If anyone knows what it’s like to get slapped with a large criminal penalty by the Justice Department, it’s Pfizer, which got whacked last year with criminal and civil fines and a forfeiture to the government to the tune of $2.3 billion.

Doug Lankler, Pfizer's chief compliance officer, talks about the company's settlement with the DOJ over the drug Bextra, (Photo by Christopher M. Matthews)

“To put it bluntly, it’s kind of like being hit in the face by a two-by-four,” said Doug Lankler, Pfizer’s chief compliance officer. “Even for a large company, it’s very hard to go through.”

In September, Pfizer pleaded guilty to a federal criminal charge of illegally marketing the painkiller Bextra and agreed to pay $2.3 billion for its illegal promotion of the drug and other medicines. It was the largest-ever settlement resulting from illegal marketing by a drug company.

Under the settlement, Pfizer admitted to encouraging doctors to prescribe Bextra to treat acute pain and other ailments the drug was not intended for, a practice banned by the Food and Drug Administration.

Lankler, who led the company’s internal investigation and dealt with government prosecutors, told attendees of the Global Ethics Summit in New York on Tuesday that he was struck by how demoralizing the settlement was to Pfizer’s employees.

“You don’t understand and realize the phenomenal impact it’s going to have internally,” said Lankler.

Lankler was asked if the settlement has served as a moment of awakening for the company — inspiring improved compliance in the future. Lankler said that it was certainly an eye-opener, but added that even now he believes that Pfizer had a strong compliance program in place when the illegal marketing took place.

“Ninety-nine percent of everyone can be doing the right thing,” he said. “But if you’ve got a problem, you’ve got a problem and it’s not going to work.”

Lankler also had some advice for the conference attendees on dealing with government prosecutors. He said that throughout the government’s investigation, he gave countless presentations to Michael Sullivan’s office, the U.S. Attorney for the District of Massachusetts.

During those interactions, he said, the hardest thing for him was seeing things from the government’s perspective.

“Putting yourself in the government’s shoes is one most difficult things to do, but it’s the most important thing,” Lankler said. Prior to joining Pfizer, Lankler served as an assistant U.S. attorney in the Southern District of New York.

Lankler said it was easy to become defensive when the government was highlighting one instance of wrongdoing, when the majority of the Pfizer’s behavior was entirely proper. But, he said ultimately he recognized that one breach of trust is more than enough for a company whose customers must trust it enough to ingest their drugs.

“It’s a little mind boggling, they certainly don’t teach you a lot of this stuff when you go to law school,” Lankler said.

Main Justice is attending the Global Ethics Summit, hosted by Dow Jones and Ethisphere, in New York today and will be posting on a number of corruption and compliance issues throughout the day.

The former Massachusetts U.S. Attorney told Main Justice today that he doesn’t regret his decision not to run for the Senate seat of the late Sen. Edward Kennedy (D).

Michael Sullivan (The Ashcroft Group)

Michael Sullivan, who served as U.S. Attorney under the Bush administration from 2001 to 2009, considered a run for the seat that Republican Scott Brown won this week. He decided in October not to launch a bid for the Republican nomination because he wanted to spend more time with his family, including his son who is in high school.

“I have no regrets at all because Brown won,” Sullivan told Main Justice. “I think the world of Brown.”

He said he might have had “some regrets” if the election had been closer. But Brown received 52 percent of the vote to beat out Democrat Martha Coakley, who had 47 percent of the vote. Democrats have held the seat for more than 50 years.

Sullivan, who is a partner at The Ashcroft Group, said he believes that he could have won the seat too and isn’t ruling out a run for elected office in the future.

“I would certainly consider it,” the former U.S. Attorney said. He previously served in the Massachusetts House of Representatives and as a county district attorney. Read his full bio here.

A prosecutor in Boston is facing a three-judge panel today to determine whether he should be disciplined for allegedly withholding exculpatory evidence in an incident that led to another federal judge releasing accused mobsters from prison, The National Law Journal reports.

In 2007, District of Massachusetts Chief Judge Mark Wolf sent a complaint letter to the Massachusetts Bar Counsel about Assistant U.S. Attorney Jeffrey Auerhahn. In the letter Wolf detailed missteps by Auerhahn in prosecuting alleged mobsters Vincent Ferrara and Pasquale Barone. A government witness recanted some statements about the defendants’ involvement in a murder, which Auerhahn did not disclose, Wolf said in the letter.

Auerhahn’s alleged misconduct conduct occurred between 1991 and 1993 but was not disclosed to the court until August 2002. A year later, then-U.S. Attorney Michael Sullivan asked Wolf to hold off on referring the matter to the bar counsel’s office until the Justice Department’s internal ethics watchdog, the Office of Professional Responsibility, had completed its investigation.

In January 2005 OPR issued a 112-page report concluding that Auerhahn had acted in “reckless disregard of discovery obligations” and “exercised poor judgment,” although the ethics office found no evidence of intentional misconduct. Sullivan issued a written reprimand to Auerhahn.

In January 2008, Wolf sent a letter to then-Attorney General Michael Mukasey criticizing the Justice Department’s handling of Auerhahn. Wolf followed up with another letter to Attorney General Eric Holder in April 2009 asking for further review of the matter.

In the meantime, the bar counsel complaint was handed off the federal court case to Judge Joseph Tauro of the District of Massachusetts. Tauro selected district court judges George O’Toole Jr., William Young and Rya Zobel to sit on the three-judge review panel.

Attorney General Eric Holder dropped by Boston yesterday to see an old friend sworn in as U.S. Attorney.

Carmen Ortiz (DOJ)

Massachusetts U.S. Attorney Carmen Ortiz first met Holder three decades ago when she was a student at George Washington University Law School interning at the Justice Department Public Integrity Section, the Boston Globe reported. Holder was then a trial lawyer in the section.

“Have we come a long way, huh?” Ortiz, the state’s first Hispanic and female U.S. Attorney said to Holder, the country’s first black Attorney General, according to the newspaper.

Holder praised Ortiz as a natural leader and well-rounded lawyer, The Globe said.

“Latinas have done pretty well over the last few months, and deservedly so,” the Attorney General said in an apparent reference to Justice Sonia Sotomayor, according to the newspaper.

Ortiz told hundreds of supporters and dignitaries packed into a John Joseph Moakley Courthouse courtroom that fighting terrorism is her “first priority,” according to The Globe. She also let the crowd know that she became engaged New Year’s Day to Thomas Dolan, who works at IBM, The Globe said.

Ortiz was officially sworn in on Nov. 9, a few days after the Senate confirmed her to succeed Michael Sullivan, who was the Bush administration’s top federal prosecutor in Boston. U.S. Attorneys often have a later ceremonial investiture with local, state and federal leaders in attendance. Ortiz’s swearing was the seventh such ceremony attended by Holder since he became Attorney General.

Carmen Ortiz (Adelphi Univ.)

Carmen Ortiz, the new U.S. Attorney for Massachusetts, on Wednesday said she will step up efforts to prosecute financial fraud, the Associated Press reports.

The 53-year-old Ortiz was confirmed by the Senate Nov. 5 and sworn in three weeks ago. She replaced Michael J. Sullivan, who resigned April 19 to join the Ashcroft Group after eight years in the U.S. Attorney’s post.

Ortiz  had worked as an assistant U.S. attorney in Boston for the last 12 years, mainly prosecuting economic crimes, including embezzlement, tax evasion, investment fraud and telemarketing schemes.

During a meeting with reporters, Ortiz said her efforts to root out financial fraud — in part by reaching out to government agencies and business — will help prevent another financial situation like the one caused by Bernie Madoff’s Ponzi scheme, according to the AP. “What happened with Bernie Madoff, we should make every single effort to prevent that from happening again,” Ortiz told reporters, adding, “Victims should know that we’re open for business.”

She said another priority will be catching long-sought fugitive James “Whitey” Bulger, who is the alleged leader of the Winter Hill Gang, a crime family in Boston, The AP reports. He has been charged in connection with 19 murders and is on the FBI’s “Ten Most Wanted” list.

Ortiz said she plans to meet with the FBI and other law enforcement agencies and hopes to come up with “creative ways” to generate publicity and aid the search for Bulger, now 80.

“If he is present in people’s minds, then perhaps it could be that one tip that … could lead to his capture,” she said.

The Worcester Telegram and Gazette reports that Ortiz also told reporters she plans to expand the U.S. Attorney’s office’s presence in Worcester, increasing the number of assistant U.S. Attorneys in the office from two to four. “There is a lot of business” in Central Massachusetts, Ortiz told reporters

The Worcester newspaper also reported that Ortiz did not back off the office’s commitment to continue prosecuting gun and gang violence cases even though they could also be prosecuted in state courts, where sentences are usually less severe. “Not all of those cases belong in federal court,” but “we do have an impact on the communities that are suffering due to gun and gang violence,” she said.  “We make a real effort to select the cases that belong in federal court,” she said. However, with some people disagreeing, she said, the policy will be reviewed.

Carmen Ortiz (Adelphi Univ.)

The Senate Judiciary Committee today released its questionnaire on Carmen Ortiz (Adelphi University, George Washington University Law School), nominated to replace Michael J. Sullivan as U.S. Attorney in Massachusetts. Sullivan resigned April 19 to join The Ashcroft Group.

Her vitals:

• Born in New York City in 1956.
• Has served as an Assistant U.S. Attorney in Massachusetts since 1997.
• Was a senior trial attorney at the Quincy, Mass., law firm Morisi & Associates, P.C. from 1994 to 1997.
• Taught at the Northeastern University School of Law in Boston, Mass. in 1995.
• Was on the board of directors of Cambridge-based Cambridge and Somerville Legal Services from 1993 to 1996.
• Was a member of the board of directors of the Massachusetts Association of Hispanic Attorneys from 1992 to 1994.
• Worked on Senate Foreign Relations Committee in 1992 .
• Worked in the Middlesex County, Mass. district attorney’’s office as an Assitant District Attorney from 1983 to 1988 and again from 1991 – 1994. She also was the director of district courts from 1992 to 1994 and the director of training from 1991 to 1992.
• Was a program coordinator at Harvard Law School’s Center for Criminal Justice from 1988 to 1991.
• Worked at the now-defunct Braintree, Mass., law office Marinelli & Morisi from 1988 to 1989.
• Worked in the Justice Department’s Criminal Division as a trial attorney 1981 to 1983.
• Was a summer intern in DOJ’s Public Integrity Section in 1980.
• Has tried an estimated 150 cases to verdict, 36 percent of which were jury trials.
• Worked for the National Football League as an investigator in 1990.
• Was a hostess at Quincy’s Restaurant in Arlington, Va., from 1981 to 1982.
• Worked at the Ortiz gift shop in Brooklyn, N.Y., from 1974 to 1978.

Click here for her full questionnaire.

UPDATE: According to her Office of Government Ethics disclosure, Ortiz has numerous funds and stock holdings valued at between $379,025 and $1.52 million. She does not report owning any property or having any debt. On her Senate Judiciary Committee financial disclosure, Ortiz lists assets valued at $2,308,700 and liabilities of $55,100, for a net worth of $2,253,600. She reports $1,117,400 in real estate and has $452,200 in securities.

Michael J. Sullivan (Ashcroft Sullivan)

Former U.S. Attorney Michael Sullivan (R) has announced he will not run in a special election to succeed the late Sen. Edward Kennedy (D-Mass.), The Boston Hearld reported yesterday. Sullivan, who has mentioned as a possible Republican candidate for Kennedy’s open Senate seat, served as Massachusetts’ U.S. Attorney from 2001 to April 19. He now is a partner at the The Ashcroft Group.

Sullivan told the paper, “I went back and forth on it,”  adding, “But the deciding factor was I didn’t want to spend my son’s last two high school years like two ships passing in the night.” The Republican field is now narrowed to state Sen. Scott Brown and Canton selectman Robert Burr.

The Democratic-controlled legislature recently passed a law to allow Gov. Deval Patrick (D) to name a successor to serve in Kennedy’s seat until the state can hold a special election on Jan. 19. A state judge ruled that Patrick’s pick — former Democratic National Committee chairman Paul Kirk — could immediately take office, despite the usual 90-day grace-period required before new laws take effect. That ruling has stirred protests from Massachusetts Republicans. Kirk was sworn in as Kennedy’s replacement on Sept. 24. Kirk has said he will not run in the Jan. 19 special election to determine who will finish out Kennedy’s term.

The Democrats who have announced their candidacy for the special election are Massachusetts Attorney General Martha Coakley, Rep. Michael Capuano, Boston Celtics co-owner Stephen Pagliuca and Alan Khazei, founder of City Year, youth service organization.

Sullivan predicted the race will be between Coakley and Brown. “Martha Coakley has done a great job as attorney general, and I have a great deal of admiration and respect for her,” adding,  “Scott Brown should do extremely well. He’s a very credible candidate and when voters get to know him, they will warm up to him.”

A Boston city councilor charged with extortion is accusing former U.S. Attorney Michael Sullivan of going after him to get in good with former Attorney General John Ashcroft, for whom Sullivan now works. The Associated press has the story.

John Ashcroft

A bit of background: Boston City Councilor Chuck Turner, a member of the Green-Rainbow Party, was arrested last year after undercover FBI agents photographed him allegedly accepting a $1,000 payoff. Turner, who is also charged with making false statements, is up for election this fall and has refused to relinquish his seat.

Before a hearing Thursday, he wrote that Sullivan sought indictments against him and former Sen. Dianne Wilkerson, who is charged with bribery, in return for a lucrative business deal.

“I personally believe that former Attorney General Ashcroft said to Sullivan that if he could take down Senator Wilkerson and myself, he would put up the money to open the firm of Ashcroft and Sullivan in Boston where they could try to secure business for Halliburton to serve as a base while Sullivan prepares for his run for governor,” Turner wrote.

The Washington-based law firm founded by U.S. Attorney General John Ashcroft in 2007 has scooped up four Bush administration U.S. Attorneys to staff offices in Austin, Dallas, St. Louis,  and Boston. Johnny Sutton, former U.S. Attorney for the Western District of Texas, will head the Austin firm, along with new firm partner, John Ratcliffe, who was U.S. Attorney for the Eastern District of Texas from 2007 to 2008. The Texas firm will be called Ashcroft Sutton & Ratcliffe.

Ashcroft told the Austin Business Journal:

“This is a next-generation law firm … The law firm of the future has got to be nimble, agile and capable of focusing resources based on talent and expertise and be able to deploy them where they are needed.”

As we previously reported, the former U.S. Attorney for the Eastern District of Missouri, Catherine Hanaway, resigned April 17 to join the new firm. Also joining the firm is the former U.S. Attorney in Boston, Michael Sullivan, who resigned earlier this month. The firm will be known as Ashcroft Sullivan LLC in Massachusetts.