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August 31, 2005.


The opinion of the court was delivered by: MARY COOPER, District Judge

Defendants move to dismiss specified portions of the Superseding Indictment on the ground that those claims are barred by res judicata because of a settlement agreement in July, 2002 ("the Settlement Agreement") between defendant Atlantic States and the State of New Jersey that resolved a then-pending state criminal investigation. Defendants argue that federal law enforcement had a "laboring oar" in that state criminal investigation, so the present federal criminal prosecution is barred by res judicata as to any claims that were covered by the Settlement Agreement. We have previously ruled that the investigation that resulted in the pending federal indictment was not a "joint investigation" with local and state authorities, for discovery purposes. The present motion will be denied for the reasons expressed in this opinion.*fn1 I.

The Superseding Indictment in this case contains 34 counts. Count One alleges a multi-object conspiracy under 18 U.S.C. § 371 against all defendants. A total of 81 Overt Acts are alleged in Count One. Overt Acts 1, 3, and 6-14 variously allege discharges of petroleum-contaminated water and asphalt-based waste paint during the period from July, 1996 through September, 2002, and efforts to conceal those discharges from federal, state and local law enforcement officials. Several of those Overt Acts refer specifically to a petroleum discharge incident that occurred on Dec. 4/5, 1999, and a related search warrant execution on or about February 23, 2000. Counts 3-4 and 24-27 are substantive counts referring to the same subject matter.

  Atlantic States was the target of a New Jersey criminal investigation that began in 1999 and resulted in a civil settlement agreement between it and the New Jersey Department of Law and Public Safety, Office of the Attorney General, Division of Criminal Justice ("DCJ") on July 12, 2002. The Settlement Agreement "covere[d] all criminal liability for acts or omissions resulting from an alleged incident . . . on or about December 4/December 5, 1999 and the alleged resultant water pollution. . . ." It provided that the DCJ "will close with prejudice its criminal investigation of the [Dec. 4/5, 1999] incident as it pertains to Atlantic States", its parent company, and related persons. It contained no admission of responsibility, but did impose certain obligations on Atlantic States. Finally, it provided that it was "fully enforceable as a final order in the Superior Court of New Jersey upon filing of a summary action for compliance." (Dkt. 139, Ex. 10.)

  A representative of the DCJ has explained to this Court that the underlying state investigation was exclusively a criminal investigation, but it did not result in an indictment. Rather, it ended with a civil settlement agreement "only because in New Jersey, we don't have a pretrial intervention program for corporations." (Dkt. 145 at 36.) The Settlement Agreement was drafted by counsel for Atlantic States, reviewed and perhaps edited by the responsible Deputy Attorney General (id. at 48), and signed on behalf of both parties effective July 12, 2002.*fn2

  Defendants contend in this motion that those Overt Acts and substantive counts that allege actions of Atlantic States or its personnel based on discharges from Atlantic States during the period covered by the Settlement Agreement, namely December, 1999 through July, 2002, must be dismissed from the Superseding Indictment on grounds of res judicata. The government opposes the motion on both legal and factual grounds. The parties disagree on the law that should govern this motion, so our discussion will begin there.


  Defendants rely on principles of res judicata requiring a final judgment in one state to be given full faith and credit in other jurisdictions, and recognizing that a settlement agreement between parties has the same preclusive effect as a judicial decree. (Dkt. 129-1 at 6-9.) They refer to established precedent that a party not named in the prior action may be precluded from bringing a subsequent action if that party is "in privity" with the party named in the first action, the notion of "privity" being a flexible concept that asks whether the party in question had a "laboring oar" in the first action. (Id. at 91-1.) We note that under this body of case law, the "laboring oar" is generally described in terms suggesting control. Recent cases in the civil environmental enforcement context, cited by defendants, have focused on the regulatory relationship between federal and state agencies in determining whether such agencies are "in privity" for res judicata purposes. (Id. at 11-14.)

  The Court has reviewed and carefully analyzed the body of case law cited by defendants, which arises in civil litigation applying res judicata principles. We conclude, however, that it does not supply the applicable jurisprudence where, as here, a party is facing a criminal indictment and seeks dismissal based on prior proceedings. Rather, this issue is governed by aspects of the Constitutional guarantee against double jeopardy embodied in the Fifth and Fourteenth Amendments, and related jurisprudential doctrines, which we will briefly review.


  The Double Jeopardy Clause of the Fifth Amendment provides: "nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb. . . ." The Supreme Court, recognizing the ancient origins of this guarantee and its fundamental nature, has ruled that it is applicable to the states through the Fourteenth Amendment. Benton v. Maryland, 395 U.S. 784, 794 (1969). The classic statement of its rationale bears repeating:
The underlying idea, one that is deeply ingrained in at least the Anglo-American system of jurisprudence, is that the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty.
Green v. United States, 355 U.S. 184, 187-88 (1957). The Supreme Court has identified "three separate constitutional protections" afforded by the guarantee against double jeopardy:
It protects against a second prosecution for the same offense after acquittal. It protects against a second prosecution for the same offense after conviction. And it protects against multiple punishments for the same offense.
North Carolina v. Pearce, 395 U.S. 711, 717 (1969) (footnotes omitted). It has been observed that "[t]he terms of the Double Jeopardy Clause, however, are not self-defining and the Supreme Court has never applied them absolutely when a first trial did not end in an acquittal on the facts." United States v. Busic, 639 F.2d 940, 945 (3d Cir. 1981).

  Our Court of Appeals recognizes that a claim of double jeopardy "is of constitutional dimension and its very substance[,] the right to be free from trial twice on the same issue[,] would be defeated if the [defendant] were required to await appellate review until after the second trial." United States v. Venable, 585 F.2d 71, 74 (3d Cir. 1978). Therefore, denial of a motion to dismiss based on double jeopardy is a final and appealable order under the collateral order doctrine.*fn3 Id.; see also United States v. Berry, 164 F.3d 844 (3d Cir. 1999) (interlocutory appeal from district court order denying motion to dismiss indictment on double jeopardy grounds).

  We will turn in a moment to a discussion of the "dual sovereignty doctrine" in double jeopardy analysis, which appears to be the basis of defendants' motion.*fn4 However, strictly speaking, we do not need to reach that topic. The dispositive answer to the present motion, in our view, is that the constitutional guarantee against double jeopardy is not triggered unless there has been an adjudication on a criminal charge in the first proceeding. Each of the "three separate constitutional protections" embodied in the Double Jeopardy Clause arise when, and only when, a person has been subjected to a criminal charge, whether by trial or by conviction via guilty plea and sentencing. The parties have not cited, nor has our research revealed, any decided case under the Double Jeopardy Clause where a mere criminal investigation, culminating in a civil settlement without any criminal prosecution, could clothe a person with constitutional rights against double jeopardy. For that basic reason alone, this motion must be denied. We will, however, briefly outline the law in the area of prosecutions by dual sovereigns, and the relevant facts in this record.

  The Supreme Court has consistently held that "the Constitution does not deny the State and Federal Governments the power to prosecute for the same act." Rinaldi v. United States, 434 U.S. 22, 28 (1977). This rule was first established in United States v. Lanza, 260 U.S. 377 (1922), holding that a prior state conviction, followed by a federal indictment for the same acts, did not violate the Fifth Amendment protection against double jeopardy. It was reinforced in the companion decisions Abbate v. United States, 359 U.S. 187 (1959), and Bartkus v. Illinois, 359 U.S. 121 (1959). Abbate, like Lanza, involved a federal indictment following a state conviction for the same acts. Bartkus involved the reverse situation of a state conviction following an acquittal on federal charges.*fn5 Over vigorous dissents, the Court declined to overrule Lanza and left intact the dual sovereignty doctrine, which continues in force to this day.*fn6 Our Court of Appeals has applied that doctrine to uphold successive state/federal prosecutions in an unbroken line of precedent. See, e.g., United States v. Gricco, 277 F.3d 339, 352 (3d Cir. 2002); United States v. Berry, 164 F.3d at 845-47; United States v. Bell, 113 F.3d 1345, 1351 n. 6 (3d Cir. 1997); United States v. Pungitore, 910 F.2d 1084, 1105-07 (3d Cir. 1990); United States v. Grimes, 641 F.2d 96, 100-04 (3d Cir. 1980); and United States v. Frumento, 563 F.2d 1083, 1085-89 (3d Cir. 1977).*fn7

  Some circuits recognize what has been called a "Bartkus exception" to the dual sovereignty doctrine. See, e.g., United States v. All Assets of G.P.S. Auto. Corp., 66 F.3d 483, 494-95 (2d Cir. 1995) (collecting cases). Our circuit has "recognized the potential existence" of a Bartkus exception, but has "never applied the exception to overturn a second state or federal prosecution." Berry, 164 F.3d at 847. Based on our careful review of the investigation record in this case, we ...

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