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Federal prosecutors in the 3rd U.S. Circuit Court of Appeals are batting .500 in two recent appeals they filed from decisions by district judges that transferred criminal cases to a faraway district at the request of the defendants. But the most recent decision shows that such transfers are tough to overturn if the trial judge properly performs the required balancing test. Nonetheless, an angry dissent by one appellate judge also shows that the issue is a divisive one that highlights the appellate court’s reluctance to use one of its most powerful tools for policing the lower court — the writ of mandamus. The two appeals — both captioned In Re: United States of America — stemmed from decisions by trial judges that granted requests by defendants to have their prosecutions transferred to a courthouse closer to their homes. In the first case, the 3rd Circuit late last year reversed a decision by U.S. District Judge Berle M. Schiller of the Eastern District of Pennsylvania after finding that while he had applied the correct test, he failed to make clear that he was putting the burden on the defendant to establish that transfer to the Middle District of Tennessee was appropriate. “The burden of proof is often the determinative factor in a discretionary decision, particularly in one where the factors may be closely balanced. It is important that an appellate court performing its review function be satisfied that the District Court recognized where the burden lay,” 3rd Circuit Judge Dolores K. Sloviter wrote. But Sloviter also made it clear that once Schiller had applied the test with the appropriate burden, there would be “no basis for [the government] to file another mandamus petition.” Now a different three-judge panel by a 2-1 vote has upheld a decision by U.S. District Judge William H. Walls of the District of New Jersey that transferred a criminal securities fraud case against two former Cendant Corp. executives to the District of Connecticut. But a spirited dissent by 3rd Circuit Judge Maryanne Trump Barry faulted Walls for catering to the defendants’ wishes at the expense of the public fisc. The majority decision, authored by 3rd Circuit Judge Jane R. Roth and joined by Judge Richard L. Nygaard, held that Walls had applied the appropriate test — the 10-factor balancing test announced by the U.S. Supreme Court in 1964 in Platt v. Minnesota Mining & Mfg. Co. Even if Walls were incorrect in his ultimate conclusions, Roth said, Platt clearly told appellate courts not to get in the business of conducting a de novo application of the test. Prosecutors argued in the appeal that the case should have stayed on Walls’ docket because he has already handled nearly 100 civil and criminal actions involving claims that principals of Cendant Corp. engaged in securities fraud. When Walls balanced the Platt factors, they said, he failed to give enough weight to his own familiarity with related actions, or to the relative costs to the parties and the potential for delay — all of which, the government said, militated against the transfer. Roth disagreed, saying, “The United States essentially invites us to balance the Platt factors de novo — an exercise that Platt, itself, admonishes is beyond the scope of our authority.” On a mandamus standard, Roth said, it was impossible to say that Walls had committed a clear error of law. “The District Court not only identified and considered the factors germane to its decision to transfer the case, but also articulated a sufficient statement of its reasoning,” Roth wrote. In a strongly worded dissent, Judge Barry said she agreed that the writ of mandamus is to be used only rarely but said “rarely … does not mean never.” Barry found that Walls’ decision to transfer the securities fraud prosecution of Walter A. Forbes and E. Kirk Shelton — the former chairman and vice chairman of the board of Cendant — to the District of Connecticut was “precisely the type of extraordinary circumstances for which mandamus was designed.” Under Rule 21 of the Federal Rules of Criminal Procedure, Barry said, a trial judge can transfer a case to another district “for the convenience of parties and witnesses, and in the interest of justice.” The glaring flaw in Walls’ decision, Barry said, was that “the interest of justice was cast aside … indeed, [the lower court's] opinion does not even mention ‘interest of justice.’” Instead, Barry complained, Walls “opted to send a $14 billion, 44 witness stock fraud case to the unsuspecting District Court of Connecticut because the two defendants live somewhat closer to one of the three district courthouses in Connecticut … and because much of the alleged criminal misconduct took place in — or was directed from — Connecticut, although it surely was not limited to that state.” Barry said she would have issued the writ of mandamus because, in her opinion, Walls did not apply the correct law. “A criminal defendant … is not entitled to defend his case in his home district, but instead bears the burden of proving that, given all the relevant circumstances, a transfer is in the interest of justice, i.e., all things being equal, a case should stay put,” Barry wrote. Barry said it was not enough for the two defendants to show that they themselves would benefit from moving the trial. Instead, she said, the burden is a heavy one that calls for proof that the case itself would be “better off in a new locale.” Under this standard, Barry said, “the defendants’ showing that New Haven, Connecticut, was slightly closer to their homes than Newark, New Jersey, where the case was to be tried, and that much of the alleged fraud took place in Connecticut was, as a matter of law, woefully deficient for several reasons.” Barry found that Walls “apparently believed” that the case would ultimately be transferred to New Haven or Bridgeport, Conn., which is only slightly closer to the defendants’ respective estates in Darien and New Canaan, Conn., than to Newark, N.J., where Walls sits. But in fact, Barry said, the transfer simply sent the case to the District of Connecticut where it is likely to be assigned to a judge in Hartford. New Haven, Barry noted, has one active district judge, and Bridgeport has two judges. By contrast, Hartford — which is about 15 to 20 miles farther from New Canaan and Darien than Newark — has the five remaining active judges. “It seems far more likely that this case will end up even further from defendants’ homes than where it started, thereby eviscerating the principal stated reason for the District Court’s transfer,” Barry wrote. Barry complained that allowing the transfer was sure to delay the trial because the new judge will be required to “get up to speed” on the case. “Even more importantly, this case comes at a time when, in the wake of the Enron-type events to which the public is daily being subjected, public confidence in the integrity of corporate America has been shaken and public interest and governmental interest in timely prosecuting those types of fraud is extraordinarily high,” Barry wrote. Barry also complained that Walls had given “short shrift” to the fact that the transfer will cost taxpayers at least $150,000 in added expenses. “Transfer will disaccommodate the entire government team of attorneys, agents, and support staff by forcing them to leave their families and relocate or commute to someplace in Connecticut for the period of this lengthy trial; rent and furnish office space which they otherwise would not have to do; and move their 150 boxes of documents,” Barry wrote. “The District Court gave this the back of its hand, finding only that ‘there may be a burden on the government’s legal staff’ but concluding that that burden was outweighed by the two paltry reasons given for the transfer,” Barry wrote. Barry concluded that “because the ‘interest of justice’ cannot possibly be served by sending this case to Connecticut, the District Court, in my view, committed ‘a clear abuse of discretion or clear error of law’ by doing so.”

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