United States v. Farrell

• Decision Date: 24 June 2015
• Docket Number: Criminal Action No. 2:14–cr–00264.
• Citation: 115 F.Supp.3d 746
• Court: U.S. District Court — Southern District of West Virginia
• Parties: UNITED STATES of America, Plaintiff, v. Dennis P. FARRELL and Gary L. Southern, Defendants.

115 F.Supp.3d 746

UNITED STATES of America, Plaintiff,

v.Dennis P. FARRELL and Gary L. Southern, Defendants.

Criminal Action No. 2:14–cr–00264.

United States District Court, S.D. West Virginia.

Signed June 24, 2015.

Eric Patrick Bacaj, Larry R. Ellis, Philip H. Wright U.S. Attorney's Office, Charleston, WV, for Plaintiff.

Robert B. Allen, Kay Casto & Chaney, Charleston, WV, for Defendants.

MEMORANDUM OPINION AND ORDER

THOMAS E. JOHNSTON, District Judge.

Defendants Dennis P. Farrell and Gary L. Southern are former officials of Freedom Industries, Inc. ("Freedom"), a West Virginia corporation that stored, sold, and transported industrial chemicals. Federal criminal charges have been filed against them in connection with a chemical spill by Freedom that occurred last year in this district and contaminated drinking water for an estimated 300,000 West Virginia residents.

In December, 2014, the Defendants filed motions to disqualify the United States Attorney's Office for the Southern District of West Virginia. (ECF 7, 22, and 25.) The Defendants argue that, because members of the United States Attorney's Office were among those affected by the spill, that Office should be disqualified from prosecuting this case.

For the reasons set forth below, the Court DENIES the motions to disqualify.

I. BACKGROUND

On January 9, 2014, it was discovered that a chemical substance used in the coal- mining industry, 4–methyl–cyclohexane–methanol (MCHM), had leaked from Freedom's chemical storage tank in Charleston, West Virginia, into the Elk River.¹ One mile downriver was an intake for a water treatment and distribution plant owned by West Virginia American Water Company ("WVAWC") that supplied water to homes and businesses in nine counties in Southern West Virginia. WVAWC issued a "Do Not Use" order directing residents living in affected areas not to use tap water for drinking, cooking, washing, or bathing. West Virginia's governor declared a state of emergency. The chemical spill left approximately 300,000 West Virginia residents without clean water for days. Clean water was restored in some areas within five days of the spill and in all areas within eight days.

During this water crisis, schools and businesses in the affected areas temporarily closed. Businesses suffered revenue losses, and workers lost wages. Many residents of Southern West Virginia were forced to purchase bottled water. Many also traveled to non-affected areas to bathe and wash clothes. Several hundred people were treated in West Virginia hospitals for symptoms thought to be caused by the contaminated water, including skin rashes. The chemical spill and its aftermath garnered extensive local and some national media attention.

After the chemical spill, numerous lawsuits were filed against Freedom and the Defendants. Among them is a consolidated class action lawsuit seeking recovery for alleged personal injuries and economic losses and requesting medical monitoring funded by the defendants. On January 17, 2014, as a result of the numerous lawsuits, Freedom filed for Chapter 11 bankruptcy protection.

On December 17, 2014, a grand jury returned an indictment charging the Defendants with negligent discharge of a pollutant in violation of the Clean Water Act, negligent discharge of refuse matter in violation of the Refuse Act, and negligent violation of an environmental permit. Southern has also been charged with bankruptcy fraud, wire fraud, making a false oath, and fraud by interstate commercial carrier, all in connection with his participation in Freedom's bankruptcy proceedings.²

The Defendants moved to disqualify the entire U.S. Attorney's Office for the Southern District of West Virginia, arguing that all or most members of the Office were likely to have been impacted in some way by the water crisis, creating a conflict of interest or the appearance of a conflict of interest. (ECF 7, 22, and 25.) At a hearing on the motions held on January 5, 2015, the Court inquired as to specific harms affecting specific prosecutors. Two Assistant U.S. Attorneys participating in the prosecution of this case, Eric P. Bacaj and Larry R. Ellis, stated that they did not reside in an area where the "Do Not Use" order was in effect at the time of the water crisis.

On January 26, 2015, Farrell and Southern moved for the Court to order the U.S. Attorney's Office to respond to discovery requests in order to develop the factual basis for their motions to disqualify. (ECF 83 and 87.) On February 27, 2015, the Court held a hearing on the discovery motions. The Court declined to take the unusual step of ordering the broad, civil-style discovery requested by the Defendants.³ However, with a view to developing a record of the specific impact that the water crisis had on the decision-makers in this case, the Court instead ordered that the Defendants and the United States submit a set of proposed written questions to be posed to U.S. Attorney R. Booth Goodwin II, First Assistant U.S. Attorney Carol A. Casto, and supervisory Assistant U.S. Attorney Philip H. Wright,⁴ with the final form of the questions to be determined by the Court. An additional hearing was held on April 1, 2015, to determine the final content of the questions and to resolve any objections thereto. After the final version of the questions was forwarded to the three government attorneys, answers were submitted in writing and under seal. Redacted versions of these responses were later unsealed. (ECF 185, 186, and 187.)

According to the questionnaires, all three supervisory attorneys lived in a "Do Not Use" area during the water crisis. Casto and Wright lacked clean water in their homes from January 9, 2014, until January 14, 2014; Goodwin did not remember how long his home was without water but recalled resuming the use of water in his home within a couple of days. Wright and his family complied fully with the "Do Not Use" order, while Casto and her spouse used the water for showering, and Goodwin and his family "mostly" complied. Casto spent $40 on bottled water, Goodwin spent $20 on bottled water, and Wright spent $5 on water; all had to spend some time driving to get clean water and thus incurred some gas expenses. None of the attorneys missed work, and none relocated as a result of the crisis. Wright's spouse, a teacher, did not go to work for six days, as school was canceled. Goodwin spent some time at his family's lake house but reported that he would have gone there anyway. Goodwin's minor children also spent some days out of school. All three attorneys reported being inconvenienced by the lack of clean water, but not aggravated or annoyed. None reported any resulting property damage or medical symptoms suffered by them or the members of their households. All three indicated that neither they nor any members of their household expect to benefit from the class action lawsuit filed in connection with the water crisis and the chemical spill, or to participate in medical monitoring if medical monitoring relief is ordered in the class action.

On May 5, 2015, after the conclusion of this limited discovery, Southern filed supplemental briefing on disqualification motions (ECF 163; see also ECF 189), in which Farrell joined (ECF 166). On May 6, 2015, the Court heard closing arguments on the motions.

The disqualification motions are now ripe for adjudication.

II. LEGAL STANDARD

The prosecutor's unique role was explained in Berger v. United States, 295 U.S. 78, 88, 55 S.Ct. 629, 79 L.Ed. 1314 (1935) :

The United States Attorney is the representative not of an ordinary party to a controversy, but of a sovereignty whose obligation to govern impartially is as compelling as its obligation to govern at all; and whose interest, therefore, in a criminal prosecution is not that it shall win a case, but that justice shall be done. As such, he is in a peculiar and very definite sense the servant of the law, the two-fold aim of which is that guilt shall not escape or innocence suffer.

Prosecutors are permitted to be zealous in their prosecution of a crime. Marshall v. Jerrico, Inc., 446 U.S. 238, 248, 100 S.Ct. 1610, 64 L.Ed.2d 182 (1980). However, prosecutors have a responsibility to seek justice, not merely to convict. Young v. U.S. ex rel. Vuitton et Fils S.A., 481 U.S. 787, 803, 107 S.Ct. 2124, 95 L.Ed.2d 740 (1987).

"Federal courts have an independent interest in ensuring that criminal trials are conducted within the ethical standards of the profession and that legal proceedings appear fair to all who observe them." Wheat v. United States, 486 U.S. 153, 160, 108 S.Ct. 1692, 100 L.Ed.2d 140 (1988). The authority of federal courts to disqualify attorneys appearing before them derives from their inherent power to "preserve the integrity of the adversary process," Hempstead Video, Inc. v. Inc. Vill. of Valley Stream, 409 F.3d 127, 132 (2d Cir.2005) (citation omitted), and federal government attorneys are "subject to State laws and rules, and local Federal court rules, governing attorneys in each State where such attorney engages in that attorney's duties, to the same extent and in the same manner as other attorneys in that State," 28 U.S.C. § 530B. The local rules of this Court provide that "[i]n all appearances, actions and proceedings within the jurisdiction of this court, attorneys shall conduct themselves in accordance with the Rules of Professional Conduct and the Standards of Professional Conduct promulgated and adopted by the Supreme Court of Appeals of West Virginia, and the Model Rules of Professional Conduct published by the American Bar Association." L.R. Cr. P. 44.7.

Because of their duty to pursue the public interest, the Supreme Court has recognized the "requirement of a disinterested prosecutor." Young, 481 U.S. at 808, 107 S.Ct. 2124 (1987). An interested prosecutor would not be "in a position to exercise fairminded judgment with respect to (1) whether to decline to prosecute, (2) whether to reduce the charge ..., or (3) whether to recommend...