Government attorneys want Sierra Pacific lawyers off Moonlight wildfire case

In the years-long legal brawl over the 2007 Moonlight wildfire that torched Plumas and Lassen counties, government attorneys have asked a Sacramento federal judge to kick the lawyers defending Sierra Pacific Industries off the case for alleged unlawful and unethical tactics.

Lawyers who handled the recent declaration of a former assistant U.S. attorney who once represented the government in its civil lawsuit against Sierra Pacific are guilty of “egregious professional misconduct,” U.S. Attorney Benjamin Wagner and his staff allege in a motion filed Monday.

In his declaration, the former assistant U.S. attorney, E. Robert Wright, described what he perceived as questionable inner workings of the U.S Attorney’s civil division and how he bucked a practice of withholding evidence that the law required be turned over to the opposition.

Wright, now retired, said he suspected he was removed as the government’s lead counsel in the suit against Sierra Pacific because of his insistence on honesty.

The Moonlight fire started on Sept. 3, 2007, on private property in Plumas County and spread into neighboring Lassen County. It turned 65,000 acres, including 46,000 acres of national forestland, into a moonscape, and burned for more than two weeks before it could be suppressed.

The government’s suit, which was settled more than two years ago, sought compensation for fire-related damages from timber giant Sierra Pacific and, to a much lesser extent, other defendants.

The government’s motion this week to banish Sierra Pacific lawyers from the suit claims that Wright’s declaration is “replete with protected work-product, privileged attorney-client communications, and client confidences and secrets.” Every lawyer involved in the document’s creation and public disclosure knew it represented a blatant violation of the State Bar’s rules of professional conduct, including Wright and defense lawyers who merely read it, the motion asserts.

Quoting from state law, the motion says the company’s lawyers “breached their ethical obligation not to ‘knowingly assist in, solicit, or induce’ Wright’s declaration.”

“This is actually the third time in this very case that these same attorneys have engaged in professional misconduct,” the motion further states. “The last time this occurred, (they) narrowly avoided a contempt finding and were specifically ordered ‘to comply with all applicable ethical rules.’”

The motion specifically accuses Sierra Pacific’s lead counsel, William Warne of Sacramento, of having a hand in obtaining Wright’s declaration.

Warne declined to comment Tuesday. But a footnote in a motion filed by the defense Tuesday evening says the attempt to disqualify Sierra Pacific’s lawyers “is not only baseless, it is insulting to our system of justice. AUSA Wright acted in the service of the United States and its Department of Justice by revealing egregious conduct that is antithetical to the Department of Justice’s very purpose.”

The government’s motion comes almost six weeks after Sierra Pacific’s lawyers filed a motion to set aside the 2012 settlement, alleging that the U.S. attorney’s office and some of its witnesses perpetrated a fraud on the court. That motion leveled charges of corruption and cover-up at government attorneys and at state and federal personnel who investigated the fire’s origin and its location.

The 2012 settlement called for Anderson-based Sierra Pacific, the state’s largest private landowner, to give the government $47 million and 22,500 acres of its land to compensate for the devastation in Plumas and Lassen national forests, as well as the U.S. Forest Service’s firefighting costs. Another $7 million was to be paid to the government by owners of the private property where the fire started and an additional $1 million by a logging company working on the private property under contract to Sierra Pacific. The entire settlement is valued in excess of $100 million.

The fire was in its earliest stages when federal and state investigators decided that Sierra Pacific was ultimately responsible. They concluded it was started when a bulldozer hit a rock, causing a spark to fly into some brush. An employee of the logging company hired by Sierra Pacific was operating the bulldozer. The private property owners had hired Sierra Pacific to do a timber harvest.

But Sierra Pacific heatedly rejects that scenario, claiming the government was looking for a “deep pocket” to reimburse it for the damages and costs. The company’s lawyers were claiming even before the settlement that the government was withholding relevant evidence and that its case was built around a fraudulent report by the cause-and-origin investigators – one from the Forest Service and one from the California Department of Forestry and Fire Protection.

Sierra Pacific’s defense lawyers further claim that federal prosecutors sat by in pretrial depositions and knowingly allowed the investigators to lie under oath.

In a joint status report, also filed Monday, the U.S. attorney’s office said it would file an answer on Dec. 17 to Sierra Pacific’s motion to wipe out the settlement.

The case has caused some upheaval in the operation of Sacramento’s federal court.

After Sierra Pacific filed the motion to throw out the settlement, U.S. District Judge Kimberly J. Mueller asked to be removed from the case, which she’d been presiding over for nearly four years.

As a consequence, Chief U.S. District Judge Morrison C. England Jr. wrote an order recusing every judge in the Sacramento-based Eastern District of California and asking Alex Kozinski, chief judge of the 9th U.S. Circuit Court of Appeals, to appoint an out-of-district judge.

But Kozinski refused, noting that the circuit court’s policy is to not bring in a judge from another district unless there is both an order recusing the judge assigned to the case and a certification from the district’s chief judge that every judge in the jurisdiction has been offered the case and refused to take it.

Mueller then wrote an order recusing herself.

Some of her fellow judges were unhappy that she dropped the case and have vented their feelings in emails circulated privately among themselves.

The case is now in the hands of U.S. District Judge William B. Shubb, the district’s longest-serving senior judge. He has scheduled a status conference for Monday.

Call The Bee’s Denny Walsh, (916) 321-1189.