Again, the court found the requisite "causal and logical connection" between individuals or organizations who helped retire Henry Espy's campaign debt via allegedly illegal contributions and the potential for improper influence upon Secretary Espy such that the Independent Counsel's jurisdiction over the challenged counts was properly exercised.
Significantly, in making these determinations of relatedness, neither the Secord nor Sun-Diamond Growers nor Crop-Growers courts required what defendant appears to be calling for here -- that the text of the indictment provides the demonstrable causal and logical connection between the charged violations and the subject matter of the Independent Counsel's investigation. None of the case law even remotely suggests that the grand jury's failure to facially demonstrate relatedness is fatal to the sufficiency of the indictment. In fact, at least one of the aforementioned cases implies the opposite. "The relationship must be "demonstrable," that is, something that is evident initially and without great steps of logic. The courts are routinely called upon to draw lines, and this is simply another of those cases. . ." Secord, 725 F. Supp. 567 (emphasis added). In each instance, the courts considered the Special Division's order, the challenged counts, and reached a conclusion as to whether the requirement of relatedness was satisfied. This court will now do the same in determining whether the language of the original order and/or the referred matter supports the Independent Counsel's prosecution of charges arising exclusively under 18 U.S.C. § 1001.
Though the Blackley prosecution is arguably within the scope of the Special Division's original jurisdictional grant, the connection is more easily demonstrated by reference to the referred matter; consequently, this court will limit its consideration to that order. The April 1996 referral order permits the Independent Counsel to investigate and prosecute any violation of any federal law "related to any application, appeal, or request for subsidy . . . for which . . . Chief of Staff Ronald Blackley intervened in the application, approval or review process." Each count in the indictment contends that Ronald Blackley made a false statement by failing to disclose his receipt of payments totaling $ 22,025, first on his Form SF-278, then pursuant to the USDA-OIG sworn declaration, and finally, pursuant to the US AID-OIG sworn declaration. The background section of the indictment explains that this income was allegedly received from Mr. Fuller & Mr. Cochran, who both sought and received subsidies from the Department of Agriculture in 1993, the same year in which the alleged payments were received by Blackley. Though defendant cannot discern the "reasonable causal or logical connection" between the alleged false statements and the jurisdictional mandate, this court can. An endeavor to conceal payments received from a Department of Agriculture subsidy applicant could be a causal consequence of possible intervention in the application process on behalf of those from whom he received payment. It is both logical and reasonable to surmise that if Ronald Blackley improperly intervened in either Fuller and/or Cochran's subsidy application, approval or review, and received payments in anticipation of or as a result of that intervention, he would not report such "income" on financial disclosure forms, or answer truthfully as to whether he received such payments when interviewed by USDA or US AID investigators.
A finding of relatedness based upon this type of inference is not without precedent this in district. In finding that General Secord's indictment was within the scope of the Special Division's jurisdictional mandate in Secord, Judge Robinson concluded that "defendant's alleged perjury could well be construed as part of a continuing effort to conceal the extent and detail of the "enterprise," Secord, 725 F. Supp. at 566 (emphasis added). If one substitutes the words "falsification of financial statements" for the word "perjury" in the above excerpt, the similarities between Secord and the instant case become patently apparent. If Mr. Blackley did, in fact, attempt to intervene in subsidy applications or reviews on behalf of Fuller or Cochran, the alleged falsifications on his financial disclosure form and on the two sworn declarations could logically be part of a "continuing enterprise" to conceal his intervention. That nexus is sufficient to provide the "reasonable causal or logical connection" and the "tenable correlation between events" that is required to support the Independent Counsel's prosecution of these charges.
This court is satisfied that the three 18 U.S.C. § 1001 charges against Ronald Blackley are sufficiently related to the Special Division's jurisdictional grant in the referred matter. Therefore, this court will not grant defendant's motion to dismiss the indictment on the basis that the Independent Counsel has acted in excess of its defined jurisdiction.
B. The Argument That The Prosecution of this Case By the Independent Counsel Circumvents Established Department of Justice Policy.
Under section 594(f)(1) of the Ethics in Government Act, an Independent Counsel:
shall, except to the extent that to do so would be inconsistent with the purposes of this chapter, comply with the written or other established policies of the Department of Justice respecting enforcement of the criminal laws. To determine these policies . . . the independent counsel shall, except to the extent that doing so would be inconsistent with the purposes of this chapter, consult with the Department of Justice.
The rationale underlying the promulgation of this addition to the Independent Counsel statute was to ensure that an Independent Counsel's prosecutorial jurisdiction is subject to some safeguards against overreaching and abuse. "The intent of this change is to create a presumption that the special prosecutor will follow prosecutorial guidelines unless extenuating circumstances exist." Sen. Rep. No. 97-496, at 16 (1982), reprinted in 1982 U.S.C.C.A.N. 3537, 3552. At the same time, it also alleviates some of the concern that the Independent Counsel law may be unconstitutional because it violates the doctrine of separation of powers. See Morrison v. Olson, 487 U.S. 654, 696, 101 L. Ed. 2d 569, 108 S. Ct. 2597 (1988) (noting that adherence to Justice Department policies unless not possible to do so does "give the Attorney General [a] means of supervising and controlling the prosecutorial powers that may be wielded by an Independent Counsel").
Defendant contends that his indictment cannot be sustained because it is in contravention of DOJ policy and therefore violates section 594(f)(1). The Department of Justice Manual directs its prosecutors "not to prosecute an EIGA [Ethics in Government Act] violation under section 1001 unless the nondisclosure conceals significant underlying wrongdoing." Department of Justice Manual at 9-85A.304. Mr. Blackley argues that because it is contrary to DOJ policy to bring an 18 U.S.C. § 1001 indictment for a financial non-disclosure in the amount of $ 22,000, the Independent Counsel is statutorily proscribed from doing so. In other words, defendant contends that section 594(f)(1) gives DOJ prosecutorial policy the force of law when applied to the Independent Counsel, even though it is conceded that the same policies are merely discretionary when applied to executive branch prosecutors. See United States v. Poindexter, 725 F. Supp. 13, 38 (D.D.C. 1989) (citing United States v. Busher, 817 F.2d 1409, 1411-12 (9th Cir. 1987) (holding that the decision to prosecute a violation of the law cannot be deemed flagrant misconduct, and noting that "The U.S. Attorney's Manual . . . 'is not intended to, does not, and may not be relied upon to create any rights, substantive or procedural, enforceable at law by any party in any matter, civil or criminal. Nor are any limitations hereby placed on otherwise lawful litigative prerogatives of the Department of Justice.")).
A section 594(f) challenge to an Independent Counsel indictment has been raised in this district at least once before, and rejected. In United States v. Poindexter, 725 F. Supp. 13, 38 (D.D.C. 1989), defendant John M. Poindexter sought to have charges dismissed because the indictment was inconsistent with the prosecutorial policies of the Department of Justice. The court found this claim to be without merit, explaining:
The very nature of the Independent Counsel's responsibilities suggests that it may not always be possible for him to follow those policies, and it is for that very reason that the Independent Counsel statute explicitly provides that he is required to follow Department of Justice policies "only to the extent possible."