United States v. Donziger

• Decision Date: 22 June 2022
• Docket Number: Docket No. 21-2486,August Term, 2021
• Citation: 38 F.4th 290
• Parties: UNITED STATES of America, Appellee, v. Steven DONZIGER, Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

38 F.4th 290

UNITED STATES of America, Appellee,

v.Steven DONZIGER, Defendant-Appellant.

Docket No. 21-2486

August Term, 2021

United States Court of Appeals, Second Circuit.

Argued: November 30, 2021

Decided: June 22, 2022

Stephen I. Vladeck, Austin, TX (William W. Taylor, III, David A. Reiser, Leila Bijan, Zuckerman Spaeder LLP, Washington, DC; Martin Garbus, Offit Kurman, New York, NY; Ronald L. Kuby, New York, NY; Natali Segovia, Water Protector Legal Collective, Albuquerque, NM, on the brief), for Defendant-Appellant.

Rita M. Glavin, Glavin PLLC, New York, NY (Brian P. Maloney, Seward & Kissel LLP, New York, NY, on the brief), for Appellee.

Robert A. Parker (Kenneth A. Polite, Jr., Lisa H. Miller, on the brief), Criminal Division, Appellate Section, United States Department of Justice, Washington, DC, for amicus curiae United States Department of Justice in support of Appellee.

Before: Park, Nardini, and Menashi, Circuit Judges.

Park, Circuit Judge:

Defendant-Appellant Steven Donziger was convicted of six counts of criminal contempt for repeatedly defying court orders, for which he was sentenced to six months’ imprisonment. He challenges the conviction, arguing that the district court's appointment of special prosecutors under Federal Rule of Criminal Procedure 42(a)(2) violated the Appointments Clause of the United States Constitution because (1) the special prosecutors are inferior officers who were not supervised by a principal officer, and (2) Rule 42 does not satisfy the Appointments Clause requirement that "Congress ... by Law" vest the appointment of inferior officers in the courts.

Before reaching Donziger's Appointments Clause challenges, we must determine whether special prosecutors are officers under the Appointments Clause. We conclude that they are because they wield federal prosecutorial power and hold a position that is not personal to a specific individual and may last for years. Cf . Morrison v. Olson , 487 U.S. 654, 108 S.Ct. 2597, 101 L.Ed.2d 569 (1988). We turn next to Donziger's Appointments Clause arguments and conclude that they lack merit. First, the special prosecutors are subject to supervision by the Attorney General, who has broad statutory authority to "conduct" and to "supervise" all litigation involving the United States. See, e.g. , 28 U.S.C. §§ 518(b), 519. This authority includes supervising—and if necessary, removing—the special prosecutors. Second, Donziger failed to raise his challenge to Rule 42 below, and we conclude that the district court did not commit plain error by appointing the special prosecutors in light of directly applicable Supreme Court precedent. See Young v. United States ex rel. Vuitton et Fils S.A. , 481 U.S. 787, 107 S.Ct. 2124, 95 L.Ed.2d 740 (1987). Finally, we conclude that the district court did not abuse its discretion by initiating a prosecution against Donziger for repeatedly defying court orders for years. We thus affirm Donziger's conviction.

I. BACKGROUND

A. Civil Contempt

In 2014, the United States District Court for the Southern District of New York found that Donziger, a New York lawyer, had engaged in fraud and racketeering activity in order to obtain an $8.646 billion judgment against Chevron Corporation in Ecuador. See Chevron Corp. v. Donziger , 974 F. Supp. 2d 362, 575–603 (S.D.N.Y. 2014), aff'd , 833 F.3d 74 (2d Cir. 2016). As part of the judgment, the district court enjoined Donziger from enforcing the Ecuadorian judgment in the United States or undertaking any acts to monetize or profit from it and ordered Donziger to transfer and assign to Chevron any property that Donziger had received or would receive that was traceable to the Ecuadorian judgment (the "permanent injunctions"). In February 2018, the court issued a $813,602.71 judgment against Donziger.

A few months later, the court granted Chevron's motion to compel Donziger's compliance with post-judgment discovery requests to identify assets for enforcing the money judgment and to assess his compliance with the permanent injunctions. Donziger refused to comply with the initial motion to compel, a subsequent motion to compel, and finally, a Forensic Protocol Order directing Donziger to surrender his electronic devices to a neutral forensic expert. In May 2019, the court held Donziger in civil contempt for several violations of the permanent injunctions and failure to comply with the Forensic Protocol Order. In an effort to coerce compliance, the court imposed daily escalating fines on Donziger and then ordered him to surrender his passports. Donziger did not pay the fines or surrender his passports, and he continued to disobey the Forensic Protocol Order.

B. Criminal Contempt

On July 31, 2019, after several more months of Donziger's noncompliance with court orders, the district court issued an order to show cause why he should not be held in criminal contempt in violation of 18 U.S.C. § 401(3). Counts 1–3 charged Donziger with failure to comply with the Forensic Protocol Order and the order to surrender his passports, and counts 4–6 charged him with violating the permanent injunctions. The court referred Donziger's prosecution to the U.S. Attorney for the Southern District of New York, who "respectfully decline[d] on the ground that the matter would require resources that we do not readily have available." App'x at 59 (alteration in original). The court thus appointed private counsel as special prosecutors under Rule 42(a)(2).

On the first day of Donziger's criminal contempt trial, he moved to dismiss, arguing that the prosecution violated the Appointments Clause because the special prosecutors were inferior officers who lacked supervision by the Department of Justice ("DOJ").¹ The court denied the motion in an oral ruling after concluding that Donziger's "moving papers have given the Court absolutely no basis on which to conclude that the special prosecutors are not subject to any control or supervision whatsoever by the Executive Branch." App'x at 153.

After trial but before the verdict, Donziger filed another motion to dismiss again arguing that his prosecution violated the Appointments Clause because the special prosecutors were unsupervised inferior officers. On July 26, 2021, the court issued its findings of fact and conclusions of law and found Donziger guilty on all six counts. In the decision, the court also denied Donziger's motion to dismiss, finding that the motion was untimely and that nothing in Rule 42(a) prevented the Attorney General from exercising supervision and review over the special prosecutor. Donziger moved for a new trial based on the same argument, and the court again rejected it.

On October 1, 2021, Donziger was sentenced to six months’ imprisonment, and judgment was entered that day. Donziger timely appealed.

II. DISCUSSION

The Appointments Clause states that the President "shall nominate, and by and with the Advice and Consent of the Senate, shall appoint ... all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments." U.S. Const. art. II, § 2, cl. 2. "The Appointments Clause prescribes the exclusive means of appointing ‘Officers,’ " Lucia v. SEC , ––– U.S. ––––, 138 S. Ct. 2044, 2051, 201 L.Ed.2d 464 (2018), and it "is more than a matter of ‘etiquette or protocol’; it is among the significant structural safeguards of the constitutional scheme," Edmond v. United States , 520 U.S. 651, 659, 117 S.Ct. 1573, 137 L.Ed.2d 917 (1997) (quoting Buckley v. Valeo , 424 U.S. 1, 125, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976) ).

Donziger argues that his prosecution was unconstitutional because the special prosecutors are inferior officers who were unsupervised by a principal officer and installed in violation of the Appointments Clause. Before reaching these arguments, we begin with the question whether the special prosecutors are Officers of the United States at all. "[W]e review questions of constitutional interpretation de novo ." United States v. Hester , 589 F.3d 86, 90 (2d Cir. 2009).

A. Special Prosecutors Are Officers Under the Appointments Clause

It is not obvious from the text of the Appointments Clause who qualifies as an Officer of the United States, but the Supreme Court has provided sufficient guidance in its Appointments Clause jurisprudence to decide this case. To qualify as an officer, an individual must (1) "exercis[e] significant authority pursuant to the laws of the United States" and (2) "occupy a continuing position established by law." Lucia , 138 S. Ct. at 2051 (cleaned up). It is undisputed that special prosecutors meet the "significant authority" requirement because they "represent the United States," Young , 481 U.S. at 804, 107 S.Ct. 2124, and exercise the "sovereign power of the United States," United States v. Providence J. Co. , 485 U.S. 693, 700, 108 S.Ct. 1502, 99 L.Ed.2d 785 (1988). We conclude that special prosecutors also hold a "continuing position" and are thus officers under the Appointments Clause.

1. Temporary Positions Can Be Offices

The Supreme Court has long held that officers occupy a "continuing position" established by law. See United States v. Germaine , 99 U.S. 508, 511–12, 25 L.Ed. 482 (1878) ; Auffmordt v. Hedden , 137 U.S. 310, 327–28, 11 S.Ct. 103, 34 L.Ed. 674 (1890). The Court's early Appointments Clause cases held that to be an officer, one's duties had to be "continuing and permanent, not occasional or temporary." Germaine , 99 U.S. at 511–12 ; see Auffmordt , 137 U.S. at 327, 11 S.Ct. 103 (merchant appraiser not an officer because he "acts only occasionally and temporarily").

More recently, the Court has indicated that "continuing position" does not exclusively refer to permanent positions. In Morrison , the Court said "[i]t is clear" that an independent counsel is an...