by David DiBari
Whether the DOJ chooses to bring criminal charges (and what charges to bring) is traditionally a decision beyond the purview of judicial intervention. The U.S. Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) recently reaffirmed this bedrock constitutional principle with respect to the DOJ’s decision to enter into a deferred prosecution agreement (“DPA”). On April 5, 2016, in the closely-watched case of United States v. Fokker Services B.V. (PDF: 114 KB), the D.C. Circuit issued its opinion on a matter of first impression and vacated an unprecedented district court order rejecting the DPA between the DOJ and Fokker Services B.V..[1] Amid the attention surrounding the D.C. Circuit’s Fokker opinion, however, several salient points are worth highlighting.
As the first U.S. appellate court to decide that a district court cannot second-guess the validity of the DOJ’s charging decisions and case resolution in a DPA, the D.C. Circuit hewed closely to constitutional and legal orthodoxy. But the procedural posture of the Fokker case was unique: Fokker Services and the DOJ appealed to the D.C. Circuit (including under collateral order and mandamus bases) after the district judge denied a joint application for an extension of time under the Speedy Trial Act to effectuate the period of deferred prosecution. The judge stated that the DPA was “too good a deal for the defendant,” since he felt the forfeiture amount and absence of a monetary penalty were inadequate, there was no independent monitor, and no company employees were charged.
On the substantive issue (the procedural issue of appellate jurisdiction, including issuance of a writ of mandamus, is also interesting, but beyond the scope of this post), the D.C. Circuit surveyed the prevailing law and came to the simple and logical conclusion that the district court had “significantly overstepped its authority” when it “denied the exclusion of time under § 3161(h)(2) [of the Speedy Trial Act] based on a belief that the prosecution had been unduly lenient in its charging decisions and in the conditions agreed to in the DPA.” Importantly, the D.C. Circuit did not attempt to define the scope of a district court’s approval over a DPA. In a nod to the DOJ’s discretionary authority to enter into a DPA, however, the D.C. Circuit observed that whatever “the precise contours of that authority . . . it does not permit the court to impose its own views about the adequacy of the underlying criminal charges. Rather, as under Rule 48(a), those core charging decisions remain the province of the Executive.”
The analogy to Rule 48 was a sensible one, not only for the dearth of precedent on § 3161(h)(2) and the brevity of its statutory text, but because all DPAs contemplate dismissal of the criminal charges under Rule 48 if the defendant fully satisfies the terms of its DPA. While the issue presented to the D.C. Circuit focused on the scope of the district court’s threshold approval of the DPA, rather than the scope of judicial supervision during the period of deferred prosecution, the D.C. Circuit’s reliance on Rule 48 may have compelled its observation that “the court plays no role in monitoring the defendant’s compliance with the DPA’s conditions” (italics added) while criminal charges remain pending on the docket; rather, “the prosecution alone – monitors a defendant’s compliance . . . and determines whether the defendant’s conduct warrants dismissal of the pending charges.” After all, the judiciary is never a party to a DPA; under a DPA’s contractual terms, the DOJ is the sole arbiter of whether the defendant has satisfied its obligations, and accordingly, whether to move to dismiss the charges under Rule 48.
Nor does the Speedy Trial Act support a more active role for the judiciary when it comes to DPAs. Contrast the mere 40 words regarding the deferral period in § 3161(h)(2) with the extensive procedure described in the U.K. legislation on DPAs. U.K. judges take an early and active role in shaping DPAs through a series of hearings under a legislatively prescribed timetable. (See Schedule 17 of the Crime and Courts Act 2013.) Obviously, this policy choice is the U.K.’s prerogative, but it is not the choice evidenced by the text and history of the Speedy Trial Act. And such a choice would not sit easily with a U.S. constitutional system that prizes the separation of powers and bestows on the DOJ primacy in criminal charging decisions.
The Fokker case ended soon after the D.C. Circuit’s opinion, when the district court on remand granted the DOJ’s Rule 48 motion to dismiss the criminal charge filed against Fokker Services. But Fokker is unlikely to be the last word on the scope of judicial authority (or lack thereof) on DPAs. Pending before the Second Circuit is an appeal from a district court order releasing on First Amendment grounds a redacted Monitor’s report on HSBC’s compliance with its DPA. In part, the district court considered the Monitor’s report essential for its judicial function of deciding any future motion by the DOJ to dismiss the charges against HSBC. This decision pre-dates the D.C. Circuit’s Fokker opinion, and is at odds with it. But it is unclear to what extent the Second Circuit will consider Fokker controlling. For one thing, unlike the Fokker DPA, the district court did initially approve the HSBC DPA. Thus, the material issue before the Second Circuit may be the contours of judicial supervision over the DPA rather than the scope of initial approval, a question never squarely presented to the D.C. Circuit in Fokker. Notwithstanding Fokker, until the Second Circuit resolves the HSBC appeal, some uncertainty will persist about the judiciary’s role over DPAs.
Footnote
[1] Clifford Chance US LLP represented Fokker Services B.V., a Netherlands-based aerospace services company, in the multi-agency investigation and negotiation with DOJ of the DPA to settle Fokker’s historical violations of U.S. sanctions and export control laws, in the district court, and in its appeal to the D.C. Circuit.
David DiBari is the Managing Partner at Clifford Chance in Washington D.C.
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