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NEW U.S. ATTORNEY TAKES REINS — FOR NOW On his first day back at the U.S. Attorney’s Office in the District, Kenneth Wainstein sent an e-mail to staff saying he has closely followed the happenings of the 360-lawyer office over the past three years. Now, his first week on the job behind him, Wainstein says he is still meeting with staff and “getting the lay of the land” before deciding whether to make any changes. Since 2001, Wainstein has risen up the ranks of the Justice Department and Federal Bureau of Investigation, most recently serving as the chief of staff to FBI Director Robert Mueller III. On May 28, the career prosecutor was selected by Attorney General John Ashcroft to be the interim U.S. attorney for the District of Columbia. Wainstein, 42, replaces Roscoe Howard Jr., who stepped down last month to join the D.C. office of Sheppard, Mullin, Richter & Hampton. The selection was not surprising, given that Wainstein held the post for several months before Howard was nominated in 2001. Wainstein’s interim term expires in 120 days unless he is nominated by the president for the permanent position or Chief Judge Thomas Hogan of the U.S. District Court for the District of Columbia orders that he remain. The U.S. Attorney’s Office in the District, the largest in the nation, is unique in that prosecutors are responsible for handling both federal cases and local street crimes. Wainstein has experience with both. He spent nine years at the U.S. Attorney’s Office in the District before leaving for Main Justice in 2001. As an assistant U.S. attorney, he tried numerous violent crime cases. Most notably, Wainstein prosecuted Carl Cooper for the 1997 murders of three employees of a Georgetown Starbucks. Wainstein, who says he is neither a registered Republican nor a Democrat, has the type of political connections to put him in the running for U.S. attorney, should President George W. Bush choose to nominate someone. In 2001, he served as director of the Executive Office for U.S. Attorneys and later as general counsel to the FBI. Last fall, according to press reports at the time, Wainstein was on a list of about nine names for the job of U.S. attorney in Manhattan. Wainstein says he would accept the nomination if asked, but declined to say whether he is seeking the job. Some in the D.C. legal community say they hope that Wainstein’s contacts within the FBI and the Justice Department will bring more resources and high-profile cases to the office. After all, most terrorism cases are handled by federal prosecutors in Virginia, while financial matters are routinely prosecuted in New York. Says Wainstein: “We do want to have a role in the most significant cases, but we also have a solemn commitment to the people of D.C. to protect them, and to protect them from violent crime.” — Tom Schoenberg A SHARPIE One Washington white collar criminal defense attorney calls James Sharp “somewhat of a mystery man.” But Sharp, whom President George W. Bush put on standby last week for advice regarding the grand jury investigation into the disclosure of CIA officer Valerie Plame’s identity, has deep roots among the bar of elite D.C. lawyers looked to by powerful people in trouble. Name partners in Sharp’s white collar defense boutique have at one time included A. Raymond Randolph, now a judge on the Court of Appeals for the D.C. Circuit, and Thomas Green, who in the 1980s became a central figure for the defense in the Iran-Contra affair. With Green, now a D.C. partner at Sidley Austin Brown & Wood, Sharp represented retired Air Force Maj. Gen. Richard Secord in the Iran-Contra scandal. Sharp’s other well-known clients have included Northern Virginia plastic surgeon Elizabeth Morgan, whom he represented in the 1980s in what became a sensational 20-year child custody battle against her former husband, Eric Foretich. Joseph diGenova, who worked with Sharp in the U.S. Attorney’s Office in the District in the early 1970s, calls him “one of the great storytellers I’ve ever seen in the courtroom.” Sharp, who maintains a small firm in the District, did not return calls for comment. — Lily Henning RIGGS’ LONG REACH Embattled D.C.-based Riggs Bank turned to New York’s Sullivan & Cromwell for help in a federal banking investigation that resulted last month in the largest fine ever imposed on a domestic bank by U.S. regulators. The Office of the Comptroller of the Currency fined Riggs $25 million for not reporting suspicious transactions and for failing to comply with the Bank Secrecy Act, a law governing anti-money-laundering requirements. Partners H. Rodgin Cohen and Mark Menting led the work for Riggs, which has not been accused of criminal wrongdoing. — Lily Henning DROPPING HINTS Last week’s release of newly declassified information about the alleged terrorist activities of Jose Padilla did not make clear the government’s ultimate plan for the enemy combatant. While Deputy Attorney General James Comey was careful not to close the door to future federal prosecution, he acknowledged that given the government’s refusal to allow Padilla to meet with an attorney until recently, any criminal case against him would face significant obstacles. “We obviously can’t use any of the statements he’s made in military custody,” Comey said. The Justice Department’s next step depends largely on how the Supreme Court rules on Padilla’s case. A decision that says the administration lacks authority to hold an American citizen without due process would force the government either to bring charges or to seek authorization from Congress. Georgetown University Law Center professor David Cole says the legislative branch may have been the target audience for last week’s announcement.” The more credible a public case they make against Padilla, the stronger the likelihood that they will get what they want from Congress,” Cole says. — Vanessa Blum BOOK CLUB Book deals are helping several Supreme Court justices make ends meet these days, according to their 2003 financial disclosure forms released June 4. Chief Justice William Rehnquist hauled in $30,148 from Alfred A. Knopf Inc. — a $25,000 advance for his recently published work Centennial Crisis: The Disputed Election of 1876, and the rest for royalties on past books. Justice Sandra Day O’Connor was paid $5,000 to do the audio book recording of her latest work, The Majesty of the Law, and $4,950 for creating signature sheets for a high-end reproduction of the same work by the Easton Press. But Justice Clarence Thomas takes the prize, reporting a $500,000 advance on his autobiography from HarperCollins — apparently the first of three equal installments. Thomas’ book is not expected before the end of the year. — Tony Mauro FUND FREEZE The U.S. Attorney’s Office in the District has moved to seize $31,000 in a money market account held by a former Washington Teacher’s Union official, claiming that the funds are tied to $400,000 stolen from the union. According to a complaint filed in the U.S. District Court for the District of Columbia on May 28, Gwendolyn Hemphill, former co-chair to D.C. Mayor Anthony Williams’ re-election campaign, deposited $50,000 in cash into a bank account in October 2003. Two days later, Hemphill and her husband moved $45,000 from that account to a Schwab One money market fund. Prosecutors claim in the complaint that Hemphill, who was indicted last November with several other union officials, failed to show that the money came from “legitimate” sources and that the funds may “constitute, or are derived from, proceeds traceable to conspiracy to commit embezzlement from union funds.” Hemphill’s lawyer, Nancy Luque, says the money was for Hemphill’s legal bills. “It was going to be used to pay me,” says Luque, who declined to say where the money came from. “I know the source of it, and I know it didn’t have anything to do with the allegations in that complaint,” says Luque, of Gray Cary Ware & Freidenrich. To keep the money from being seized, Luque says she may have to disclose its source. — Tom Schoenberg THE NEXT GENERATION After five years in the position, Michael Kelly has stepped down as managing partner of the D.C. office of Morgan, Lewis & Bockius. On May 25, firm chairman Francis Milone sent a memo to partners announcing the news and introducing 44-year-old Steven Stone, a partner in the securities industry and investment management practice, as the new managing partner, effective June 1. Kelly “approached the management committee several months ago and suggested that it was time to move the leadership position in our Washington office to the next generation of office leaders,” Milone said in the memo. Stone, a George Washington University Law School graduate, joined the firm in 1988. — Marie Beaudette TRAIL OF THE TAPE Recently released tapes of Enron energy traders bragging about manipulating energy prices during the 2000 West Coast energy crisis have further jolted those still reeling from Enron’s 2001 collapse. But if not for a electric utility in Snohomish County, Wash., and its D.C. lawyer, Patton Boggs partner Deborah Swanstrom, those tapes may never have been heard. Swanstrom’s client, Public Utility District No. 1 of Snohomish County, has been embroiled in Federal Energy Regulatory Commission proceedings to recover money from Enron, which the utility says owes its customers for market manipulations. Telephone calls of energy trades are routinely recorded, and tapes of such calls were seized as part of the Justice Department’s Enron investigation. Swanstrom and the utility traced the Enron tapes to a government contractor that was maintaining them. Federal investigators hadn’t yet listened to the tapes because they were in a coded format. Early this year, Swanstrom persuaded the DOJ to hand over the tapes. In return, her client had them restored to a listenable format. The utility filed a batch of the restored tapes at FERC May 17, and more were filed June 3. “I suspected that we would find relevant evidence on the tapes, but I was outraged at how blatant they were,” Swanstrom says. — Marie Beaudette DELAYED RESPONSE The World Trade Organization has delayed an anticipated decision that would have set the levels of punishment against the United States for keeping a law that the international body says unfairly benefits U.S. industries. The law, nicknamed the Byrd Amendment, was denounced by the WTO more than a year ago. The United States has refused to repeal it, and now the complaining countries, including the European Union and Canada, have asked for permission to retaliate. But they will have to wait a little longer. The WTO arbitrators recently informed the countries that a decision was “extended because of the complexity of the case,” says Andre Lemay, a spokesman for Canada’s Department of International Trade. The countries, however, were not told when to expect the arbitrators’ determination. — Christine Hines

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