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Epstein Accusers, Justice Department Split on Next Steps

May 13, 2019, 12:18 PM

The Justice Department and lawyers for women accusing Jeffrey Epstein of running a sex trafficking ring haven’t been able to agree what happens next after a federal judge said Labor Secretary Alexander Acosta as a prosecutor broke the law in negotiating a controversial plea deal for the Miami hedge fund manager.

Judge Kenneth Marra in February ruled that Acosta and other prosecutors violated the law by failing to inform Epstein’s accusers of the nonprosecution agreement before it was approved by a court. Marra also instructed DOJ lawyers and attorneys for the accusers to come up with an appropriate remedy under the Crime Victims Rights Act. Both sides told the judge late Friday that they’re deadlocked.

“This case has spanned more than a decade, during which the Government repeatedly created obstacles to reaching the merits of whether CVRA violations occurred when the Government (and Epstein) purposely concealed the consummation and execution of a secret non-prosecution agreement,” lawyers for the accusers told the judge. They said efforts to craft a remedy for the victims “foundered as to how to proceed at the opening step.”

Marra’s decision and a Justice Department investigation into how the case was handled turned up the heat on Acosta, who was U.S. Attorney for the Southern District of Florida at the time. Acosta, who President Donald Trump has since publicly backed, appears to have survived initial calls for him to step down from the Cabinet position.

The South Florida case is the latest chapter in the decade-old Epstein saga, which has been the subject of swirling public attention following a November Miami Herald report detailing the allegations and the plea deal. A handful of Democrats and progressive groups have called for Acosta to resign, but labor unions, Democratic leaders, and others appear to be waiting for the litigation and DOJ probe to play out.

Epstein, a well-connected financier with ties to New York and Florida, was accused of using employees to bring local teen girls to his Palm Beach home for sex and paying them to recruit new victims. The alleged victims were as young as 13 at the time. The deal allowed Epstein to avoid prosecution for federal sex-trafficking offenses and instead serve 13 months in prison on state prostitution charges.

Marra ruled Feb. 21 that the prosecutors violated the law by entering the agreement without telling the alleged victims and “misleading” them to believe that Epstein may still be prosecuted in federal court. The law gives alleged victims broad rights to be involved in and “reasonably heard” during legal proceedings.

The judge said prosecutors didn’t give the alleged victims an adequate opportunity to weigh in on the plea deal. He made clear, however, that he wasn’t ruling on the validity of the deal itself.

Alan Dershowitz, the Harvard University law professor who represented Epstein in the case, said prosecutors will not be able to retry the case against his client.

“The one thing that is clear is that they can’t put him back in jail,” Dershowitz told Bloomberg Law shortly after Marra issued the decision. “There is no constitutional way he can be retried on the same charges.”

Safe for Now

Acosta has said through a DOL spokeswoman that he welcomes the new investigation and stands by his work as a federal prosecutor.

He recently told two separate congressional panels that he stepped in to pursue federal charges against Epstein after a Florida grand jury recommended no prison time for state charges. Acosta also said Epstein’s lawyers unsuccessfully asked Justice Department officials to tell his team to back off.

“This matter was appealed all the way up to the deputy attorney general’s office,” Acosta said in response to questioning at a May 1 House hearing. “Not because we weren’t doing enough but because the contention was that we were too aggressive.”

Epstein’s all-star legal defense team included Dershowitz, former special prosecutor Kenneth Starr, and famed criminal defense attorney Roy Black. Jay Lefkowitz, who previously worked with Acosta at Kirkland and Ellis, also was part of the team.

An Epstein accuser in a related lawsuit in New York claims Dershowitz participated in the sex ring, a claim Dershowitz denies. He’s among a group that has asked a court to unseal documents in that case.

Acosta’s supporters point out that the plea deal forced Epstein to compensate victims and register as a sex offender. They also say that some victims refused to cooperate with prosecutors, who had a tough time supporting federal instead of state charges by showing that the alleged crime happened across state lines.

Acosta made the “best possible decision and deal” in a “very complicated case,” White House press secretary Sarah Huckabee Sanders told reporters Feb. 22. President Trump later the same day called Acosta “a fantastic labor secretary.”

Marie Villafana, who worked as a federal prosecutor under Acosta on the Epstein case, told a federal court in 2017 that one alleged victim who initially declined to speak with investigators was represented by a lawyer whose fees were paid by Epstein. The same alleged victim later told investigators that Epstein never had sexual contact with her, according to Villafana. She also said other alleged victims declined to participate in the prosecution’s case.

‘Negligent in His Duty’

Critics say that if Acosta can’t stand up to accused pedophiles and their powerful lawyers, he has no business running an agency designed to protect workers.

“I do continue to have very serious concerns about the plea deal that you helped negotiate for Jeffrey Epstein for the horrific abuses he committed,” Sen. Patty Murray (D-Wash.) told Acosta at a May 2 Senate Appropriations subcommittee hearing. “That sweetheart deal and the way that it came about raises a lot of questions, and it really is unacceptable that we still do not have answers.”

Murray and other Democratic leaders, as well as the AFL-CIO, have stopped short of calling for Acosta to resign. They’re concerned that Deputy Labor Secretary Patrick Pizzella, a Republican operative who cut his teeth working with disgraced lobbyist Jack Abramoff, likely would take a more aggressive anti-union stance if he were to replace Acosta.

Meanwhile, lawyers for Epstein have asked to intervene in the South Florida case. They want a chance to weigh in on on any remedy that Marra proposes for Epstein’s accusers.

To contact the reporter on this story: Chris Opfer in New York at copfer@bloomberglaw.com

To contact the editors responsible for this story: Simon Nadel at snadel@bloomberglaw.com; Terence Hyland at thyland@bloomberglaw.com