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Case 3:07-cr-00192-NBB -SAA Document 349 Filed 04/28/11 Page 1 of 9

UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF MISSISSIPPI

UNITED STATES OF AMERICA

v. CRIMINAL CASE NO. 3:07CR192

DAVID ZACHARY SCRUGGS

GOVERNMENT’S RESPONSE TO PETITIONER’S


MOTION TO DISQUALIFY ROBERT NORMAN

Comes now the United States of America, by and through the United States Attorney for

the Northern District of Mississippi, and in response to David Zachary Scruggs’ “Motion to

Disqualify Robert Norman,” would respectfully show unto the Court as follows, to-wit:

1.

Because the petitioner and his attorneys failed to prosecute a direct appeal, they have

forfeited the ability to raise a Skilling issue unless and until the petitioner can prove actual,

factual innocence of the underlying charge of bribery. However, it makes better press to allege

that it is the government and its minions who are the bad guys in this case. First they revisit

allegations that it was Circuit Judge Henry Lackey who created the crime that brought down

otherwise innocent lawyers, doing so at the insistence of the Federal Bureau of Investigation and

the United States Attorney’s office. They revisit allegations that Special Agent Bill Delaney

perjured himself before the grand jury, and that Timothy R. Balducci intentionally misled the

grand jury, with the complicity of Bob Norman and Tom Dawson. They allege that the district

court erred in “ . . . refusing to hear petitioner’s counsel . . . .” and then they allege that at the

conclusion of the Court’s 404(b) hearing (applicable to Richard F. “Dickie” Scruggs, Sidney

Backstrom and David Zachary Scruggs), Bob Norman intentionally lied to the Court about Joey
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Langston’s anticipated testimony. Finally, they conclude that: “Most fundamentally, in 2008

Mr. Norman admitted that the bribery case against Zach Scruggs is not supported by probable

cause.” Because of their own allegations, they conclude that Mr. Norman will have to be a

witness at the 2255 hearing and therefore must be disqualified from participation in the case.

2.

It is undisputed that Richard F. “Dickie” Scruggs, David Zachary Scruggs, Sidney

Backstrom, Steven Patterson and Timothy R. Balducci met at the Scruggs Law Firm in March

2007, to discuss a number of issues. One of the things the five co-conspirators decided that day

was that Timothy R. Balducci would attempt to use his personal influence with Circuit Judge

Henry Lackey to ensure a favorable outcome in the Circuit Court case of Jones v. Scruggs.

Millions of dollars were at issue, but more importantly the Scruggs Law Firm could not

countenance the idea of not being in control, and sought to ensure its own success. Steve

Patterson says that the “earwigging” was his idea; Timothy R. Balducci believes that it was Zach

Scruggs’ who conceived the plan. In any event, Balducci did speak with Judge Lackey, and in

the same conversation attempted to solicit the use of Judge Lackey’s name on firm letterhead, the

benefit being a $1,000 per month stipend for the aging judge. At the motions day hearing

conducted in February 2008, the government acknowledged that the co-conspirators apparently

did not initially intend to pay the judge for his favors, but Judge Lackey thought the “of counsel”

offer was a quid pro quo. He first approached the district attorney’s office for help and then a

fellow circuit judge, before seeking help from the United States Attorney’s Office and the FBI.

Judge Lackey’s subsequent effort to clarify the co-conspirator’s intentions encountered no

hesitancy from Balducci or the other four co-conspirators, and the $40,000 bribe money actually

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changed hands. On October 18, 2007, Timothy R. Balducci delivered a proposed order in the

Jones v. Scruggs case to Zachary Scruggs at the Scruggs Law Firm. Balducci was not counsel of

record in the Jones case, but rather than asking how Balducci got the order or why he had an

interest in the case, Zachary Scruggs thanked Balducci and told him that he was a good friend.

On November 1, 2007, Timothy R. Balducci was confronted by the FBI, immediately agreed to

cooperate, implicated the other co-conspirators, and wore a body wire into the Scruggs Law

Firm. Balducci first met with Sidney Backstrom and David Zachary Scruggs, and the three of

them discussed Judge Lackey’s proposed order as if they felt they could write it any way they

pleased. The three of them discussed whether they wanted an outright dismissal or something

short of that, demonstrating a belief that they had absolute control over the contents of that order.

Any attorney who practices law would know that having that kind of control over a circuit judge

would indicate something far more sinister than a simple earwigging. David Zachary Scruggs

even opined that they needed to get the order they wanted entered before some other “asshole,”

took over the case, referring to Senior Circuit Judge Henry Lackey. Taking the entire recording

in context, no one showed any reluctance to talk about the bribery in front of Zach Scruggs and

there was no apparent shock or anger on Scruggs’ part when Balducci brought up getting the

order right because they were paying for it. Zach Scruggs, his attorneys and his witness,

Backstrom, at first attempted to deny that Scruggs was even present in the room when those

words were spoken, then by their pleadings they eventually admitted that he was indeed in the

room, just as Balducci said. They would like for the Court to believe that he was simply

“disengaged.”

The petitioner presumably would have known whether or not he had knowledge of the

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criminality involved in the case of Wilson v. Scruggs, and he knew when he plead guilty that the

404(b) issue was set for rehearing that afternoon. Presumably his father, Richard F. Scruggs, and

his law partner, Sidney A. Backstrom, should have been available to testify in support of his

position. Yet, he abandoned his motion in limine, pleading guilty that morning. Now, he avers

that he did so because the threat of 404(b) evidence was overwhelming. The government has

acknowledged a misunderstanding between Mr. Norman and Mr. Langston regarding the

expected testimony of Joey Langston, but there is now no dispute that Langston would testify

that so far as he knew, Zach Scruggs was unaware of the criminality in Wilson v. Scruggs, but

did know that Ed Peters was hired because of his long standing relationship with Circuit Judge

Bobby DeLaughter. Obviously, the initial misunderstanding had been corrected by the time the

petitioner filed his motion for rehearing on March 19, 2008, as his attorneys recited in that

motion the exact language now set forth in Langston’s affidavit. As a side note, David Zachary

Scruggs’ knowledge of Peters’ involvement, together with the sentiments he expressed in his

“napkin”1 e-mail to Johnny Jones, together with Johnny Jones’ obvious interpretation of those

comments would even now arguably support the admissibility of 404(b) evidence reflecting

David Zachary Scruggs’ state of mind. David Zachary Scruggs had the opportunity to ventilate

all those issues on March 21, 2008, with the same witnesses he has now, but elected to plead

guilty instead. The petitioner would like to cast Mr. Norman’s statement to the Court as an

intentional misrepresentation, but it would make little sense to intentionally misrepresent facts to

1
Zach Scruggs had e-mailed Johnny Jones opining that the Wilson case was in a posture
where Team Scruggs could get whatever they wanted signed on the back of a napkin. Jones had
responded that he hoped Zach Scruggs had misunderstood Langston’s and Balducci’s roles in
that case.

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the Court that could not be proven in litigating a motion in limine, much less at trial.

It would also make no sense for Mr. Norman or Mr. Dawson to consciously condone or

intentionally suborn perjury before the grand jury, and then turn both the grand jury transcript of

Timothy R. Balducci’s testimony and his November 1, 2007, undercover recording over to the

defense in discovery. Balducci’s misstatement was an inadvertent reference to his taped

conversation with the senior Scruggs, not David Zachary Scruggs and Sidney A. Backstrom, but

was not an intentional effort to mislead the grand jury. When there is a misstatement before the

grand jury, the legal standard is whether or not there was sufficient evidence to support the

indictment. Absent the misstatement by Timothy Balducci, there was more than sufficient

evidence to support the indictment.

Ironically, those who are alleging intentional misrepresentations by the government now

boldly represent to the Court in writing that “most fundamentally, in 2008 Mr. Norman admitted

that the bribery case against Zach Scruggs is not supported by probable cause.” That is simply

not true. Petitioner’s counsel disingenuously draws that conclusion from the negotiated plea.

They also attempt to use the Attorney General’s policy memorandum regarding plea agreements

as evidence that the government did not have proof to support the underlying bribery charge.

The offer of a plea to misprision of a felony was simply an effort to avoid a two-week trial for the

driver of the getaway car, once the actual bank robbers had pled guilty. The Attorney General’s

guidelines obviously require serious consideration by any federal prosecutor, but are not intended

to confer upon the petitioner any right or defense. Additionally, the specific language of the

prosecution guidelines permits the United States Attorney to authorize variances from those

guidelines. In this case the United States Attorney specifically approved the plea to the lesser

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offense.

Rule 3.7 of the Mississippi Rules of Professional Conduct prohibits a material witness

from participating as an attorney “at trial.”2 The rationale for the Rule is set forth in the

Comment: “It may not be clear whether a statement by an advocate-witness should be taken as

proof or as an analysis of the proof. . . . Paragraph (a)(3) recognizes that a balancing is required

between the interests of the client (in this case the government) and those of the opposing party.”

By its terms the Rule applies to the trial of a cause, where the attorney’s testimony will be

necessarily material. West Virginia’s Rule 3.7 appears identical to Mississippi’s rule, and was

discussed at length in a District Court’s opinion in Stone v. Allstate Ins. Co., unreported but

found at 2000 WL 25609369 (S.D. W. Va.). The court concluded that a trial advocate was

prohibited from calling himself as a witness on a material issue, but went on to say that the rule

does not apply in pre-trial or post-trial proceedings, especially where the attorney is uniquely

familiar with the case. That court went so far as to hold that the rule does not apply if the

attorney will not be calling himself as a witness. Stone, p. 3. A New Jersey district court in

Main Events Productions, LLC v. Jeff Lacy, 220 F.2d 353 (D.N.J. 2002), agreed that the

prohibition applies only to being an “advocate at a trial.” “The rule is designed to prevent a

situation in which at trial a lawyer acts as an attorney and as a witness, creating the danger that

2
Rule 3.7 of the Mississippi Rules of Professional Conduct provides that:
(a) A lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary
witness except where:
(1) the testimony relates to an uncontested issue;
(2) the testimony relates to the nature and value of legal services rendered in the case; or
(3) disqualification of the lawyer would work substantial hardship on the client. (emphasis
added)

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the fact finder (particularly if it is a jury) may confuse what is testimony and what is argument

and otherwise creating an unseemly appearance at trial. Limiting the disqualification to advocacy

at trial achieves these objectives and at the same time respects a client’s right to be represented

generally by an attorney of his choice.” Main Event Productions, p. 356, 357. A district court in

Colorado, analyzing a very similar Rule 3.7 agreed that “Rule 3.7(a) is a prohibition only against

acting as an “advocate at trial.” Its purpose is to avoid jury confusion. Merrill Lynch Business

Financial Ser., Inc., v. Nudell, 239 F. Supp. 2d 1170, 1174 (D.Col. 2003). The Supreme Court of

Florida, analyzing the application of their Rule 3.7, agreed that the rule does not apply to post-

trial hearings, in that case a motion for new trial in a capital case. Willacy v. State of Florida,

967 So.2d 131, 139 (Fla. 2007). See also Alexander v. Federal Bureau of Investigation, 186

F.R.D. 21 (1998). Two district court opinions from the District of Kansas have analyzed Rule

3.7, again noting that the strongest rationale for the lawyer-witness rule is to prevent jury

confusion over the separate roles of an advocate and a witness, and noting that disqualification

can often work a substantial hardship on the non-moving party. “Where the party seeking

disqualification is also the one wanting to call the attorney as a witness, the court ‘must be

especially sensitive to the potential for abuse.’” Federal Deposit Insurance Corp. v. Frazier, 637

F. Supp. at 81. Chapman Engineers v. Natural Gas Sales Co., Inc., et al, 766 F. Supp. 949, 959

(D. Kan. 1991). See also, Federal Deposit Insurance Corp. v. Frazier, 637 F. Supp. 77 (D. Kan.

1986). In the case sub judice, it is the petitioner that avers that Mr. Norman is a material witness

and if he is called to the witness stand it will be the petitioner who calls Mr. Norman.

Although the United States Attorney’s office has other competent counsel who are ready,

willing and able to prosecute the government’s case, Mr. Norman is the only remaining

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prosecutor at the office with institutional knowledge of the case from its inception. It would

therefore work a hardship on the government, and because the matter is a bench hearing,

disqualification is unnecessary.

Accordingly, the government respectfully suggests that the petitioner’s Motion to

Disqualify Robert Norman should be denied and overruled.

Respectfully submitted,

JOHN MARSHALL ALEXANDER


United States Attorney

/s/ William C. Lamar


By:
WILLIAM C. LAMAR
Chief, Criminal Division
Mississippi Bar No. 8479

/s/ Clayton A. Dabbs


By:
CLAYTON A. DABBS
Assistant United States Attorney
Mississippi Bar No. 101537

/s/ Robert H. Norman


By:
ROBERT H. NORMAN
Assistant United States Attorney
Mississippi Bar No. 3880
Case 3:07-cr-00192-NBB -SAA Document 349 Filed 04/28/11 Page 9 of 9

CERTIFICATE OF SERVICE

We, WILLIAM C. LAMAR, Chief, Criminal Division, CLAYTON A. DABBS, Assistant

United States Attorney, and ROBERT H. NORMAN, Assistant United States Attorney, hereby

certify that the electronically filed the foregoing GOVERNMENT’S RESPONSE TO

PETITIONER’S MOTION TO DISQUALIFY ROBERT NORMAN with the Clerk of the

Court using the ECF system which sent notification of such filing to the following:

Honorable David Lee Martin


lm@mikemoorelawfirm.com

Honorable Michael C. Moore


mm@mikemoorelawfirm.com

Honorable Christopher T. Robertson


christopherrobertson@gmail.com

Honorable Edward D. Robertson, Jr.


chiprob@earthlink.net

This the _28th_ day of April, 2011.

_/s/ William C. Lamar______________


WILLIAM C. LAMAR
Chief, Criminal Division

_/s/ Clayton A. Dabbs______________


CLAYTON A. DABBS
Assistant United States Attorney

_/s/ Robert H. Norman______________


ROBERT H. NORMAN
Assistant United States Attorney