News: Senator seeks Bush nominee delay over tobacco case

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USA A senator wants to delay consideration of President George W. Bush’s nominee to serve as the ambassador to Australia until his role in the U.S. government’s racketeering case against cigarette makers is thoroughly examined.

After Lots of Fanfare, McCallum Deposition Turns Up Nothing
October 17, 2006
By Michael Siegel
It received lots of fanfare, but the deposition of former Associate Attorney General Robert McCallum turns up no evidence that he did anything wrong in his handling of the DOJ tobacco litigation or in his response to a FOIA request from Citizens for Responsibility and Ethics in Washington (CREW).
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McCallum Questioned About Tobacco Case
By PETE YOST, The Associated Press
Jul 20, 2006
WASHINGTON – A Justice Department official who slashed the amount of money being sought from tobacco companies made misleading statements to Congress, says a former government lawyer who handled a landmark lawsuit against the industry.
The comments by attorney Sharon Eubanks follow Associate Attorney General Robert McCallum’s decision a year ago to downsize a proposed smoking cessation program from $130 billion to $10 billion. That’s the amount the government wants a judge to order cigarette companies to pay.
A month ago, McCallum sent written statements explaining his actions to the Senate Foreign Relations Committee, which was considering his nomination to be U.S. ambassador to Australia. The Senate subsequently confirmed McCallum, a former Yale classmate of President Bush, to the post.
Eubanks, who ran the department’s tobacco litigation team, retired from government and now works for Citizens for Responsibility and Ethics in Washington. The private group sued the department and questioned McCallum for several hours Tuesday about documents he kept on the tobacco case.
The group wants to find out whether White House influence was brought to bear in the pending tobacco lawsuit.
“I don’t remember ever receiving any directive from the White House about anything that had to do with the tobacco case,” McCallum said in his sworn videotaped deposition.
The Justice Department’s Office of Professional Responsibility said last month that McCallum’s conduct was not influenced by any political considerations.
Internal Justice Department e-mails obtained by The Associated Press show that the White House OK’d an op-ed piece by McCallum in USA Today defending the department’s drastic cut in the amount it was demanding the tobacco companies pay.
“Please hold up. The White House wanted some changes,” one Justice Department employee wrote regarding McCallum’s op-ed piece.
“WH says it’s good to go,” said an e-mail an hour later by another department employee.
In his testimony about the Justice Department suit against the tobacco companies, McCallum refused to say whether he had notes of contacts with industry representatives. He said he was barred from answering by an order the judge had issued in the case. The order itself is sealed, McCallum added.
On Wednesday, a Justice Department spokesman, Charles Miller, said “it’s absolutely incorrect” to suggest that McCallum “was anything but truthful in what he said to the Senate.”
Eubanks said McCallum mischaracterized a court order in his statements to Capitol Hill, making it appear that U.S. District Judge Gladys Kessler criticized the government’s embrace of smoking cessation as a remedy in the lawsuit. McCallum cited the judge’s order in explaining why he reduced the government’s request.
Eubanks pointed out that the judge later rejected the tobacco industry’s arguments and allowed Eubanks’ expert witness to testify that the companies should pay $130 billion for smoking cessation.
McCallum said the decision to cut the amount of money being sought stemmed from a federal appeals court ruling in the case that requires forward-looking remedies aimed at preventing future violations rather than penalties for past misdeeds. McCallum said career attorneys in the department’s organized crime and racketeering section recommended the change.
In his comments to the Senate, McCallum noted an order from the judge that the appeals court ruling “struck a body blow to the government’s case.”
Eubanks said the “body blow” language had nothing to do with a smoking cessation remedy and “to make that suggestion is misleading.”
In his written statements to the Senate, McCallum said he had “no personal involvement even as to supervision and oversight, in the vast majority” of proceedings in the tobacco case.
Eubanks said the statement is technically accurate, but “extremely misleading.”
“I had the guy’s cell phone number and he told me to call him any time on the case and occasionally I did,” said Eubanks. “On the significant and important things, he made it very clear that he was to remain in the loop and involved.
“Whenever we had meetings on this, Robert was at all of them, and we had a lot of them,” said Eubanks. “This is a guy who’s not involved?”
McCallum told the Senate that he had conferred with attorneys including the career lawyers leading the trial team, a characterization that Eubanks rejected.
“There was no conferring,” said Eubanks. “I was taking orders.”
At McCallum’s direction, says Eubanks, political appointees at the department wrote almost every word of Eubanks’ closing argument in which she asked the judge to order the industry to pay the reduced amount.
Eubanks has removed herself from her new employer’s lawsuit against the Justice Department where she used to work.

Feds Oppose Public Query in Tobacco Case
July 18, 2006

The Justice Department is opposing public questioning of a former department official in a lawsuit stemming from the government’s landmark case against the tobacco industry.

The court battle involves former associate attorney general Robert McCallum and a private group alleging that McCallum and others at the Justice Department failed to surrender records related to the lawsuit against the cigarette companies.
A year ago, McCallum became the central figure in the government’s decision to lower by more than 90 percent the amount of money it was seeking from cigarette companies.
In December, Citizens for Responsibility and Ethics in Washington sued, alleging the department had failed to surrender records that might explain the reasons for the reduction from $130 billion to $10 billion.
McCallum, who was confirmed as U.S. ambassador to Australia last month, was scheduled to undergo a deposition Tuesday in a case that the ethics group filed against the department.
After U.S. District Judge Emmet Sullivan gave the go-ahead to question McCallum, the department sought an order that his videotaped deposition be done in private and not be publicly released.

On Monday, CREW asked Sullivan to address the issue after a federal magistrate sided with the department.

“Where the conduct of a high level government official is at issue, protective orders to shield that office from potential embarrassment are not appropriate,” CREW said in court papers.
The private group said it wants to question McCallum “to answer the legitimate question of what role he played in the government’s misconduct” in failing to produce records.
The department cited court cases which state that depositions cannot be used to embarrass or harass a witness. The department argues it would be inappropriate for members of the public to attend McCallum’s deposition because pretrial depositions generally are not public components of a civil trial.


Envoy under tobacco cloud

William Birnbauer
June 11, 2006

THE man President George Bush wants as the next US ambassador to Australia took “aggressive actions” to destroy a multibillion-dollar fraud case against tobacco companies, according to the US Government’s top prosecutor in the case.
Robert McCallum, the US Associate Attorney-General, was said to have undermined the case once it became apparent that prosecutors could win.
The claims were made by Sharon Eubanks, who led the US Justice Department’s nine-month prosecution against the tobacco firms. Last week an internal Justice Department inquiry found no wrongdoing by Mr McCallum, clearing the way for him to become the US ambassador in Canberra.
Controversy has dogged Mr McCallum over his role in slashing the penalty the Justice Department sought to impose on tobacco companies from $US130 billion ($A174 billion) to $US10 billion. He was also accused of pressuring three witnesses to tone down their testimony in relation to the penalty.
In an exclusive interview, Ms Eubanks said: “Robert McCallum definitely was not supportive of the trial team’s efforts … He took aggressive actions to destroy our efforts when it became clear that we had firm legal bases for seeking much more meaningful remedies from the court.
“I should be clear about this: Robert McCallum directed the position taken on remedies sought by the United States. It did not matter to him what the evidence actually demonstrated and supported, rather, it was only the bottom line that mattered to him — the lower the better.”
Ms Eubanks, who has not spoken publicly about Mr McCallum’s role previously, made her comments to The Sunday Age and a TV documentary team consisting of Melbourne filmmaker Terry Carlyon and this journalist. A second former Justice Department lawyer, Brett Spiegel, backed Ms Eubank’s version of events.
Mr McCallum was appointed to a senior Justice Department post by Mr Bush and had oversight of the tobacco case.
Mr Spiegel said the department’s political appointees had undermined the trial team.
“We were working under an administration whose inaugural ball was paid for by (tobacco company) Philip Morris. You’re getting some mixed signals when you have that situation.”
The comments are set to increase scrutiny and criticism of Mr McCallum in the US and Australia, despite his being cleared by the Justice Department’s Office of Professional Responsibility. The office found that he did not “engage in professional misconduct or exercise poor judgement”.
The US ambassador’s position has been vacant for about 18 months following the departure of Tom Schieffer.
Mr McCallum, nominated as ambassador by his friend Mr Bush in March, faces questioning about his role in the fraud trial. Last week, a US District Court judge ordered him to answer questions about the penalty reduction. His nomination also must go through the Senate’s Foreign Relations Committee and the full Senate.
Ms Eubanks resigned from the department late last year after 22 years of service. At the end of the case, Mr McCallum thanked her for her “tireless efforts”. He denied political interference in the case, saying the remedy sought by the Government was downgraded on legal grounds. Before his Justice Department appointment, he was a lawyer at an Atlanta law firm that worked for a tobacco company.
The US Government’s case against tobacco giants including Philip Morris, British American Tobacco and RJ Reynolds wrapped up last June. Judge Gladys Kessler is yet to rule on it. During the trial, a senior lawyer for Philip Morris said the penalty reduction proved the Government’s case was a “house of cards”.
Judge Kessler responded that the downgrade could suggest there were “some additional influences being brought to bear on what was the Government’s case”.
The Justice Department case, filed in 1999 when Bill Clinton was president, initially sought forfeiture of $US280 billion of profits from tobacco companies to recover the costs of treating smoking-related disease. It was one of the biggest civil suits filed in the US.
Cigarette makers successfully appealed against the health-cost recovery claim but the Justice Department proceeded with a racketeering fraud case, alleging a 50-year conspiracy by the companies to deceive the public about the risks of smoking.

Justice Dept. Official Faces Questioning
Jun 1,2006
By PETE YOST
WASHINGTON (AP) – A judge ruled Thursday that Associate Attorney General Robert McCallum must undergo questioning in a lawsuit, a decision that is helpful to a private group seeking records about the Justice Department’s conduct in a landmark case against the tobacco industry.
The action by U.S. District Judge Emmet Sullivan is the latest problem related to McCallum’s nomination as the Bush administration’s choice to become ambassador to Australia.
Democratic Sen. Dick Durbin of Illinois is blocking McCallum’s nomination over allegations the No. 3 official at the Justice Department improperly influenced the government’s lawsuit against cigarette manufacturers.
Citizens for Responsibility and Ethics in Washington sued last year after the department ignored the testimony of one of its own witnesses in the tobacco trial and reduced the amount the Bush administration is seeking from the tobacco industry from $130 billion to $10 billion.
CREW says the department has failed to produce a single responsive document to demands for information under the Freedom of Information Act.
Sullivan said the private organization is entitled to delve into the department’s handling of the document requests by questioning McCallum, who is at the center of the controversy over whether the administration caved into the tobacco industry in reducing the amount of money it is seeking.
The judge said statistical data the department sends to Congress every year belies the government’s argument that there is nothing unusual or out of the ordinary in the amount of time it has taken to respond to CREW’s lawsuit.
In its lawsuit filed last October, CREW asked for records of all contacts between Justice Department officials and the White House concerning the tobacco litigation and records of all contacts between McCallum and his old law firm in Atlanta which has done work in the past for the tobacco industry.

Undocumented Accusations of Wrongdoing Bring Down Ambassadorial Nominee; Anti-Smoking Groups Joined in Making These Claims

April 26, 2006
By Michael Siegel
Undocumented accusations of ethical wrongdoing against Associate Attorney General Robert McCallum have successfully thwarted his nomination to become ambassador to Australia without even a hearing.

As I reported here last week, Senator Dick Durbin (D-IL) held up the nomination of Associate Attorney General Robert McCallum to become ambassador to Australia over a claim that he acted improperly in changing the government’s requested smoking cessation remedy in its RICO-based Department of Justice (DOJ) lawsuit from a $130 billion backwards-looking program to a $10 billion forwards-looking one.

Now, that effort to derail McCallum’s nomination, which comes without any documented evidence that he did anything wrong, has been successful.

The Rest of the Story

This is precisely why, as early as July of last year, I spoke out against the unwarranted and undocumented political attack that anti-smoking groups, led by Americans for Nonsmokers’ Rights (ANR), waged against Associate Attorney General McCallum.

I argued that it was simply inappropriate for a public health group to be making a political attack without sufficient evidence of wrongdoing. In this case, there was actually no evidence that McCallum did anything wrong.

This, however, didn’t stop ANR from falsely claiming to the public that McCallum was a “former tobacco industry lawyer” and implying that it was therefore an ethical violation for him to be involved in a lawsuit against the tobacco companies who he formerly represented.

In its political attack, ANR went so far as publicly stating that there was “a cancer” on the Justice Department.

In addition, ANR stated that there was sufficient evidence to warrant “an ethics complaint to be filed with the Federal Bar.”

All this despite the fact that ANR itself admits that federal policy allows an “employee to participate in a matter about which he has an apparent conflict if he is authorized by an appropriate agency designee” and that “Mr. McCallum apparently was so authorized.”

The truth is that McCallum never represented any tobacco company and therefore he is not a former tobacco industry lawyer as ANR claims.

The truth is that McCallum did appropriately request clearance from the DOJ Ethics Office to participate in the DOJ tobacco case because he had been a partner at a law firm that represented R.J. Reynolds. Clearance was granted.

The truth is that the conflict of interest is one which would provide R.J. Reynolds with a potential grievance, not the U.S. government.

The truth is that the request to reduce the proposed smoking cessation remedy in the DOJ case from a $130 billion backwards-looking program to a $10 billion forwards-looking one was legally necessary in order to comply with the D.C. Court of Appeals ruling that precluded backwards-looking remedies. Had McCallum not intervened in the lawsuit to more narrowly tailor this remedy, it would have been a complete embarrassment to the Department of Justice (as such, it is only a partial embarrassment, because at least it looks like DOJ is aware of the appellate court decision, though not being particularly compliant with it).

Back on July 21, I noted that ANR’s political campaign to denigrate Robert McCallum was working. The public seemed to be buying the “fact,” false as it was, that McCallum had previously represented R.J. Reynolds.

I wrote on July 21: “I think we need to wait until the investigation has been completed to cast judgment on him [McCallum] and his role in the case. But what I do think is indisputable is that he deserves to be judged based on the facts. And in this case, the fact is that he never represented R.J. Reynolds in litigation. But in my opinion, the majority of the public who is familiar with this story believes that he has. I do not think that is just. And I do not, therefore, find it acceptable that anti-smoking groups may have contributed to the public’s misperception in a way that may inappropriately denigrate the reputation and character of an individual.”

Apparently, the denigration of McCallum’s character was successful, because public opinion was judged to be sufficiently negative against McCallum to support a single Senator successfully blocking this nomination.

Don’t get me wrong. I’m not suggesting that ANR was responsible for blocking the nomination. That was clearly Durbin’s doing. I’m only pointing out the kind of damage that can be done when anti-smoking groups make undocumented and unwarranted political attacks. And I’m pointing out the damage that was apparently done by ANR’s unwarranted and premature attack.

The rest of the story is that there simply is no actual evidence that Associate Attorney General Robert McCallum did anything wrong by seeking clearance to be involved in his Department’s tobacco case, being cleared by the Ethics Office, and participating in the case. Nor is there any evidence that he did anything wrong by demanding that a more narrowly tailored and forwards-looking smoking cessation remedy be substituted for one which was clearly not consistent with statute as interpreted by the governing court in the case.

My impression is that ANR and other anti-smoking groups are so anxious to jump into the attack of anyone who can in any way be construed as opposing our side that they jumped the gun and attacked without the evidence.

Unfortunately, this is not an isolated occurrence, but seems to be becoming a common theme in the anti-smoking movement: attack first, ask questions later.

This is not the way to practice public health.
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U.S. appoints new Australian ambassador

By UNITED PRESS INTERNATIONAL
April 20, 2006
Washington has appointed a former spy who was instrumental in shaping the administration’s post-Sept. 11 anti-terrorism strategy as ambassador to Australia.

The Australian reported on April 18 that U.S. embassy personnel in Canberra confirmed that Carol Rodley had been appointed to replace the current chief of mission and acting ambassador Bill Stanton.

Rodley is currently acting assistant secretary for the U.S. State Department’s Bureau of Intelligence and Research in Washington.

Political analysts surmise that Rodley will probably be appointed as acting U.S. ambassador after President George W. Bush’s original nominee last week suffered political problems. In March Bush nominated close associate Robert McCallum for the post, but Senate approval was withheld after Sen. Dick Durbin, D-Ill., acted to delay the nomination.

Durbin charged that McCallum should not be given a position of trust while he was under investigation by the Justice Department for his role in a case against the tobacco industry. McCallum was being investigated for reportedly pressuring Justice Department lawyers to reduce the amount of compensation paid to smokers while associate attorney-general.

Australia has been without a U.S. ambassador since Tom Schieffer, a close friend of Bush, left Canberra in February 2005 after being appointed U.S. ambassador to Japan.


Senator seeks Bush nominee delay over tobacco case
Apr 13, 2006
By Peter Kaplan
WASHINGTON (Reuters) – A senator wants to delay consideration of President George W. Bush’s nominee to serve as the ambassador to Australia until his role in the U.S. government’s racketeering case against cigarette makers is thoroughly examined.
Democratic Sen. Richard Durbin of Illinois said in an April 12 letter to Bush that it was premature for Associate Attorney General Robert McCallum to move to a new position of public trust until it was clear he had not engaged in any inappropriate conduct.
“He should not be promoted until the questions surrounding his role in the tobacco case are resolved,” Durbin wrote.
McCallum’s appointment requires confirmation by the U.S. Senate.
At issue is a decision reached by McCallum and other senior Justice Department officials in June last year to scale back the remedy sought by the government in its landmark case against the tobacco industry.
Senior officials decided to pull back from the department’s initial plan to ask a federal judge force cigarette makers to fund a $130 billion, 25-year, quit-smoking program. Instead, lawyers for the department recommended a $10 billion, five-year program.
McCallum denied any political influence, saying afterward that the remedy had to be scaled down to keep it in line with an appeals court ruling in the case, which dictated that it could only address future misconduct by the tobacco companies.
McCallum could not immediately be reached for comment on Thursday. A Justice Department spokesman declined to comment.
Targeted in the lawsuit, filed in 1999, are Altria Group Inc. and its Philip Morris USA unit; Loews Corp.’s Lorillard Tobacco unit, which has a tracking stock, Carolina Group; Vector Group Ltd.’s Liggett Group; Reynolds American Inc.’s R.J. Reynolds Tobacco unit and British American Tobacco Plc unit British American Tobacco Investments Ltd.
Cigarette makers deny they illegally conspired to promote smoking and say the government has no grounds to pursue them after they drastically overhauled marketing practices as part of a 1998 settlement with state attorneys general.
The racketeering trial ended in June, and U.S. District Judge Gladys Kessler has yet to issue a ruling.
The last-minute decision to scale back the government’s proposed remedy provoked a storm of criticism from anti-smoking activists and charges of political influence.
An investigation was subsequently launched by the Justice Department’s Office of Professional Responsibility. Durbin said in his letter that the office “has not shared any information on the status or conclusions of this investigation.”
Durbin said it would be “premature” to consider McCallum’s nomination until the internal investigation is completed.

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