Federal Criminal Defense Lawyers

Tuesday, October 4, 2011

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Judge OKs secret evidence for CIA leak trial

McNabb Associates, P.C. (Federal Criminal Defense Lawyers)
Submitted at 7:57 AM October 4, 2011

Politico on October 3, 2011 released the following: By Josh Gerstein A federal judge has ruled that prosecutors pursuing a leak case against a former Central Intelligence Agency officer may present evidence to the jury that will not be seen by the public. U.S. District Court Judge Leonie Brinkema ruled in an order made public Friday that prosecutors may use a controversial procedure known as the silent witness rule to present three classified exhibits during the upcoming trial of former CIA officer Jeffrey Sterling. Sterling is set to go on trial later this month in Alexandria, Va. on a tencount indictment charging him with leaking information about a highlyclassified CIA program to New York Times reporter James Risen. In response to pleas from the White House, Risens editors at the Times never published details of the program, which was aimed at undermining Irans nuclear efforts by giving that country flawed nuclear designs. However, Risen revealed the program in his 2006 book, State of War. Under the silent witness rule, a document is shown to jurors, the defendant, the judge and the jury, but not to the public. Witnesses may refer to the documents in general terms, but do not read from them. The procedure has been used in several trials, but its

constitutionality is not firmly established. Brinkemas order (posted here) does not provide any rationale for her decision, but tersely indicates that the prosecution will be allowed to use the silent witness procedure to present what a prosecution filing describes as three CIA operational documents, all marked secret, relating to the use of telephones. The judge deferred ruling on a fourth document prosecutors wanted to present through the procedure, a CIA personnel evaluation report for Sterling for 1993. All four documents were recovered in an FBI raid of Sterlings home in Missouri in 2006. CIA rules prohibit employees from taking classified documents home without express permission, prosecutors contend. Sterling is not charged with leaking information from the four documents to Risen. Prosecutors want to show that it is likely that Sterling had similar documents at home that he leaked to or discussed with Risen. Prosecutors have argued that denying the public access to the evidence is necessary to safeguard national security secrets and will be of little significance since the prosecutions questioning about the documents is likely to last only five to ten minutes. (Their motion is posted here.) Sterlings defense team has been hostile to the proposal. Use of the silent witness rule in this case would seriously prejudice Mr. Sterling and totally eviscerate his right to a fair trial, defense lawyers Ed MacMahon Jr. and Barry Pollack wrote in a recent court filing (posted here). Press advocates have also expressed

concern about the use of the technique. However, none has intervened in Sterlings case. The issue was apparently argued in closed-door hearings held by Brinkema in recent weeks. One twist in the judges order could complicate the issue further. She denied a prosecution request to make some deletions in the documents. If the CIA is skittish about showing the entirety of the documents to jurors, prosecutors might have to drop the evidence altogether. In another ruling in the same order, Brinkema denied the defenses request to call a Russian nuclear scientist key to the CIAs attempt to snooker the Iranians. She also offered no explanation for that decision. Sterlings trial is set to open October 17. Brinkema ruled in July that Risen would not have to identify his confidential source or sources at the trial. However, prosecutors have asked her to reconsider that ruling. To find additional federal criminal news, please read Federal Crimes Watch Daily. Douglas McNabb and other members of the U.S. law firm practice and write and/ or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal. The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.

Attorney and Former Edgewater Hospital Owner Indicted for Allegedly Lying and Obstructing Justice to Impede U.S. and Bank Efforts to Collect Judgements Totaling More Than $188 Million
McNabb Associates, P.C. (Federal Criminal Defense Lawyers)
Submitted at 8:02 AM October 4, 2011

The Federal Bureau of Investigation (FBI) on October 3, 2011 released the following: CHICAGO An Indiana attorney was arrested today in Florida on federal charges alleging that he and his onetime client, the former owner and chief executive of the bankrupt Edgewater Hospital and Medical Center in Chicago, committed perjury and obstruction of justice to thwart efforts by the government

and a bank creditor to collect civil judgments totaling approximately $188 million involving fraud that resulted in Edgewaters collapse. The lawyer, Frederick M. Cuppy, was charged for the first time in a 10-count indictment that follows a criminal complaint that was unsealed in May 2008 against his former client and Edgewaters former owner, Peter G. Rogan. The indictment, which was returned by a federal grand jury last Wednesday, was unsealed today following Cuppys arrest, announced Patrick J. Fitzgerald, United States Attorney for the

Northern District of Illinois, and Robert D. Grant, Special Agent in Charge of the Chicago Office of the Federal Bureau of Investigation. Cuppy, 70, of Ft. Lauderdale, Fla., and Rogan, 65, currently residing in Vancouver, British Columbia, were each charged with one count of conspiracy to obstruct justice. Cuppy was also charged with three counts of perjury and three counts of obstruction of justice. He appeared this morning before a magistrate ATTORNEY page 2

Federal Criminal Defense Lawyers

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judge in Federal Court in Ft. Lauderdale and remains in custody pending further court proceedings. Rogan, formerly of Valparaiso, Ind., who was also charged with two counts of perjury and one count of obstruction of justice, remains free on bond in Vancouver, where he was detained in 2008 by the Canada Border Services Agency upon returning from a trip to China. Rogan was denied admission to Canada based on Canadian immigration law, but he was allowed to remain there while contesting the denial of admission and he continues to face Canadian immigration proceedings to determine whether or not he may be admitted or must leave. Rogan once owned Edgewater Hospital and later sold it, but continued to control the hospital and medical center through various management companies he owned. The hospital, located at 5700 North Ashland, closed in December 2001 and entered bankruptcy in 2002, about the same time four doctors, a vice president, and the management company pleaded guilty to federal criminal health care fraud charges involving the payment of kickbacks for patient referrals and medically unnecessary hospital admissions, tests, and services. Rogan was not charged criminally at that time, but in 2002, the United States filed a civil lawsuit against him alleging that was responsible for Edgewaters submission of millions of dollars of false claims for reimbursement under the Medicare and Medicaid programs, United States v. Peter Rogan, et al., 02 C 3310 (N.D. Il.). In September 2006, following a bench trial, U.S. District Judge John Darrah entered a judgment against Rogan for $64,259,032, and found that Rogan had testified falsely, destroyed documents and obstructed justice, United States v. Rogan, 459 F. Supp.2d 692 (N.D. Il. 2006). The judgment was upheld on appeal in 2008, United States v. Rogan, 517 F. 3d 449 (7th Cir. 2008). Also in 2002, Dexia Crdit Local, a bank that extended credit financing to Edgewater Medical Center, filed a civil fraud lawsuit against Rogan and his companies. Dexia Crdit Local v. Rogan, et al., 02 C 8288 (N.D. Il.). In 2007, Dexia

was awarded a judgment of more than $124 million. The United States and Dexia separately pursued legal remedies to enforce their judgments and collect the money that Rogan and his companies owed. These post-judgment procedures included depositions, citations, and subpoenas to discover the nature, extent and location of any assets Rogan owned or controlled, including offshore trusts that Rogan controlled. In 1996, Rogan created the Peter G. Rogan Irrevocable Trust 001 (the Rogan Trust), in the Bahamas to protect his assets from future judgments. By approximately 2002, the Rogan Trust had assets of approximately $28 million, according to the indictment. Cuppy and an unnamed Florida lawyer helped Rogan create the trust, establish its terms, and choose an offshore location. Oceanic Bank and Trust Ltd., (Bahamas), served as a successor trustee of the Rogan Trust. The indictment alleges that between 2002 and October 2010, Rogan and Cuppy conspired to obstruct justice in both the governments and Dexias cases in federal court in Chicago by impeding the courts and the parties from obtaining complete and accurate information as to the nature, operation and control of the Rogan Trust, its assets, and its distributions. Between 2002 and 2006, more than $11 million was distributed from the trust for the benefit of Rogan and Rogans wife, the indictment alleges. As part of the conspiracy, Rogan and Cuppy allegedly made incomplete, inaccurate, and misleading statements in depositions and to the judges, the United States, and Dexia about the Rogan Trust; filed an affidavit (Rogan) and a declaration (Cuppy) containing incomplete, inaccurate, and misleading information; and caused the trustee to withhold trust-related documents. In December 2006, Rogan responded to the governments collection efforts by filing an affidavit with the court in which he denied that he exercised any control over the Rogan Trust and its income or assets, asserted that he had no control over distributions from the trust, and asserted that he did not have ready access to the assets of the trust. The indictment alleges that those statements were false and that,

in fact, Rogan controlled the trust and its income and assets and had ready access to its funds. In 2009 and 2010, Cuppy allegedly impeded collection efforts by falsely stating that he did not have authority to instruct the trustee about the disposition of assets; did not cause the trustee to distribute funds to Rogans wife; and had not taken steps to ensure that the trustee would not produce documents in response to Dexias discovery efforts. Cuppy also allegedly lied to the court when he testified under oath that he did not remember telling an employee of the trustee to tell an unnamed Chicago lawyer that no information would be given out about the Rogan Trust. The United States is being represented by Assistant U.S. Attorneys Andrew S. Boutros and Daniel Gillogly. Conspiracy to obstruct justice and obstruction of justice carry a maximum penalty of 20 years in prison on each count and each count of perjury carries a maximum of five years, and all of the charges carry a maximum fine of $250,000 on each count. If convicted, the court must impose a reasonable sentence under the advisory United States Sentencing Guidelines and federal sentencing statutes. The public is reminded that an indictment contains only charges and is not evidence of guilt. The defendants are presumed innocent and are entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt. To find additional federal criminal news, please read Federal Crimes Watch Daily. Douglas McNabb and other members of the U.S. law firm practice and write and/ or report extensively on matters involving Federal Criminal Defense, INTERPOL Red Notice Removal, International Extradition and OFAC SDN Sanctions Removal. The author of this blog is Douglas McNabb. Please feel free to contact him directly at mcnabb@mcnabbassociates.com or at one of the offices listed above.