United States of America v. Sierra Pacific Industries et al

Filing 603

ORDER of RECUSAL signed by Chief Judge Morrison C. England, Jr on 10/14/2014 ORDERING that all District and Magistrate Judges in the Eastern District of California are RECUSED from hearing this case and all related matters. This matter is REFERRED to Alex Kozinski, Chief Judge of the US Court of Appeals, for reassignment of a judge other than from the Eastern District of California. (cc USCA, MCE) (Donati, J)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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UNITED STATES OF AMERICA,

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No. 2:09-cv-02445-KJM-EFB

Plaintiff,
v.

ORDER

SIERRA PACIFIC INDUSTRIES, et al.,

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Defendants.

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In July 2012, the parties to this action entered into a settlement agreement. See

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ECF Nos. 577-78, 592. Defendants agreed to pay $55 million to the United States over

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five years, and Sierra Pacific agreed to transfer 22,500 acres of land through ongoing

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negotiations. ECF No. 593-3. Thereafter, the Court closed the matter, but retained

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jurisdiction to enforce the terms of the compromise settlement. Order, ECF No. 592.

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On October 9, 2014, Defendant Sierra Pacific Industries (“Sierra Pacific”) together

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with the other named Defendants1 moved to set aside the judgment in this case for fraud

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The other named-defendants include Eunice Howell, individually and dba Howell's Forest
Harvesting Company ("Howell's"); W.M. Beaty &Associates, Ina (`Beaty") and the following parties
(hereinafter collectively "the Landowners"): Ann McKeever Hatch, as Trustee of the Hatch 1987 Revocable
Trust; Richard L. Greene, as Trustee of the Hatch Irrevocable Trust; Brooks Walker, Jr., as Trustee of the
Brooks Walker, Jr. Revocable Trust, and the Della Walker Van Loben Sels Trust for the Issue of Brooks
Walker, Jr.; Brooks Walker, III, Individually and as Trustee of the Clayton Brooks Danielsen Trust, the
Myles Walker Danielsen Trust, the Margaret Charlotte Burlock Trust, and the Benjamin Walker Burlock
Trust; Leslie Walker, Individually, and as Trustee of the Brooks Thomas Walker Trust, the Susie Kate
Walker Trust, and the Della Grace Walker Trust; Wellington Smith Henderson, Jr., as Trustee of the

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on the Court under Federal Rule of Civil Procedure 60(d)(3) (the “Motion”). Mot., ECF

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No. 593. Defendants base their Motion on the grounds that the United States'

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prosecution of this action constituted a fraud upon the Court when the United States

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attorneys and the Moonlight Fire investigators and their counterparts in co-pending state

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actions, operating under a joint prosecution agreement with the United States, advanced

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a corrupt and tainted prosecution, violated Defendants' due process rights, and engaged

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in investigatory and prosecutorial misconduct.2 Id. Defendants allege that this

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misconduct was perpetrated by officers of the Court and ultimately tampered with the

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administration of justice, in a manner that wronged not only Defendants, but also the

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Court and the public. Id. According to Defendants, the government's misconduct

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compromised the judicial process and amounts to an unconscionable scheme designed

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to improperly influence the Court's decisions in this case.3 Id. In fact, Defendants state

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that they perceive the Court itself as a victim “as it has neither had the chance to fully

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assess the trust it naturally placed in certain federal prosecutors nor the ability to do so

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in the context of all that was eventually discovered about the thoroughly corrupt and

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financially driven Moonlight Fire investigation.” ECF No. 593-3. Defendants ask that the

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Court set aside the judgment and the Settlement Agreement and dismiss this action in

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Henderson Revocable Trust; Elena D. Henderson, Individually; Mark W. Henderson, as Trustee of the
Mark W. Henderson Revocable Trust; John C. Walker, Individually, and as Trustee of the Della Walker
Van Loben Sels Trust for the Issue of John C. Walker; James A. Henderson, Individually; Charles C.
Henderson, as Trustee of the Charles C. and Kirsten Henderson Revocable Trust; Joan H. Henderson,
Individually; Jennifer Walker, Individually, and as Trustee of the Emma Walker Silverman Trust, and the
Max Walker Silverman Trust; Kirby Walker, Individually; and Lindsey Walker, a.k.a. Lindsey WalkerSilverman, Individually, and as Trustee of the Reilly Hudson Keenan Trust, and the Madison Flanders
Keenan Trust.
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Specifically, Defendants allege, among other things, that the United States presented false
evidence to the Defendants and the Court and/or concealed material evidence from the Defendants and
the Court; advanced arguments to the Court premised on that false evidence, or for which material
evidence had been withheld, and obtaining Court rulings based thereon; prepared key Moonlight Fire
investigators for depositions, and allowed them to repeatedly give false testimony about the most
important aspects of their investigation; and failed to disclose the facts and circumstances associated with
the Moonlight Fire lead investigator's direct financial interest in the outcome of the investigation arising
from an illegal bank account that has since been exposed and terminated. ECF No. 593.
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Defendants believe that the circumstances may warrant the appointment of special master.
ECF No. 593.

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its entirety. ECF No. 593. Defendant’s Motion is currently set for hearing before Judge

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Kimberly J. Mueller on November 21, 2014.

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Based upon facts alleged in the Motion and accompanying Declarations and

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Exhibits, the impartiality of the District and Magistrate Judges in the Eastern District

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might reasonably be questioned. Therefore, on the Court’s own motion and pursuant to

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the Code of Conduct for United States Judge, Canons 2 and 3, in order to avoid the

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appearance of impropriety, and because a judge has a duty to disqualify him or herself if

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his or her impartiality could be reasonably questioned, whether or not such impartiality

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actually exists, the Court recuses itself from the above-captioned case. See 28 U.S.C. §

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455(a). Accordingly, all District and Magistrate Judges in the Eastern District of

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California are RECUSED from hearing case number 2:09-cv-02445 and all related

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matters. This matter is REFERRED to Alex Kozinski, Chief Judge of the United States

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Ninth Circuit Court of Appeals, for the assignment of a judge other than from the Eastern

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District of California to sit by designation and hear case number 2:09-cv-02445 and all

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related matters.

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IT IS SO ORDERED.
Dated: October 14, 2014

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