1074 Exhibit 73: Memorandum of the American Law Division to Senator Exhibit 76: Memorandum of the American Law Division to Senator James Exhibit 77: Letter from Senator James Abourezk to Elmer B. Staats, Comptroller General, requesting clarification of April 12, 1978, decision (exhibit 37), April 17, 1978__ Exhibit 78: Letter from Elmer B. Staats, Comptroller General, to Senator James Abourezk regarding request for clarification of April 12, 1978, decision (exhibit 37), April 24, 1978__ 1083 1085 1087 1106 1109 Exhibit 79: Letter from Senator James Abourezk to Elmer B. Staats, 1113 1118 JUSTICE DEPARTMENT RETENTION OF PRIVATE LEGAL COUNSEL TO REPRESENT FEDERAL EMPLOYEES IN CIVIL LAWSUITS INTRODUCTION BY SENATOR JAMES ABOUREZK On January 19, 1977, Attorney General Levi issued a statement of policy regarding "the limits within which the Department may provide for representation of Federal employees with respect to employment-related matters in which they are involved in their individual capacity." 42 Fed. Reg. 5695-96 (January 31, 1977) (emphasis supplied). This statement of policy, Attorney General's Order 683–77, sets out the Justice Department's response to the deluge of civil suits relating to Watergate and intelligence community abuses. These suits, brought against present and former Federal officers and employees in their individual capacity, allege various deprivations of constitutional rights. The Attorney General's order goes beyond the long-standing Department policy of representing Federal employees in civil lawsuits for conduct performed within the scope of their employment. The order also defines certain circumstances in which the Department will retain, at its expense, private legal counsel to represent these employees sued in their individual capacities. The Senate Judiciary Committee has undertaken a detailed review of the order under which the program operates. The committee's review of the Attorney General's Order 683-77 was undertaken as a result of conference committee action on the Department's Supplemental Appropriations Act for fiscal year 1977. There the Department had requested $4,878,000 for private counsel fees. During the Senate hearings on the Justice Department supplemental appropriations request considerable attention was focused on the request for funds to pay for private counsel. See exhibit 13 at pages 189 to 239. Although "fully aware of the ethical conflicts which have required the Department to contract with private counsel instead of the usual direct representation by Department attorneys," the committee was gravely concerned about the Justice Department providing (IX) The Senate Appropriations Committee specifically recommended that there be incorporated in that order a procedure, requiring that should In chamber action, the Senate appropriated the full $4,878,000 to the Department but provided that none of the funds appropriated *** for payment of private The House supplemental appropriations bill which went to conference did not approve any money for Department payment of private counsel fees although a great deal of time had been devoted to the subject during the House supplemental appropriations hearing. See exhibits 12, 14, and 15 at pages 156, 240, and 242. In conference, the House agreed to an appropriation of $1,860,000 for private counsel fees; the Senate agreed to delete its express provision requiring Judiciary Committee approval of the order. See exhibit 19 at page 252. However, the conference demonstrated its concern over the amounts of money being expended and the wisdom of the policy by providing in its report that: the conferees are agreed that none of the funds available to the Department shall be obligated or expended by the Department for the representation of any defendants in suits commenced after the effective date of this act, until the appropriate committees of the Senate and the House of Representatives have reviewed the policy statement embodied in the Attorney General's Order No. 687-77 (sic) dated January 19, 1977. See exhibit 18 at page 251. (Emphasis supplied.) It is the fund limitation and mandated review which led the Assistant Attorney General for the Civil Division, Barbara Babcock, to write Senator James O. Eastland, chairman of the Senate Judiciary Committee, on May 19, 1977, requesting a meeting with representatives of the committee to "discuss" the order. See exhibit 22 at page 273. On June 15, 1977, representatives of the Senate Judiciary Committee and the Department met. In light of the detailed examination. of the order contemplated by the committee, the Department expressed its need for interim authority to hire new private counsel on a case-bycase basis pending completion of the committee's review. A June 21, 1977, letter from Assistant Attorney General Babcock, emphasized this point by suggesting that pending completion of the detailed review of the statement, "a preliminary review" be completed "so that the Government may retain private counsel in the cases which have been or may be filed." However, it was understood that such a preliminary review "would in no way prevent the committee from examining the implementation of the Department's policies with respect to the retention of private counsel." See exhibit 24 at page 275–276. In response to the Department's need for interim authority, on June 11, 1977, Chairman Eastland wrote to the Attorney General stating: I understand that several cases have been filed which may require the retention of private counsel. Because the committee has yet to complete its review, the Department's existing procedures for the retention of private counsel should, in the meantime, continue to be followed. While the committee is conducting its review, it understands that the Department has agreed to apprise the committee of any decision to retain private counsel arising under the guidelines, and, if practicable, before such decision is implemented. See exhibit 23 at page 274. By memos dated July 14, October 20, November 11, and December 28, 1977, the Justice Department has, in fact, apprised the committee of each instance when it has retained private counsel. See exhibits 56, 57, 58, and 59 at pages 935 to 943. Since the Supplemental Appropriations Act became law on May 4, 1977, the Department has under the June 11 letter retained 29 lawyers and law firms to represent 30 defendants in 12 cases. See exhibit 59 at page 941. Acting on behalf of the Judiciary Committee, I sent a comprehensive interrogatory to the Civil Division on July 13, 1977. See exhibit 25 at page 277. I requested access to eight categories of documents and that the Department compile a list of cases in which outside counsel had been retained. On October 4, 1977, Assistant Attorney General Babcock provided answers to the questions and a number of the documents. Exhibit 26 at page 308. After reviewing the Department's submission, on October 12, 1977, I forwarded 18 followup questions to the Department, and limited the pending request for documents. Exhibit 27 at page 390. By letter of December 16, 1977, Ms. Babcock answered the followup questions and produced further documents. Exhibit 28 at page 398. In a December 22 letter I inquired about a few remaining documents and the list of cases. Exhibit 29 at page 411. In response to the December 22 letter on February 7, 1978, Ms. Babcock provided the documents and list. See exhibit 30 at page 1054 and exhibit 60 at page 944. Throughout the Senate Judiciary Committee's review, the cooperation of the Justice Department has been excellent. The Department has answered a large number of questions about its private counsel program and provided detailed documentation needed by the committee to evaluate the program. In every phase of the investigation both the committee and the Department have taken every precaution to avoid prejudicing the rights of Federal employees in pending litigation. Due to the volume and complexity of the materials which the Judiciary Committee review had generated, I have directed that this staff report be prepared for the use of the committee. This staff report analyzes the challenge presented by these lawsuits and the complications involved in the Government retaining private legal counsel to represent the defendants in these civil lawsuits. The staff report concludes that the Department has no statutory authority to retain private legal counsel under the terms of the order. This is very troubling to me because I believe that Federal employees should normally not have to bear the costs of defending themselves in civil suits involving conduct within the scope of their employment. The report also raises substantial questions whether the Department's policy underlying its decision to retain private legal counsel in these cases is consistent with the public interest. The Department policy of retaining private counsel arose out of a genuine concern for the plight of Federal employees subject to suit. There is, however, substantial doubt about whether the Department has the requisite statutory authority to retain such counsel. I question whether the Department has not, in fact, committed itself to a policy and a program of substantial public importance before carefully reviewing its statutory authority. The staff conclusion that the Department has no statutory authority to retain private counsel is based on an extensive legal analysis prepared by the staff, an analysis in which the Congressional Research Service concurs. The Department's absence of statutory authority to retain private counsel raises the clear possibility that the Department's existing contracts with private counsel may be invalid. At the present time the Department has contracts with approximately 80 law firms to represent 107 Federal employees in 27 cases. Several million dollars have already been appropriated to pay these law firms. However, each of the contracts with these firms now may be in jeopardy. Even if the contracts are eventually found to be enforceable, this uncertainty itself adversely affects the interests of these Federal employees. Aside from the absence of statutory authority, the staff report raises serious reservations about the independence given to the private counsel who are retained by the Department. I understand that the Department order is based on the premise that private counsel must be given complete independence in order to avoid the conflict which originally made it necessary to retain such counsel. As the staff report observes, however, a direct consequence of this independence is that private counsel are free to raise any defense— including a "superior orders" type defense or argue that activities such as mail openings or surreptitious entries are legal. Indeed, private counsel are free to assert legal argument even though the Department believes such arguments not in the interest of the United States. to assert. The staff report concludes that the Government should not allocate its resources, directly or indirectly, to support anyone advocating "superior orders" defenses-which were rejected at Nuremberg-or the legality of mail openings or surreptitious entries. I agree, if Government employees are to be held accountable for their actions, private attorneys retained by the Department should not be permitted to raise "superior orders" type defense or to raise other arguments which violate the public interest. There is some question whether the authority of private counsel to raise these defenses can be limited without infringing on the ethical relationship of such counsel with their Federal employee clients. If the independence of private |