The botched prosecution of the late Sen. Ted Stevens of Alaska, once one of the most powerful Republicans in the Senate, has cost the Department of Justice a lot in terms of time, energy and embarrassment. It is also costing the taxpayers, to the tune of some $1.8 million in legal fees so far to defend prosecutors from allegations of wrongdoing.

The DOJ has paid about $1.6 million since 2009 to private lawyers representing six prosecutors accused of misconduct and about $208,000 to defend three prosecutors accused of civil contempt of court, USA Today’s Brad Heath reported, citing data obtained under the Freedom of Information Act.

The consolation to the taxpayers is that the tab would have been much worse, had the cast of big-time white collar defense lawyers been allowed to charge their usual fees. But the Justice Department limits the hourly rate it will pay, and also limited the monthly hours of work it would reimburse to around 200.  To borrow a line from Mitt Romney, the several hundred thousand dollars each firm pulled in on the case is “not very much,” relatively speaking.

That’s not how Sen. Charles E. Grassley of Iowa sees it.

“Unfortunately, it’s the taxpayers who are losing twice,” the top Republican on the Senate Judiciary Committee, said, according to the newspaper. “First, the Justice Department committed serious legal errors and ethical missteps in its taxpayer-funded investigation and trial against Senator Stevens. And second, this is an unseemly high amount of money being spent by the taxpayers to defend what appears to be egregious misconduct.”

DOJ spokeswoman Laura Sweeney said the “government’s long-standing practice has been to provide or make representation available to federal employees for legal proceedings arising out of the performance of their official duties,” according to USA Today.

The Stevens case has had elements of politics, sex and tragic deaths. At its core, it focused on charges that Stevens, the longest-serving Republican in Senate history, was much too cozy with Alaska oil tycoon Bill Allen, happily accepting gifts and favors from him and failing to disclose them. He was convicted in federal court in 2008 of lying about the gifts and lost his Senate seat that fall.

But that was hardly the end of the episode.  Attorney General Eric Holder was forced to seek dismissal of the case in 2009 when it became known that the prosecution had withheld evidence that might have helped the defense.  Nor, in the opinion of the judge who presided over the Stevens trial, were the prosecutors’ lapses the result of mere carelessness.

The prosecutorial misconduct “permeated the proceedings before this Court… to a degree and extent that this Court had not seen in twenty-five years on the bench,” Judge Emmet G. Sullivan of U.S. District Court in the District of Columbia observed in November. He ordered an investigation by Washington lawyer Henry Schuelke that found that prosecutors had engaged in willful and intentional misconduct, albeit without enough accompanying evidence to bring criminal charges against them (see Main Justice’s report).

The prosecutors who came under scrutiny were William Welch, then head of the Public Integrity Section at Main Justice; and Justice Department trial attorneys Brenda Morris and Edward Sullivan, along with Alaska Assistant U.S. Attorneys Joseph Bottini and James Goeke. Justice Department prosecutor Nick Marsh was also under investigation, but took his own life in 2010.

Bill Welch (© 2009 The Republican Company)

Sullivan has said he intends to release the Schuelke report publicly after the Justice Department responds.

The former senator died in a plane crash in 2010, and weeks later, Marsh committed suicide (see Main Justice’s report).  In the following months, Alaska cases linked to the episode had to be thrown out or failed to gain any traction. They included an investigation of Ben Stevens, former president of the Alaska State Senate and son of Ted Stevens (see Main Justice’s report).

Finally, there is the issue of Bill Allen, the oil tycoon who became the key witness against Ted Stevens.  It seems that Allen has a weakness for young girls, a failing that has been widely publicized because some people, including Sen. Lisa Murkowski (R-Alaska), have questioned why Allen escaped prosecution for transporting a minor prostitute across state lines (see Main Justice’s report).

Amid the continuing fallout from the Stevens case, it is fair to note in passing that the DOJ smoothly handles and prosecutes many, many cases each year. But the Stevens case is surely one the DOJ would like to forget and put behind it, if and when it can.

The Department of Justice has pulled the plug on several high-profile investigations of members of Congress recently. But the DOJ sought to dispel any notion that it has become hesitant because of the disastrous episode involving the late Sen. Ted Stevens (R-Alaska.)

As The New York Times recounted on Monday, the DOJ recently announced that it will not pursue charges against Sen. John Ensign (R-Nev.) and Rep. Jerry Lewis (R-Calif.) who had been the subject of lengthy investigations. Ensign came under scrutiny for his efforts to help a former campaign aide with whom he had had an affair, while Lewis was in the spotlight for steering government spending to campaign donors.

Other investigations that ended without federal charges being lodged focused on Tom DeLay of Texas, the former House majority leader, and Rep. Don Young of Alaska, both Republicans, and Rep. Alan B. Mollohan (D-W.Va.).

But Lanny Breuer, the Assistant Attorney General in charge of the Criminal Division, rejected any suggestion that the DOJ has become “gun-shy” because of setbacks. “If a case cannot be brought, it’s because we’ve taken a hard look and made the determination that this case cannot be proved beyond a reasonable doubt,” he said, adding that behavior that might be labeled “reprehensible or immoral” is not necessarily criminal.

The DOJ’s biggest setback, and arguably the saddest, involved Stevens. He was convicted on corruption charges in 2008, but the verdict was later thrown out because of misconduct by prosecutors, who themselves came under investigation. One prosecutor committed suicide in September, several weeks after Stevens was killed in a plane crash.

Bill Welch (© 2009 The Republican Company)

The former chief of the Justice Department’s public corruption unit, who stepped down amid a criminal investigation of his team’s handling of the prosecution of former Alaska Sen. Ted Stevens, emerged Thursday as the lead prosecutor in a high-profile leak case.

William Welch II, who was chief of Public Integrity Section from 2007 to 2009, was named in a Justice Department news release announcing the indictment of Thomas Andrews Drake, a former National Security Agency official accused of providing classified information to a newspaper reporter.

Late last year, Welch returned to Springfield, Mass., where he had been an Assistant U.S. Attorney before joining the Public Integrity section as a deputy chief in 2006. He remains an employee of the Criminal Division with the title “Senior Litigation Counsel” but is based in the U.S. Attorney’s Office for the District of Massachusetts. The Drake indictment was filed in Maryland on Wednesday with Welch’s signature.

The department recently selected Jack Smith, a former Assistant U.S. Attorney in Brooklyn, to replace Welch as section chief. Raymond Hulser, who will be Smith’s Principal Deputy, has led the section on an acting basis since Welch’s departure.

Welch’s former Principal Deputy in the Public Integrity Section, Brenda Morris, who is also under investigation, left Washington under similar circumstances. In September, she moved  to U.S. Attorney’s office in Atlanta for personal reasons but is still identified by the department as Senior Litigation Counsel in the Criminal Division.

She, too, recently surfaced in a high-profile public corruption investigation involving Alabama lawmakers and gambling legislation.

The cases are the first public indication that the prosecutors have continued to handle sensitive matters for the department since Stevens’ conviction on false statement charges was thrown out roughly one year ago. A court-appointed prosecutor is investigating whether the six lawyers involved in the prosecution violated criminal contempt statutes by withholding evidence favorable to Stevens’ defense.

The department’s Office of Professional Responsibility is conducting a separate investigation. Both probes are near completion, people familiar with them say.

Nicholas Marsh, another member of the Stevens trial team, has also been in the public eye since his transfer out of the Public Integrity Section last summer. As a lawyer in the department’s Office of International Affairs, Marsh was involved in requesting the extradition of Roman Polanski to face sentencing in the U.S. for having sex with a minor three decades ago.

The special prosecutor investigating the Justice Department lawyers involved in the government’s case against former Sen. Ted Stevens (R- Alaska) has completed interviews, signaling that the yearlong probe is nearing its conclusion, said two people familiar with the matter.

Henry F. Schuelke III (photo by Susana Raab)

Meanwhile, the Justice Department’s ethics unit is close to finishing a separate investigation of the six lawyers, which will culminate in a report on whether their failure to turn over critical evidence to Stevens’ defense team amounted to professional misconduct, the people said.

Special prosecutor Henry Schuelke III, whose investigation began in April 2009, is expected to make his recommendation first. U.S. District Judge Emmet Sullivan, who presided over the Stevens trial, tapped Schuelke to determine whether department lawyers sought to conceal the evidence in violation of criminal contempt statutes or whether they withheld it by mistake.

Stevens was convicted of omitting gifts on his Senate financial disclosure forms in October 2008, but Attorney General Eric Holder dropped the case amid cries of foul by Stevens’ defense lawyers and after an internal review revealed irregularities in the way prosecutors shared documents and witness statements.

Schuelke’s investigation has been complex, reaching back years before Stevens was indicted and drawing from thousands of documents. The people, who spoke on the condition of anonymity because the investigations are ongoing, said Schuelke is now evaluating the evidence he’s collected in the past year. It’s unclear when he will make his determination.

Schuelke and investigators in the department’s Office of Professional Responsibility conducted separate interviews with the lawyers, with some sessions lasting 16 hours, but they are sharing information because of the overlap in their investigations, the people said.

Five of the lawyers involved in the Stevens prosecution, including two former supervisors in the department’s prestigious Public Integrity Section, have shifted jobs since the case was thrown out. William Welch II, who was the section chief, is now based in the Springfield branch of the U.S. Attorney’s Office in Massachusetts. Brenda Morris, who was the section’s principal deputy chief, moved to the U.S. Attorney’s Office in Atlanta for personal reasons.

Both Welch and Morris are employees of the Criminal Division — they are not Assistant U.S. Attorneys — though it’s unclear whether they continue to handle public corruption work. Justice Department spokeswoman Laura Sweeney declined to comment on personnel matters.

Two other members of the trial team, Nicholas Marsh and Edward Sullivan, were reassigned from the public integrity unit to the Office of International Affairs. James Goeke, an Assistant U.S. Attorney, transferred from the U.S. Attorney’s Office for the District of Alaska to the Yakima branch of the U.S. Attorney’s Office for the Eastern District of Washington. Alaska-based Assistant U.S. attorney Joseph Bottini has continued in his position.

The Stevens case prompted a series of reforms at the department, including a new training regime for prosecutors and the creation of a new position with oversight of department discovery practices.

A federal judge in Alaska this week rejected another motion for a new trial or dismissal of charges for a former state lawmaker convicted of corruption in a 2007 case that included errors by federal prosecutors.

Pete Kott (AKRepublicans.org)

U.S. District Court Judge John Sedwick denied a motion filed late last month by a lawyer for former Alaska House Speaker Pete Kott (R) to dismiss the charges against him or have a new trial for him since the lawyer received new documents pertaining to the case. Late last month, his lawyer received handwritten notes made during Justice Department and FBI meetings with the attorney who represented a key government witness who admitted bribing Kott.

Earlier last month, Kott’s lawyer filed another motion for dismissal statement filed last month, citing new DOJ guidelines that encourage prosecutors to list all witness interviews and keep their rough notes. Sedwick also rejected this motion.

U.S. District Court Judge John Sedwick wrote in a court order on Monday that Kott’s most recent motion and the handwritten notes “do not compel a different result” from the earlier rulings.

“Much of Kott’s briefing attacks the previous ruling, but in a manner not squarely based on the new documents,” the judge wrote.

Sheryl McCloud, a lawyer for Kott, told Main Justice she was disappointed with Sedwick’s ruling this week and said she will continue to appeal her client’s conviction.

“We really wanted to get to the bottom of the matter and figure out who stopped the flow of information about the moral, ethical, and perjury problems with their principal witness,” McCloud said.

Prosecutors in Alaska have admitted evidence was inappropriately withheld, but have said their actions didn’t cause any harm.

Kott previously asked Sedwick in November to toss his corruption conviction, arguing the same prosecutors withheld evidence in both his case and the unrelated prosecution of former Sen. Ted Stevens (R-Alaska). Stevens conviction was later thrown out by a federal judge in Washington, D.C., at the request of Attorney General Eric Holder.

Assistant U.S. Attorneys Joseph Bottini and James Goeke, as well as former Public Integrity Section lawyers Nicholas Marsh and Edward Sullivan prosecuted Kott. A court-appointed counsel and the department’s Office of Professional Responsibility are probing the prosecutors’ handling of evidence in the Stevens case.

The former state lawmaker was released from prison in June, after prosecutors said they did not hand over exculpatory evidence to the defense.

The story was first reported by The Anchorage Daily News.

This post has been updated from an earlier version.

The White House and the Justice Department are vetting the head of the Office of Professional Responsibility, Mary Patrice Brown, for a federal judgeship, according to two people familiar with the matter.

Brown, a well-regarded career prosecutor, is expected to secure a nomination to the U.S. District Court for the District of Columbia, assuming she clears her FBI background check and American Bar Association review, the people said.

Brown was tapped to lead the Justice Department’s ethics unit in April, amid a high-profile probe of former Office of Legal Counsel lawyers whose legal opinions paved the way for waterboarding of terrorism detainees. Her office reportedly determined that the lawyers — John Yoo, now a law professor, and Jay Bybee, now a federal judge — violated professional standards in blessing some of the Bush administration’s most controversial national security policies.

The Justice Department official who oversees OPR in the Deputy Attorney General’s office, David Margolis, softened the report to say the lawyers were guilty of “poor judgment” but not of professional misconduct — a finding that would have warranted referrals to state bar associations, Newsweek reported.

The issue would almost certainly be raised in Brown’s Senate confirmation hearings. Many Republicans strongly oppose disciplining Yoo or Bybee for their work during the Bush administration in the aftermath of the 9/11 attacks, while many Democrats have called for them to account for approving an interrogation method that Attorney General Eric Holder and others have equated with torture.

Brown, just the third OPR counsel since the office was created in 1975, came from the U.S. Attorney’s Office for the District of Columbia, where she was chief of the Criminal Division. The Justice Department announced the move the day after a federal judge criticized OPR for dragging its feet in an investigation of possible misconduct in the botched prosecution of former Alaska Sen. Ted Stevens. The events were unrelated.

The judge, Emmet Sullivan, took the extraordinary step of appointing a special prosecutor to investigate government lawyers for possible criminal contempt. Sullivan’s actions also set in motion a series of reforms designed to ensure that prosecutors meet their obligations to turn over evidence to defendants. (Brown would be Sullivan’s colleague on D.C.’s federal trial court, among the most prestigious in the country.)

The OPR investigations of the Stevens prosecutors and of the former OLC lawyers elevated the profile of Brown’s office. Rarely do OPR findings see the light of day, much less become the subject of congressional inquiries, as the OLC probe has. As a result, the office has received more complaints, Brown has said.

Delegate Eleanor Holmes Norton sent Brown’s name to the White House, along with eight others, for three vacancies on the court. (The names were generated by Norton’s nominating commission, the same group that interviewed candidates for U.S. Attorney in the District.) The White House appears to have pared the list down to three names, and the Justice Department’s Office of Legal Policy has been assisting with the vetting since December, the people said.

The lawyers being considered for the other two vacancies are Venable LLP partner Robert Wilkins, former special litigation chief for the D.C. Public Defender Service, and D.C. Superior Judge James “Jeb” Boasberg, who was an Assistant U.S. Attorney in District before his confirmation in 2002, the people said.

Brown could not be reached for comment. Wilkins and Boasberg declined to comment.

The court has a fourth vacancy as of late December, when U.S. District Judge Paul Friedman took senior status. It’s unclear whether the White House will select a nominee from Norton’s list, ask for more names or conduct its own search.

The Obama administration wants to expand the staff of the Office of Professional Responsibility, the Justice Department’s internal disciplinarians, to handle an “increasing number of special investigations.”

The president’s budget proposal asks for $488,000 to add five positions, including three attorneys, and notes that “several investigations were opened at the request of congressional oversight committees or members of Congress.”

In a well-publicized example, the top Republican on the House Judiciary Committee, Virginia Rep. Frank Wolf, asked Justice Department Inspector General Glenn Fine to probe the circumstances surrounding dismissal of voter intimidation charges against members of the New Black Panther Party. Fine referred the case to OPR. That inquiry is ongoing.

OPR currently has 29 positions, including 21 attorneys. The office, which is led by veteran prosecutor Mary Patrice Brown, saw an increase in the pace of complaints filed in 2009. As of May, the office had received nearly 700 complaints, while about 800 complaints were filed in all of 2008.

In a meeting with representatives of the National Association of Assistant U.S. Attorneys, Brown attributed the uptick to OPR’s increased visibility. She cited its investigations of high-profile matters, such as the conduct of prosecutors in the botched Ted Stevens trial and of the Bush administration Office of Legal Counsel lawyers whose legal opinions paved the way for waterboarding.

The OPR report on the Office of Legal Counsel is going through declassification now, in preparation for public release. It was more than four years in the making.

Newsweek reported last week that OPR originally found the former Office of Legal Counsel lawyers had failed to to meet professional standards in crafting a 2002 memo blessing the use of harsh interrogation techniques. Those lawyers were Jay Bybee, now a federal appellate judge, and John Yoo, now a law professor.

But Associate Deputy Attorney General David Margolis, who conducted the final review, softened the report to say they showed “poor judgement,” Newsweek said.

The Justice Department on Friday appealed a court decision dismissing charges against five former Blackwater guards involved in a 2007 shooting in Baghdad that left 17 Iraqis dead.

Vice President Joe Biden announced the government’s intention to file an appeal last weekend, after a meeting with Iraqi President Jalal Talabani.

Prosecutors say the guards opened fire in a crowded Baghdad intersection without provocation, killing or wounding more than 30 Iraqis, including women and children. Attorneys for the guards say their clients, who were protecting U.S. diplomats, took fire from insurgents and responded in kind.

U.S. District Court Judge Ricardo Urbina in Washington dismissed manslaughter charges against the guards in a harshly worded Dec. 31 ruling, in which he faulted Justice Department prosecutors for using tainted evidence to build their case and for abusing the grand jury process.

Many Iraqis were outraged by the decision, viewing it as evidence that the U.S. was not accountable for bloodshed in their country. Iraqi leaders have been collecting signatures for a class action against the security contractor, which changed its name to Xe Services last year.

Urbina’s December ruling invited comparisons to the the botched prosecution of former Sen. Ted Stevens (R-Alaska), whose conviction was erased last year because of government missteps.

In that case, Judge Emmet Sullivan, who sits on same court as Urbina, criticized the government for failing to disclose materials that could have aided in Stevens’ defense. Sullivan dismissed the case at Attorney General Eric Holder’s request, and then appointed a counsel to investigate prosecutors for possible criminal contempt.

Urbina, however, made no formal finding of misconduct, and in a ruling earlier this month, he said the Justice Department could seek a new indictment against the men. Urbina said prosecutors acted with “disregard” but concluded that dismissing the case — without prejudice — was punishment enough.

The government has not yet filed a brief explaining the grounds for appeal. In pretrial hearings, prosecutors argued that interviews the guards gave to the State Department after the shooting were part of the normal course of their job and could be used against them. Urbina ruled that interviews were compelled, which immunized the guards.

As part of its initiative to address concerns about prosecutorial misconduct, the Justice Department today announced that an assistant chief in the Environment and Natural Resources Division will be its new national coordinator for its criminal discovery programs.

Andrew Goldsmith, First Assistant Chief of the ENRD’s Environmental Crimes Section, will direct the department’s efforts to educate prosecutors about their obligations to turn over potentially exculpatory or other information to defendants. His appointment comes a week after the department released new guidelines for federal prosecutors in applying discovery rules, part of an effort by the DOJ to head off judicial rules changes pushed by U.S. District Judge Emmet Sullivan that would restrict prosecutors’ discretion to decide what information in their possession is relevant to a defense team under Brady.

“Andrew brings a wealth of knowledge and experience in this field, and I am pleased he is taking on this crucial role,” Deputy Attorney General David Ogden said in a news release. “He will be instrumental in overseeing our efforts to ensure all of our prosecutors and law enforcement agents have the necessary training and tools to achieve fair and just results in the nation’s courts.”

Goldsmith’s job description includes, according to the news release:

• Creating an online directory of resources on discovery issues available to all prosecutors at their desktop

• Producing a handbook on discovery and case management similar to the Grand Jury Manual so that prosecutors will have an accessible and comprehensive resource on discovery obligations

• Implementing a training curriculum and a mandatory training program for paralegals and law enforcement agents

• Revitalizing the Computer Forensics Working Group to ensure the proper cataloguing of electronically stored information recovered as part of federal investigations

• Creating a pilot case management project to fully explore the available case management software and possible new practices to better catalogue law enforcement investigative files and to ensure that all the information is transmitted in the most useful way to federal prosecutors.

Justice Department Inspector General Glenn Fine said in a report to Congress last year that restoring confidence in the department is a major challenge after the high-profile public corruption case against former Sen. Ted Stevens (R-Alaska) case was thrown out because of prosecutor mistakes.

Attorney General Eric Holder moved to dismiss the charges against Stevens in April, after an internal DOJ review revealed prosecutors had failed to give the defense material favorable to Stevens’ defense. A court-appointed counsel is investigating whether they did so intentionally. Fine said in the report that the Stevens fiasco “created concern about the prosecutors’ adherence to professional standards of conduct.”

On Dec. 31, U.S. District Judge Ricardo Urbina rebuked prosecutors in the District of Columbia for their handling of a manslaughter case against five former Blackwater Worldwide guards accused in a shooting incident in Iraq that left 17 people dead.

In ordering dismissal of the indictment, Urbina said prosecutors had violated the defendants’ constitutional rights by making use of compelled statements the guards had given about the incident under threat of losing their jobs.

A former Alaska lawmaker is citing new Justice Department guidance for prosecutors on discovery procedures in his effort to have his 2007 conviction on public corruption charges repealed, The Associated Press reported today.

Pete Kott (AKRepublicans.org)

In a motion for dismissal statement filed this week, a lawyer for former Alaska House Speaker Pete Kott cited new DOJ guidelines that encourage prosecutors to list all witness interviews and keep their rough notes. The lawyer, Sheryl Gordon McCloud, said the Alaska U.S. Attorney’s Office has yet to hand over items from a 2006 interview with ex-VECO Corp. chief Bill Allen, the AP said.

Allen was a key witness against Kott as well as ex-Sen. Ted Stevens (R-Alaska), whose conviction on public corruption charges was overturned last year after the Justice Department said it had mishandled potentially exculpatory evidence.

“[T]hat memo is based on existing law, and sets forth materials that government attorneys must seek out, review, and disclose,” McCloud wrote in the court filing. “It includes not just material from the U.S. Attorney’s files but from all those associated with the prosecution team, and it includes not just information memorialized in written statements but also evidence favorable to the accused that is transmitted in a ‘conversation.’ ”

Prosecutors in Alaska have admitted evidence was inappropriately withheld, but have said their actions didn’t cause any harm.

Kott previously asked Judge John Sedwick in November to toss his corruption conviction, arguing the same prosecutors withheld evidence in both his case and the Stevens trial.

Kott was prosecuted by Assistant U.S. Attorneys Joseph Bottini and James Goeke, as well as former Public Integrity Section lawyers Nicholas Marsh and Edward Sullivan. A court-appointed counsel and the department’s Office of Professional Responsibility are probing the prosecutors’ handling of evidence in the Stevens case, which was thrown at the request of Attorney General Eric Holder.

The judge has several options. He could let the Kott conviction stand, dismiss it and order a new trial, or dismiss it with prejudice. He has not said when he will rule.

Kott was released from prison in June, after prosecutors said they did not hand over exculpatory evidence to the defense.