U.S. attorney general ends Stevens prosecution

Holder says prosecutors failed to share key evidence

April 1, 2009 

The Justice Department moved to dismiss former Sen. Ted Stevens' indictment on Wednesday, effectively voiding his Oct. 27 conviction on seven counts of filing false statements on his Senate financial disclosure forms.

The decision by U.S. Attorney General Eric Holder comes after a new prosecution team discovered a previously undocumented interview on April 15, 2008, with the star witness in the case that sharply contradicted the most dramatic testimony in the four-week trial. The information had never been turned over to the defense, the Justice Department said in its motion.

"After careful review, I have concluded that certain information should have been provided to the defense for use at trial," Holder said in a statement released Wednesday morning. "In light of this conclusion, and in consideration of the totality of the circumstances of this particular case, I have determined that it is in the interest of justice to dismiss the indictment and not proceed with a new trial."

The government is seeking dismissal of the charges "with prejudice," meaning that they cannot be filed again.

U.S. District Judge Emmet Sullivan ordered a hearing on the government's motion for April 7.

"I always knew that there would be a day when the cloud that surrounded me would be removed," Stevens said in a written statement. "That day has finally come. It is unfortunate that an election was affected by proceedings now recognized as unfair. It was my great honor to serve the state of Alaska in the United States Senate for 40 years."

Stevens was reported to be traveling in Alaska and not available for an interview.

In a written statement, Stevens' attorneys decried the "corrupt" conduct of attorneys and the FBI in the case, though it said Holder and the new prosecution team, along with Sullivan, the trial judge, were "heroes" for bringing the information to light.

"This jury verdict was obtained unlawfully," said the statement by Washington-based law firm Williams & Connolly and the two attorneys who led the defense team, Brendan Sullivan and Robert Cary. "The misconduct of government prosecutors, and one or more FBI agents, was stunning."

In a brief news conference in Washington, Brendan Sullivan said the former senator should never have been prosecuted.

"It was a bad judgment to have done so in the first place," said Sullivan. "He's a war hero. He served in the Senate for 40 years, and he was the target of prosecutors who wanted to enhance their own reputation."

The action Wednesday clears Stevens' name, Sullivan said.

"To us, while this is a joyful day and we're happy that Sen. Stevens can resume a normal life without the burden that he's carried over these last years," he said, "at age 85, it's a very sad story too. Because it's a warning to everyone in this country that any citizen can be convicted if the prosecutor ignores the Constitution of the United States."

It was the first statement to reporters by anyone from Williams & Connolly since the firm began representing Stevens at least two years ago.

'YOU OWE ME A BILL'

The dramatic events that brought down the case after months of post-trial wrangling were rooted in testimony on Oct. 1, the second day on the witness stand for Bill Allen, the chief executive of the defunct oil-field services company Veco Corp. It was the fifth day of a trial that would run more than a month.

Allen had described how he had spent tens of thousands of dollars renovating Stevens' home in Girdwood starting in 1999 -- gifts that Stevens never disclosed. On Oct. 6, 2002, Stevens sent a handwritten note to Allen asking that it be "done right" -- he wanted to pay for Veco's services, he wrote. He told Allen that their mutual friend in Girdwood, Double Musky restaurant owner Bob Persons, would talk to him about the matter.

"You owe me a bill," said the note from Stevens, which was placed into the trial as evidence. "Remember Torricelli, my friend. Friendship is one thing, compliance with the ethics rules entirely different." Robert Torricelli was a New Jersey senator who got into trouble in 2002 for accepting improper gifts from a donor.

Allen testified that he had a conversation a short time later with Persons. But Persons told him the note from Stevens shouldn't be taken seriously, Allen said.

"Don't worry about getting a bill -- Ted's just covering his ass," Allen quoted Persons as saying.

The Allen statement came at the close of testimony for the day.

With the jury out of the courtroom, defense attorney Sullivan said foul. In all the material turned over to the defense by the government under fair-trial rules, there was nothing from Allen quoting Persons like that, he argued, then accused the government and Allen of conspiring to make up the testimony.

Even worse, Sullivan said, was that Allen's testimony came at the end of the day, leaving the jury to ponder it, unchallenged, overnight.

The newly discovered April 15 interview wasn't transcribed the way interviews with Allen and other witnesses had been, on FBI form 302s or memorandums of interviews, the Justice Department said this morning. Rather, it was discovered in the notes of attorneys who questioned Allen that day, five and half months before his testimony.

"The notes of the April 15 interview indicate that Bill Allen said, among other things, in substance and in part, that he (Bill Allen) did not recall talking to Bob Persons regarding giving a bill to the defendant," the Justice Department said in its motion to dismiss the case. "This statement by Allen during the April 15 interview was inconsistent with Allen's recollection at trial where he described a conversation with Persons about the Torricelli note."

The interview notes also say that Allen thought the market value of Veco's work on Stevens' home was about $80,000. The government introduced evidence from Veco's bookkeeping that suggested it was worth about $250,000, though the judge threw out some of that evidence because it proved to be wrong.

"Defendant Stevens was not informed prior to or during trial of the statements by Bill Allen on April 15, 2008," the department's motion for dismissal said. "This information could have been used by the defendant to cross-examine Bill Allen and in arguments to the jury."

NEW PROSECUTION TEAM

In his statement, Holder didn't say precisely what he meant by the "interests of justice" dictating that Stevens not undergo a new trial. But Stevens' lawyers had argued that government misconduct was so extreme that the only remedy for the judge was to completely dismiss the case.

Stevens, who is 85, lost a close re-election bid in November to the former Anchorage mayor, Democrat Mark Begich.

Since Stevens' conviction, the former senator's lawyers have filed several motions to outright dismiss his original indictment or to grant Stevens a new trial. Their motions have been based in part on allegations in a whistle-blower complaint by an Anchorage FBI agent, and other allegations of prosecutorial misconduct that emerged after Stevens' conviction.

The complaint by agent Chad Joy said prosecutors deliberately withheld information from Stevens' defense team.

The government appointed a new team of prosecutors when Judge Sullivan held three government lawyers in contempt, including the chief trial lawyer, Brenda Morris, and her boss at the Public Integrity Section, William Welch. Contrary to Sullivan's direct order, Morris and Welch had failed to turn over material to the defense uncovered in the investigation of Joy's allegations.

It was the new team, led by Paul O'Brien, chief of the Narcotics and Dangerous Drugs Section, that last week discovered the April 15 meeting with Allen, the Justice Department said.

The Justice Department immediately turned over the notes of the April 15 meeting to the defense, it said.

Holder said that the Justice Department's Office of Professional Responsibility "will conduct a thorough review of the prosecution of this matter."

"This does not mean or imply that any determination has been made about the conduct of those attorneys who handled the investigation and trial of this case," he said. "The Department of Justice must always ensure that any case in which it is involved is handled fairly and consistent with its commitment to justice. Under oftentimes trying conditions, the attorneys who serve in this department live up to those principles on a daily basis. I am proud of them and of the work they do for the American people."

Stevens' lawyers said Judge Sullivan was key to uncovering the misconduct by the Justice Department in the case.

"Judge Sullivan gave the defense the ability to press for evidence of misconduct," the statement said. "When he did so, more and more evidence came to light, including the most recent revelation about false testimony. Had Judge Sullivan accepted the word of government prosecutors as is done often in our courts, the extraordinary misconduct would never have been uncovered, and the trial verdict might have survived appellate review. Judge Sullivan prevented such a tragic outcome."

'HE'D STILL BE IN THE SENATE'

Rep. Don Young, who as Alaska's sole congressman spent 30 years working with Stevens, said he thought "justice has finally been served."

"It's a shame that Alaskans lost one of the best lawmakers they've ever had last year over a false conviction, but his legacy in Alaska will always live on," he said. "I join my fellow Alaskans today in standing by Ted and congratulating him and Catherine on the courage they've shown throughout this ordeal and the end of this difficult journey."

Stevens' replacement, Begich, said in a statement that "the decision by President Obama's Justice Department to end the prosecution of Senator Ted Stevens is reasonable."

"I always said I didn't think Senator Stevens should serve time in jail and hopefully this decision ensures that is the case," he said. "It's time for Senator Stevens, his family and Alaskans to move on and put this behind us."

Sen. Lisa Murkowski, now Alaska's senior senator, said in a statement, "I was pleased with the news that the Justice Department will drop all charges against Senator Ted Stevens, but I am deeply disturbed that the government can ruin a man's career and then say 'never mind.' There is nothing that will ever compensate for the loss of his reputation or leadership to the state of Alaska."

Murkowski decried the violation of Steven's rights. "Our nation is governed by the rule of law, and violations of our civil liberties cannot be tolerated," she said. "Prosecutors and law enforcement have the power to bring the full weight of the government to bear on individuals. If they are willing to bend the law, they put all of our civil liberties at risk."

Gov. Sarah Palin said Stevens recently had lunch at her home in Wasilla where he expressed his faith he would vindicated.

"Senator Stevens deserves to be very happy today," Palin said in a statement. "What a horrible thing he has endured. The blatant attempts by adversaries to destroy one's reputation, career and finances are an abuse of our well-guarded process and violate our God-given rights afforded in the Constitution. It is a frightening thing to contemplate what we may be witnessing here -- the undermining of the political process through unscrupulous ploys and professional misconduct."

The Senate Republican leader, Mitch McConnell of Kentucky, called the Justice Department's move "a relief to Stevens and his family." But he also said that had the Justice Department acted last year, before the election, Republicans might not have lost the seat. It would give Democrats -- who have 58 seats in the Senate and are likely to gain a 59th -- one less seat toward a 60-vote, filibuster-proof majority.

"It was disappointing to lose the seat, no question about it," McConnell said. "No question that if this decision had been made last year he'd still be in the Senate."

Erika Bolstad reported from Washington, D.C., and Richard Mauer from Anchorage. E-mail them at ebolstad@adn.com and rmauer@adn.com.

The note behind the proposed dismissal A handwritten note was the key document associated with dismissal of charges against Ted Stevens. In his note, Stevens asked Bill Allen for a bill for Veco's services on his house, and said that a mutual friend, Bob Persons, would be in touch with him about it. "Torricelli" is a reference to New Jersey Sen. Robert Torricelli, who got into trouble that year for accepting gifts from a contributor. Bill Allen testified that he indeed hear from Persons. But Persons said Stevens didn't really want a bill and was only "covering his ass" in sending the note, Allen said. But the notes of two Justice Department lawyers from an interview with Allen in April 2008 show that Allen didn't remember talking with Persons after getting the note. The prosecutors didn't turn over the notes of the interview with Allen despite an order from the trial judge to do so. The text of the Stevens note isn't very legible. Here's what he wrote: Dear Bill -- When I think of the many ways in which you make my life easier and more enjoyable, I lose count! Thanks for all the work on the Chalet. You owe me a bill -- remember Torricelli, my friend. Friendship is one thing -- compliance with these ethics rules [is] entirely different. I asked Bob P to talk to you about this so don't get P.O'd at him -- it just has to be done right. Hope to see you soon. My best Ted -- Richard Mauer, rmauer@adn.com

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