in the united states court of appeals for the district … · fokker services b.v....

IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

Consol. Case Nos. 15-3016 & 15-3017

United States of America,

Appellee,

v. Fokker Services B.V.,

Appellant. United States of America,

Appellant,


Appellee.

APPELLANT'S CONSENT MOTION TO EXPEDITE

Fokker Services B.V. ("FSBV") moves for expedited briefing and

consideration of the above-captioned consolidated appeal. This procedural motion

is being taken within 30 days of the United States of America's notice of appeal in

this case, which was filed on March 9, 2015.

USCA Case #15-3016 Document #1546447 Filed: 04/08/2015 of 12

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The United States has advised FSBV that it consents to this motion for

expedited briefing and consideration of this appeal, and has authorized FSBV to

represent that the United States respectfully requests that the appeal be resolved

before December 5, 2015. The parties therefore respectfully request that the Court

adopt the following agreed-to briefing schedule:

Opening Briefs for the Parties 30 days from Scheduling Order

Briefs of any Amici in Support of the Parties 30 days from Scheduling Order

Briefs (if any) in Support of the Order Below

At least 30 days after Opening Briefs for the Parties are due

Reply Briefs for the Parties 14 days after Briefs of Designated Counsel or Amici in Support of the

Order Below are due

For the reasons explained below, the parties respectfully request that the Court

schedule oral argument on the earliest available date following the completion of

briefing, and resolve the appeal before December 5, 2015.

BACKGROUND

This case involves an extraordinary assertion of judicial authority over a

criminal charging decision of the United States. The central issue presented is

whether a district court may deny a motion to exclude time under the Speedy Trial

Act pursuant to a deferred prosecution agreement validly entered into between the

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United States and FSBV (the "DPA"), on grounds that the penalties imposed and

the remedies obtained by the United States in the DPA were inadequate in the

district judge's view. The United States entered into this DPA with FSBV as part

of a global settlement between FSBV, the United States Attorney’s Office for the

District of Columbia (“USAODC”), the United States Department of the

Treasury’s Office of Foreign Assets Control ("OFAC") and the United States

Department of Commerce’s Bureau of Industry and Security ("BIS").

In 2010, FSBV made a voluntary self-disclosure identifying its historic

violations of U.S. sanctions law to OFAC and BIS. After four years of FSBV’s

cooperation with the joint investigations of USAODC, OFAC and BIS, the parties

agreed to a global settlement in June 2014. The global settlement featured a

binding DPA between USAODC and FSBV that would impose an 18-month

deferral of prosecution to allow FSBV to demonstrate its ongoing good conduct

and diligent enforcement of its export compliance program (which FSBV adopted

as a result of its cooperation with the United States), criminal forfeiture to the

United States of $10.5 million, and an additional civil penalty of $10.5 million

payable to OFAC and BIS.

Under the binding terms of the DPA that was executed between FSBV and

the USAODC on June 3, 2014, FSBV gave up several important rights in

consideration for the United States' agreement to defer prosecution: waiving

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indictment, thereby allowing the United States to file an information charging

FSBV with criminal conspiracy and offenses against the International Emergency

Economic Powers Act (IEEPA); agreeing to exclusions of time under the Speedy

Trial Act at the discretion of the United States; and accepting responsibility for the

conduct as alleged by the United States and as set forth in the Factual Statement

accompanying the DPA.

On June 5, 2014, pursuant to the binding settlement negotiated and agreed-

upon between the United States and FSBV, USAODC filed with the district court a

one-count Information charging FSBV with a criminal conspiracy to transact with

entities associated with U.S.-sanctioned countries (the "Information"), annexed to

which were the DPA and the Factual Statement. The DPA specifically provided

that it "is effective for a period beginning on the date on which the Information is

filed, [June 5, 2014,] and ending 18 months from that date", which would fall on

December 5, 2015. Consistent with the requirements of the DPA, the United

States filed a Joint Consent Motion for exclusion of the 18-month term under

Section 3161(h)(2) of the Speedy Trial Act.

The case was assigned to the Honorable Richard J. Leon. Over the ensuing

seven months, Judge Leon held four court conferences during which he expressed

concerns about the DPA and questioned whether its terms were sufficiently severe

to address the conduct alleged in the Information. During this period, Judge Leon

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also ordered the United States to conduct a collateral inquiry into the voluntariness

of FSBV's self-disclosure, which was concluded in September 2014 with

USAODC filing a report in the district court that unequivocally confirmed that

FSBV's self-disclosure was voluntary. Judge Leon subsequently issued an order

and memorandum opinion on February 5th, 2015 (collectively, the "Order

Below"), denying the Joint Consent Motion for exclusion of time. See Order,

United States v. Fokker Services B.V., No. 1:14-cr-00121-RJL-1 (D.D.C. Feb. 5,

2015).

Since the Information, DPA and Factual Statement were publicly filed on

June 5, 2014, FSBV has been the subject of persistent media commentary and

speculation, all of which has emphasized FSBV's historical violations rather than

its current dedication to compliance, a dedication that has been acknowledged in

this case by the United States. The persistent media scrutiny of FSBV only

worsened after the Order Below was issued on February 5th, 2015, leading to

'expert' commentary questioning whether the terms of the DPA, including the 18-

month expiration date, will be subject to revision. Such speculation has had

collateral consequences on FSBV, as business partners or creditors of the company

cite such media reports and commentary as indicators of uncertainty surrounding

the company.

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Both parties to this appeal now seek expedited review of the Order Below,

and have proposed the above briefing schedule to facilitate prompt resolution of

this appeal on or before December 5, 2015. Obtaining a resolution of the appellate

issues prior to December 5, 2015 is critical, since such resolution will provide

FSBV with a clearer understanding of the likelihood that this matter will in fact be

concluded by that date. Such a determination is of paramount importance for

FSBV's continued operations, while it maintains compliance with the terms of the

DPA during this 18-month deferral period.

ARGUMENT

This Court's internal procedures provide that "[i]t is the policy of this Court

to expedite criminal appeals." U.S. Court of Appeals for the D.C. Circuit,

Handbook of Practice and Internal Procedures at Part IV.A.1 (Nov. 12, 2013).

Further, a motion to expedite consideration of an appeal may be granted if the

movant demonstrates that (i) "the delay will cause irreparable injury and that the

decision under review is subject to substantial challenge”, or (ii) “the public

generally, or . . . persons not before the Court, have an unusual interest in prompt

disposition.” Id. at Part VIII.B. Both of these standards are met here and warrant

the scheduling of oral argument on the earliest available date following the

completion of briefing, and resolution of the appeal before December 5, 2015.

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I. Delay in this Appeal Will Cause Irreparable Injury to the Parties and the Order Below is Subject to Substantial Challenge. First, FSBV will be irreparably harmed if this appeal remains pending after

December 5, 2015. The DPA provides for an effective term that commenced with

the Information's filing on June 5, 2014 and expires 18 months later on December

5, 2015. The parties are therefore currently bound by the terms of the DPA, and

FSBV is duly performing its obligations under the DPA.

A key motivation for FSBV to enter into the DPA with the United States

was to obtain a full and final resolution of the investigation into its historical

conduct, which FSBV voluntarily disclosed to the United States. As the United

States has acknowledged in its filings with the district court, FSBV has

experienced significant financial distress while this matter has been ongoing, and is

currently in the midst of a corporate restructuring in the Netherlands. Under these

circumstances, obtaining stability was a paramount concern of FSBV. Therefore,

FSBV bargained for, and received from the United States, the promise of certainty

and a final resolution of this matter through the DPA.

The Order Below has already injected doubt into the minds of third-parties

as to the finality of FSBV's bargained-for resolution with the United States, and the

resulting reputational harm has had an impact on FSBV's ongoing business affairs.

The pendency of this appeal after December 5, 2015, will effectively deny FSBV

the benefit of a full and final resolution of this matter, damage FSBV's reputation,

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and impact its ability to conduct its business affairs, and its relationship with

potential counterparties. Any uncertainty as to the outcome of this appeal after

December 5, 2015 will therefore deprive FSBV of the benefit of its bargain with

the United States, and cause irreparable injury to FSBV. See, e.g., SEC v.

Citigroup Global Mkts., 752 F.3d 285, 292 (2d Cir. 2014) (irreparable harm can be

shown where parties to consent decree are denied "'their right to compromise their

dispute on mutually agreeable terms'" (quoting Carson v. Am. Brands Inc., 450

U.S. 79, 87-88 (1981)).

Because FSBV relinquished important rights when it accepted the DPA in

reliance on promises given to it by the United States, FSBV should not be denied

its essential contractual right – the deferral of prosecution for 18 months

commencing on June 5, 2014, the timely dismissal of the Information within 30

days of the end of that period, and the finality associated with such dismissal – as a

result of the district court's misunderstanding of the limits of its authority to review

the DPA. See United States v. Garcia, 519 F.2d 1343, 1345 (9th Cir. 1975)

(defendant who waived "his valuable right to a speedy trial" by entering into

deferred prosecution agreement with government was entitled to its enforcement).

Finally, the Order Below is subject to substantial challenge. The Order

Below is an unprecedented assertion of judicial authority over the United States'

exercise of prosecutorial discretion in criminal cases, and the first case where a

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district court judge issued an order and opinion that refused to approve a deferred

prosecution agreement. At minimum, serious legal questions exist as to whether

Judge Leon erred when he stated that he had authority to review the DPA under the

court's inherent supervisory power over proceedings before it, an issue that this

Court has never had the occasion to decide; and whether Judge Leon erred by

challenging the adequacy of the penalties and remedies that the United States

obtained in the DPA, without according the appropriate level of deference owed to

the Executive branch in the exercise of its prosecutorial discretion. See, e.g.,

United States v. Microsoft Corp., 56 F.3d 1448, 1462 (D.C. Cir. 1995) (reversing

district court rejection of antitrust consent decree as inconsistent with the

separation of powers).

II. Non-parties and the Public have an Unusual Interest in Prompt Disposition of this Appeal. In the alternative, the aforementioned issues in this appeal give non-parties

and the public an exceedingly strong interest in the prompt disposition of this case.

Aside from the impact on FSBV, the pendency of this appeal beyond

December 5, 2015 has collateral consequences on non-parties affiliated with

FSBV. For example, FSBV depends to a large extent on its corporate parent,

Fokker Technologies Holding B.V. ("FT"), for the requisite financial support to

pay the $10.5 million criminal forfeiture sum, the $10.5 million civil penalty to

BIS and OFAC, and to meet the costs associated with its corporate restructuring.

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The continued pendency and related costs of this appeal will negatively impact

FT's ability to make strategic business decisions, to adopt its financing structure, or

to pursue potential business opportunities. In combination with the recent

exchange rate fluctuations, the ongoing uncertainty related to the pendency of this

appeal negatively impacts FT's ability to hedge the exchange rate risks related to

new contracts. Accordingly, FT is a non-party that has an exceedingly strong

interest in seeing a prompt disposition of this appeal.

Moreover, the public at large has an unusual interest in prompt disposition of

this appeal. There are certainly other companies, whether domestic or foreign

corporations, that are in the course of negotiating with the United States about a

potential resolution of their exposure to criminal charges. These companies are

undoubtedly being affected by the uncertainty engendered by this case as to the

scope of a district judge's authority to question the substantive merits of a deferred

prosecution agreement. Expedited review by this Court will resolve any questions

in the public mind about the ability of the United States to exercise its

prosecutorial discretion by entering into binding deferred prosecution agreements

with corporate entities, and remove any uncertainty as to the proper scope of a

district judge's authority to review deferred prosecution agreements. See Microsoft

Corp., 56 F.3d at 1456 ("A district judge’s refusal to accept the [antitrust consent

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decree] . . . cannot but have enormous practical consequences for the government’s

ability to negotiate future settlements.”)

CONCLUSION

For the foregoing reasons, FSBV, with the consent of the United States,

respectfully requests that consideration of this appeal be expedited, that the Court

issue an order setting the above briefing schedule, that the Court direct the Clerk to

schedule oral argument on the earliest available date following the completion of

briefing, and that the Court resolve the appeal before December 5, 2015.

Dated: April 8, 2015

Respectfully Submitted, CLIFFORD CHANCE US LLP

/s/ Edward C. O'Callaghan Edward C. O’Callaghan David D. DiBari (D.C. Bar No. 426152) Rijie Ernie Gao 31 West 52nd Street New York, NY 10019 (212) 878-8000 Counsel for Fokker Services B.V.

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Certificate of Service

I hereby certify that on this 8th day of April, 2015, I caused the foregoing document to be served electronically on counsel for the parties in this case, via the Court's Electronic Case Filing System.

S/ Edward C. O'Callaghan Edward C. O'Callaghan Clifford Chance US LLP 31 West 52 Street New York, NY 10019 (212) 878-8000 [email protected]


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IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

Consol. Case Nos. 15-3016 & 15-3017

United States of America,

Appellee,


Appellant. United States of America,

Appellant,


Appellee.

CERTIFICATE AS TO PARTIES, RULINGS UNDER REVIEW AND RELATED CASES

Pursuant to Circuit Rules 27(a)(4) and 28(a)(1), counsel for Appellant

Fokker Services B.V. ("FSBV") respectfully submits this Certificate as to Parties,

Rulings under Review, and Related cases.

USCA Case #15-3016 Document #1546447 Filed: 04/08/2015 Page 1 of 4

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- 2-

A. Parties

The following is a list of all the parties in this case who have appeared

before the district court below and in this Court:

The United States of America, and

FSBV, a corporation headquartered and incorporated under the laws

of the Netherlands (FSBV filed its Corporate Disclosure Statement

with this Court, in accordance with Circuit Rules 12 and 26.1, on

March 24, 2015).

At this time, no amici or intervenors have appeared before the district court

below or in this Court.

B. Rulings Under Review

The following rulings by the Honorable Richard J. Leon of the United States

District Court for the District of Columbia is under review: the Memorandum

Opinion and Accompanying Order, both issued on February 5, 2015, which denied

the parties’ joint consent motion to exclude time under the Speedy Trial Act

pursuant to a deferred prosecution agreement validly entered into between the

United States and FSBV (the "DPA"), on grounds that the penalties imposed and

the remedies obtained by the United States in the DPA were inadequate in the

district judge's view. The Memorandum Opinion was entered as Docket Number


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- 3-

22 in the district court, and the Accompanying Order was entered as Docket

Number 23 in the district court.

C. Related Cases

This case has not been before this or any other court previously. With the

exception of the appeal filed by the United States in this case on March 9, 2015

(docketed in this Court as No. 15-3017), which this Court consolidated with

FSBV's appeal on March 10, 2015, undersigned counsel is not otherwise aware at

this time of any "related cases" as the term is defined in Circuit Rule 28(a)(1)(C).

Dated: April 8, 2015

Respectfully Submitted,

CLIFFORD CHANCE US LLP

/s/ Edward C. O'Callaghan Edward C. O’Callaghan David D. DiBari (D.C. Bar No. 426152) Rijie Ernie Gao 31 West 52nd Street New York, NY 10019 (212) 878-8000

Counsel for Fokker Services B.V.


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Certificate of Service

I hereby certify that on this 8th day of April, 2015, I caused the foregoing document to be served electronically on counsel for the parties in this case, via the Court's Electronic Case Filing System.

S/ Edward C. O'Callaghan Edward C. O'Callaghan Clifford Chance US LLP 31 West 52 Street New York, NY 10019 (212) 878-8000 [email protected]


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