors” to write checks to Edwards, and agreed to provide them with

? Co-Defendant Johnson has joined in this Motion. (See Hearing Trans. 10/16/07, at 6).

2


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 4 of 30

On November 16, 2007, this Court entered an Interim Opinion and Order re Govemment Ex
Parte [in camera] Submissions Related To Defendants’ Motion to Dismiss Indictment For
Selective/Vindictive Prosecution. (Doc. No. 99). That Order referenced three categories of
documents that had been submitted to the Court voluntarily by the Government, ex parte and in
camera, in response to questions raised by the Court at hearings’:

1. a list of other Eastern District of Michigan federal criminal cases where a very

large complement of agents was utilized in simultaneous search warrant executions,

and interviews of individuals;

2. the reason for the recusal in November 2005 from further involvement in the

instant investigation/prosecution by the top three ranking personnel in the Office of

the United States Attorney for the Eastern District of Michigan; and

3. identification of the named subject of a Department of Justice campaign finance

criminal investigation, a tort plaintiffs attorney contributor to the 2004 John Edwards

for President campaign, that did not result in a prosecution.

Thereafter, the Court held one sealed ex parte hearing on the record on November 27, 2007 in
response to the Government’s request.

Defendants have consistently objected to the ex parte, in camera process, contending such
communication is violative of their right to due process, and arguing that the recent Sixth Circuit
decision in United States v. Barnwell, 447 F.3d 844 (6th Cir. 2007) requires that the in camera
information should be provided to them.

I, BACKGROUND

This indictment charges illegal campaign contributions to an individual (John Edwards)

seeking election for a federal office (President), bringing it within Federal jurisdiction. See Federal

* On October 30, 2007, the Court issued a scheduling order regarding the Government’s
submission of ex parte information, giving a deadline of November 2, 2007, and denying
Defendant’s opposition to the Government’s providing “Secret Information” to the Court.

4


18) B8E.$585 + PAR (248) 285 S148

E

FIBORR, FIEGER, KENNEY, JOHNSON & GIROUX + 4 PROFESSIONAL CORPORATION + ATPORNEYS AND COUNSELORS AT LAW + 19390 WESTTCN MILE ROAD + SOUTHFIELD MICHIGAN 48075-2463

PLAINTIFFS-APPELLANTS’ REPLY BRIEF

This case started when nearly 100 federal agents raided the Michigan law
firm of Fieger, Fieger, Kenney & Johnson along with the homes of nearly all the
Fieger firm employees, their families, and their friends. Shortly thereafter, the
Attorney General began wildly sending grand jury subpoenas all over the nation
to dozens of people who were friends and acquaintances of Mr. Geoffrey Fieger.
Appellant Jon Marcus has been a close friend of Mr. Fieger for many years.

Mr. Marcus was dragged before a grand jury where he was asked to reveal
for whom he voted in the 2004 presidential election. Such abhorrent behavior
on the part of the Attorney General was designed solely to threaten, intimidate,
and chill the exercise of free speech.

In September 2006, the FEC began investigating the same political
contributions that were being investigated by the Attorney General. This
presented a problem, however, because the provisions of the Act provide the
FEC with “exclusive” civil jurisdiction and the Attorney General did not want
the FEC to interfere with its criminal investigation. To remedy this problem, the
Attorney General secretly secured an agreement with the FEC so that the FEC
would step aside and allow the Attorney General to proceed unimpeded with its

investigation.



Case 2:07-cr-20414-PDB-MKM Document162 Filed 02/01/2008 Page 25 of 30

ce The Attorney-Client Privilege

The Governinent also raises the attomey-client privilege concerning the recusal information
submitted to the Court in camera. Specifically, the Government references:

The information that is contained in the memorandum we provided the Court which

describes the events leading up to that final decision, concerns discussions between

the United States Attorneys’ Office for the Eastcrn District of Michigan and one of

two entities in the Department of Justice — either the Professional Responsibility

Office or the Exccutive Office for United States Attorneys.
(Gov’t Br. at 7). Again, the Court reiterates that it is not ordering the Government to provide any
discussions, or the memorandum provided to the Court, but merely the reason for the November
recusal decision.

The Government recognizes that the final decision to recuse is not legal advice, but asserts
that all other information in the recusal information is covered by the privilege. (Gov’t Br. at 8 n.
4). Again, the Court reiterates that it is not requiring release of the memorandum, or the reasoning,
just the specific conduct of the three that resulted in the recusal in November, 2005. As the Court
is not requiring the Government to disclose the discussions or the memoranda, the attorney-client
privilege is not applicable.

Cc. Vindictive Prosecution

The Sixth Circuit relied upon the discussion of vindicate prosecution Blackledge in United
States v. Adams, 870 F.2d 1140, 1141 (6thCir. 1989), where it held, “[T]his is one of those rare cases
where the defendants are entitled to discovery on the issue of whether the government’s decision
to prosecute was tainted by improper motivation.”

Judge David Nelson’s opinion discussed the constitutional underpinning for a claim of

vindictive prosecution:

25


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 13 of 30

Ata hearing, the Government sought to undercut Defendant’s claim that the Government’s
simultaneous deployment of 75 agents in this case was unusual, and that this unusual fact supported
Defendants’ claim of selective and vindictive prosecution. The Government asserted that it was not
unusual to utilize large numbers of agents in non-drug, non-violent crime cases in this district, and
offered to supply the Court, ex parte, in camera, with examples of similar resource allocations in
other Eastern District of Michigan cases. Thereafter, thc Government did submit such a list, but
sought in camera protection, to avoid revealing the names of the specific cases.

After viewing the Government’s submission, the Court suggested to the Government that it
could protect its interest, and at the same time, provide disclosure of this information to Defendants
by redacting identifying information, i.e. deleting the names of the cases. This redaction would
provide Defendants with the year of the case, the generic type of the case, and the number of agents
utilized ina combined scarch warrant execution/interviews/arrest. Initially, the Government agreed
to this resolution — “If we have to provide that discovery, we would be comfortable doing it in that
format.” (Hearing Trans. 12/14/07, at 32, Helland). Nevertheless, the Government concluded that
to support its institutional argument that Defendants have not met the factual threshold required to
justify any discovery, it will not provide any discovery information to Defendants relating to their
claims of selective or vindictive prosecution.

The second matter that the Government provided to the Court ex parte, in camera related to
the DOJ’s recusal of the three principal Detroit U.S. Attorneys. The Government first stated that
it would have to get clearance to release that information. Thereafter, the Government stated that
DOJ policy prevented disclosure of the information, but that it would submit the information to the

Court ex parte, in camera. It did so, and the court has been informed of the reason for the recusal.


FIRGER, FHEGER, KENNFY, JOHNSON & GIROUX + A PROFESSIONAL CORPORATION + ATTORNEYS AND COUNSELORS AT LAW + 19399 WISTTFR MIF ROAD + SOUTHFIPID VICIIGAN 48075-2463 + THLEPHONE (248) 185-5858 © [4X (24

TABLE OF AUTHORITIES

FEDERAL CASES
AmSouth Bank v. Dale, 386 F.3d 763, 786 (6th Cir, 2004) oe 8
Fieger v. Ferry, 47) F.3d at 644 (6th Cir. 2006) ... 8
Galliano v. U.S. Postal Serv., 836 F.2d 1362 (D.C. Cir. 1988) oe 4
Steffel v. Thompson, 415 U.S. 452 (1974) cceceeceecceeeseeteteseteteneteeeneee 8
United States v. Hsia, 24 F. Supp. 2d 33 (Dist. D.C. 1998),

rev'd on other grounds, 176 F.3d 517 (D.C. Cit. 1999) Licence 5
United States v. International Union of Oper. Eng'rs,

638 F.2d L161 (9th Cir. 1979) ooo ese esecneeereseseesseseeteeeneaeees 3,4
United States v. Jackson, 433 F. Supp. 239 (W.D. N.Y. 1977) ween 4
United States v. LaSalle National Bank, 437 U.S. 298 (1978) ose 6
United States v. Palumbo Brothers, Inc.,

145 F.3d 850 (7th Cir, 1998) ooo ec eseee esse cseeeneeeseineee 5
United States v. Tonry, 433 F. Supp. 620 (E.D. La. 1977) wocceeeeee 4

DOCKETED CASES
Fieger v. Gonzales, Sixth Cir. Case No. 07-2291 vaccines 3
-1-



Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 21 of 30

The Government brief relies on three separate grounds to support secrecy: Fed. R. Crim. P.
Rule 16, the deliberative process privilege, and the attorney client privilege, all of which are
discussed, infra.

3. Fed. R. Crim. P. Rule 16 and Privileges

The Government filed a brief, apart from its November 26, 2007 Motion for Reconsideration,
filed on December 7, 2007: “United States’ Brief Concerning Privileged Nature of Recusal
Information,” which sets forth three separate theories in support of its argument that it need not
provide Defendants with the recusal reason: (1) F.R. Crim. P. 16, (2) the Deliberative Process
Privilege, and (3) the Attorney Client Privilege.

The Court concludes that none of thesc three grounds protects the reason for recusal from

discovery by the Defendants. The Court is not requiring the Government to turn over the recusal
memoranda/documents — just to explain in a single sentence the reason for the recusal, e.g., “The
DOJ ordered the recusal of the three top Detroit U.S. Attorney Office principals because they (did
what).”
a. Fed. Rule Crim. P. 16(a){2): Discovery and Inspection
The Government contends that the recusal memoranda is not subject to discovery insofar as

it is protected under Rule 16(a)(2), which states:

Except as Rule 16(a)(1) provides otherwise, this rule does not

authorize the discovery or inspections of reports, memoranda or other

internal government documents made by an attorney for the

government . . . in connection with investigating or prosecuting the
case.”

21


Case 2:07-cr-20414-PDB-MKM Document162 Filed 02/01/2008 Page 30 of 30

The Court ORDERS that the Government provide the reason for the U.S. Attomey recusals
to Defendants with seven (7) days of this Order.

Further, the Court ORDERS the Government provide the redacted list of other E.D. MI
cases within seven (7) days of this Order. The Court is not now ruling on Defendant’s claim of
selective and vindictive prosecution.

SO ORDERED.

s/Paul D. Borman.
PAUL D. BORMAN
UNITED STATES DISTRICT JUDGE

Dated: February 1, 2008
CERTIFICATE OF SERVICE

Copies of this Order were served on the attomeys of record by electronic means or U.S. Mail on
February 1, 2008.

s/Denise Goodine
Case Manager

30


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 16 of 30

The Government also notes that providing materials to the Court ex parte for in camera
review, e.g. grand jury materials, does not waive the government’s ability to assert confidentiality.
The Court concurs. The Court recognizes that this occurs, inter alia with regard to claims of grand
jury secrecy under Federal! Rule of Criminal Procedure 6(e), and in cases where the Court concludes
that information submitted ex parte, in camera is privileged.

As noted before, the Court will not adopt the Government’s suggestion and erase from its
mind the cxistence of the evidence. Indeed, the Government acknowledged that the information at
issue is relevant to Defendants’ claim. But while the Government finds that “the particular
information we have provided is only marginally relevant to Defendants’ claim,”the Court concludes
that the information is quite relevant and essential to that claim. (/d. at 9).

The Government recognizes that in certain circumstances, the Court would utilize that
information: “The only reason the ‘judicial bell’ could not be ‘unrung’ would be if, once exposed
to information, the Court was unable to disregard that information.” (/d. at 10). Such is the case

here.
In reaching this conclusion to provide discovery of the reason for recusal, the Court has not

concluded that the information at issue establishes Defendants’ claim of selective or vindictive
prosecution ~ that consideration is for another day
2. Government’s Motion for Reconsideration
The Government’s Motion for Reconsideration “asks that the Court not require the
Government to provide further information” in camera, unless Defendant Fieger withdraws his
objection to Government in camera presentations to the Court. Defendant Fieger has not withdrawn
his objection to that concept.

The Government seeks to distinguish Barnwell from the instant case:

16


Addendum A


Case 2:07-cr-20414-PDB-MKM Document 162 Filed 02/01/2008 Page 3 of 30

funds to make the contributions or to reimburse them. Among the straw donors recruited by
Defendant were:

i. in March 2003, attorneys of the Fieger Law Firm Corporation
and their spouses;

ii, in June 2003, children of attorneys, and non-attormey

employees and their spouses;

in September 2003, friends of Defendant Fieger;

in January 2004, third party vendors of services to the

Corporation as well as attorneys and support staff not-

previously used as straw donors.

Count II charges Defendants with Making and Causing Conduit Campaign Contributions —
causing contributions to be made in the names of others, when in fact the contributions were made
by Defendants.

Count III charges Defendant Fieger only with making conduit contributions.

Count IV charges Defendants with making campaign contributions by a corporation,
aggregating $25,000 or more during 2003.

Count V charges Defendant Fieger only with making corporate contributions in 2004
aggregating more than $25,000.

Counts VI and VII charge both Defendants with causing false statements to be made by the
Edwards campaign to the FEC, showing that other individuals had made contributions when in fact
they had been made by the corporation and the defendants. This same charge was contained in
Counts VIII and IX, against Defendant Fieger only.

Finally, Count X charges Defendant Fieger only, with obstruction of justice, to wit: acting

to conceal incriminating information and to provide false exculpatory information to the grand jury.’

3 On January 7, 2008, the grand jury issued a superceding indictment containing the same
10 counts.