Monday, July 8, 2019

U.S. v. Jeffrey Epstein

Although U.S. v. Epstein is not a white collar case, the issues raised by SDNY's federal conspiracy and sex-trafficking charges will reverberate throughout the white collar world, as we deal with such issues all the time. Here is the background in a nutshell.

Epstein was investigated by the U.S. Attorney's Office for the Southern District of Florida ("SDFL") for a series of sex crimes involving minor girls. A Non-Prosecution Agreement ("NPA") was entered into between SDFL and Epstein.  The NPA called for Epstein to plead guilty to related state charges. There were no federal charges, but the NPA was contingent upon Epstein entering into and abiding by the state plea deal. Additionally, Epstein's named victims were allowed to sue Epstein civilly under 18 U.S.C. 2255, which is only available to federal sex crime victims.

Under the NPA's terms, "on the authority of R. Alexander Acosta, United States Attorney for the Southern District of Florida, prosecution in this District for these offenses shall be deferred in favor of prosecution by the State of Florida, provided that Epstein abides by the following conditions and the requirements of this agreement as set forth below." (Emphasis added.) If the United States Attorney determines that Epstein has violated the NPA, the United States Attorney may notify Epstein of the violation and "shall initiate its prosecution." But, if Epstein timely fulfills all of the NPA's obligations, "no prosecution for the offenses set out on pages 1 and 2 of this Agreement, nor any other offenses that have been the subject of the joint investigation by the Federal Bureau of Investigation and the United States Attorney's Office, nor any offenses that arose from the Federal Grand Jury investigation will be instituted in this District, and the charges against Epstein, if any, will be dismissed." (Emphasis added.) It is undisputed that Epstein fulfilled all of his obligations under the NPA. The NPA does NOT include a standard provision near the signature block explicitly affirming that the agreement binds only the SDFL.

About a week after Epstein's state guilty plea, one of his victims, Jane Doe, filed a federal civil action seeking enforcement of the federal Crime Victim's Rights Act ("CVRA"). She claimed that SDFL had failed to confer with her as required by CVRA. Neither Jane Doe nor any of Epstein's other victims were aware that an NPA had been entered into that would free Epstein from having to face federal charges, at least in SDFL. In fact, it is clear from her pleading that Jane Doe thought federal plea negotiations were still under way when she filed. Jane Doe's case continues to wind its way through U.S. District Judge Kenneth Marra's court, and new plaintiffs, including Jane Doe 2, have been added. On February 21, 2019, Judge Marra held that SDFL violated the CVRA by hiding the NPA and its terms from Epstein's victims. Judge Marra also held that the CVRA authorizes the rescission of an NPA reached in violation of a prosecutor's conferral obligations. SDFL prosecutors maintained, as recently as June 24, that judge Marra had no authority to force them to reopen Epstein's case.

Fast forward to late last week, when Epstein was arrested on new federal sex crime charges emanating from the SDNY. The SDNY indictment was unsealed today. The SDNY charges are clearly covered by the NPA, if the NPA extends beyond the Southern District of Florida.

So, the battle lines are drawn for what promises to be a fascinating and important test of constitutional and statutory issues.

You can be certain that Epstein will move quickly to dismiss the new charges as a violation of the NPA and the Double Jeopardy Clause of the U.S. Constitution. What are some of the key issues likely to be litigated?

  1. Was the CVRA really violated? Does it even apply to non-prosecution agreements, or does it require a federal court filing by the prosecutors?
  2. If the CVRA was violated, does the violation affect the NPA provisions that benefitted Epstein?
  3. Is the NPA really unambiguous as to where it applies? If the NPA is ambiguous, have Epstein's due process rights been violated by the SDNY prosecution?
  4. Does the Double Jeopardy Clause even come into play here? Epstein only pled to state charges and the doctrine of Dual Sovereignty would appear to control. Does the joint federal-state nature of the NPA bring the Double Jeopardy Clause back into play? In other words, is the federal action here brigaded with state action for purposes of Double Jeopardy Clause analysis? Could an exception to Gamble be carved out? If jeopardy only attaches after a court accepts a guilty plea, how would that work here where there was no federal plea? Would jeopardy attach when the state court accepted the plea or when Epstein fulfilled the terms of the plea, thereby fulfilling the NPA's terms?
  5. Regarding potential remedies to a CVRA violation, is it fair to punish Epstein for the government's transgression? Is it relevant that Epstein's attorneys were keenly aware of the CVRA's provisions and vigorously tried to minimize the government's disclosures of the NPA to the victims? Isn't it the defense attorney's duty to aggressively defend his/her client to the full extent allowed by law and ethical rules?

On the political front, I have been asked whether it is possible that SDNY acted on its own in charging Epstein. I find such a scenario to be highly unlikely. If not, how high within DOJ did the approval request reach?

Stay tuned. It's going to be a rocky ride. Case materials will be posted later tonight or tomorrow morning.


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