Sie sind auf Seite 1von 53

Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 1 of 11

IN THE UNITED STATES DISTRICT COURT


FOR THE DISTRICT OF COLUMBIA

____________________________________
)
UNITED STATES OF AMERICA, )
)
v. )
) Crim. No. 08-231 (EGS)
THEODORE F. STEVENS, )
)
Defendant. )
____________________________________)

SENATOR STEVENS’S EMERGENCY MOTION TO DISMISS INDICTMENT OR FOR


A MISTRIAL DUE TO GOVERNMENT’S CONTINUING BRADY VIOLATIONS

Before trial, the government told defense counsel that Mr. Allen had told the

government that he believed Senator Stevens would not pay an invoice if one had been sent for

work by VECO employees. Now, after weeks of preparation, after opening statements, and after

most of the government’s case has been presented to the jury, the defense learns for the first time

that Mr. Allen told the government, on at least two different occasions, that he believed that the

Stevens family would have paid invoices if they had been sent. Late last night, with Bill Allen’s

direct testimony almost completed and cross-examination scheduled to begin today, the

government provided for the first time this crucial Brady and Giglio information that it was

ordered to produce weeks ago (and should have produced immediately following indictment).

The government claimed in court that the information provided last night was

cumulative. Nothing could be further from the truth. The information is both highly exculpatory

and diametrically opposite to the information previously provided. Among other things, last

night’s disclosure shows that Mr. Allen told the government he “believes that STEVENS would

have paid an invoice if he had received one” for the work done by John Hess; similarly, Mr.

Allen told the government that the Senator and his wife “would have paid the bill” for the work
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 2 of 11

of Rocky Williams or Dave Anderson if they had received one. Ex. A. The government’s prior

Brady disclosure indicated precisely the opposite. Letter from Ms. Morris of Sept. 9, 2008 at 3

(Attached as Ex. B) (“Allen stated that he believed that defendant would not have paid the actual

costs incurred by VECO, even if Allen had sent defendant an invoice, because defendant would

not have wanted to pay that high of a bill.” (Emphasis added)).

Enough is enough.1 The Court should dismiss the indictment. In the alternative,

the Court should immediately declare a mistrial, because no lesser sanction could possibly cure

the prejudice caused by the government’s pattern of severe Brady violations. The new

information goes to the core of this case – Senator Stevens’s state of mind. It is impossible at

this point to have a fair trial. This is the sort of information defense counsel would have used to

maximum effect in opening statement. It would have shaped all aspects of the defense. In short,

it is not sufficient now, on the eve of the government’s case resting, to say no harm no foul.

If the Court is not prepared to dismiss the indictment outright at this time, it

should first declare a mistrial and then hold an evidentiary hearing to determine whether the

indictment should be dismissed and whether other sanctions should be imposed.

BACKGROUND

1. Since day one, defense counsel persistently have sought all Brady

material, and the Court consistently has ordered the government to produce it. On August 1,

2008, immediately after arraignment, defense counsel sent the first of many Brady request letters

to the government. See Ex. D. The defense specifically requested, on multiple occasions, that

the government produce memoranda of interview, such as FBI Form 302s. See Ex. D, Ex. E

1
Several days ago, as the Court is aware, it came to light that the government had withheld
critical Brady information regarding Rocky Williams, and had sent Mr. Williams back to Alaska

2
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 3 of 11

(collecting correspondence). The government assured defense counsel that it was producing all

Brady material, but it declined to produce the interview memoranda, instead providing the

information in the form of summary letters. The government sent two such letters, on August

25, 2008 (Ex. C) and September 9, 2008 (Ex. B). The government was slow to provide even this

insufficient disclosure, which necessitated the defense filing two separate motions to compel

production of this constitutionally-required discovery. See Motion To Compel Discovery

Pursuant to Brady v. Maryland and Fed. R. Crim. P. 16 (Dkt. No. 60) (Sept. 2, 2008); Motion to

Compel Emergency Relief and Discovery (Dkt. No. 65) (Sept. 12, 2008). In each of these

motions, Defendant specifically requested that the government provide its interview memoranda,

instead of a summary prepared by government counsel.

The Court took up Brady issues at four separate hearings, on September 10, 12,

16 and 18. On September 10, 2008, the Court ordered the government to comply with its Brady

obligations as explained in United States v. Safavian, 233 F.R.D. 12 (D.D.C. 2005). At a

subsequent hearing on September 12, the government represented that it had fully complied.2

Yet the government continued to contend that it should not be required to produce its underlying

interview memoranda or grand jury transcripts. The Court ultimately disagreed and, on

before the defense could learn that information. The defense’s motion to dismiss or for a mistrial
with regard to that violation remains pending.
2
See Hr’g Tr. (Sept. 12, 2008) at 40-41:

MR. CARY: And your Honor, one question the defense has, it is
not clear to us whether the government believes that they’re finished with
their Brady and Giglio obligations. I understand it's ongoing, but at least
as to what they know right now.
THE COURT: It’s probably fair to ask you, if you had anything
else you’d be producing it right now?
MS. MORRIS: That's absolutely right, Judge. We know that
there’s a continuing duty. If something else comes up we provide it.

3
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 4 of 11

September 16, 2008, specifically ordered the government to produce exculpatory information in

the 302s by the next day, September 17. See Hr’g Tr. (Ex. F). In apparent compliance with the

Court’s order, the government produced several redacted interview memoranda and grand jury

transcripts.

2. This past Sunday, September 28, 2008, the defense learned that the

government had withheld critical exculpatory information regarding Rocky Williams, which had

been contained in a previously undisclosed grand jury transcript. The defense immediately

moved for dismissal or a mistrial, and further asked that the government be required to disclose

all of its interview memoranda and grand jury transcripts for all witnesses. The defense’s motion

remains pending.

3. On Tuesday, September 30, 2008, the government called Bill J. Allen to

the stand. Mr. Allen is the government’s star witness. His direct testimony continued yesterday,

October 1, and was scheduled to conclude this morning. Mr. Allen testified, among other things,

that he did not send Senator Stevens bills for work Veco did on his Girdwood home, despite

Senator Stevens’s request for bills. Mr. Allen dramatically testified that he did not send the bills

because a mutual friend, Bob Persons, told him that Senator Stevens was “just covering his ass.”

The government had previously disclosed other information about Allen’s

decision not to send bills to Senator Stevens or his wife. In its so-called Brady letter of

September 9, 2008, the government represented that, in prior communications with the

government, “Allen stated that he believed that defendant would not have paid the actual costs

incurred by VECO, even if Allen had sent defendant an invoice, because defendant would not

have wanted to pay that high of a bill.” Ex. B at 3.

4
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 5 of 11

4. Late last night, October 1, 2008, with Mr. Allen’s direct testimony

scheduled to conclude this morning, the government sent a letter to defense counsel purportedly

in furtherance of its “continuing duty to provide the defendant with information in the

government’s possession, custody, or control that is ‘favorable’ to the defense.” Ex. A. It

attached portions of redacted government memoranda of interviews that had not previously been

produced, which the government understatedly conceded “could arguably constitute Giglio

material concerning certain parts of Mr. Allen’s trial testimony.” Id. Attempting to excuse its

prior non-production, the government’s letter represents that the information “could arguably

constitute cumulative Brady material that was provided in summary fashion in our August 25

and September 9 letters.”

In fact, far from “cumulative,” the information provided for the first time last

night directly contradicts the government’s prior “summary” disclosures and is highly material to

impeaching Bill Allen’s testimony. The government’s September 9 letter had represented that,

“Allen stated that he believed that defendant would not have paid the actual costs incurred by

VECO, even if Allen had sent defendant an invoice, because defendant would not have wanted

to pay that high of a bill.” But the information produced last night says exactly the opposite, in

two separate interview memoranda dating back almost two years:

The source [Allen] did not invoice STEVENS fr the work that
Hess performed; however, the source believes that STEVENS
would have paid an invoice if he had received one.

Ex. A, March 1, 2007 302 Interview Memorandum at 2 (emphasis added);

If Rocky Williams or Dave Anderson had invoiced Ted or


Catherine Stevens for VECO’s work, BILL ALLEN believes they
would have paid the bill.

Ex. A, Dec. 11-12, 2006 Memorandum of Interview at 9 (emphasis added).

5
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 6 of 11

Not only does it contradict the government’s prior representations, the newly

disclosed Brady material goes to the heart of this case. Most significantly, Mr. Allen testified

yesterday that Senator Stevens specifically requested that he send bills for work VECO

employees had done. Mr. Allen testified that he did not send bills to Senator Stevens or

Catherine Stevens after he spoke to a mutual friend, Bob Persons, who told him that the notes

requesting bills were “just Ted covering his ass.” The clear implication to the jury is that Senator

Stevens had no intention to pay any bills. This is directly in line with the government’s false

September 9 letter, but not the interview memoranda first disclosed last night. Ex. B at 3.

5. The defense is severely prejudiced by the government’s affirmatively false

letter and its failure to provide the highly exculpatory interview memoranda until last night. It is

a critical defense theme that Senator and Catherine Stevens paid every bill that was sent to them.

See Trial Tr. (Sept. 25, 2008) at 68 (defense opening statement) (Ex. G). It was a critical defense

theme that “there’s no evidence that if Catherine had been sent a bill, a proper bill, that it would

not have been paid.” Id. Had the defense known before trial that the prior statements of the

government’s star witness (and alleged participant in a scheme) provided evidence that he

believed that invoices sent would in fact have been paid, defense counsel would have trumpeted

Mr. Allen’s statements in the opening statement. Defense counsel would have had a field day

with the information. The defense also would have prepared its cross-examination of Mr. Allen

on the basis of those critical statements. Instead, because of the government’s belated disclosure

and its prior misrepresentation of Mr. Allen’s statements, defense counsel did not learn of the

prior exculpatory statements until after Mr. Allen’s testimony on direct examination was nearly

concluded. To prepare properly for cross-examination at this stage would at the very least

require a substantial continuance. In the meantime, the jury has heard most of Mr. Allen’s direct

6
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 7 of 11

testimony, and the continuance will allow that testimony to sink in unrebutted. The jurors’

minds may be made up against Senator Stevens in the meantime, such that no cross-examination

would be effective.

The prejudice to the defense cannot possibly be undone short of a mistrial, which

should be ordered before any further proceedings. In addition, the government’s conduct

warrants immediate dismissal of the indictment. If the Court does not dismiss forthwith, it

should first declare a mistrial and then order an evidentiary hearing at which the Court may

consider dismissal and other appropriate sanctions.

ARGUMENT

I. THE GOVERNMENT HAS VIOLATED BRADY AND THE COURT’S


SEPTEMBER 16 ORDER AND HAS PROVIDED FALSE INFORMATION TO
DEFENSE COUNSEL.

There can be no question that the information about Mr. Allen’s statements

should have been produced long ago under the Brady doctrine. Under Brady v. Maryland, 373

U.S. 83 (1963), and successive cases, including United States v. Agurs, 427 U.S. 97 (1976), and

Giglio v. United States, 405 U.S. 150 (1972), the government is required to produce exculpatory

information to the defense. As Judge Friedman explained in Safavian, this duty exists regardless

of whether the prosecution may believe the information could affect the result at trial:

[T]he government must always produce any potentially


exculpatory or otherwise favorable evidence without regard to how
the withholding of such evidence might be viewed—with the
benefit of hindsight—as affecting the outcome of the trial. The
question before trial is not whether the government thinks that
disclosure of the information or evidence . . . might change the
outcome of the trial going forward, but whether the evidence is
favorable and therefore must be disclosed. Because the definition
of ‘materiality’ discussed in Strickler and other appellate cases is a
standard articulated in the post-conviction process for appellate
review, it is not the appropriate one for prosecutors to apply during
the pretrial discovery phase. The only question before (and even
during) trial is whether the evidence at issue may be ‘favorable to

7
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 8 of 11

the accused’; if so, it must be disclosed without regard to whether


the failure to disclose it likely would affect the outcome of the
upcoming trial.

233 F.R.D. at 16.

The undisclosed information here unquestionably is exculpatory and producible

under Brady. It directly supports Senator Stevens’s defense that he intended to pay for the home

renovations. It also provides highly significant cross-examination material for the government’s

most important witness, Bill Allen.

In addition, the government violated the Court’s September 16 order that it

produce all exculpatory information contained in interview memoranda by the next day,

September 17, 2008. The information provided last night obviously falls within the terms of the

Court’s order, yet it was not disclosed until October 1. Worse, the government actually produced

a redacted copy of the same Bill Allen 302 to the defense on September 17 that redacted out the

statement that he believed Senator Stevens would have paid John Hess’s bill. See Ex. H.

In fact, the government on September 9 “disclosed” information that falsely stated

the exact opposite of what these interview memoranda reflect. It now incredibly seeks to excuse

its conduct on the ground that the new information is somehow “cumulative.”

II. THE INDICTMENT SHOULD BE DISMISSED.

“Brady violations are just like other constitutional violations. Although the

appropriate remedy will usually be a new trial, a district court may dismiss the indictment when

the prosecution’s actions rise . . . to the level of flagrant prosecutorial misconduct.” United

States v. Chapman, 524 F.3d 1073, 1086 (9th Cir. 2008). The dismissal remedy is further

warranted here, where the facts show more than ordinary Brady violations; they also show that

the government has presented fundamentally misleading evidence at trial while failing to

disclose to defense counsel the very information needed to understand and rebut that evidence.

8
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 9 of 11

Courts have not hesitated to dismiss indictments when faced with similarly severe

constitutional violations. For example, in United States v. Wang, No. 98 CR 199(DAB), 1999

WL 138930, at *37 (S.D.N.Y. Mar. 15, 1999), the court found a due process violation and

dismissed an indictment due to the government’s failure to provide defense counsel with

“material information” until the “eve of trial,” and its delay in disclosing that its key witness was

unavailable and would not be called to testify. Similarly, in United States v. Lyons, 352

F. Supp. 2d 1231, 1251-52 (M.D. Fla. 2004), the court dismissed an indictment due to the

government’s multiple and flagrant Brady and Giglio violations. See also United States v. Sabri,

973 F. Supp. 134, 147 (W.D.N.Y. 1996) (finding due process violation and dismissing one count

of indictment based on government’s outrageous conduct in engaging defendant’s civil attorney

to accumulate evidence for use against him in criminal prosecution); United States v. Marshank,

777 F. Supp. 1507, 1524 (N.D. Cal. 1991) (finding due process violation and dismissing

indictment where government interfered in the defendant’s attorney-client relationship by using

his former attorney to obtain incriminating information upon which indictment was based).

Here, the government’s conduct requires dismissal. Particularly when coupled

with the recently discovered misconduct involving Rocky Williams, the government’s failure to

provide Bill Allen’s exculpatory statements and its false letter to the defense of September 9

warrant the sternest possible remedy.

III. IN THE ALTERNATIVE, THE COURT SHOULD DECLARE AN IMMEDIATE


MISTRIAL AND SHOULD ORDER AN EVIDENTIARY HEARING TO
CONSIDER DISMISSAL AND OTHER SANCTIONS.

A mistrial is appropriate to remedy a Brady violation. See, e.g., Giglio v. United

States, 405 U.S. 150, 153 (1972) (noting that “Brady v. Maryland, 373 U.S. at 87, held that

suppression of material evidence justifies a new trial irrespective of the good faith or bad faith of

the prosecution.” (internal quotations omitted)); United States v. Andrews, 532 F.3d 900, 905

9
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 10 of 11

(D.C. Cir. 2008) (“If the undisclosed evidence is material, a new trial is required.”) (citing Kyles

v. Whitley, 514 U.S. 419 (1995)); Government of Virgin Islands v. Fahie, 419 F.3d 249, 252 (3d

Cir. 2005) (“[T]he Court has assumed that Brady violations that have affected the judgment of a

jury normally will be remedied by a new trial . . . .”); United States v. Evans, 888 F.2d 891, 897

n.5 (D.C. Cir. 1989) (appropriate relief for a Brady violation is a mistrial).

No remedy short of a mistrial can possibly cure the prejudice to the defense from

the government’s Brady failures and obfuscations. Had they been timely disclosed, the critical

exculpatory prior statements by Mr. Allen would have been a focus of the defense opening

statement and would have impacted the defense’s preparation of the case. Now that most of Mr.

Allen’s direct testimony is concluded, the defense is irremediably prejudiced in its cross-

examination. Even if a continuance were granted to permit defense counsel to prepare, the jurors

will be left with Mr. Allen’s unrebutted direct testimony for an extended period, during which

their minds may be set against the Defendant.

If the Court does not dismiss the indictment outright, therefore, it should first

declare a mistrial and then order an evidentiary hearing to consider dismissal and other sanctions.

In advance of any such hearing, the defense should be entitled to full discovery into all

communications between the government and all witnesses.

10
Case 1:08-cr-00231-EGS Document 126 Filed 10/02/2008 Page 11 of 11

CONCLUSION

For the foregoing reasons, the Court should dismiss the indictment or, in the

alternative should declare an immediate mistrial and order an evidentiary hearing.

Dated: October 2, 2008

Respectfully submitted,

WILLIAMS & CONNOLLY LLP

By: _/s/ Craig D. Singer_________________


Brendan V. Sullivan, Jr. (Bar No. 12757)
Robert M. Cary (Bar No. 431815)
Craig D. Singer (Bar No. 445362)
Alex G. Romain (Bar No. 468508)

725 Twelfth Street, N.W.


Washington, D.C. 20005
(202) 434-5000
(202) 434-5029 (facsimile)

Attorneys for Defendant Theodore F. Stevens

11
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 1 of 10

EXHIBIT A
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 2 of 10
U.S. Department of Justice

Criminal Division

Washington, D.C. 20530

October 1, 2008

BY ELECTRONIC MAIL

Robert M. Cary, Esq.


Williams & Connolly LLP
725 Twelfth Street, N.W.
Washington, D.C. 20005

Re: United States Senator Theodore F. Stevens

Dear Mr. Cary:

As we are all aware, the government is under a continuing duty to provide the defendant
with information in the government's possession, custody, or control that is "favorable" to the
defense. This obligation includes, among other things, the production of information that could
reasonably be used to impeach a government witness.

In connection with the ongoing trial testimony of Bill J. Allen, this evening we undertook a
re-review of, among other information, all memoranda of interviews between federal law
enforcement agents and Mr. Allen. During the course of that re-review, we have located two
memoranda that, out of an abundance of caution, we are providing to you in redacted form. The
unredacted portions of these memoranda could arguably constitute cumulative Brady material that
was provided in summary fashion in our August 25 and September 9 letters but was not provided to
you in redacted format and could arguably constitute Giglio material concerning certain parts of Mr.
Allen's trial testimony.

The redacted memoranda have been attached hereto. In an additional abundance of caution,
we are sending the Court, by separate cover, both the redacted and unredacted memoranda for j
camera review.
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 3 of 10

We have also reviewed, again, all of the interviews of Mr. Allen to insure that no other
reports pertain to this isstie.

cc: The Honorable Emmet G. Sullivan

-2-
: Case 1:08-cr-00231-EGS
(1
Document 126-2 Filed 10/02/2008 Page 4 of 10
FD-302 (Rev. 10-6-95)

FEDERAL BUREAU OF INVESTIGATION

Date oftranscription 03/0112007

A source who is in a position to testify provided the


following information regarding the addition and remodeling of the
residence of Unites States Senator TED STEVENS:

Investigation on 2/28/2007 at Anchorage, AK

File # dictated Typed 3/1/07


nary tetn ±cepnerJY"-
by SA Michelle R. P1ut

This document contains neither recommendations nor conclusions of the FBI. It is the property of the FBI and is loaned to your agency;
it and its contents arc not to be distributed outside your agency.
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 5 of 10
FD-302a (Rev. 10-6-95)
1 (7

Corninuation of FD-302 of Source On 2/28 / 2007 ,Page 2

The source did not invoice STEVENS for the


work that HESS performed; however, the source believes that STEVENS
would have paid an invoice if he had received one.
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 6 of 10

FD-302.a (Rev. 10-6-95)


C.

ContrnuationofFD.302of Source ,On 2/2812007 ,Page 3

In relation to the work on the Girdwood resideçe,


STEVENS told the source that he needed to pay some of the source's
invoices. This conversation occurred within a month or two of the
completion of the Girdwood renovation project. STEVENS said he
wanted to pay the source and requested the source provide him with
an invoice. The source never complied with STEVENS' request and
STEVENS never again asked for an invoice for the renovations.
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 7 of 10

i5)
(

ContrnuationofFD-302of Source .On 2128/2007 ,Page ..L.

that STEVENS' thought he should pay for the plumbers not the
source. STEVENS and the source later discussed this matter in
person while vacationing in Wickenburg, Arizona. STEVENS said
"ethics" was on his ass and the source needed to get him an
invoice. STEVENS said that he didn't want the source to go through
what JON RUBINI went through with their investment. The source did
not provide STEVENS with the requested invoice.
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 8 of 10

Internal Revenue Service


Criminal Investigation tjj
Memorandum of Interview

In Re: BILL ALLEN Location:

Investigation #:
Date: December 11-12, 2006
Time: Dec. 11th 9:05am to 11:50am and
1:05pm to 3:55 pm
Dec. 12th 10:45am to 12:00 pm and
1:35 pm to 3:25 pm
Participant(s): BILL ALLEN, Witness
Robert Bundy, Defense Attorney
Dennis Roberts, Special Agent-IRS
Larry Bateman, Special Agent-IRS
Mary Beth Kepner, Special Agent-FBI

IRS Special Agents Dennis Roberts and Larry Bateman and FBI Special Agent Mary
Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 9 of 10

owned Christianson Builders. Eventually Christianson Builders was hired and


paid by Ted and Catherine Stevens to perform finish work on their Girdwood
cabin.

for VECO'S work, BILL ALLEN believes they would have paid the bill. BILL
ALLEN did not request any VECO employee invoice Ted or Catherine
Stevens for work performed on the cabin. If there were invoices, the
have aone to Bob Persons then to Catherine Stevens for nvmnt

Memorandum Page 9 of 11 U.S. Treasury Criminal Investigation


Case 1:08-cr-00231-EGS Document 126-2 Filed 10/02/2008 Page 10 of 10

Dennis Roberts
Special Agent

/a4A1&Z
Larry Bateman
L
Special Agent

I prepared this memorandum on December 13, 2006, after refreshing my memory from
notes made during and immediately after the interview with BILL ALLEN.

Dennis Roberts
Special Agent

Memorandum Page 11 of 11 U.S. Treasury Criminal Investigation


Case 1:08-cr-00231-EGS Document 126-3 Filed 10/02/2008 Page 1 of 6

EXHIBIT B
Case 1:08-cr-00231-EGS Document 126-3 Filed 10/02/2008 Page 2 of 6
U.S. Department of Justice

Criminal Division

Washington, D.C. 20530

September 9, 2008

BY BLECTRONTC MAIL

Alex G. Romain, Esq.


Williams & Connolly LLP
725 Twelfth Street, N.W.
Washington, D.C. 20005

Re: United States Senator Theodore F. Stevens

Dear Mr. Romain:

As noted in several of our prior letters, and as set forth in certain of our briefs, the
government has completed its review of agents' notes, formal memoranda, and grand jury
transcripts for Brady/Giglio material. We have also searched for additional documents in our
possession, custody, and control concerning the prior and pending local law enforcement
investigations of potential government witness Bill Allen. The following information is being
furnished to you in a manner consistent with our prior agreement.

Please note that the information set forth in this letter and the government's letter dated
August 25, 2008, does not contain all potential impeachment material related to certain
government witnesses. As you know, the government has produced substantial discovery to
defendant which may contain additional Brady/Giglio material. This discovery also includes the
documents voluntarily produced to us by defendant prior to his indictment.

Please also note that we believe that a significant portion of the information set forth
below is not Brady/Giglio material. We produce this information nonetheless in the continued
spirit of compromise and cooperation.

On December 7, 2006, David Anderson stated he was fired from VECO, and that he was
paid $3,800 by the FBI for lodging, food, and gas expenses. Anderson also admitted that
he received approximately $30,000 from Allen and VECO around the time that Anderson
was terminated from VECO. Although Allen has stated that the payment was extorted by
Anderson, Anderson stated that he believed the payment was part of a severance package.

2. On November 8, 2006, Jack Billings stated it was his understanding that defendant was
going to pay the repair to the boiler system, but Billings did not see a bill go to defendant.

3. On February 9, 2007, Cecil Dale III stated he believed that a flaw in the remodeling may
have caused the need for the snow melt system.
Case 1:08-cr-00231-EGS Document 126-3 Filed 10/02/2008 Page 3 of 6

4. On May 4, 2007, John David stated that miscoding can sometimes cause billing
problems.

5. On May 6, 2007, Robin Friend stated that David Anderson has been removed from ajob
for drinking and a terrible work record.

6. On June 3, 2008, Justin Stiefel stated he performed consulting and polling work for
Governor Frank Murkowski's re-election campaign. Stiefel stated he agreed with Rick
Smith to have VECO pay a polling company for services performed by Stiefel and
charged to the polling company. Stiefel stated this was done so that payments would not
go directly from VECO to Stiefel. Stiefel further stated he never received any payment
from VECO or the polling company.

7. On June 7, 2007, Linda Carpenter stated that Catherine Stevens contacted her and asked
for advice from KPMG regarding the best way to pay for certain improvements at the
Girdwood residence. Carpenter stated that the Stevenses took out a $100,000 loan to pay
for certain improvements. Carpenter further stated that the loan was paid off, but could
not recall the date.

8. On August 8, 2007, Larry Daniels stated that defendant asked Daniels to remove lights
from a tree on the property, but to preserve them due to the on-going investigation.
Daniels stated that defendant told Daniels to send him a bill for the removal of the lights
from the tree, which Daniels did after receiving defendant's address in Washington, D.C.
from James Helms.

9. On June 6, 2007, Wendi Dow stated that defendant would ask for individual checks when
eating with a group of the people at the Double Musky Inn, presumably to avoid violating
the Senate Rules concerning gifis. Dow further stated that Bill Allen would pay the entire
bill, however, including defendant's portion.

10. On June 5, 2007, Charles Hart stated he performed repair work on a boiler at defendant's
residence in Girdwood, Alaska. Hart stated he originally sent an invoice to VECO for the
entire cost. However, he subsequently received a telephone call from Bill Allen who
instructed Hart to split the bill in half. Pursuant to Allen's instructions, Hart sent VECO a
bill for the labor and a bill to defendant for the material/parts. VECO paid the bill for
labor.

11. On June 6, 2007, Robert Penney stated that some construction materials for the Girdwood
residence were purchased on a Penland Development account at Spenard Builders
Supply, and that the Stevenses sent a check to Penland in the amount of $10,656.98.
Penney further stated that, although he had not heard defendant complain about work that
was performed on the house and was not aware of defendant saying anything was broken
or not performed well, the project overall should have been done more quickly. Penney
also stated that he has never gotten a dime from defendant in any way.

-2-
Case 1:08-cr-00231-EGS Document 126-3 Filed 10/02/2008 Page 4 of 6

12. On December 14, 2006, Linda Croft stated that after certain plumbing work had been
performed at the Girdwood residence, Croft saw an e-mail from defendant to Allen
advising Allen that defendant needed to pay the plumber.

13. On August 3 1, 2006, Pete Leathard stated that VECO had performed small favors for
defendant, which Leathard believed had been reimbursed by defendant. Leathard further
assumed that defendant reimburses everyone.

14. On May 13, 2007, Chris Von Imhof stated that defendant always paid his share of meals
when out to dinner.

15. On September 1, 2006, Robert Williams stated there were no formal plans for the
addition at defendant's residence and that Williams sketched the plans for the addition
based upon conversations with defendant. Williams also stated that, although he was the
general contractor on the project, he did not deal with the expenses and did not recall
reviewing Christensen Builders invoices. In a memorandum of interview from the same
meeting, a federal law enforcement agent noted that Williams estimated that 99 percent of
the work was done by Christensen Builders. In a subsequent interview, Williams stated
that he did not recall ever saying that Christensen Builders performed 99 percent of the
work, and that such a figure was inconsistent with what he knows to have occurred.

16. On August 13, 2008, David Anderson stated he signed an affidavit on March 25, 2008;
the affidavit was drafted by Jerry Ward; Ward chose the individual names that would be
included in the affidavit; Anderson felt pressured to sign the affidavit because of his
relationship with Ward's daughter; the affidavit contains numerous false statements; and
that he and the other individuals mentioned in the affidavit were not promised, offered, or
actually given immunity.

17. From August 30, 2006 to the present, Allen has made the following statements:

a. Allen stated that he believed that Rocky Williams and David Anderson had
drinking problems.

b. Allen stated that he was aware that defendant took out a loan to pay a contractor
in connection with the renovations at defendant's residence in Girdwood, and that
he knew that the contractor was Augie Paone with Christensen Builders.

c. Allen stated that on at least two occasions defendant asked Allen for invoices for
VECO's work at the Girdwood residence. Allen stated he never sent an invoice to
defendant or caused an invoice to be sent to defendant. Allen stated that he
believed that defendant would not have paid the actual costs incurred by VECO,
even if Allen had sent defendant an invoice, because defendant would not have
wanted to pay that high of a bill. Allen stated that defendant probably would have
paid a reduced invoice if he had received one from Allen or VECO. Allen did not
want to give defendant a bill partly because he felt that VECO's costs were higher

-3-
Case 1:08-cr-00231-EGS Document 126-3 Filed 10/02/2008 Page 5 of 6

than they needed to be, and partly because he simply did not want defendant to
have to pay.

d. Allen stated that when he gave defendant a new king sized bed, defendant said he
did not need a new bed but then commented that it was pretty good.

e. Allen stated that defendant was careful about making sure he paid for some things
such as his share of the bill when they went out to dinner, and.that defendant also
paid for his share of a charter flight.

f. Allen stated that although defendant knew that Allen purchased and installed the
Viking gas grill at the Girdwood residence, defendant once told Allen that
defendant considered the grill Allen's property, not defendant's.

18. The grand jury transcripts for Robert Persons and Augie Paone will be provided by
separate cover tomorrow.
*

In response to your request for additional information concerning the prior and pending
local law enforcement investigations of Allen, the federal government has located in its
possession, custody, and control information concerning a 2004 statement made to the
Anchorage Police Department ("APD") and provided to the government in an unrelated, closed
federal investigation. In February 2004, an adult female alleged she had a sexual relationship
with Allen while she was an adult, but believed that Allen had a contemporaneous sexual
relationship with a 15 year-old female. (This "other female" is one of the individuals disclosed in
our letter to you dated August 25, 2008.) The adult female alleged that during the course of her
relationship with Allen, Allen provided her with things of value, including money, trips, housing,
and a car, as well as paying for the adult female to attend an alcohol rehabilitation program.

The adult female further alleged that, after her relationship with Allen ended, she was
contacted by an attorney for Allen and requested to sign a nondisclosure agreement that would
have contained, in part, a statement that she had never had a sexual relationship with Allen. The
adult female suggested that the attorney offered her $5,000 in exchange for the statement, but she
declined in part because she wanted more money. The adult female also alleged that Allen
provided her with a trip outside Alaska for the purpose of preventing the adult female to testify in
an unspecified proceeding.

On September 7, 2008, Allen was interviewed concerning these allegations. Allen stated
he did have a relationship with the adult female and he did pay her rent during their relationship.
Allen advised that the adult female was a prostitute. Allen advised that after the relationship
ended, the adult female and the adult female's mother began to demand money from him and
threatened to go to the newspaper to expose their relationship. Allen stated that the adult female
also threatened to make statements concerning Allen's relationship with the "other female"
referenced above. Allen stated that the adult female demanded money in exchange for her not to

-4-
Case 1:08-cr-00231-EGS Document 126-3 Filed 10/02/2008 Page 6 of 6

make such statements to the media. Allen refused to pay any money and considered her threats
to be blackmail and/or extortion. Allen hired a lawyer to address his belief that he was being
blackmailed. Allen denied ever offering to pay anyone money to make a false statement, and
denied ever causing anyone to leave the state of Alaska to prevent testimony in any type of
proceeding.

Given the foregoing allegation from the adult female, we are also providing you with
some additional information that, as described below, is neither Brady nor Giglio. In 2007, the
government became aware of a suggestion that, a number of years ago, Allen asked the "other
female" to make a sworn, false statement concerning their relationship. After hearing that
suggestion, the government conducted a thorough investigation and was unable to find any
evidence to support it. The investigation included: (a) an inquiry to the "other female," who
denied the suggestion; (b) an inquiry to Allen, who denied the suggestion; (c) a review of notes
taken by a federal law enforcement agent during a 2004 interview of the "other female,"; and (d)
a review of notes taken by a federal prosecutor during a 2004 interview of the "other female."
Because the government is aware of no evidence to support any suggestion that Allen asked the
"other female" to make a false statement under oath, neither Brady nor Giglio apply.

Finally, we note that during debriefs with the government, Allen stated that Bill Bittner,
an attorney in Anchorage, once asked Allen to make a statement that the "other female"
referenced above had extorted him and/or blackmailed him, for the purpose of benefitting one of
Mr. Bittner's clients. Allen stated that he told Mr. Bittner that any such allegations were false
and refused to make the statement.

Very t1r yours,

William M. Welch II,

K. Morris
Principal Deputy Chief

Nicholas A. Marsh
Edward P. Sullivan
Trial Attorneys

Joseph W. Bottini
James A. Goeke
Assistant United States Attorneys

-5-
Case 1:08-cr-00231-EGS Document 126-4 Filed 10/02/2008 Page 1 of 4

EXHIBIT C
Case 1:08-cr-00231-EGS Document 126-4 Filed 10/02/2008 Page 2 of 4
Case 1:08-cr-00231-EGS Document 126-4 Filed 10/02/2008 Page 3 of 4
Case 1:08-cr-00231-EGS Document 126-4 Filed 10/02/2008 Page 4 of 4
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 1 of 10

EXHIBIT D
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 2 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 3 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 4 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 5 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 6 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 7 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 8 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 9 of 10
Case 1:08-cr-00231-EGS Document 126-5 Filed 10/02/2008 Page 10 of 10
Case 1:08-cr-00231-EGS Document 126-6 Filed 10/02/2008 Page 1 of 4

EXHIBIT E
Case 1:08-cr-00231-EGS Document 126-6 Filed 10/02/2008 Page 2 of 4
Case 1:08-cr-00231-EGS Document 126-6 Filed 10/02/2008 Page 3 of 4
Case 1:08-cr-00231-EGS Document 126-6 Filed 10/02/2008 Page 4 of 4
Case 1:08-cr-00231-EGS Document 126-7 Filed 10/02/2008 Page 1 of 5

EXHIBIT F
Case 1:08-cr-00231-EGS Document 126-7 Filed 10/02/2008 Page 2 of 5

transcript - 09-16-08 10/2/2008

Page 1
UNITED STATES DISTRICT COURT

DISTRICT OF COLUMBIA

UNITED STATES OF AMERICA CRIMINAL ACTION NO. 08-0231

WASHINGTON,D.C.

VERSUS TUESDAY, SEPTEMBER 16, 2008

THEODORE F. STEVENS 3:30 P.M.

STATUS HEARING

BEFORE THE HONORABLE EMMET G. SULLIVAN

UNITED STATES DISTRICT COURT JUDGE

A P P E A R A N C E S:

FOR THE PLAINTIFF, BRENDA K. MORRIS, ESQ.


U.S. DEPARTMENT OF JUSTICE
1400 New York Avenue, NW
12th Floor
Washington, DC 20005
(202) 514-1439

NICHOLAS A. MARSH, ESQ.


U.S. DEPARTMENT OF JUSTICE
10th & Constitution Ave. NW
Washington, DC 20530
202-307-1049

JOSEPH W. BOTTINI, ESQ.


JAMES A. GOEKE, ESQ.
U.S. ATTORNEYS OFFICE
District of Alaska
222 West Seventh Avenue
Federal Building and U.s.
Courthouse
Anchorage, AK 99513-7567
(907) 271-5071

e5ca14b3-e72f-4d56-afd1-d360716026b7
Case 1:08-cr-00231-EGS Document 126-7 Filed 10/02/2008 Page 3 of 5

transcript - 09-16-08 10/2/2008

Page 2
1
EDWARD P. SULLIVAN,ESQ.
2 U.S. DEPARTMENT OF JUSTICE
1400 New York Avenue, NW
3 12th Floor
Washington, DC 20005
4 (202) 514-1412
5
FOR THE DEFENDANT, ROBERT M. CARY, ESQ.
6 WILLIAMS & CONNOLLY
725 12th Street, NW
7 Washington, DC 20005
(202) 434-5175
8
ALEX G. ROMAIN, ESQ.
9 WILLIAMS & CONNOLLY
725 12th Street, NW
10 Washington, DC 20005
(202) 434-5164
11
REPORTED BY: WENDY C. RICARD, RPR, CCR
12 OFFICIAL COURT REPORTER
333 Constitution Ave., NW.
13 Room #6718
Washington, DC 20001
14 (202)354-3111
15

16 Proceedings recorded by mechanical stenography.


17 Transcript produced by computer-aided transcription.
18

19

20

21

22

23

24

25

e5ca14b3-e72f-4d56-afd1-d360716026b7
Case 1:08-cr-00231-EGS Document 126-7 Filed 10/02/2008 Page 4 of 5

transcript - 09-16-08 10/2/2008

Page 30
1 it this way. They don't need the information about which
2 agents were present in an interview to impeach Mr. Billings,
3 for instance.
4 What they would say to Mr. Billings is: Do you
5 recall making a statement to the effect of "x"? He either
6 will either recall it or he won't. Do you recall being
7 interviewed by the FBI? They don't need more information
8 beyond that. If he doesn't recall it, he doesn't recall it,
9 but it wouldn't be proper impeachment to then put a 302 in
10 front of him and say, uh-huh, you did talk to the FBI. That's
11 not his statement.
12 THE COURT: All right. I'm going being to direct
13 that the government produce the redacted 302s and do it by
14 tomorrow.
15 MR. SULLIVAN: Very well, Your Honor.
16 THE COURT: Maybe they won't learn anything more,
17 but I'm going to direct that it be produced. What else?
18 Anything else? The medical records issues I'll deal with on
19 Thursday if not sooner. I may decide on the papers. I don't
20 know.
21 Do you plan to file a reply to the government's
22 response and maybe you already have?
23 MR. CARY: Oh, we have, Your Honor.
24 THE COURT: You have. All right.
25 MR. CARY: Yes.

e5ca14b3-e72f-4d56-afd1-d360716026b7
Case 1:08-cr-00231-EGS Document 126-7 Filed 10/02/2008 Page 5 of 5

transcript - 09-16-08 10/2/2008

Page 32
1

2 C E R T I F I C A T E
3

4 I, Wendy C. Ricard, Official United States Court


5 Reporter in and for the District of Columbia, do hereby
6 certify that the foregoing proceedings were taken down by
7 me in shorthand at the time and place aforesaid,
8 transcribed under my personal direction and supervision,
9 and that the preceding pages represent a true and correct
10 transcription, to the best of my ability and
11 understanding.
12

13

14

15 ________________________________
16 Wendy C. Ricard, RPR, CCR,
17 Official U.S. Court Reporter
18

19

20

21

22

23

24

25

e5ca14b3-e72f-4d56-afd1-d360716026b7
Case 1:08-cr-00231-EGS Document 126-9 Filed 10/02/2008 Page 1 of 3

EXHIBIT H
Case 1:08-cr-00231-EGS Document 126-9 Filed 10/02/2008 Page 2 of 3
Case 1:08-cr-00231-EGS Document 126-9 Filed 10/02/2008 Page 3 of 3