Court Opinion

ID: 185240
Source: CourtListenerOpinion
Date Created: 2011-02-05 02:29:23+00
Date Added: 2024-06-11T17:26:14.198957
License: Public Domain

227 F.3d 466 (D.C. Cir. 2000)
In re:  Ronald H. Brown(Brannock Fee Application)
Division No. 95-2
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Filed August 29, 2000

Division for the Purpose of Appointing Independent Counsels Ethics in Government Act of 1978, as Amended
Before:  Sentelle, Presiding, Fay and Cudahy, Senior  Circuit Judges.
Opinion for the Special Court filed PER CURIAM.

O R D E R
PER CURIAM

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This matter coming to be heard and being heard before the  Special Division of the Court upon the petition of Lisa M.  Brannock for reimbursement of attorneys' fees and costs  pursuant to Section 593(f) of the Ethics in Government Act of  1978, as amended, 28 U.S.C. § 591 et seq. (1994), and it  appearing to the court for the reasons set forth more fully in  the opinion filed contemporaneously herewith that the petition is not well taken, it is hereby

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ORDERED, ADJUDGED, and DECREED that the petition of Lisa M. Brannock for attorneys' fees she incurred  during the investigation by Independent Counsel Daniel S.  Pearson be denied.

ON APPLICATION FOR ATTORNEYS' FEES

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Lisa M. Brannock petitions this court  under Section 593(f) of the Ethics in Government Act of 1978,  as amended, 28 U.S.C. § 591 et seq. (1994) (the "Act"), for  reimbursement of attorneys' fees in the amount of $7,354.45  that she incurred during and as a result of the investigation  conducted by Independent Counsel ("IC") Daniel S. Pearson. Because we conclude that Brannock has not carried her  burden of showing that the fees would not have been incurred  but for the requirements of the Act, we deny the petition in  its entirety.

Background

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Ronald H. Brown began a term as Secretary of Commerce  in January of 1993.  Allegations arose thereafter concerning  improprieties related to his financial transactions.  In particular, there were media reports that Secretary Brown may have  failed to disclose required information about First International, a company he owned with a business associate, Nolanda S. Hill.  As the Secretary of Commerce is a "covered  person" under 29 U.S.C. § 591(b)(2), the Independent Counsel statute was triggered.  On February 15, 1995, pursuant to  28 U.S.C. § 592(a)(1), the Department of Justice ("DOJ")  notified the Court that it had initiated a preliminary investigation concerning Secretary Brown's finances.  That investigation subsequently determined, inter alia, "that Secretary  Brown received things of value totalling almost $500,000 from  First International while he was Secretary of Commerce,"  and after completion of the preliminary investigation the  Attorney General applied to this Court for the appointment of  an independent counsel.  Application to the Court Pursuant  to 28 U.S.C. § 592(c)(1) for the Appointment of an Independent Counsel, May 16, 1995.  On July 6, 1995, we appointed  Daniel S. Pearson independent counsel for this matter.The  Order appointing Pearson authorized him to investigate, inter  alia, First International and other companies controlled or  operated by Nolanda Hill.  Lisa Brannock, the fee petitioner  here, was the registered agent of one of Hill's companies and  former officer or director of two other Hill corporations.

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The IC's investigation was proceeding when, on April 3,  1996, Secretary Brown was killed in an airplane accident.  IC  Pearson subsequently determined that, in light of the Secretary's death, "the original reason for the appointment of an  Independent Counsel ... no longer existed," Final Report of  the Independent Counsel In re:  Ronald H. Brown at 7  (submitted June 10, 1996) (hereinafter Final Report), and it  would be "in the public's best interest to transfer the investigation" to the Department of Justice, id. at 1.  The DOJ  agreed to the transfer, which was completed by May 31, 1996.Id.  On June 10, 1996, IC Pearson submitted his final report  to this Court.  On July 7, 1999, the DOJ advised the Court  that its investigations and prosecutions of all matters referred  to it by the IC had been completed.  Thereafter, the present  fee petitioner filed an application with this Court, seeking  reimbursement of attorneys' fees assertedly incurred in connection with the IC's investigation.

ANALYSIS

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The Ethics in Government Act provides for reimbursement  of attorneys' fees expended by subjects in defense against an  investigation under the Act.  Specifically, 28 U.S.C.  § 593(f)(1) states:

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Upon the request of an individual who is the subject of an investigation conducted by an independent counsel pursuant to this chapter, the division of the court may, if no indictment is brought against such individual pursuant to that investigation, award reimbursement for those reasonable attorneys' fees incurred by that individual during that investigation which would not have been incurred but for the requirements of this chapter.

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Because the Act "constitutes a waiver of sovereign immunity it is to be strictly construed."  In re Nofziger, 925 F.2d  428, 438 (D.C. Cir., Spec. Div., 1991) (per curiam).  Therefore,  the Act provides only reimbursement for attorneys' fees that  survive an elemental analysis determining whether the petitioner is the "subject" of the independent counsel's investigation, incurred the fees "during" that investigation, and would  not have incurred them "but for" the requirements of the Act. The petitioner "bears the burden of establishing all elements  of his entitlement."  In re North (Reagan Fee Application),  94 F.3d 685, 690 (D.C. Cir., Spec. Div., 1996) (per curiam).

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As we have held, "[a]ll requests for attorneys' fees under  the Act must satisfy the 'but for' requirement of" the Act.  In  re Sealed Case, 890 F.2d 451, 452 (D.C. Cir., Spec. Div., 1989)  (per curiam).  The purpose of awarding only fees that would  not have been incurred "but for" the Act is to ensure that  "officials who are investigated by independent counsels will  be subject only to paying those attorneys' fees that would  normally be paid by private citizens being investigated for the  same offense by" federal executive officials such as the United States Attorney.  Id. at 452-53 (citing S. Rep. No. 97-496,  at 18 (1982), reprinted in 1982 U.S.C.C.A.N. 3537, 3554  (referring to "fees [that] would not have been incurred in the  absence of the special prosecutor [independent counsel] law")).  We conclude that Brannock has not met the "but for"  requirement.

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The Order appointing Pearson as IC authorized him to  investigate "whether Ronald H. Brown, Secretary of the  Department of Commerce, committed a violation of any federal criminal law ... in connection with:  (1) accepting money  and other things of value from Nolanda Hill or First International, Inc."  Order Appointing Independent Counsel, July 6,  1995.  As the Independent Counsel points out, it thus appears  that the investigation of Nolanda Hill, whom Lisa Brannock  was employed by, was precipitated by her alleged act of  giving things of value to a high-ranking government official.

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The Order further gave IC Pearson the "jurisdiction and  authority to investigate whether Nolanda Hill violated federal  criminal law ... through or in connection with the operations  of her organizations, including, but not limited to First International, Inc., and related organizations."  Id.  One such  related organization investigated by the IC was the Corridor  Broadcasting Corporation ("Corridor"), of which Hill was  owner, president, and chief executive officer.  According to  the IC's Final Report, the IC's office "investigated allegations  that at the same time Corridor failed to make payments on its  outstanding loans by asserting lack of finances to the banks  and FDIC, it was using Corridor income for the personal  benefit of its owner Nolanda Hill."  Final Report at 6.Ultimately, Nolanda Hill pleaded guilty to preparing and  presenting fraudulent tax returns for three years, based upon  income from Corridor Broadcasting Co.  Evaluation by Independent Counsel at 11 n.4.  Lisa Brannock was an officer or  director of two broadcasting stations owned by Corridor.

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Another related organization of Hill's was Columbia Leasing Enterprise.  The IC investigated Hill for using this  company in connection with acts involving the aiding and  assisting in false and fraudulent statements.  Brannock was  listed as Columbia's registered agent and therefore its custodian of records.  Evaluation by Independent Counsel at 1011.

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As we noted in In re Nofziger, 938 F.2d 1397 (D.C. Cir.,  Spec. Div., 1991) (per curiam), under the Act, "the first  requirement a subject must meet is to submit legal and  factual authority proving that he was subjected to an investigation and prosecution that satisfy the 'but for' requirement,  i.e., an investigation that subjected him to different standards  of the criminal law than are applied to private citizens, or ...  that constituted a more rigorous application of the criminal  law than is applied to private citizens."  Id. at 1400.  The acts  listed above for which Nolanda Hill was investigated--giving  things of value to a high government official, tax fraud, false  statements--did not subject her to a "different standard" nor  constitute a "more rigorous application" of the criminal law. Indeed, the listed acts are regularly investigated by United  States Attorneys as well as by the Tax Division of the DOJ. We are thus persuaded that even in the absence of the Act  Nolanda Hill would have been investigated for these activities  and that Lisa Brannock, as an employee of Hill's, would have  nevertheless incurred the attorneys' fees for which she now  seeks reimbursement.  Cf. In re Pierce (Olivas Fee Application), 178 F.3d 1350, 1355 (D.C. Cir., Spec. Div., 1999) (per  curiam) ("If the investigative act generating the defensive  costs would, in the absence of the Act, have been pursued by  other authorities--'had the case been handled by the Department of Justice or other executive authorities rather than the  Independent Counsel'--then Congress did not contemplate  the award of counsel fees.").

Conclusion

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The petition of Lisa M. Brannock for reimbursement of  attorneys' fees is denied for failure to satisfy the "but for"  requirement of 28 U.S.C. § 593(f)(1).