Here’s a question I hope comes to a courtroom in Connecticut within the next 30 days: Will the United States Government be forced to reimburse North Haven businessman Frank Ruocco for his legal fees?
Mr. Ruocco was acquitted of 19 counts Friday afternoon by a federal jury in Bridgeport, Connecticut. He, an associate, and his company, Earth Technology, Inc., were charged with fraud in a scheme involving alleged overstated invoices and other affirmative acts of fraud. The Government was dogged in its pursuit of this case, zeroing in on a company involved in environmental clean-up while bankers laid waste to the nation.
The Government hounded Mr. Ruocco and his company. He lawyered up with high-priced talent and fought back. The government walked away empty-handed and is now strangely unaccountable.
Where’s the justice in permitting the Government to run roughshod without consequence over a private citizen, spending no end of tax dollars in a vendetta against a local businessman whose last named just happens to end in a vowel? I would not be surprised if legal fees in this battle for the defendants approached seven figures.
The Government’s costs, of course, are fixed, and sunk: You and I pay them whether the Government wins or loses. In other words, a defendant risks all in a confrontation with the Government -- liberty, wealth, the ability to carry on with the ordinary tasks of daily living. The Government risks nothing.
The general rule in the American courts is that the parties bear their own costs. It is called the American Rule. In England, by contrast, the winner in a piece of litigation can pursue his or her costs. The American Rule makes the Government unaccountable when it tries, and loses, in its efforts to bring a citizen to his knees. Why? Where’s the justice in giving a blank check to Justice?
Under the Equal Access to Justice Act, a defendant who prevails in a case against a government agency, and that includes the Justice Department, can seek to recover some of their legal expenses. Prevailing in such a claim is difficult, however. A party needs to act fast, within 30 days of their victory. They also need to show that the Government’s case lacked merit, and was brought in bad faith, or without substantial justification. Congress places a fee cap on the hourly rate that may be sought as well.
It seems to me that when the Government launches a lengthy investigation, then ties lawyers up in the courts for years, seeking convictions on dozens of counts and then walks away from the courthouse with its face slapped by twelve ordinary people, in that sort of case the defendant is entitled to compensation.
Mr. Ruocco is a free man tonight. Whether he can afford to celebrate his victory after the financial beating the Government imposed on him is an open question. A review of the docket sheets maintained by the federal government shows that one of the defendants in the case lost the services of high-priced lawyers in the summer, and that a federal public defender had to finish the case out at taxpayer expense. My hunch is the Government bled Mr. Ruocco for all it could. I hope he returns the favor.
The trial was tried before Senior United States District Judge Warren Eginton, a jurist who is, unlike many of his peers, not always impressed by the claims and antics of the prosecution. It is the right courtroom to make a claim for fees under the EAJA. At a minimum, putting the Government on the defense sends a message: Sure, strike hard blows, and hopefully fair blows, but when you fail to win suffer the consequences. Or don’t we believe the Government should be held accountable for its actions?