In a nasty, months-long fight, a U.S. District Court judge has alleged that a federal prosecutor may have broken the law by turning over grand jury materials to lawyers in a civil case.
The judge also has ordered a misconduct investigation of U.S. Atty. Patrick J. Fitzgerald and four of his assistants by the U.S. Department of Justice’s Office of Professional Responsibility.
In response, Fitzgerald countered that the judge, James F. Holderman, has been openly hostile to prosecutors and said that the judge’s wife works for the law firm fighting prosecutors in the dispute.
The fight, which had roiled in secret, became public Friday when a federal appeals court unsealed a request by Fitzgerald to remove Holderman from his own investigation into the matter.
“This is an extraordinary petition, and the United States brings it with full recognition of its seriousness and gravity,” Fitzgerald wrote in court papers filed this week with the 7th Circuit Court of Appeals. “…Throughout these proceedings, Judge Holderman has displayed a disturbing lack of objectivity.”
The roots of the dispute go back almost five years, to the April 2000 death of a man named Albert Okaro. His death, from a medically unnecessary angiogram at Chicago’s Edgewater Hospital, was part of a “massive health-care fraud scheme” designed to obtain money for unnecessary medical procedures, according to Fitzgerald’s court filing.
An investigation, led by Assistant U.S. Atty. Jacqueline Stern, resulted in the conviction of five doctors, two hospital administrators and two management companies. And the probe led to other lawsuits in both federal and state courts.
In December 2003, Stern obtained a court order by U.S. District Chief Judge Charles Kocoras to turn over materials from a grand jury investigation of Peter Rogan, a former executive at a management company affiliated with Edgewater Hospital. The order allowed Stern to provide the grand jury materials to Okaro’s attorneys in a lawsuit without the knowledge of the defense attorneys. Okaro’s attorneys later turned over the documents to the defense attorneys, including the firm of Winston & Strawn
In May 2004, Winston & Strawn fought to have the grand jury materials taken away from Okaro’s attorneys and banned from use in the civil lawsuit. At this point, Kocoras recused himself because his son is a partner at Winston & Strawn and thereby stood to potentially benefit financially from the case.
The case was assigned to Holderman, who also had family ties to Winston & Strawn. His wife is the firm’s director of professional development. But she is not a partner and thus had no potential financial gain from the Okaro civil case.
Winston & Strawn alleged that prosecutor Stern had “knowingly and intentionally engaged in misconduct” by getting court approval to release the grand jury materials without defense attorneys’ knowledge. Fitzgerald’s office acknowledged they had made a procedural gaffe and should have made defense attorneys aware of the disclosure. But they denied any intentional misconduct.
In June, Holderman ordered Okaro’s attorneys to return all the grand jury materials and said he was launching an investigation to determine if prosecutor Stern should be charged with criminal contempt.
A series of terse exchanges between Holderman and prosecutors continued for several months. By midsummer, Holderman’s probe of Stern had compromised settlement negotiations in another federal civil case related to Edgewater Hospital, Fitzgerald claimed in the court filings.
Holderman’s probe of Stern led Winston & Strawn to cut its settlement offer with the federal government in half–from $4.1 million to $2.1 million “based on the alleged misconduct in the criminal investigation.” That case is now scheduled to go to trial in February.
Last month, Holderman denied Fitzgerald’s request for the judge to recuse himself from his own contempt probe of prosecutor Stern. But Holderman did suspend his own probe while he waits for the results of a separate probe he asked the Office of Professional Responsibility to conduct. That probe includes not only Stern, but the actions of Fitzgerald and others in the U.S. attorney’s office while they defended Stern.
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The Office of Professional Responsibility investigates allegations of wrongdoing on the part of federal prosecutors.
In appealing the matter this week, Fitzgerald called Holderman’s actions retaliatory and said the judge had badgered prosecutors in other cases as a result of the tension over the contempt probe.
Also, Fitzgerald charged, Holderman allowed Winston & Strawn attorneys to take part in the criminal probe of prosecutors at the same time the firm was defending Edgewater clients in civil suits with millions of dollars in settlements and penalties potentially at stake.
But Fitzgerald saved his sharpest assault for Holderman’s own family interests:
“All of the conduct by Judge Holderman in these proceedings that gives grounds for concern about the appearance of bias takes place against the backdrop of Winston’s employment of Judge Holderman’s wife as the firm’s director of professional development,” Fitzgerald wrote this week. “This fact substantially exacerbates the already serious difficulties with the appearance of bias in Judge Holderman’s handling of this matter, both because Winston’s client has a substantial financial interest that is advantaged by Judge Holderman’s inappropriate treatment of the government and [prosecutor] Stern, and because Judge Holderman’s treatment of the government and Winston has been sharply and unjustifiably disparate.”
Tensions have long simmered between Holderman and the U.S. attorney’s office.
In the early 1990s, Holderman was one of three federal judges who threw out numerous convictions of El Rukn gang leaders, citing misconduct by prosecutors. After an investigation by its Office of Professional Responsibility, the Justice Department fired one prosecutor. But that prosecutor was cleared of wrongdoing and returned to work after a lengthy trial before a Merit Systems Protection Board administrative judge.
A member of Holderman’s staff issued a brief statement Friday: “The matter is before the 7th Circuit. Judge Holderman has no comment.”
Holderman’s wife and other representatives at Winston & Strawn could not be reached in time for publication.