To Lawyers Who Represent Cooperators: Fear Judge Richard Sullivan

[WSJ Law Blog]

If there’s one lesson we learned from our visit to the courtroom of Manhattan-based U.S. District Judge Richard Sullivan (pictured) last week, it’s that he can be unfriendly to criminals, even if they plead guilty and cooperate with the government in bringing cases against other individuals.

Specifically, the 45-year-old Sullivan (William & Mary, Yale Law), who became a judge two years ago after spending more than 10 years as a prosecutor at the U.S. attorney’s office in Manhattan, denied bail to Frank DiPascali, a possible key witness in future Bernard Madoff-related prosecutions. That occurred after DiPascali pleaded guilty to helping carry out Madoff’s fraud scheme, including lying to investors, creating lots of fake documents, and repeatedly lying under oath to SEC investigators. He is facing 125 years in prison.

In a twist that shocked onlookers (including yours truly), Sullivan, who has also worked as a Wachtell associate and general counsel of insurance firm Marsh Inc., put DiPascali behind bars despite objections by prosecutors and DiPascali’s lawyers, who said he wasn’t prepared for jail, had no intention of fleeing, and that he would be able to better assist the government while free on bail. If he isn’t granted bail sometime down the road, DiPascali will likely remain at the Metropolitan Correctional Center for a long, long time, because cooperators generally are sentenced only after they help the government bring other criminal cases.

When we dug deeper, we found this wasn’t the first time Sullivan showed little mercy for a cooperating witness. Exhibit A: Brian McLaughlin, a former New York State assemblyman and a representative of two unions, who earlier this year admitted to misappropriating funds from the assembly and unions and receiving payoffs from contractors.

McLaughlin’s lawyers and the government told Sullivan that for his crimes alone, McLaughlin deserved 8 to 10 years in prison. But the sentence was expected to be lower because of his cooperation. In a letter to Sullivan before sentencing, prosecutors said McLaughlin’s cooperation, which led to the commencement of two “important” criminal cases, “reflects a genuine acceptance of responsibility for his criminal conduct,” and that he should earn points for his help.

But to the shock of McLaughlin’s lawyers, prior to sentencing Sullivan informed them and prosecutors that he intended to sentence the defendant above the 8-to-10-year range.

Michael Armstrong, McLaughlin’s attorney, argued in a letter that his office couldn’t find a single instance of a judge in the Southern District of New York who gave a so-called “upward departure” sentence for a cooperating witness.

At sentencing in May, Sullivan said he would have sentenced McLaughlin to 15 years but reduced it to 10 because of his cooperation. He compared McLaughlin to “Boss Tweed” and said his conduct “staggers the mind.”

Granted, it’s not unheard of for judges to question agreements between prosecutors and informants. After all, prosecutors could have an incentive to cut an informant a sweetheart deal in the event he or she promises testimony that could make another case.

That said, some defense lawyers have suggested to the Law Blog that Sullivan’s conduct may have a chilling effect on cooperation agreements, if criminals believe the government can’t help them get more-favorable treatment by judges. Sullivan declined to comment to the Law Blog.