[House Hearing, 108 Congress]
[From the U.S. Government Publishing Office]



 
REAUTHORIZATION OF THE U.S. DEPARTMENT OF JUSTICE: EXECUTIVE OFFICE FOR 
   U.S. ATTORNEYS, CIVIL DIVISION, ENVIRONMENT AND NATURAL RESOURCES 
    DIVISION, EXECUTIVE OFFICE FOR U.S. TRUSTEES, AND OFFICE OF THE 
                           SOLICITOR GENERAL

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   COMMERCIAL AND ADMINISTRATIVE LAW

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED EIGHTH CONGRESS

                             FIRST SESSION

                               __________

                             APRIL 8, 2003

                               __________

                             Serial No. 28

                               __________

         Printed for the use of the Committee on the Judiciary


    Available via the World Wide Web: http://www.house.gov/judiciary





                        U.S. GOVERNMENT PRINTING OFFICE

87-407                        WASHINGTON : 2004
_____________________________________________________________________
For sale by the Superintendent of Documents, U.S. Government Printing
Office Internet: bookstore.gpo.gov  Phone: toll free (866) 512-1800
Fax: (202) 512-2250  Mail: Stop SSOP, Washington, DC  20402-0001



                 COMMITTEE ON THE JUDICIARY

            F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois              JOHN CONYERS, Jr., Michigan
HOWARD COBLE, North Carolina         HOWARD L. BERMAN, California
LAMAR SMITH, Texas                   RICK BOUCHER, Virginia
ELTON GALLEGLY, California           JERROLD NADLER, New York
BOB GOODLATTE, Virginia              ROBERT C. SCOTT, Virginia
STEVE CHABOT, Ohio                   MELVIN L. WATT, North Carolina
WILLIAM L. JENKINS, Tennessee        ZOE LOFGREN, California
CHRIS CANNON, Utah                   SHEILA JACKSON LEE, Texas
SPENCER BACHUS, Alabama              MAXINE WATERS, California
JOHN N. HOSTETTLER, Indiana          MARTIN T. MEEHAN, Massachusetts
MARK GREEN, Wisconsin                WILLIAM D. DELAHUNT, Massachusetts
RIC KELLER, Florida                  ROBERT WEXLER, Florida
MELISSA A. HART, Pennsylvania        TAMMY BALDWIN, Wisconsin
JEFF FLAKE, Arizona                  ANTHONY D. WEINER, New York
MIKE PENCE, Indiana                  ADAM B. SCHIFF, California
J. RANDY FORBES, Virginia            LINDA T. SANCHEZ, California
STEVE KING, Iowa
JOHN R. CARTER, Texas
TOM FEENEY, Florida
MARSHA BLACKBURN, Tennessee

             Philip G. Kiko, Chief of Staff-General Counsel
               Perry H. Apelbaum, Minority Chief Counsel
                                 ------                                

           Subcommittee on Commercial and Administrative Law

                      CHRIS CANNON, Utah Chairman

HOWARD COBLE, North Carolina         MELVIN L. WATT, North Carolina
JEFF FLAKE, Arizona                  JERROLD NADLER, New York
JOHN R. CARTER, Texas                TAMMY BALDWIN, Wisconsin
MARSHA BLACKBURN, Tennessee          WILLIAM D. DELAHUNT, Massachusetts
STEVE CHABOT, Ohio                   ANTHONY D. WEINER, New York
TOM FEENEY, Florida

                  Raymond V. Smietanka, Chief Counsel

                        Susan A. Jensen, Counsel

                        Diane K. Taylor, Counsel

                  James Daley, Full Committee Counsel

                   Stephanie Moore, Minority Counsel





                            C O N T E N T S

                              ----------                              

                             APRIL 8, 2003

                           OPENING STATEMENT

                                                                   Page
The Honorable Chris Cannon, a Representative in Congress From the 
  State of Utah, and Chairman, Subcommittee on Commercial and 
  Administrative Law.............................................     1

                               WITNESSES

The Honorable Thomas Sansonetti, Assistant Attorney General, 
  Environment and Natural Resources Division
  Oral Testimony.................................................     5
  Prepared Statement.............................................     7
Mr. Stuart Schiffer, Deputy Assistant Attorney General, Civil 
  Division
  Oral Testimony.................................................    10
  Prepared Statement.............................................    11
Mr. Guy Lewis, Director, Executive Office for United States 
  Attorneys
  Oral Testimony.................................................    14
  Prepared Statement.............................................    16
Mr. Lawrence Friedman, Director, Executive Office for United 
  States Trustees
  Oral Testimony.................................................    20
  Prepared Statement.............................................    22

                                APPENDIX
               Material Submitted for the Hearing Record

Prepared Statement from Theodore B. Olson, Solicitor General of 
  the United States..............................................    33
Additional Questions from Chairman Chris Cannon..................    36
Additional Questions and Responses Presented to the Honorable 
  Thomas Sansonetti by Chairman Chris Cannon.....................    46
Additional Questions and Responses Presented to Stuart Schiffer 
  by Chairman Chris Cannon.......................................    52
Additional Questions and Responses Presented to Guy Lewis by 
  Chairman Chris Cannon..........................................    66
Additional Questions and Responses Presented to Lawrence Friedman 
  by Chairman Chris Cannon.......................................    84


REAUTHORIZATION OF THE U.S. DEPARTMENT OF JUSTICE: EXECUTIVE OFFICE FOR 
   U.S. ATTORNEYS, CIVIL DIVISION, ENVIRONMENT AND NATURAL RESOURCES 
    DIVISION, EXECUTIVE OFFICE FOR U.S. TRUSTEES, AND OFFICE OF THE 
                           SOLICITOR GENERAL

                              ----------                              


                         MONDAY, APRIL 8, 2003

                  House of Representatives,
                         Subcommittee on Commercial
                            and Administrative Law,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 2:05 p.m., in 
Room 2141, Rayburn House Office Building, Hon. Chris Cannon 
[Chairman of the Subcommittee] presiding.
    Mr. Cannon. The Subcommittee will come to order.
    I would like to welcome the panel today.
    I would also point out that we have a friend of mine, Eddie 
Radon Levy, who is a Congressman, I keep trying to say 
``dipotado,'' in the Mexican House of Representatives today. 
Mr. Radon Levy is the Chairman of the Subcommittee of the 
Mexican House on Mexican Affairs Abroad. So we welcome Eddie 
with us today. He will be leaving I think at some point because 
he has got other meetings, but we encouraged him to come and 
enjoy at least part of this hearing.
    I hope the hearing by the way will be enjoyable for 
everyone concerned.
    This afternoon we will hear testimony from four 
distinguished representatives of the Department of Justice who 
will report on activities of their respective positions 
preparatory to consideration by the Committee on the Judiciary 
of legislation reauthorizing the Department.
    Today's hearing will not only enable us to make 
recommendations to the Committee concerning the activities of 
these divisions, but it will also provide us with the basis and 
context for possible subsequent hearings and continuing 
oversight.
    The purpose of a reauthorization hearing is to provide an 
opportunity to examine the budget requests and policy 
priorities from the representatives of these components. 
Appropriate areas of inquiry include, for example, the 
Department's effectiveness in resource allocation and other 
budget efficiencies, as well consideration of how well these 
components have set and achieved their goals.
    The Subcommittee's oversight responsibility with respect to 
the Department include five of the most active and important 
divisions: The Environmental and Natural Resources Division, 
the Civil Division, the Executive Office for the United States 
Attorneys, the Executive Office for the United States Trustees, 
and the Office of the Solicitor General.
    The Environment and Natural Resources Division--I will call 
that ENRD from now on--first created in 1909 as the Public 
Lands Division, has seen its areas of responsibility expanded 
to include litigation concerning the protection, use, and 
development of the Nation's natural resources and public lands, 
wildlife protection, Indian rights and claims, cleanup of the 
Nation's hazardous waste sites, the acquisition of prior 
property for Federal use, and the defense of environmental 
challenges to Government programs and activities. It is in 
effect the largest environmental law firm in the country.
    The Civil Division is one of DOJ's six litigating 
divisions. It represents the United States, its departments and 
the agencies, Members of Congress--so we want to treat you guys 
well, by the way--cabinet offices and other Federal employees. 
It brings suit to collect money owed the United States by 
delinquent debtors and recovers sums lost to the Government 
through waste, fraud, and corruption. Finally, it enforces 
Federal consumer protection laws, immigration laws and 
policies, and the regulatory integrity of Federal programs.
    The Executive Office for the United States Attorneys 
provides support and coordination to the 94 United States 
Attorneys throughout the country in the following areas: 
General executive assistance and direction, policy development, 
and administrative management direction and oversight. It 
supervises the legal education of DOJ personnel through such 
units as the Attorney General's Advocacy Institute and is 
entrusted with the evaluation and improvement of U.S. 
Attorney's performance.
    The Executive Office for the United States Trustees is 
responsible for overseeing the administration of bankruptcy 
cases and the integrity of the bankruptcy system. It appoints 
and supervises private trustees who administer chapter 7, 12, 
and 13 bankruptcy estates, and it enforces the requirements of 
the bankruptcy code to prevent fraud and abuse.
    The Office of Solicitor General supervises and conducts 
Government litigation in the United States Supreme Court. It is 
involved in about two-thirds of all the cases that the Supreme 
Court decides on the merits each year. The Solicitor General 
reviews all cases decided adversely to the Government in the 
lower courts to determine whether they should be appealed and, 
if so, which position should be taken.
    The Subcommittee has chosen to accept written testimony 
from the Office of Solicitor General as its budget request is 
the smallest and does not represent a significant increase. So 
we may look at or hold a hearing in the future on the Office of 
Solicitor General.
    I might note that we were just handed a report which we 
have not had a chance to evaluate much, but the conclusions 
appear to be a little bit critical of the program and its 
effort to detect fraud and abuse. And let me just give you a 
quote from that:
    The UST Program does not have an ongoing systematic process 
to identify vulnerabilities in the bankruptcy system, and it 
has not established uniform internal controls to detect common 
high-risk frauds such as a debtor's failure to disclose all 
assets. In fact, the management controls in place did not 
address most of the fraud indicators identified by the UST 
Manual, and instead focuses primarily on fraud that might be 
committed by trustees and their employees rather than by 
debtors.
    In addition, the report concludes that, as a result, the 
FBI's estimated 10 percent of bankruptcy cases that involve 
fraud may not be discovered, and the UST Program's mission to 
preserve the integrity of the bankruptcy system may not be 
accomplished as effectively as it should.
    I also note that the report contains a fairly extensive 
response from Mr. Friedman on behalf of the program.
    Given the fact that we have not had sufficient time to 
study the report, its conclusions, and the program's response, 
I would suggest that we follow up either in the form of written 
questions or further hearing if appropriate under the 
circumstances.
    Just a couple of points here on how we will proceed in the 
hearing. We will take testimony from our four representatives 
from the Justice Department today.
    You will note that we have a lighting system, which I think 
works now. It looks like we have got this thing working. A 
little problem there. You will note that it starts with a green 
light. After 4 minutes it turns to a yellow, and then it turns 
to a red light. It is my habit to tap the gavel at 5 minutes. 
We would appreciate it if you would finish up your thought. We 
don't want to cut people off in their thinking, but I find that 
it works much better if everybody knows that--members of this 
panel included on this side of the dais--that 5 minutes is 5 
minutes. So if you could wrap it by the time we get there, I 
will appreciate that, and I will try to be consistent in my 
tapping. If you are really boring and I lose track, I will get 
nudged or something.
    We look forward to hearing from representatives of these 
divisions today. Mr. Watt was going to join us. We may allow 
him to make an opening statement when he comes in or after the 
panel.
    Does anyone on the panel wish to submit an opening 
statement for the record? Or, worse yet, take 5 minutes? Thank 
you. Good guys on this side of the Committee. We appreciate 
that.
    It is my pleasure to welcome representatives from the 
Department of Justice who are with us today to testify 
regarding the subject matter of today's hearing.
    I will hear first from Thomas Sansonetti, who is the 
Assistant Attorney General in charge of the Environment and 
Natural Resources Division at the Department of Justice. Mr. 
Sansonetti served as the Solicitor for the Department of 
Interior from 1990 to 1993, where he was the primary legal 
advisor to Secretary Manuel Lujan, Jr., and the six Assistant 
Secretaries on all legal matters confronting the Department.
    During his tenure, Mr. Sansonetti signed the $1.1 billion 
Exxon Valdez oil spill settlement after serving as one of the 
six Federal negotiators, and was appointed counsel to the 
Endangered Species Committee for the Spotted Owl hearings in 
Oregon.
    He also served at the Interior Department as Associate 
Solicitor on Energy and Natural Resource from 1987 to 1989, and 
we just barely missed each other. I left the Department as an 
Associate Solicitor in 1987, but I followed your career, Mr. 
Sansonetti, and appreciate it.
    By the way, he was the Administrative Assistant and 
Legislative Director for then Congressman Craig Thomas during 
the 101st Congress. President George W. Bush also appointed him 
to chair the Presidential Advisory Commission on Western Water 
Resources.
    Mr. Sansonetti received both a BA and an MBA from the 
University of Virginia and received a law degree from 
Washington Lee University.
    I welcome Mr. Sansonetti.
    And I will go ahead and introduce the other panelists, and 
then we will just go through the panel, if you don't mind.
    Next we have Mr. Stuart Schiffer in the Department or who 
is the Deputy Assistant Attorney General in the Civil Division 
of the State--or the Department of Justice.
    Since 1978, Mr. Schiffer has served as the Senior Career 
Official in the Civil Division, Justice's largest litigating 
division. He is responsible for management of the Division's 
280 attorneys in the Commercial Litigation Branch.
    On numerous cases he has served as the Division's Acting 
Assistant Attorney General, most recently in the first 8 months 
of the current Administration.
    He is a charter member of the Senior Executive Service, 
which is I think is an enormous honor, and has four times 
received Presidential Rank Awards, the highest awards given to 
the members of the Senior Executive Service. Mr. Schiffer 
received both his undergraduate and law degrees from the 
University of Illinois.
    Mr. Guy Lewis is Director of the Executive Committee or the 
Executive Office for United States Attorneys in the Department 
of Justice.
    Mr. Lewis is the former United States Attorney for the 
Southern District of Florida, where he has been an Assistant 
since 1988, prior to being appointed as the United States 
Attorney in 2000.
    Mr. Lewis received his undergraduate degree from the 
University of Tennessee and his law degree from the University 
of Memphis.
    And Mr. Lawrence Friedman is Director of the Executive 
Office of the United States Trustees at the Department of 
Justice.
    Prior to joining the Department of Justice, Mr. Friedman 
was a partner in the Southfield law firm of Friedman & Kohut. 
He was appointed to the panel of Chapter 7 Trustees for the 
Eastern District of Michigan in 1990, and also served as a 
Chapter 11 Trustee when so appointed and managed to administer 
more than 10,000 bankruptcy cases as a trustee.
    Mr. Friedman received his undergraduate degree from 
Hillsdale College and his law degree from Thomas M. Cooley Law 
School.
    We thank you for coming back to join us, Mr. Friedman, and 
we thank you all for coming to today's hearing.
    And we will now turn the time over to Mr. Sansonetti for 5 
minutes, please.
    Thank you.

 STATEMENT OF HONORABLE THOMAS SANSONETTI, ASSISTANT ATTORNEY 
      GENERAL, ENVIRONMENT AND NATURAL RESOURCES DIVISION

    Mr. Sansonetti. Thank you, Chairman Cannon, and Members of 
the Subcommittee.
    I am pleased to be here today, and welcome this opportunity 
to tell you about the Environment and Natural Resources 
Division. I will summarize the Division's work which is 
essential to the environmental and natural resource protection 
in this country, and then discuss the resources that the 
Administration is requesting for the Division for the fiscal 
year 2004.
    If Congress approves funding for our proposed Hazardous 
Materials Transportation Initiative, which promotes Homeland 
Security, and our Tribal Trust Fund Litigation Initiative, 
which provides necessary resources to defend multi-billion-
dollar claims against the public fisc, then the Division will 
receive the first real increase in its budget in 10 years.
    The Division's mission is to enforce civil and criminal 
environmental laws that protect the health and environment of 
our citizens, and it defends suits challenging environmental 
and conservation laws, programs, and activities.
    We also represent the United States in matters concerning 
Indian rights and claims in the acquisition of Federal 
property. We have approximately 400 lawyers handling over 
10,000 active cases, and we represent virtually every Federal 
agency with cases in every judicial district in the United 
States.
    Our principle clients include the EPA and the Departments 
of Interior, Defense, and Agriculture and will soon include the 
Department of Homeland Security.
    Many of our cases involve defensive litigation regarding 
alleged violations by the United States of the environmental 
laws, for example, in connection with the Federal highway 
construction or airport expansion.
    Another significant portion of our docket consists of 
nondiscretionary imminent-domain litigation involving the 
acquisition of land for important national projects when our 
defensive and imminent domain litigation is considered 
together.
    In cases funded from the General Legal Activities 
Appropriation, over 60 percent of our attorneys' time is spent 
on nondiscretionary cases. This fact has important resource 
implications, as we cannot always anticipate our future 
workload.
    Nevertheless, we are committed to ensuring that American 
taxpayers are getting their monies' worth. And despite budget 
constraints and declining resources beginning in the 1990's, we 
have achieved significant cost-effective results.
    We have obtained more than $7.9 billion dollars in fiscal 
years 2001 and 2002 in environmental cleanup and compliance 
commitments, two of our best years ever.
    We have secured civil penalties and criminal fines for the 
U.S. Treasury that exceed the Division's GLA budget.
    We have obtained benefits for human health in the 
environment that provide an impressive return on the taxpayers' 
dollar.
    We have also protected the taxpayer from invalid or 
overbroad monetary claims sometimes for hundreds of millions of 
dollars.
    To leverage our resources, we have forged partnerships with 
the U.S. Attorneys' Offices and State and local officials 
across the Nation. For example, we recently joined the National 
Association of Attorneys General in announcing the release of 
our guidelines for joint State, Federal, civil, environmental 
enforcement litigation.
    We approach our work with the spirit of teamwork, 
cooperation, and Federalism that is the hallmark of effective 
environmental protection. And my written testimony provides 
several examples that illustrate the success of this approach.
    Now, for fiscal year 2004, the President has requested 
$81.25 million to the Division within the Justice Department's 
GLA appropriation. Most of the increase for the fiscal year 
2003 appropriation is for mandatory adjustments and allowances, 
but we are also requesting $4.188 million for two initiatives: 
The Hazardous Materials Transportation Initiative, and the 
Tribal Trust Fund Litigation Initiative.
    Funding for both initiatives is critical, and if money is 
provided, again, this would be the first real increase the 
Division's budget has seen in over a decade.
    The Hazardous Materials Transportation Initiative will help 
protect America against the threat of terrorism by helping to 
prevent, disrupt, and defeat terrorist operations before they 
occur, and by vigorously prosecuting those who have committed 
or intend to commit terrorist attacks on the United States.
    Experts who have considered the possible terrorist targets 
in the wake of September 11th attacks have identified Nation's 
Hazardous Material Transportation and Handling System as a 
vulnerable area.
    The Tribal Trust Litigation Initiative is essential for the 
Government to effectively defend itself in 22 lawsuits brought 
by various Indian tribes alleging that the United States has 
mismanaged tribal assets and failed to provide an accounting of 
the money collected, managed, and disbursed by the United 
States of the behalf of the tribes.
    Some of these cases seek an order requiring the United 
States perform a multi-million dollar, multi-year accounting 
and others seek a money judgment for the losses the tribes 
claim they have suffered.
    In these cases filed so far, the tribes are claiming that 
they are owed more than $3 billion, and 200 to 300 other tribes 
may be preparing claims for similar amounts.
    These Tribal Trust cases are similar to the huge and 
controversial Cobell versus Norton lawsuit, a class-action on 
behalf of 300,000 individual Indians. And to avoid another 
situation similar to Cobell, it is critical the Department of 
Justice establish a team dedicated to litigating these cases.
    I would be happy to answer any questions that the Committee 
may have regarding the Division and its work.
    Mr. Cannon. Thank you, Mr. Sansonetti.
    [The prepared statement of Mr. Sansonetti follows:]
               Prepared Statement of Thomas L. Sansonetti
                              introduction
    Chairman Cannon, Congressman Watt, and Members of the Subcommittee, 
I am pleased to be here today, along with my colleagues from the 
Department of Justice. I welcome this opportunity to discuss the 
Environment and Natural Resources Division, one of the principal 
litigating Divisions within the Department of Justice, and to answer 
any questions that the Subcommittee may have about the Division.
    In my testimony today, I will first summarize the Division's work 
and provide an outline of the scope of our responsibilities. Our work 
is essential to the implementation of Congressional programs to protect 
the nation's environment and its natural resources, and to defend 
federal agencies sued by others. We have a long and distinguished 
history, and the Division's attorneys have built a record that 
demonstrates their commitment to legal excellence. In the second part 
of my testimony, I will discuss the resources that the Administration 
is requesting for the Division as part of its fiscal year 2004 budget. 
In particular, I will focus on the monies we are requesting for two 
ENRD initiatives--the Hazardous Materials Transportation Initiative, 
which will promote homeland security, and the Tribal Trust Fund 
Litigation Initiative, which will provide resources to defend multi-
billion claims against the public fisc. If Congress decides to approve 
funding for these two important initiatives, it would constitute the 
first real increase that the Division's budget has seen in the last 
decade.
       overview of the environment and natural resources division
    The Environment and Natural Resources Division's mission is to 
enforce civil and criminal environmental laws and programs to protect 
the health and environment of United States citizens, and to defend 
suits challenging environmental and conservation laws, programs and 
activities. We represent the United States in matters concerning the 
protection, use and development of the Nation's natural resources and 
public lands, wildlife protection, Indian rights and claims, and the 
acquisition of federal property. We represent virtually every federal 
agency in over 10,000 active cases in every judicial district in the 
nation utilizing the efforts of approximately 400 lawyers at the 
present time. Our principal clients include the U.S. Environmental 
Protection Agency, and the Departments of, Agriculture, Commerce, 
Defense, Energy, the Interior, and Transportation. We will soon be 
responsible for a portion of the new Department of Homeland Security 
cases as well.
    Many of our cases involve defensive litigation in which the United 
States is being sued for alleged violations of the environmental laws, 
for example in connection with federal highway construction, airport 
expansion, or military training. These defensive cases are non-
discretionary. This large defensive docket has important implications 
for the Division's resources because we cannot always anticipate our 
future workload. Effective lawyering in these cases is critical to 
agency implementation of Congressionally mandated programs and 
protection of the public fisc.
    In addition to our defensive work, another significant portion of 
our docket consists of non-discretionary eminent domain litigation. 
This work, undertaken pursuant to Congressional direction or authority, 
involves the acquisition of land for important national projects such 
as the construction of federal courthouses and the construction or 
expansion of border stations for the Immigration and Naturalization 
Service. When our defensive and eminent domain litigation is considered 
together, in cases funded from the General Legal Activities (GLA) 
appropriation over 60 percent of our attorney time is spent on non-
discretionary cases.
    The Division is committed to ensuring that American taxpayers are 
getting their money's worth. Despite budget constraints and declining 
resources beginning in the 1990's, we have achieved significant, cost-
effective results for the public. Conserving the Superfund to ensure 
prompt cleanup of hazardous waste sites is a top priority for the 
Division, and FY 2001 and 2002 were the two best consecutive years on 
record for Superfund cost recovery, Superfund injunctive relief, and 
natural resource damage recovery. In fact, when court-ordered 
injunctive relief for Superfund, the Clean Air Act, Clean Water Act, 
and hazardous waste enforcement laws is combined, we have obtained more 
than $7.9 billion in cleanup and compliance commitments, two of our 
best years ever. We have secured civil penalties and criminal fines for 
the U.S. Treasury that exceed the Division's GLA budget, and obtained 
benefits for human health and the environment that provide an 
impressive return on the taxpayer's dollar. We also have protected the 
taxpayer from invalid or overbroad monetary claims against the United 
States, claims that sometimes involve hundreds of millions of dollars.
    To leverage our resources and enhance our effectiveness, we have 
forged partnerships with U.S. Attorneys' Offices and state Attorneys 
General and other state and local officials across the nation. Through 
Law Enforcement Coordinating Committees and other task forces developed 
in U.S. Attorneys' Offices across the country, we have increased 
cooperation among local, state, and federal environmental enforcement 
offices. In addition, just two weeks ago, in cooperation with the 
National Association of Attorneys General (NAAG) and EPA, we announced 
the release of our ``Guidelines for Joint State/Federal Civil 
Environmental Enforcement Litigation,'' which will assist states and 
the federal government in the conduct of joint civil environment 
enforcement litigation. In these ways and many others, we approach our 
work with the spirit of teamwork, cooperation, and federalism that is 
the hallmark of effective environmental protection. I would like to 
take a moment to discuss some cases from my tenure as Assistant 
Attorney General that illustrate the success of this approach.
    Fraudulent testing of the integrity of underground storage tanks is 
a major problem. Tests that indicate that a tank is sound when in fact 
it is not can result in major environmental harm and property damage, 
and the Division is committed to rooting out and prosecuting fraud in 
this area. In United States v. Tanknology, which involved fraudulent 
testing of tanks in Arizona, Florida, and Texas, among other states, we 
worked with the EPA Criminal Investigation Division, FBI, the Postal 
Service Office of the Inspector General, Defense Criminal Investigative 
Service, Army Criminal Investigation Division, Air Force Office of 
Special Investigations, Navy Criminal Investigative Service, NASA, and 
personnel from the Texas Natural Resources and Conservation Commission 
and the Pennsylvania Department of Environmental Protection to obtain 
$1 million in criminal fines and another $1.29 million in restitution 
from Tanknology-NDE International, the largest UST testing company in 
the United States. In another such case last year, United States v. 
Adams, we worked with the North Carolina State Bureau of Investigation, 
South Carolina Department of Health and Environmental Control Office of 
Criminal Investigations, and U.S. EPA, to make sure that the person 
responsible for testing fraud in the Carolinas, Florida, Georgia, 
Tennessee, and Virginia, was sentenced to 27 months in prison and three 
years of supervisory release for conspiracy to commit mail fraud and 
related crimes. In addition to being a good example of federal-state 
cooperation, these cases illustrate that we are committed to leveling 
the playing field in our enforcement work and ensuring that bad actors 
don't get an unfair competitive advantage over good corporate citizens 
who invest in compliance and environmental management programs.
    Another great example of cooperation came in United States v. 
Nuyen, where we successfully concluded the first-ever criminal 
prosecution under the federal Residential Lead-Based Paint Hazard 
Reduction Act in conjunction with the U.S. Attorney's Offices here in 
the District and in Maryland. This Act requires landlords to give 
tenants warnings about actual and possible lead hazards. Lead poisoning 
can impair a child's central nervous system, kidneys, and bone marrow 
and even cause coma, convulsions, and death, and is especially acute 
among low-income and minority children living in older housing. The 
defendant, a Maryland landlord, pleaded guilty to obstructing justice 
and making false statements to federal officials, as well as violating 
the Lead Hazard Reduction Act. This case is part of a larger initiative 
to protect our nation's children from the hazards of lead paint and 
includes civil settlements which will result in the cleanup of such 
hazards in more than 16,000 apartments in New York, Los Angeles, and 
Chicago.
    Also, earlier this year, we joined EPA and the state of Washington 
in announcing a civil settlement with Olympic Pipe Line Company and 
Shell Pipeline Company LP for environmental violations leading to a 
fatal pipeline rupture in Bellingham, Washington, which caused the 
deaths of two 10-year-old boys and an 18-year-old man. The companies 
will pay civil penalties of $15 million total, to be split equally 
between the federal government and the State, and will spend an 
estimated $77 million to conduct programs for state-of-the-art spill 
prevention work on thousands of miles of pipelines in states including 
Washington, Colorado, Kansas, Illinois, Indiana, Ohio, Oklahoma and 
Texas. The companies will also pay $21 million total in criminal fines. 
Promoting and maintaining plant and infrastructure security is of 
paramount concern, particularly in these uncertain times, and we hope 
that the measures imposed in this case will help prevent such a tragedy 
from ever happening again.
    These are only a few of the Division's many cases, but they are 
representative of the high-quality, cost-effective work that the 
Division's staff performs every day on behalf of the American taxpayer. 
If you are interested in learning more about the Division's work, 
please visit our website at http://www.usdoj.gov/enrd/pressroom.html.
               enrd's budget request for fiscal year 2004
    The Division receives its annual appropriation from the General 
Legal Activities (GLA) portion of the Justice Department's 
appropriation. For fiscal year 2004, the President has requested 
$81,205,000 for the Division within the Justice Department's GLA 
appropriation. Most of the increase over the FY 2003 appropriation is 
due to mandatory adjustments and allowances, including pay raises, 
other salary adjustments, and increases for GSA rent, which will allow 
the Division to maintain its current level of operations. However, as 
part of his proposed budget, the President is also requesting 
$4,188,000 for two ENRD initiatives--the Hazardous Materials 
Transportation Initiative and the Tribal Trust Fund Litigation 
Initiative. These initiatives, if funded, will, respectively, promote 
homeland security and enable the Division to effectively defend the 
United States against a wave of claims for billions of dollars. They 
would also constitute the first real increase that the Division's 
budget has seen in the last decade. For the reasons that I will now 
give, funding for both initiatives is critical.
    The Hazardous Materials Transportation Initiative will help the 
Department achieve its top strategic goal of protecting America against 
the threat of terrorism by helping to prevent, disrupt, and defeat 
terrorist operations before they occur, and by vigorously prosecuting 
those who have committed, or intend to commit terrorist attacks in the 
United States. Experts who have considered the issue of possible 
terrorist targets in the wake of the September 11th attacks have 
identified the nation's hazardous material (``HazMat'') transportation 
and handling system as a vulnerable area. Deaths and injuries could 
result from a terrorist with a fraudulent HazMat license commandeering 
a tractor trailer or a vessel laden with flammable or poisonous 
materials, as could an attack on a pipeline or other facility handling 
HazMat that does not have proper safety and security measures in place. 
The HazMat Initiative will concentrate on three tasks: 1) development 
of strategy and coordination with other federal, state and local 
agencies; 2) development of criminal prosecutions and referrals for 
civil enforcement actions; and 3) development and implementation of a 
training program to assist federal, state and local prosecutors and 
investigators in uncovering and prosecuting such illegal activity. 
These measures will effectively marshal and focus all available 
resources, create an immediate deterrent effect, and ensure long-term 
effectiveness through training of United States Attorneys and state 
enforcement offices around the country, and will give state and local 
law enforcement agencies a considerable boost in implementing counter-
terrorist activities.
    The Tribal Trust Fund Litigation Initiative is essential for the 
government to effectively defend itself in twenty-two current lawsuits 
brought by various Indian Tribes alleging that the U.S. has mismanaged 
tribal assets and failed to provide an ``accounting'' of the money 
collected, managed and disbursed by the U.S. on behalf of the Tribes. 
Some of these cases seek an order requiring the U.S. to perform a 
multi-million dollar, multi-year accounting, and others seek a money 
judgment for losses the Tribes claim they have suffered. In the twenty-
two cases filed so far, the Tribes are claiming that they are owed more 
than $3 billion--and 200 to 300 other Tribes may be preparing claims 
for similar amounts. These Tribal Trust cases are similar to the 
significant Cobell v. Norton lawsuit, a class action on behalf of 
300,000 individual Indians. Both Cobell and the Tribal Trust cases 
concern the scope of the duty owed to Native Americans for the Indian 
land that the government has held in trust since the late 1800s and has 
been used, among other things, for grazing, lodging, and oil and gas 
exploration. Three Cabinet officials and two other Presidential 
appointees have been held in contempt in Cobell, in part for their 
alleged failure to obey orders to produce documents, and further 
contempt charges are still pending against 37 government attorneys and 
managers. To avoid allegations similar to those in Cobell v. Norton, it 
is critical that the Department of Justice establish a team dedicated 
to litigating these cases. Many of them involve millions of historical 
accounting documents spanning more than a century of economic activity, 
and the issues are legally and factually complex.
    This initiative will enable the Department of Justice to 
effectively defend the United States in the first wave of cases filed 
seeking recompense for Tribal Trust accounts, and maintain an adequate 
staffing level in our remaining non-discretionary caseload. Failure to 
provide sufficient resources for these cases could lead to additional 
allegations of contempt, substantial and unnecessary monetary awards at 
taxpayer expense, and a public loss of confidence in the federal 
government in general.
                               conclusion
    The work of the Environment and Natural Resources Division is both 
challenging and complex. It is vitally important to the implementation 
of Congressional programs and priorities regarding public health and 
the environment, to the protection of the public fisc, and to the 
advancement of the public interest generally. We have an exceptional 
record of assuring that polluters are made to comply with the law, that 
responsible private parties are made to cleanup Superfund sites rather 
than leaving the taxpayer on the hook, and that criminal defendants are 
punished appropriately. I am proud of the people in my Division, who 
consistently provide top-notch, cost-effective legal services to the 
American people and who dedicate their lives to assuring that the rule 
of law is met and complied with by all parties.
    I would be happy to answer any questions you might have about the 
Division and its work.

    Mr. Cannon. Mr. Schiffer.

    STATEMENT OF STUART SCHIFFER, DEPUTY ASSISTANT ATTORNEY 
                    GENERAL, CIVIL DIVISION

    Mr. Schiffer. Thank you, Mr. Chairman, Members of the 
Subcommittee. I appreciate the opportunity to appear before you 
today to discuss the work of the Civil Division.
    The size of our caseload and the variety of cases entrusted 
to us are such that it is somewhat impossible to describe in 5 
minutes, so I will try to do it in a little bit less time than 
that.
    Stripped to the barest essentials, our responsibilities can 
best be described as safeguarding and saving billions of 
dollars in taxpayer funds, recovering similarly impressive 
amounts for the Federal Treasury, and defending the policies 
and practices of the Executive Branch, and, as well, the 
decisions made by Congress in the form of the statutes passed 
by the Congress.
    We, in the Civil Division, are not the initiators of 
Government policies, but instead, as is true of our colleagues 
in the U.S. Attorney's Offices, we are front-line lawyers who 
represent in court virtually every Government agency in the 
broadest conceivable array of cases.
    We have only the most limited control of our caseload. 
Almost 90 percent of the cases are defensive; that is, they are 
suits brought against the Government and its officers.
    Even with respect to the affirmative portion of our 
caseload, the discretion or control that we might be thought to 
have is often illusory. For example, when the Food and Drug 
Administration or an agency similarly situated refers to us for 
injunctive relief, allegations that unsafe or unhealthy drugs 
are being manufactured and sold illegally, or that a warehouse 
is contaminated, we in fact have very little option but to 
proceed with the case.
    I would also add that almost 40 percent of our attorneys 
are responsible for litigation in the so-called national 
courts, that is, courts that have nationwide jurisdiction. The 
Court of Federal Claims in Washington, the Court of Appeals for 
the Federal Circuit, and the New York-based Court of 
International Trade.
    Many of the cases in these courts are among our most 
complex. And, of course, there are no U.S. Attorneys assigned 
to these courts with whom we can share the caseload.
    The President's fiscal year 2004 budget request for the 
Division includes only the most modest increases to handle 
first our burgeoning immigration caseload and, second, $1 
million for administration of the Radiation Exposure 
Compensation Act.
    We too have been operating under a largely static budget 
with a rising workload, and I believe these are minimal 
increases needed for us to fulfill our responsibilities in 
these vital area.
    I started by saying I really couldn't summarize the work of 
the Division in under 5 minutes, and so I think I will stop at 
this point simply by stating my heartfelt belief that the 
taxpayers get a huge return of investment in the work that the 
Civil Division does. And I look forward to answering your 
questions.
    Mr. Cannon. Thank you, Mr. Schiffer.
    I can assure you that you will have that opportunity.
    Mr. Schiffer. I will try to answer your questions.
    Mr. Cannon. Mr. Lewis, before we recognize you, let me 
point out that we have Mr. Flake from Arizona, Mr. Feeney from 
Florida, who is also the Vice Chair of this Committee, and Mr. 
Chabot from Ohio has been in, and we expect Mr. Watt from North 
Carolina shortly.
    [The prepared statement of Mr. Schiffer follows:]
                Prepared Statement of Stuart E. Schiffer
    Chairman Cannon, Congressman Watt, and Members of the Subcommittee:
    I appreciate the opportunity to discuss the work of the Civil 
Division of the Department of Justice and our budget and resource needs 
for Fiscal Year 2004.
    The Division represents the interests of the United States in a 
wide range of civil matters. Our cases encompass virtually every aspect 
of the Federal government--from defending the constitutionality of 
Federal statutes to recovering money from those who have committed 
fraud in connection with government programs, to the administration of 
national compensation programs, to the representation of Federal 
agencies in a host of matters that arise as part and parcel of 
Government operations--contract disputes, allegations of negligence and 
discrimination, loan defaults, immigration matters, and much more. We 
have 729 dedicated public servants who serve as trial attorneys in the 
Division and 411 full and part time employees who provide essential 
paralegal, administrative, and clerical support.
    Over the last year and a half, the Civil Division has:

          Recovered hundreds of millions of dollars lost 
        through fraud against health care and defense programs;

          Defended Congressional efforts to shield children 
        from pornography on the Internet;

          Protected the public fisc from billions of dollars in 
        claims arising from the Government's commercial activities;

          Developed the Employment Discrimination Task Force--a 
        joint venture with the Civil Rights Division that has provided 
        substantive guidance and training to the United States 
        Attorneys Offices on this burgeoning area of complicated 
        litigation.

          The Civil Division has taken on the task of assisting 
        in the development and administration of congressional 
        programs, such as the September 11th Victim Compensation Fund; 
        the Division has also continued its work with the Vaccine 
        Injury Compensation Program, and the Radiation Exposure 
        Compensation Act.

          Further, in the months since the September 11th 
        attacks, there has been a substantial increase in civil 
        litigation challenging the Federal government's coordinated 
        response to those attacks and the Administration's policies 
        designed to prevent future acts of terrorism. The Civil 
        Division currently has well over 60 pieces of litigation 
        directly related to the September 11 attacks and the country's 
        response to those attacks.
                           national security
    Among the laws and policies of most prominent concern to the 
Administration, the Congress, and the public are those involving our 
nation's security. We take the Attorney General's charge seriously--to 
prevent, disrupt, and dismantle future terrorist attacks by thinking 
outside the box, but never outside the Constitution. Here our role is 
especially critical, as Division attorneys defend challenges to the USA 
Patriot Act and the AntiTerrorism Act, lead efforts to freeze the 
assets of terrorist organizations and ensure that immigration hearings 
may proceed without risking harm to our Nation's counterterrorism 
strategy. Civil Division attorneys defend enforcement actions involving 
the detention and removal of suspected alien terrorists and defend our 
Commander-In-Chief in suits seeking to enjoin the country's military 
actions in Iraq.
    While national security cases are paramount, they represent a small 
fraction of the over 29,000 cases and matters handled annually by the 
Civil Division. This vast and diverse workload is handled by our trial 
attorneys who spend their time on the front lines of litigation--
preparing motions, taking depositions, negotiating settlements, 
conducting trials, and pursuing appeals.
                       protecting the public fisc
    Our dockets are filled with cases that involve monetary claims--the 
majority are claims against the Government and huge sums are at risk.
    It is hardly possible to overstate the magnitude of these claims, 
considering that our responsibilities include: the 100+ Winstar suits 
in which some 400 financial institutions sought in the neighborhood of 
$30 billion for alleged losses that occurred in the wake of banking 
reforms enacted in the 1980s; the Cobell class action--perhaps the 
largest ever filed against the Government; and the Spent Nuclear Fuel 
cases where nuclear utilities allege a multi-billion dollar breach of 
contract against the Department of Energy for its failure to begin 
acceptance and disposal of spent nuclear fuel.
    In these and thousands of other defensive monetary matters, our 
mission is to ensure that the will of Congress and the actions of the 
Executive Branch are vigorously and fairly defended, and that claims 
without merit are not paid from the public fisc. In fiscal year 2002, 
we defeated $17 billion in claims asserted against the United States.
    In any given year about 15 to 20 percent of our cases involve 
affirmative litigation to enforce important Government regulations and 
policies, and to recover money owed the Government resulting from 
commercial transactions, bankruptcy proceedings, and fraud.
    Cases in point include the Schering-Plough consent decree that 
required the company to pay $500 million for its failure to comply with 
FDA regulations.
    In fiscal year 2002, we recovered for the United States an 
additional $1.9 billion and set precedents that will deter future 
practices designed to bilk the public coffers and the American people.
                            workload trends
    In 2000, the Civil Division had just over 20,000 cases and matters, 
and a staff of 725 trial attorneys. In just three years our pending 
caseload grew 45 percent to just over 29,000, while the number of trial 
attorneys has held almost steady at 729.
    During this time we witnessed significant growth in appellate cases 
and matters--driven largely by the steep rise in challenges to 
immigration enforcement actions. Cases in National courts and foreign 
courts continued to account for a very significant portion of our 
workload--some 44 percent. In contrast, the number of trial cases 
assigned to district courts declined both numerically and as a 
proportion of our total workload. Most notably, the sharpest increases 
are attributable to our expanding responsibilities for administering 
compensation programs.
                       alternatives to litigation
    The Vaccine Injury Compensation Program was created in 1986 by the 
National Childhood Vaccine Injury Act--to encourage childhood 
vaccination by providing a streamlined system for compensation in rare 
instances where an injury results. To date, nearly 1,800 people have 
been paid in excess of $1.4 billion. The Program's success is evident.
    In FY 2002, claims filed under the Program increased more than 
four-fold--a rise largely attributable to claims alleging that a 
vaccine preservative, thimerosal, caused autism. As the Court of 
Federal Claims increases its staff of Special Masters, we expect 
further growth in vaccine-related work.
    Congress has introduced several bills that could substantially 
increase the scope of the Vaccine Program. Most significantly, 
lawmakers and the Administration are examining how the United States 
can most fairly handle claims likely to emerge with the widescale 
issuance of smallpox vaccine.
    To handle its vaccine caseload, the Division may spend up to 
$4,028,000, which is made available through a reimbursement from the 
National Childhood Vaccine Injury Trust Fund. The Division will 
continue to monitor the sufficiency of these resources.
    Congress passed the Radiation Exposure Compensation Act (RECA) in 
1990 to offer an apology and compensation to people who suffered 
disease or death as a result of the nation's nuclear weapons program 
during the Cold War era.
    In July 2000, RECA Amendments were enacted. Among other things, new 
categories of beneficiaries were added, eligible diseases were 
increased, and the years and geographic areas covered were expanded.
    The amendments resulted in over 3,800 new claims filed in FY 2001--
more than in the prior six years combined. Awards rose sharply too, 
from an average of about $20 million a year to over $172 million in 
2002 alone. Trust Fund resources were provided to pay claims via the FY 
2002 National Defense Authorization Act. Similarly, for FY 2004, the 
President's budget requests an increase of $1,000,000 above base 
funding of $1,996,000 to administer the expanded program.
    As backlogs mount, Congress and the Administration must take steps 
to ensure that limitations on administrative support do not hinder our 
ability to make timely payments from the recently replenished Trust 
Fund. To this end, the Omnibus Appropriations Act merged the RECA 
administration budget with the General Legal Activities (GLA) 
appropriation, making it possible to reprogram resources to assist in 
handling the onslaught of RECA claims.
    However, the need to absorb pay hikes and meet resource 
requirements placed by our emerging counterterrorism caseload, limits 
our reprogramming flexibility. The requested increase will enable us to 
acquire contractor support to help analyze claims and work to keep 
payments apace with the volume of sick and dying claimants found to be 
eligible.
    Simultaneously, the Division will monitor closely the adequacy of 
the caps established by the National Defense Authorization Act to 
ensure sufficient funds continue to be available for all eligible 
claimants.
    The most recent addition to the Division's responsibility for 
compensation programs is the September 11th Victim Compensation Fund of 
2001. The Air Transportation Safety and System Stabilization Act (P.L. 
107-42) created the Program to pay compensation to families of deceased 
individuals and to those physically injured as a result of the 
terrorist attacks that day.
    On December 21, 2001, the program's regulations were issued. Soon 
after, secure and private Claims Assistance Sites were opened in 
Manhattan and Long Island, NY; Jersey City and Edison, NJ; Arlington, 
VA; Boston, MA; and Stamford, CT. More than 1,800 potential claimants 
received assistance at these sites.
    Under the leadership of Special Master Kenneth Feinberg, the 
Program is processing over 1,300 claims. It has paid over $200 million 
to claimants.
    The amounts approved for deceased victims ranged from $250,000 to 
$6.0 million. Awards approved for physically injured (but not deceased) 
victims ranged from $500 to $6.8 million.
    The law requires that all claims be filed by December 21, 2003. 
Accordingly, we expect to receive the lion's share of the 4,000 
anticipated claims during the next nine months, as claimants complete 
and submit their applications.
    To address the surge of work expected through the remaining months 
of the Program, the Department is expanding the contractor staff which 
assists the Special Master in reviewing the claims. In addition, 
several Federal agencies are providing Administrative Law Judges to 
conduct hearings for claimants who challenge preliminary compensation 
determinations.
    For FY 2004, the President's budget seeks a total of $26 million 
for administration of the Victim Compensation program.
    Because the enacting legislation provided a permanent and 
indefinite appropriation for making compensation payments, there will 
be sufficient funds to pay an estimated $5 billion in approved claims 
over the life of the program.
    This Program has had to come to grips with some of the most 
sensitive issues of our time.
                         immigration litigation
    The Office of Immigration Litigation (OIL) defends the Government's 
immigration laws and policies, and handles challenges to immigration 
enforcement actions. At no time in history has this mission been so 
important.
    Immigration attorneys defend the removal of criminal aliens and 
challenges to critical features of the nation's counterterrorism 
strategy. Attorneys defend landmark cases dealing with media access to 
immigration hearings of individuals who have been detained in 
connection with the post-September 11th investigation.
    Immigration has been the fastest growing component of the Civil 
Division's workload. Court challenges handled by the Civil Division 
have more than doubled in the past five years.
    Accounting for this growth is the dramatic rise in the number of 
court cases seeking to overturn decisions regarding alien removal and 
detention, including those involving individuals with links to 
terrorist organizations.
    Our cases begin when cases brought by the immigration component of 
the Department of Homeland Security are challenged before the Board of 
Immigration Appeals (BIA). Aliens appealing BIA decisions take their 
cases to Federal courts.
    Appeals decided by the BIA have substantially increased as a result 
of initiatives by the Attorney General to streamline the BIA's 
procedures
    The impact on OIL caseload has been dramatic: Between 1999 and 2002 
a 40 percent increase brought the total workload to a record 7,000 
cases.
    These attorneys are the last line of defense in upholding 
immigration enforcement decisions. Any attempt to strengthen 
immigration enforcement must ensure that such efforts are not 
undermined by inadequate defense when actions are challenged in court. 
Such neglect would necessarily weaken National efforts to protect 
homeland security through an effective immigration enforcement program.
    The President therefore requests in his FY 2004 budget a program 
increase of 30 positions (26 attorneys and four support staff), 22 FTE, 
and $3,500,000 for immigration litigation.
                              performance
    By concentrating on the Civil Division's top priorities, this 
testimony provides little elaboration on the thousands of cases and 
matters that form the traditional core of our work.
    The Civil Division has a longstanding commitment to maximizing the 
effectiveness of scarce Government resources. It is with pride that I 
can report that performance targets across the board were met or 
exceeded in FY 2002--as we succeeded in recovering substantial funds 
owed to the Government, defeating unmeritorious claims and prevailing 
in the vast majority of cases involving challenges to the programs of 
some 200 agencies that are our clients.
                       president's budget request
    The President's FY 2004 request seeks 1,084 positions, 1,097 FTE 
and $235,553,000. Included in this request are the base resources 
required to maintain superior legal representation services that have 
yielded such tremendous success.
    An increase of $1 million is needed to ensure timely and accurate 
payments for people injured as a result of radiation exposure during 
the Cold War era; and, 30 new immigration positions and a $3.5 million 
increase are required to protect homeland security through effective 
immigration enforcement.
    Finally, as mentioned earlier, the President's budget includes $26 
million for administration of the September 11 Victim Compensation 
program. This proposed decrease reflects the winding down of the 
program.

    Mr. Cannon. Mr. Lewis, you are recognized for 5 minutes.

 STATEMENT OF GUY LEWIS, DIRECTOR, EXECUTIVE OFFICE FOR UNITED 
                        STATES ATTORNEYS

    Mr. Lewis. Thank you, Mr. Chairman. Members of the 
Subcommittee.
    I, too, am pleased to appear before you today with my 
colleagues from the Department of Justice. I am also pleased, 
Mr. Chairman, that my good friend Paul Warner, United States 
Attorney for the District of Utah is here with us as well.
    It is my honor to be here representing the outstanding 
women and men of the 94 United States Attorneys' Offices, and 
please allow me to sincerely thank you, Mr. Chairman, and this 
Committee and your staffs for your continued support of the 
United States Attorneys' mission.
    I would now like to briefly outline our 2004 budget 
request, and highlight accomplishments of the U.S. Attorneys 
this past year and then some of our management goals for the 
future.
    To carry out our mission in fiscal year 2004, we are 
requesting a budget of just over $1.5 billion to support about 
10,200 positions. We are seeking a little over $18 million to 
support an increase in 233 positions. Now, in formulating our 
requests, the President, the Attorney General, the Deputy 
Attorney General asks that we invest in programs that are 
critical to the Department's highest priorities.
    Our fiscal year 2004 budget request complies with this 
directive, and includes a number of savings to help us fund the 
enhancements that we seek.
    The request before you recognizes that the prevention of 
terrorism and investigation and prosecution of terrorist acts 
are the most important responsibilities of every United States 
Attorney. The convictions of John Walker Lindh, the Shoe 
Bomber, and a number of terrorist financiers, including several 
major cases in Mr. Warner's district, are just a few examples 
of the important work being done by U.S. Attorneys in our fight 
against terrorism.
    Our fiscal year 2004 request also recognizes that, in 
addition to the pressing priority of terrorism, there are still 
other crime problems that we must address. One example is 
corporate fraud. Since the President created the Corporate 
Fraud Task Force in July of 2002, the U.S. Attorneys have 
obtained over 50 convictions of corporate wrongdoers as a 
result of convictions in WorldCom, ImClone, Homestore, 
Allfirst, and many, many others, the U.S. Attorneys have helped 
restore the public's confidence in the integrity of our 
financial markets.
    Now, as additional prosecutors have been allocated to fight 
terrorism, gun violence, corporate fraud, a need has developed 
for additional support staff assistance. As a result, we are 
asking for 85 support staff positions, which, in reality, is a 
little less than one per office nationwide.
    We are also asking, Mr. Chairman, for some additional help 
on the civil side of the house. The Civil Division in the U.S. 
Attorneys Office handled over 190,000 cases this past fiscal 
year, and collected over 100 percent of their annual budgets, a 
fact that we are very proud of. Our request for 60 new civil 
defensive positions will ensure that our offices can continue 
to defend the U.S. in civil actions.
    Now, we recognize that stewardship of appropriated funds is 
a serious responsibility, and our commitment to sound 
management at the Department of Justice runs deep. We expect to 
achieve substantial savings by supporting department-wide 
efforts to evaluate programs and operations, and we are 
committed to identifying the savings necessary to help us fund 
the new resources we seek.
    Now, with regard to sound management. At the request of 
Larry Thompson, the Deputy Attorney General, each U.S. Attorney 
has reported on the state of management in his or her district. 
These performance reports include accomplishments in national 
and district priority areas and address strategic planning in 
their district.
    In conclusion, Mr. Chairman, the men and women of the U.S. 
Attorneys' Offices and the Executive Office for United States 
Attorneys are dedicated to fighting terrorism, protecting our 
neighborhoods and schools from gun violence and drug-related 
crimes, upholding civil rights, and prosecuting those who 
perpetrate corporate fraud. We believe that our fiscal year 
2004 budget request is a responsible, prudent request that will 
allow us to maintain the important programs designed to carry 
out the Department's strategic plan.
    Again, we truly appreciate this Committee's continued 
support. And I would be glad to answer any questions you may 
have. And I would request that my prepared long statement be 
included in the record.
    Mr. Cannon. Without objection.
    Thank you, Mr. Lewis. I thank you for introducing Mr. 
Warner. Paul Warner is my U.S. Attorney and has done a great 
job. We appreciate him in Utah and we appreciate your being 
here today.
    [The prepared statement of Mr. Lewis follows:]
                   Prepared Statement of Guy A. Lewis
    Mr. Chairman, Congressman Watt, Members of the Subcommittee, I am 
pleased to appear before you today with my colleagues, Thomas L. 
Sansonetti, Assistant Attorney General of the Environment and Natural 
Resources Division; Robert D. McCallum, Jr., Assistant Attorney General 
for the Civil Division; and Lawrence A. Friedman, Director of the 
Executive Office for U.S. Trustees. I am also pleased that Paul Warner, 
the U.S. Attorney for the District of Utah and, until recently, the 
Chair of the Attorney General's Advisory Committee is here. The United 
States Attorneys were critical in developing the budget request that is 
before you today.
                                overview
    It is an honor to be here representing the women and men of the 94 
United States Attorneys' offices nationwide and I thank you on their 
behalf for your continuing support of their efforts. The Executive 
Office for United States Attorneys (EOUSA) provides support and 
administration for the United States Attorneys, their offices, and 
their staffs nationwide. EOUSA deals with issues involving the United 
States Attorneys' offices (USAOs), their overall operations, budgets, 
management, personnel matters and evaluations. In addition, EOUSA is 
the voice of the United States Attorneys within the Department of 
Justice. As such, EOUSA supports and represents the interests of the 
United States Attorneys, with the Attorney General's Advisory 
Committee, on a host of legal and policy issues presented within the 
Department.
    The United States Attorney serves as both the chief law enforcement 
officer and the chief federal litigator in his or her district. The 
United States Attorneys and their staffs work closely with the six 
litigating divisions of the Department of Justice. The work of the 
United States Attorneys is among the most fundamental of any in the 
government: criminal law enforcement; affirmative civil litigation; and 
defending the government when it is being sued.
    The top priority of the USAOs is the investigation and prosecution 
of terrorism. The USAOs are aggressively pursuing criminal 
investigations throughout the United States, preventing, and 
prosecuting possible terrorist-related activity aimed at the United 
States. Some of the important terrorism prosecutions were:

          In the Northern District of Illinois, the head of the 
        Benevolence International Foundation, pleaded guilty to 
        defrauding his investors by failing to disclose that their 
        charitable contributions were being forwarded to finance 
        violent jihad activities.

          John Walker Lindh pleaded guilty in the Eastern 
        District of Virginia and was sentenced to 20 years imprisonment 
        for aiding the Taliban.

          In the District of Massachusetts the alleged ``shoe 
        bomber'' was sentenced to life in prison and ordered to pay a 
        $2 million fine for terrorist acts, including his attempt to 
        ignite explosive bombs located in his footwear while a 
        passenger on an American Airlines flight. The defendant, who 
        received Al-Qaeda training in Afghanistan, pleaded guilty on 
        October 4, 2002.

          A Salt Lake City resident pleaded guilty in the 
        District of Utah to operating an unlicenced money transmitting 
        business, admitting that he and his associates made a series of 
        bank transfers from Salt Lake City banks to an account at Arab 
        Bank in Amman, Jordan, controlled by his brother.

    We are also focusing on alien smugglers and disrupting alien 
smuggling rings. In the District of Columbia, a jury found one 
defendant guilty of illegally smuggling aliens from Iraq to the United 
States through Ecuador and Colombia. He is subject to deportation upon 
completion of his sentence.
    In addition, we are prosecuting individuals for immigration fraud. 
In the District of Oregon, a defendant , who was suspected of 
affiliating with the Palestinian terrorist group Hamas, was sentenced 
to 30 months in prison on various firearms and immigration fraud 
charges and ordered to pay $41,000 in restitution. In addition, the 
court signed an order revoking the defendant's fraudulently obtained 
citizenship. Searches of the defendant's home and vehicle uncovered an 
assault rifle, $20,000 in cash, 1,000 rounds of ammunition, a handgun, 
and documentary evidence establishing multiple identities, frequent 
foreign travel, and various frauds. A calendar seized from his home had 
the date September 11, 2001, marked with a red circle. The defendant 
admitted having received weapons and explosives training at a guerilla 
camp in Lebanon prior to coming to the United States at the age of 19.
    The United States Attorneys have shared information with more than 
6,000 federal, state and locals agencies through the 93 Anti-Terrorism 
Task Forces (ATTFs). The ATTFs have used Chief Information Officers, 
Law Enforcement Coordinators, and Intelligence Research Specialists to 
facilitate law enforcement information sharing at meetings and joint 
training sessions, and through e-mail distribution groups and telephone 
``trees''.
    After the events of September 11, 2001, the prosecution of those 
who perpetrated threats or violence against individuals who were 
perceived to be of Middle-Eastern origin became a priority of the 
Department. In the Central District of California a member of the 
Jewish Defense League, pleaded guilty on February 4, 2003, for 
conspiring to manufacture and detonate bombs at a mosque in Culver 
City, California, and at the field office of United States Congressman 
Darrel Issa, an Arab-American. A defendant in the Western District of 
Washington, pleaded guilty for attempting, two days after the September 
11, 2001, terrorist attacks, to set fire to cars in the parking lot of 
Seattle's Islamic Idriss Mosque. He then fired at worshipers exiting 
the mosque and fled. The defendant was sentenced to 78 months in 
prison.
    Another important prosecutorial focus is corporate fraud. On July 
9, 2002, the President established by Executive Order the Corporate 
Fraud Task Force to direct the investigation and prosecution of 
significant cases of corporate fraud. In concert with the Department's 
Criminal Division, the United States Attorneys for the following 
districts are members of the Corporate Fraud Task Force: Southern 
District of New York, Eastern District of New York, Eastern District of 
Pennsylvania, Northern District of Illinois, Southern District of 
Texas, Central District of California, and Northern District of 
California.
    In September 2002, the Deputy Attorney General convened all United 
States Attorneys and representatives from the other agencies 
represented on the task force for a Corporate Fraud Conference in 
Washington, D.C. Subsequently, EOUSA designed and conducted specialized 
training to better equip prosecutors to combat corporate fraud.
    Since the inception of the Task Force, the United States Attorneys 
have obtained over 50 convictions. Set forth below is a small sampling 
of some of the more significant corporate fraud prosecutions undertaken 
by the United States Attorneys' Offices since the inception of the 
Corporate Fraud Task Force:

          In the Southern District of New York, the former 
        WorldCom Comptroller and three former accounting employees 
        pleaded guilty to securities fraud violations in connection 
        with their participation in a scheme to defraud investors and 
        the public regarding the financial condition and operating 
        performance of the company. Also in the Southern District of 
        New York, the Chief Executive Officer of ImClone Systems, Inc., 
        pleaded guilty to securities fraud, conspiracy, obstruction of 
        justice, perjury, and bank fraud.

          In the Central District of California, three 
        Homestore.Com, Inc. executives pleaded guilty to fraudulently 
        inflating the company's revenues by over $30 million through a 
        series of transactions known as ``round-tripping'' in which the 
        online real estate listing giant bought and sold services 
        solely to increase revenue.

          In the Northern District of California, a jury 
        convicted the chief financial officer of Media Vision, Inc., a 
        Silicon Valley technology company, of a scheme to inflate the 
        company's earnings and income and to mislead company 
        stockholders. This conviction followed guilty pleas by four 
        other company officials: the Chief Executive Officer, Chief 
        Operating Officer, the Sales Vice President and the Controller.

          In the District of Maryland, a former Allfirst Bank 
        currency trader pleaded guilty to bank fraud after being 
        charged with making false entries into bank records that caused 
        the bank to lose more than $691 million.

    The variety of significant cases handled by the USAOs in areas 
other than terrorism and corporate fraud is remarkable. A brief 
description of some of the more significant recent cases is provided 
below. These cases reflect our prosecution of criminal and civil 
offenses with the goal of reducing firearms-related violence, narcotics 
trafficking and protecting the American people from fraud.
    Through Project Safe Neighborhoods and Project Sentry, the United 
States Attorneys partner with local and state law enforcement and 
prosecutors along with federal agencies to reduce gun violence by 
prosecuting violators to the fullest extent possible. Examples of two 
cases that were investigated and prosecuted under the Project Safe 
Neighborhoods initiative are:

          In the Middle District of Tennessee a defendant was 
        sentenced as a career offender to 21 years and 10 months in 
        prison after a jury convicted him on charges of being a felon 
        in possession of a firearm and possession with intent to 
        distribute cocaine. His past criminal offenses stretched from 
        1974-1997.

          A defendant in the District of Nevada pleaded guilty 
        to being a felon in possession of a firearm. While returning 
        merchandise at a Wal-Mart, the defendant became confrontational 
        and argumentative. While he was waiting in the store's security 
        office for the police to arrive, a loaded Titan 25-caliber 
        semi-automatic handgun dropped from his waistband onto the 
        floor and was recovered by the store security officer. The 
        defendant has three prior felony convictions for aggravated 
        assaults in 1996 and 1993, and felony failure to appear in 
        1996.

    To achieve the Department's strategic goal of enforcing federal 
criminal laws related to drug enforcement, the United States Attorneys' 
objectives are twofold. First, they seek to reduce the threat, 
trafficking, and related violence of illegal drugs by identifying, 
disrupting, and dismantling drug trafficking organizations. Second, 
they aim to break the cycle of drugs and violence by reducing the 
demand for illegal drugs. Integral to this strategy is the Organized 
Crime Drug Enforcement Task Force (OCDETF) program. Under this program, 
the efforts and expertise of federal, state, and local law enforcement 
agencies are coordinated in comprehensive attacks on major drug 
traffickers and their organizations. Several significant cases that 
illustrate our success in meeting these goals:

          In the Southern District of New York the supervisor 
        of a Colombian narcotics trafficking organization that sent 
        ton-quantity cocaine loads from South America to New York City, 
        pleaded guilty to charges relating to a 5,000-kilogram cocaine 
        load sent from Colombia via Venezuela and Mexico to New York 
        City in late 1998 or early 1999. The defendant is the younger 
        brother of two notorious bosses of Colombian narcotics 
        trafficking organizations that imported thousands of kilograms 
        of cocaine from South America into the United States during the 
        1990s. By 1993 or 1994, the defendant himself became directly 
        involved in the family drug business.

          A defendant in the District of Utah, who directed a 
        drug trafficking organization responsible for bringing 
        methamphetamine, marijuana, and cocaine from Mexico through 
        Arizona and Southern California to Utah, pleaded guilty to 
        operating a continuing criminal enterprise. The defendant 
        admitted to distributing approximately 80 kilograms of 
        methamphetamine over a two-and-half to three-year period.

          In the Western District of Texas, two defendants were 
        each sentenced to life imprisonment after a jury convicted them 
        of running a continuing criminal enterprise that distributed 
        approximately 75 tons of marijuana through the West Texas area 
        and other parts of the United States. A third defendant pleaded 
        guilty before trial to running a continuing criminal enterprise 
        involving more than 30,000 kilograms of marijuana and was 
        sentenced to 252 months in prison. More than 25 defendants 
        connected to this drug distribution operation have now been 
        convicted.

          In the Middle District of Pennsylvania, the kingpin 
        of a global Albanian organized crime group pleaded guilty to a 
        55-count indictment charging him under the Racketeering 
        Influenced Corrupt Organization (RICO) statute with a broad 
        range of criminal offenses that generated significant income. 
        He acquired cocaine in multiple kilogram amounts from Colombian 
        drug traffickers, among others, and would distribute the 
        cocaine in the United States, often hiding the cocaine in the 
        panels of the stolen cars that his confederates drove 
        throughout the United States. He also shipped cocaine to Europe 
        hidden in appliances. Members of his organization also stole 
        the identities of credit card holders, manufactured counterfeit 
        credit cards with that information, and then went to various 
        stores and purchased hundreds of thousands of dollars worth of 
        merchandise using the counterfeit credit cards.

    The protection of the American people against identity theft, 
health care fraud, and investment fraud remain important objectives of 
the United States Attorneys. Several cases illustrate that commitment:

          In an identity theft case prosecuted in the Southern 
        District of Texas, a Nigerian national was sentenced to 10 
        years in prison after pleading guilty to mail fraud and 
        naturalization fraud for stealing the identities of 32 
        individuals and using the names of 30 different companies over 
        a two-year period to open accounts with brokerage firms with 
        the intention of causing more than $3.3 million in losses.

          In the District of Massachusetts, a major American 
        pharmaceutical manufacturer was ordered to pay a criminal fine 
        of $290 million, the largest criminal fine ever imposed in a 
        health care fraud prosecution, and was sentenced to five years 
        probation after pleading guilty to conspiring to violate the 
        Prescription Drug Marketing Act in connection with fraudulent 
        drug pricing and marketing of a drug sold primarily for 
        treatment of advanced prostate cancer. The defendant also 
        agreed to settle its federal civil False Claims Act liabilities 
        and pay the federal government $559 million for filing false 
        and fraudulent claims with the Medicare and Medicaid programs. 
        In addition, the defendant settled its civil liabilities to the 
        50 states and the District of Columbia for $25 million. The 
        total amount paid will exceed $884 million.

          In the Western District of Missouri, a pharmacist, 
        who diluted drugs that had been prescribed as treatment for 
        cancer patients, pleaded guilty to consumer product tampering, 
        drug adulteration, and drug misbranding. He was sentenced to a 
        term of 30 years imprisonment. The pharmacist and his 
        corporation also were ordered to pay a fine of $25,000 and 
        victim restitution of $10.5 million. As part of the parallel 
        civil litigation, the Court entered a consent decree banning 
        the pharmacist until further order of the Court from practicing 
        pharmacy, possessing pharmacy licenses, or violating any 
        provision of the Food, Drug, and Cosmetic Act. The assets 
        previously frozen in the civil case were transferred to the 
        criminal case for use as restitution by victims.

          A certified public accountant and escrow agent in the 
        Northern District of Ohio was sentenced to 151 months in prison 
        following his conviction on charges of wire fraud, mail fraud, 
        tax evasion and money laundering related to his role as an 
        escrow agent for two funding companies involved in fraud. 
        During the time in question, the defendant received 
        approximately $160 million dollars in investment funds from 
        which he embezzled approximately $39 million. In a separate 
        indictment, the defendant was also indicted for money 
        laundering, involving approximately $22 million dollars. The 
        two cases were consolidated for sentencing purposes. In 
        addition, the defendant agreed to a $10 million dollar 
        forfeiture order along with the forfeiture of several pieces of 
        property.

    While we have achieved considerable progress in the past year, more 
can be done to ensure the safety of our communities. Our Fiscal Year 
2004 budget request will enable us to build on our success.
                    fiscal year 2004 budget request
    Before outlining the particulars of this request, let me make one 
caveat to my testimony. We are still analyzing the impact of the 2003 
Omnibus Appropriations Act on our 2004 request. It is possible that 
some changes to the request may be required to reflect the 2003 enacted 
level. We will be working with the Appropriations Committee on this 
analysis and will keep you informed.
    To carry out our mission in fiscal year 2004, we are requesting a 
budget of just over $1.5 billion to support 10,223 positions. The 
initiatives included seek an increase of 233 positions and $18,151,000.
    The President, Attorney General, and Deputy Attorney General asked 
that we look for opportunities to re-prioritize activities before 
seeking new resources, that we invest in programs that are of the 
highest priority and greatest value, and that we abandon activities 
that are not effective. Our 2004 budget request complies with these 
requests and includes savings to help us fund the enhancements we seek.
    The request before you recognizes that the prevention of terrorism 
and the investigation and prosecution of terrorist acts are the most 
important responsibilities of every United States Attorney. Our 2004 
request also recognizes that in addition to the pressing priority of 
terrorism there are still other crime problems that must be addressed 
at the federal level. To this end the request also includes resources 
to support the Corporate Fraud Task Force as well as other important 
programs.
    As additional attorneys have been allocated to our offices in past 
years to address the strategic priorities of fighting terrorism, gun 
violence, and corporate fraud, a need has developed for additional 
support staff assistance. As a result, we are asking for 85 support 
staff positions, including paralegals, to begin to address the current 
workforce imbalance and enhance attorney productivity.
    The Civil Divisions within the U.S. Attorneys' offices handled over 
190,000 cases this past fiscal year and collected over 100 percent of 
their annual budgets through their enforcement and collection efforts. 
Our request for 60 new civil defensive positions will ensure that our 
offices can continue to defend the United States treasury in civil 
actions brought against government officials and agencies.
    Our 2004 budget request also allows us to continue to improve our 
information technology capabilities to provide attorneys the tools 
necessary to support our prosecution efforts and civil defensive work.
    We expect to achieve savings by supporting Department-wide efforts 
to evaluate programs and operations with the goal of achieving across-
the-board economies of scale. We will be assessing potential savings 
through improved business practices in the area of facilities 
management; human resource deployment; consolidation of IT support; and 
the centralization of procurement for relocation services. We are 
committed to identifying the savings necessary to help fund the new 
resources we seek.
    We recognize that stewardship of appropriated funds is a serious 
responsibility and our commitment to sound management runs deep. At the 
request of the Deputy Attorney General, each United States Attorney has 
reported on the state of management in his or her district. These 
performance reports include accomplishments in national and district 
priority areas, office administration and resource management 
accomplishments, and the status of strategic planning in each district. 
By compiling the best practices identified in the U.S. Attorneys' 
performance reports, as well as those discovered through our Evaluation 
and Review program, we will provide all U.S. Attorneys concrete 
examples of how to improve the operations and management of their 
offices.
    We also seek to identify performance measurements for the U.S. 
Attorneys' offices that are more results oriented. To this end, the 
United States Attorneys' conference held at the beginning of this 
fiscal year was dedicated to that subject.
                               conclusion
    The United States Attorneys and EOUSA are dedicated to fighting 
terrorism, protecting our neighborhoods and schools from gun violence 
and drug-related crimes, upholding civil rights, and prosecuting those 
who commit corporate fraud. We believe that our FY 2004 budget request 
is a responsible request that will allow us to maintain the important 
programs designed to carry out the Department's strategic plan.
    We hope to build on our successes in cooperation with this 
Subcommittee and with its support for the President's FY 2004 Budget 
request for the Offices of the United States Attorneys.
    Again, I would like to thank you, Chairman Cannon, Congressman Watt 
and all the members of this Subcommittee for your continued support of 
the United States Attorneys' offices. I look forward to answering any 
questions that you may have at this time.

    Mr. Cannon. Mr. Friedman, you are recognized for 5 minutes.

STATEMENT OF LAWRENCE FRIEDMAN, DIRECTOR, EXECUTIVE OFFICE FOR 
                     UNITED STATES TRUSTEES

    Mr. Friedman. Thank you, Mr. Chairman, and Members of the 
Subcommittee.
    Thank you for the opportunity to discuss the work of the 
United States Trustee Program, which is the component of the 
Department of Justice with responsibility for the oversight of 
bankruptcy cases and trustees.
    To enhance the efficiency and the integrity of the 
bankruptcy system, the Program carries out broad administrative 
regulatory and litigation duties under both title 11 of the 
Bankruptcy Code and title 28 of the United States Code.
    Our mandate is especially imposing in light of the 
significant growth in bankruptcy filings, which reached more 
than 1.5 million cases in fiscal year 2002. That is a 58.3 
percent increase over the past 10 years. The Program is headed 
by the Director of the Executive Office for United States 
Trustees who is appointed by the Attorney General. The 
Director's duties include developing national Program policies 
and supervising field operations. I am both pleased and honored 
to serve in that capacity.
    At Program headquarters, I am assisted by a staff of 
approximately 70 employees, of whom about half provide 
administrative support for regional and field offices.
    Field operations are organized into 21 regions, each headed 
by a United States Trustee appointed by the Attorney General. 
Ninety-five field offices carry out the work of the Program in 
88 judicial districts in 48 States and the territories. There 
are approximately 1,000 staff in the field with an average 
office consisting of 10 employees.
    Among the United States Trustees' specific functions, we 
investigate and file enforcement actions to protect the system 
from fraud and abuse and to ensure compliance with the 
Bankruptcy Code.
    We work closely with the United States Attorneys, the FBI, 
and other law enforcement agencies to help ensure prosecution 
of criminal violations that affect the bankruptcy system.
    We appoint and supervise approximately 1,400 private 
bankruptcy trustees who administer cases filed under chapter 7, 
12, and 13 to ensure prompt administration, financial, and 
fiduciary accountability, and maximize potential return to 
creditors. These private trustees dispersed over $5 billion in 
2002.
    We oversee the administration of chapter 11 reorganization 
cases which involve some of the Nation's leading companies to 
ensure financial accountability and regularity, compliance with 
the Code, and plans for prompt disposition.
    We review applications for the employment of professionals 
for potential conflicts of interest, review professional fee 
applications, establish creditors' committees, and file motions 
to convert or dismiss cases. If there is misconduct or 
egregious mismanagement, we appoint private trustees or 
examiners.
    The United States Trustee Program is a self-funded agency, 
primarily through fees collected from debtors who file 
bankruptcy. By statute, these fees are deposited in the United 
States Trustee System Fund. None of these funds, as you know, 
can be expended by the Program until they are appropriated by 
Congress annually, and no general revenues are appropriated to 
fund our Program.
    For fiscal year 2004, the Administration has requested a 
Program appropriation of $175.2 million, which represents an 
increase of $19.4 million over fiscal year 2003.
    Finally, Mr. Chairman, with regard to the OIG Report 
referenced in your opening remarks, let me simply say that we 
found the report very helpful. You will find in our response to 
it and, as referenced in my earlier testimony, that most of our 
initiatives and the action points referenced in that report had 
already been instituted prior to the report being issued and 
since I have taken the helm at the Agency on March 4th of 2002.
    Mr. Chairman, that completes my remarks, and I would be 
happy to answer any questions you or the Subcommittee may have. 
Thank you.
    Mr. Cannon. Thank you, Mr. Friedman.
    [The prepared statement of Mr. Friedman follows:]
               Prepared Statement of Lawrence A. Friedman
    Mr. Chairman and Members of the Subcommittee:
    I appreciate the opportunity to appear before you on behalf of the 
Department of Justice to discuss the work of the United States Trustee 
Program.
    The United States Trustee Program (USTP or Program) is the 
component of the Department of Justice with responsibility for the 
oversight of bankruptcy cases and trustees. Our mission is to enhance 
the efficiency and the integrity of the bankruptcy system. We carry out 
broad administrative, regulatory, and litigation duties under both 
title 11 (the Bankruptcy Code) and title 28 of the United States Code.
    Our mandate is especially imposing in light of the significant 
growth in bankruptcy filings which reached more than 1.5 million cases 
in Fiscal Year 2002. This number reflects an increase in filings of 
58.3 percent over the past ten years. Most of the increase has incurred 
in consumer cases, but business reorganization cases continue to demand 
significant time and attention as the size and complexity of business 
and accounting issues have grown exponentially.
    The Program is headed by the Director of the Executive Office for 
United States Trustees located in Washington, D.C. The Director is 
appointed by the Attorney General. Among other duties, the Director is 
responsible for developing national Program policies and supervising 
field operations. I am assisted by a staff of approximately 70 
employees. About one-half of these staff members provide administrative 
support for regional and field offices. Field operations are organized 
into 21 regions, with each region headed by a United States Trustee 
appointed by the Attorney General. Ninety-five field offices carry out 
the work of the Program in 88 judicial districts in 48 states \1\ and 
the territories.\2\ Field offices are headed by career Assistant United 
States Trustees and assisted by career attorneys, financial analysts, 
paraprofessionals, and support staff. There are approximately 1,000 
staff in the field, with an average office consisting of ten employees.
---------------------------------------------------------------------------
    \1\ By statute, judicial districts in North Carolina and Alabama 
are not included in the United States Trustee Program. Bankruptcy 
courts in those districts employ Bankruptcy Administrators to carry out 
many of the functions otherwise conferred upon the USTP.
    \2\ The USTP has responsibility for bankruptcy cases filed in 
Puerto Rico, Guam, the Virgin Islands, and the Northern Mariana 
Islands.
---------------------------------------------------------------------------
    Among the specific functions carried out by the United States 
Trustee Program are the following:

          We investigate and file enforcement actions to 
        protect the system from fraud and abuse, and to ensure 
        compliance with the Bankruptcy Code.

          We work closely with the United States Attorneys, the 
        FBI, and other law enforcement agencies to help ensure the 
        investigation and prosecution of criminal violations that 
        affect the bankruptcy system.

          We oversee the administration of chapter 11 
        reorganization cases, which involve some of the nation's 
        leading companies, to ensure financial accountability and 
        regularity, compliance with the Code, and plans for prompt 
        disposition. We review professional employment applications for 
        potential conflicts of interest; review professional fee 
        applications; establish creditors' committees; and file motions 
        to convert or dismiss. If there is misconduct or egregious 
        mismanagement, we appoint private trustees or examiners.

          We appoint and supervise approximately 1,400 private 
        bankruptcy trustees who administer cases filed under chapters 
        7, 12, and 13 to ensure prompt administration, financial and 
        fiduciary accountability, and maximum potential returns to 
        creditors. The private trustees disbursed over $5 billion in 
        2002.

    In October 2001, the USTP commenced a National Civil Enforcement 
Initiative to address bankruptcy fraud and abuse. I described our 
purposes and activities in testimony delivered last month.
    In summary, we undertook the National Civil Enforcement Initiative 
because of widespread concerns that the integrity of the bankruptcy 
system was being undermined by some debtors who received relief to 
which they were not entitled, as well as by attorneys and others who 
abused the bankruptcy system for illegitimate personal gain. With more 
than $5 billion in assets being distributed by trustees each year, and 
many billions more in debt discharged by consumers and corporations, 
the public clearly has a large stake in the proper administration of 
bankruptcy cases.
    The National Civil Enforcement Initiative consists of two major 
prongs:
    (1) Debtor Misconduct: Under this prong of the Initiative, the 
Program uncovers such improper conduct as inaccurate financial 
disclosure, concealment of assets, ``substantial abuse,'' and misuse of 
social security numbers by those who seek the discharge of debts 
despite an ability to repay. The primary civil remedies sought by 
Program attorneys are dismissal under 11 U.S.C. Sec. Sec. 707(a) and 
(b) and denial of discharge under Sec. 727.
    (2) Consumer Protection: The Program also seeks to protect debtors 
and creditors who are victimized by those who mislead or misinform 
debtors, file bankruptcy petitions without a debtor's knowledge, make 
false representations in a bankruptcy case, or commit other wrongful 
acts in connection with a bankruptcy filing. Primary targets are 
unscrupulous bankruptcy petition preparers and attorneys. The primary 
remedies sought are fines and injunctions under 11 U.S.C. Sec. 110, 
disgorgement of fees under Sec. 329, and other sanctions.
    The results of our first year after implementing the National Civil 
Enforcement Initiative are dramatic. During Fiscal Year 2002, field 
offices reported taking more than 50,000 civil enforcement and related 
actions (including cases resolved without resort to litigation) that 
resulted in an overall potential return to creditors of approximately 
$160 million.
    The United States Trustee Program is a self-funded agency. The USTP 
is funded primarily through fees collected from debtors who file 
bankruptcy. By statute, these fees are deposited into the United States 
Trustee System Fund. None of the funds can be expended by the Program 
until they are appropriated by Congress annually, and no general 
revenues are appropriated to fund the Program.
    Revenue in excess of the annually-appropriated amount remains in 
the System Fund. The monies appropriated typically total less than the 
monies collected. At the end of Fiscal Year 2002, the System Fund held 
$186,345,311 in funds not appropriated for Program use.
    For Fiscal Year 2004, the Administration has requested a Program 
appropriation of $175.2 million, which represents an increase of $19.4 
million or 12.5 percent over the Fiscal Year 2003 operational level.
    Consistent with the President's Management Agenda and statutory 
mandates, the Program has taken a number of performance-based 
management reforms. We are committed to improving our ability to 
identify agency goals and to measure our progress in reaching those 
goals. These reforms include the following:

          We developed a ``Significant Accomplishments 
        Reporting System.'' This System includes a new data base to 
        measure approximately 100 work elements, including motions 
        filed and informal enforcement actions not leading to 
        litigation, and the results achieved. We are now better able to 
        record and track specific enforcement and case administration 
        activities at the time they occur. To improve the reliability 
        of the System, and to ease the associated administrative 
        burden, the System has been completely automated. The automated 
        System will be fully operational in all field offices by May 1, 
        2003, having been developed, piloted, and provided to the field 
        offices in less than one calendar year. The System will 
        continue to be refined and improved in the future.

          We revamped our budget submissions under the 
        Government Performance and Results Act (GPRA) to better reflect 
        the costs and benefits associated with various program 
        activities. We are continuing to review our GPRA and related 
        measures so that we can more fully integrate management and 
        budgeting functions.

    That completes my prepared remarks, and I would be happy to answer 
any questions you and the Subcommittee members may have.

    Mr. Cannon. Since I expect we will do a couple of rounds 
here, I would normally defer to others for the first 
questioning if we only had one round of questions, but I tend 
to take the first questioning, unless either of my Members here 
would like to go first.
    Do either of you have something you have to get to?
    Thank you. Then if you don't mind, I will begin with some 
questioning.
    First, Mr. Sansonetti, directed to you. And perhaps Mr. 
Schiffer you will have something to add on these points. 
Regarding the Cobell versus Norton case, what is the 
relationship between the Indian Tribal Trust cases being 
handled by the Environment Division and the Cobell being 
handled by the Civil Division? Why was the change made as to 
the division representing Cobell, and how does this relate to 
the increase in funds which ENDR is requesting for Tribal Trust 
Fund case defense?
    Mr. Sansonetti. Well, Mr. Chairman, the Cobell case is a 
class-action lawsuit, which is supposedly constituting all the 
past and present individual Indian money accounts. There are 
some 300,000 individual money accounts that are at stake in 
that case.
    In contrast, the Tribal Trust cases, which are in the 
Division, are brought on behalf of tribes and not the 
individual Indians. There are 22 of those cases at the present 
time while there is over 470 Federally recognized tribes in the 
United States, and so I anticipate that the number of cases 
will go up from 22 in the future.
    We have--in relation to the question as to why we are 
asking for the additional monies, we have at the present time 
in our General Litigation Section, the attorneys that defend 
these Tribal Trust cases, there are only eight of them. They 
are already handling the 22 cases. The Civil Division has been 
good enough--and this is before my time--as to take over the 
Cobell case on the individual accounts. And so we work with the 
Bureau of Indian Affairs and the folks in the Department of 
Interior including their Solicitor's Office in developing the 
defense for those cases.
    I would also note that there is a difference in the type of 
cases that are involved in the fact that the Cobell suit is a 
strict APA case asking for an accounting, how much was supposed 
to come to us, how much did come to us. And they, basically, 
allege a failure to perform a nondiscretionary duty.
    In the Tribal Trust cases, not only do you have the APA 
allegations, but you also have allegations of asset 
mismanagement, that the highest royalty figure was not obtained 
for a certain natural resource found on a particular 
reservation.
    So, the suits may be just simply the tip of the iceberg as 
far as those 22 are concerned. Some of them are in the Court of 
Federal Claims, which of course then requires appeals to the 
Federal Circuit. Others are before various U.S. District 
Judges, about eight of the 22 having been assigned to Judge 
Lamberth, who also has the oversight over the Cobell case.
    Mr. Cannon. Was there any conflict of interest in the ENDR 
that caused the move over to Civil?
    Mr. Schiffer. There were concerns of that sort, Mr. 
Chairman. There were contempt motions being filed or motions 
seeking the imposition of contempt sanctions against, actually, 
two successive teams of attorneys in the Environment Division 
and a number of officials in Interior.
    I should add that similar allegation have been made against 
almost anyone who comes near the Cobell case, including all of 
the attorneys in the Civil Division that worked on it, and 
then, in a statement putting everything on the table, I have 
personally been among the lawyers sanctioned by Judge Lamberth.
    We have been obtaining waivers from the appropriate 
officials to permit us to continue, because we are simply at a 
point where it makes no sense and would be unfair to the United 
States for us to seek yet another team of lawyers to handle the 
case.
    Mr. Cannon. Would you describe what you mean by personally 
sanctioned?
    Mr. Schiffer. I hate to go into great detail about the 
inglorious end of my 40-year career at the Department, but in 
December I was, or I think, six of us were referred, to the 
Disciplinary Committee of the United States District Court for 
the District of Columbia for what the judge regarded as 
inappropriate conduct by attorneys.
    In February, an order was entered where approximately the 
same number of attorneys and largely overlapping names were 
ordered personally to pay the plaintiffs' costs of engaging in 
certain discovery. A similar order was entered in March.
    Mr. Cannon. Thank you.
    Do you know, Mr. Schiffer, Mr. Sansonetti, of any other 
judges in the history of America who have held any Secretaries 
of any department in contempt?
    Mr. Schiffer. I do not.
    Mr. Sansonetti. I do not.
    Mr. Cannon. We took a brief look. I am glad to have such a 
wise counsel at this point. I don't think so. And I think we 
have here a judge who has held four Secretaries in contempt. 
And Mr. Schiffer, I want to come back to who else was held or 
sanctioned, and what that does to your job. But my time has 
run, and consistent with my habit, we are going to yield back 
and call on the gentleman from Florida, Mr. Feeney, if he has 
questions.
    Mr. Feeney. Well, Mr. Chairman, my time is your time. And 
if you would like to continue along your line of questioning, I 
am fascinated by it, and I will pick up when you are through.
    Mr. Cannon. Thank you. We will go to a second round of 
questioning then, and we will continue this discussion.
    You had mentioned that six other people were sanctioned. 
Were those members of your Division or ENDR?
    Mr. Schiffer. These are all Civil Division attorneys.
    Mr. Cannon. Was anybody sanctioned on the ENDR side?
    Mr. Schiffer. There are pending proceedings that we are 
handling, and private counsel are handling involving, I think, 
some five dozen individuals by now in the Environment Division 
and the Department of Interior.
    Mr. Sansonetti. So it is both.
    Mr. Cannon. What, now I--do I understand, Mr. Schiffer, 
what you said was these cases were moved, this case was moved 
from the ENDR to your Division because of concern on the part 
of the lawyers in ENDR that they would be subject to sanction?
    Mr. Schiffer. And I think departmental administration 
thought that it might make sense to get a fresh team of lawyers 
in the case, which was something I wish they could reconsider 
at this time.
    Mr. Cannon. I suspect that you might feel that way. Can you 
tell me a little bit about the sense of concern among your 
attorneys who are subject to the sanctions?
    Mr. Schiffer. It is, obviously, not something pleasant.
    We are a mix of very senior people who have had long, if 
not illustrious, but have had long careers and have never 
before been sanctioned in any form nor had sanctions been 
sought against us either by a judicial body or professional 
association. And then, at the other end of the spectrum, at 
least one or two of the very youngest attorneys, who are just 
beginning their careers and are understandably very, very 
concerned about what they regard as serious reputational damage 
that has already occurred.
    Mr. Cannon. And I met with a Former Deputy Solicitor in the 
former Administration, the Deputy Solicitor from the Interior 
Department who left because of the sanctions.
    Are either of you aware--that is, he left public service 
because he was concerned about what these sanctions would do to 
him professionally and personally and from the point of view of 
his long-term career. Are either of you aware of others who 
have left public service in either the Justice Department or 
the Interior Department because of these sanctions?
    Mr. Sansonetti. I am not. Of course, I have just been there 
a year. But I can tell you that within the shop of our 400 
attorneys, there is hardly a line standing outside my door to 
sign up to defend the Tribal Trust cases. And with 22 of those 
already on our plate and more yet to come, you can see why the 
eight attorneys that are assigned these defenses are already 
relatively overwhelmed.
    Mr. Schiffer. I should add, I am also aware of people who 
had seemed very interested in joining us as new attorneys in 
the Division and who have asked the right questions and been 
told about the Cobell case and have declined our offers, 
telling us that it is because of the likelihood they might have 
to work on the case that they have decided not to join the 
Civil Division.
    Mr. Cannon. So you can't get your senior guys to do it, and 
you can't get new guys to come in.
    Mr. Schiffer. Well, it speaks to the wisdom of the people 
that we try to recruit.
    Mr. Cannon. At least they are smart enough to recognize the 
problem. Can you give us an idea of how many people have looked 
at this and decided it is too difficult?
    Mr. Schiffer. I don't know the number, but I have heard 
from time to time.
    Mr. Cannon. Shifting gears just a little bit here. There 
are, apparently Ernst and Young did an audit that cost 
something in the neighborhood of $20 million. Are either of you 
familiar with that? And was that ordered by the Court or did 
Interior do that on their own?
    Mr. Schiffer. Well, it is a mix, Mr. Chairman. The Court 
had ordered very, very extensive discovery involving just 
massive numbers of documents. There was controversy in the case 
over whether the documents were sufficient to permit accounts 
to be reconciled, whether all relevant documents had been 
produced. And the Interior Department undertook, with respect 
to the five named plaintiffs, to have Ernst & Young go back and 
see if it could account for the money coming in and out of the 
accounts, and Ernst & Young did so.
    Mr. Cannon. My understanding is that they found a--no 
misplacement, a decimal point here--a $60.94 problem after a 
$20 million inquiry? Are you familiar with that?
    Mr. Schiffer. Yes, sir. That is my understanding, as well.
    Mr. Cannon. Well, nice to know we have books, I guess.
    Secretary Norton was ruled in contempt of court last 
December for deceiving Judge Lamberth about the DOI's failure 
to reform a trust fund for Native Americans, and ordered DOI to 
reappear in May to explain and rectify further accounting 
problems relating to the Cobell case.
    Could you explain, either of you, for the Subcommittee to 
what efforts have been made or are currently under way to 
conform to Judge Lambert's ruling and avoid any subsequent 
contempt rulings being directed at Secretary Norton and other 
staff and other Secretaries?
    Mr. Schiffer. Well, I probably shouldn't discuss the 
contempt rulings at length. They are being argued on appeal in 
just a few weeks, April 24, in the United States Court of 
Appeals for the District of Columbia Circuit.
    I do know personally the Secretary has devoted enormous 
amounts of her own time and that of her senior staff in dealing 
with this litigation.
    Mr. Cannon. If I might, Mr. Schiffer, can I just interject 
and say that I serve on the Resources Committee.
    I preceded Mr. Sansonetti in the Solicitor's Department. I 
am close to Interior people, I am very close--the people who 
are now running the Department are people who were there when I 
was there, and they are busting their guts to deal with this 
lawsuit, and it is keeping them from doing and implementing the 
policies of this President and the people of America. And that 
is my soap box, but I am more aggravated than I can say about 
this, and I hope that doesn't come through in the tone of my 
questions.
    But let me just ask to follow up on one issue. You point 
out that you are reluctant to talk about a matter that is under 
appeal. And, you know, this is not the Appellate Court; this is 
another branch of Government. And it seems to me we find 
ourselves--and I would like you to both comment on this--with 
you as members of the Executive Branch uncomfortable talking 
with members of the Legislative Branch, who happen to have 
particular concerns about this very subject matter because you 
have got a Member of the Judiciary who has subjected you, Mr. 
Schiffer, personally to contempt citations. And it seems to me 
that we have a little bit of a conflict among the three 
branches here.
    I would very much appreciate your opinions, if you are 
courageous enough. I shouldn't say that. That is unfair. I know 
you are courageous enough. If you feel you could comment on 
that.
    Mr. Schiffer. I wasn't really trying to avoid discussion of 
the case with the Chairman.
    I did start by announcing I had been sanctioned three 
times. So if I am a little bit reluctant to--I mean, I have 
only limited assets available, so I suppose at a certain point 
I shouldn't care, but I know that others do.
    And part of my motivation, in saying I was reluctant to 
discuss the issues, is that I am sure my colleagues who are 
going to argue the appeal would much prefer to do so themselves 
than have me butcher them.
    But the Chairman was not exaggerating at all when you 
talked about the amount of time that senior managers, including 
the Secretary herself, have been devoting to this case. She is 
just an extremely sincere individual. And so the notion that 
she is doing anything to place herself arguably in contempt of 
the Court is certainly foreign to me. The Court has ruled 
otherwise, and this is why we have courts of appeal.
    Mr. Cannon. Can you give us counsel on what this Branch 
should do to oversee what this judge is doing in this process?
    Mr. Schiffer. I am obviously the one who needs counsel. 
There may well have to be a legislative solution to the case 
itself at a certain point. I cannot give the Chairman counsel, 
I think, on the judge as an individual. That is again why we 
have courts of appeal. We seek redress in those courts.
    Mr. Cannon. The courts of appeal are the judicial process 
for correcting errors. We also have other corrective measures, 
but it is not fair, I don't think, to ask you to comment on 
that.
    Mr. Schiffer. Article 3 of the Constitution is a wonderful 
thing, Mr. Chairman. It appoints judges for life as long as 
they engage in good behavior. And it is not for me to I think 
try to discuss what constitutes good behavior at this point.
    Mr. Cannon. It occurs to the mind that there are actually 
many levels of checks and balances here which we need to 
consider.
    But I do want to pursue just one other issue, if the 
gentleman from Florida wouldn't mind, because it was so very 
difficult for many people. That is, that apparently Joseph S. 
Kieffer, III, was appointed by Judge Lamberth as Special Master 
Monitor to the Cobell case.
    He hired a team of computer hackers in order to test the 
security of DOI's computer systems, specifically those which 
contained information relating to the Tribal Trust accounts. As 
a result, Judge Lamberth ordered the subsequent shutdown of 
DOI's computer system until the Tribal Trust information could 
be verified as secure. And, that through this there was a 
massive blackout of DOI's computer ability, that is its web 
presence and its information capabilities. My office worked 
closely with DOI. We couldn't get information from them. And 
when we called them, which is, of course, the awkward way to do 
it, we couldn't get the information because of their blackout. 
And, that to this date, there is still some component of DOI's 
computer network which is not up and running including the 
Bureau of Indian Affairs.
    Could you please explain how much longer you expect this 
situation to continue and what efforts are under way within DOI 
or DOJ to comply with this order? And also, is it true that 
subsequent to Judge Lamberth's order, that DOI was actually 
rendered unable to send out royalty checks, royalties to tribes 
and individuals under the Trust Account for 2 months?
    Mr. Schiffer. I should start, I suppose, by noting there 
are two Special Masters that the Court has appointed and who 
are being paid for at Government expense. I would add, Mr. 
Kieffer is one of them. Alan L. Balaran is the second one.
    It was Mr. Balaran, who with the Court's approval in the 
form of an order that had been entered, even though we had not 
known about it, hired a company to tap into essentially the 
Interior Department computers. I think that about 95 percent of 
them are now back online.
    It is also accurate that there was a period where checks 
were delayed. That problem has been taken care of, and I think 
all the checks are current.
    Mr. Cannon. Are you aware of any of the personal problems 
that were caused by checks not being delivered either of you?
    Mr. Sansonetti. I, personally, am not.
    Mr. Schiffer. I have certainly heard about them. And, of 
course, there were other problems, such as people being unable 
to gain access to National Park Service websites and the like.
    Mr. Cannon. Those were greatly inconvenient, I might say. I 
see that my time has actually expired.
    We note that Mr. Watt has joined us, and if you will allow 
Mr. Watt, we have done an extended questioning here that I 
participated in. But Mr. Feeney has been gracious enough to let 
me do that. Would you mind if we yield 5 minutes to him?
    Mr. Watt. Go right ahead.
    Mr. Cannon. Mr. Feeney, you are recognized for 5 minutes.
    Mr. Feeney. Well, thank you, Mr. Chairman.
    I was fascinated by your discussion of a case that I was 
unfamiliar with, the Cobell case. And I obviously can't opine 
in view of the facts of the case or the participants or the 
counsel on either side. It is sort of amazing that one Federal 
judge apparently can shut down or immobilize the better part of 
a department including a half-dozen or a dozen attorneys and as 
many as 60 people that feel under some sort of threat, which 
doesn't by the way opine as to whether or not the behavior of 
any individual or the entire Justice Department for that matter 
has been appropriate. But I guess I had a couple questions.
    Has there been any effort to ask the judge to recuse? Is it 
him? Is Royce a mister?
    Mr. Schiffer. Judge Lamberth? Yes.
    Mr. Feeney. Okay. Any effort to ask the judge to recuse 
himself given his obvious--I mean, something has gotten the 
judge's ire, either rightfully or wrongfully, and he has now 
threatened between one and five dozen employees of the United 
States Government.
    Mr. Schiffer. A number of private counsel representing 
individuals against whom sanctions have been sought, contempt 
sanctions largely, have filed such motions, Mr. Feeney.
    Mr. Feeney. So that in addition to the dozen or five dozen 
public counsel, there are private counsel that have been 
apparently subjected to the same----
    Mr. Schiffer. I am sorry. I think I am confusing things. 
There have been private counsel retained at Government expense 
to represent the interests of the individuals, because the 
determination was made that the sanctions were being sought as 
a result of the performance of their official duties.
    Mr. Feeney. And so there has been some suggestion or formal 
request for the judge to consider recusing himself?
    Mr. Schiffer. That is correct.
    Mr. Feeney. And he hasn't responded to that yet?
    Mr. Schiffer. That is an issue that is now also pending 
before the Court of Appeals.
    Mr. Feeney. Has there been any effort to discipline the 
judge based on his judicial canons, been filed as a formal 
matter?
    Mr. Schiffer. I am not aware of anything of that sort.
    Mr. Feeney. Well, of course, the Chairman asked 
rhetorically, and I understand that sometimes we ask the 
Executive Branch for advice, but ultimately in separation of 
powers issues, you are probably not the court of last resort in 
terms of article 1 powers. And you suggested the importance of 
article 3, I happen to believe that, too, but I also like 
article 1, especially now that I am in Congress.
    And it seems to me that at a minimum that Congress has the 
right to set the jurisdiction of Federal judges. Harassing 
several dozen members of the Justice Department seems to be 
something that we could effect with our jurisdictional powers. 
And you may or may not have an opinion on that. And then 
ultimately, of course, there is the question of the judge's 
good behavior. And so this is something I intend to look into. 
And, again, I have no opinion about the facts. I have no 
opinion about the behavior of individual counsel or anybody in 
the Judicial Department, but it does seem to me that we have 
got a significant portion of our Justice Department paralyzed 
by one Federal judge that somebody, somewhere has got to answer 
as to whether or not the judge has behaved appropriately.
    And you can comment on that if you would like, Mr. 
Sansonetti, but if you would prefer not to, I understand that, 
too.
    Mr. Sansonetti. Well, I think the topic that you are 
discussing is probably important from the standpoint of why we 
are here asking for the additional monies today. Because 
ultimately it is the Congress's job to make sure that you 
appropriate only the necessary monies from the public fisc for 
our duties.
    And the amount that I am asking for is an additional $3 
million for my Tribal Trust initiative. That may be able to 
garner me 15 attorneys with some support staff, a couple legal 
secretaries. Add that to the eight folks, that is still maybe 
23 attorneys handling 22 cases. You know, usually you would 
have law firms, whole law firms assigned to a case of this 
magnitude. If you add up the dollars that are being sought by 
the tribes, we are in the billions.
    So if the cases are not litigated properly, then the public 
fisc is at risk.
    And so the reason I made that reply to the Chairman about 
this 22 cases--these 22 cases being the tip of the iceberg is, 
in my case, these Tribal Trust cases have been filed say maybe 
since 2001, 2002. Mr. Schiffer's Civil Division has been 
dealing with the Cobell case for years now. You know, what if 
another 22 are filed next year? Another 10 this year?
    So I am going to have to come back to you as long as this 
is going on each and every year to ask for an increase, because 
just like eight attorneys is not enough to handle 22 cases, I 
can already see that 23 attorneys is hardly going to be enough, 
either, if we get additional cases added too. And given that 
eight of these cases are also in front of Judge Lamberth, there 
are going to be a whole series of things that we are going to 
have to do to comply with discovery, et cetera, that are going 
to be very time consuming.
    And, needless to say, if people fall behind or are having 
difficulty getting their arms around the scope of the 
discovery, then there are potential sanctions down the road as 
well.
    Mr. Feeney. Mr. Chairman, if I could have unanimous consent 
for one more short question? I don't know how long the answer 
will be.
    Mr. Cannon. Without objection.
    Mr. Feeney. To finish up this line of thought. To the 
extent that individuals in the Justice Department have had to 
hire private counsel to protect their interests and to the 
extent that they may be found innocent or whatever civil or 
criminal sanctions the judge or others would bring, will the 
taxpayers be obligated to reimburse individual attorneys in the 
Justice Department?
    Mr. Schiffer. At this point, Congressman, I think that all 
of the attorneys are being paid for by the Department of 
Justice by taxpayer funds.
    Mr. Feeney. Okay. Thank you.
    Mr. Cannon. The gentleman yields back.
    Mr. Watt, would you like to question?
    Mr. Watt. I just wanted to say to the witnesses that I 
apologize for not being here. We had a Rules Committee hearing 
that was going on in a case that is coming to the floor either 
tomorrow or Thursday, and I was required to be there.
    So I don't have any questions. I will look at the 
transcript and look at your testimony, and but it is certainly 
was not out of a lack of regard for the importance of what you 
are doing here. I know that it is very important, but it is 
still impossible to be in two places at one time.
    Thank you. I yield back.
    Mr. Cannon. Thank you, Mr. Watt.
    We have tried your patience sorely on a pretty narrow 
issue. I apologize for that. We have a number of questions that 
transcend the ability and the timeframe of this hearing to ask, 
so we will ask those questions in writing and if you could 
respond in writing that would be very helpful.
    There are a number of issues out there that are very 
serious. For instance, my understanding is that you have got 
about 60 percent of your Environmental Division's cases that 
are defensive and therefore they are essentially 
nondiscretionary. Is that enough?
    So we are going to ask those kinds of questions. We will 
appreciate your response to those. And I want to thank you all 
for coming today, and the Committee will be adjourned.
    [Whereupon, at 3 p.m., the Subcommittee was adjourned.]
                            A P P E N D I X

                              ----------                              


               Material Submitted for the Hearing Record

                Prepared Statement of Theodore B. Olson
    Mr. Chairman and Members of the Subcommittee: Thank you for 
inviting me to present this written testimony regarding the Office of 
the Solicitor General in connection with the Committee's hearing.
                   i. the solicitor general's duties
    When Congress created the position of Solicitor General in 1870, it 
expressed high ambitions for the Office: the Solicitor General is the 
only officer of the United States required by statute to be ``learned 
in the law,'' 28 U.S.C. Section 505, and the Committee Report 
accompanying the 1870 Act stated: ``We propose to have a man of 
sufficient learning, ability, and experience that he can be sent . . . 
into any court wherever the Government has an interest in litigation, 
and there present the case of the United States as it should be 
presented.''
    In modern times, the Solicitor General has exercised responsibility 
in three general areas.
    1. The first, and perhaps best-known, function of the Solicitor 
General is his representation of the United States in the Supreme 
Court. The late former Solicitor General Erwin Griswold captured the 
nature of this responsibility in observing:

        The Solicitor General has a special obligation to aid the Court 
        as well as serve his client. . . . In providing for the 
        Solicitor General, subject to the direction of the Attorney 
        General, to attend to the ``interests of the United States'' in 
        litigation, the statutes have always been understood to mean 
        the long-term interests of the United States, not simply in 
        terms of its fisc, or its success in particular litigation, but 
        as a government, as a people.

    This responsibility, of course, includes defending federal statutes 
challenged as unconstitutional on grounds that do not implicate the 
executive branch's constitutional authority when a good faith defense 
exists. The Solicitor General also defends regulations and decisions of 
Executive Branch departments and agencies, and is responsible for 
representing independent regulatory agencies before the Supreme Court.
    The Supreme Court practice of the Solicitor General includes filing 
petitions for review on behalf of the United States. In this regard, as 
the Supreme Court has stated:

        This Court relies on the Solicitor General to exercise such 
        independent judgment and to decline to authorize petitions for 
        review in this Court in the majority of the cases the 
        Government has lost in the courts of appeals.

    The Solicitor General also responds to petitions filed by adverse 
parties who were unsuccessful in the lower federal courts in criminal 
prosecutions or civil litigation involving the government. Where review 
is granted in a case in which the United States is a party, the 
Solicitor General is responsible for filing a brief on the merits with 
the Court and he or a member of his staff presents oral argument before 
the Court. The Solicitor General also files amicus curiae, or friend-
of-the-court, briefs in cases involving other parties where he deems it 
in the best interest of the United States to do so. Although most 
amicus filings occur only after review has been granted, the Solicitor 
General also submits amicus briefs at the petition stage when invited 
by the Court to do so or, in rare instances when Supreme Court 
resolution of the questions presented may affect the administration of 
federal programs or policies. The Solicitor General generally seeks and 
receives permission to participate in oral argument in those cases in 
which the government has filed an amicus brief on the merits.
    2. The second category of responsibilities discharged by the 
Solicitor General relates to government litigation in the federal 
courts of appeals, as well as in state, and sometimes even foreign, 
appellate courts. Authorization by the Solicitor General is required 
for all appeals to the courts of appeals from decisions adverse to the 
United States in federal district courts. The Solicitor General's 
approval is also required before government lawyers may seek en banc, 
or full appellate court, review of adverse decisions rendered by a 
circuit court panel. Additionally, government intervention or 
participation amicus curiae in federal appellate courts (as well as 
state or foreign appellate courts) must be approved by the Solicitor 
General. In addition, once a case involving the government is lodged in 
a court of appeals, any settlement of that controversy requires the 
Solicitor General's assent. In cases of particular importance to the 
government, lawyers from the Office of Solicitor General will directly 
handle litigation in the lower federal courts. Recent examples include 
the Microsoft antitrust appeal, important criminal procedural issues 
when addressed by the courts of appeals en banc, and cases involving 
enemy combatants.
    3. In the third category of responsibilities are decisions with 
respect to government intervention in cases where the constitutionality 
of an Act of Congress ``affecting the public interest'' has been 
brought into question at any level within the federal judicial system. 
In such circumstances, 28 U.S.C. Section 2403 requires that the 
Solicitor General be notified by the court in which the constitutional 
challenge has arisen and be given an opportunity to intervene with the 
full rights of a party.
                                 ______
                                 
    The various decisions discussed above for which the Solicitor is 
responsible are arrived at only on the basis of written recommendations 
and extensive consultation among the Office of the Solicitor General 
and affected offices of the Justice Department, Executive Branch 
departments and agencies, and independent agencies. Where differences 
of opinion exist among these components and agencies, or between them 
and the Solicitor General's staff, written views are exchanged and 
meetings are frequently held in an attempt to resolve or narrow 
differences and help the Solicitor General arrive at a final decision. 
Where consideration is given to an amicus curiae filing by the 
government in non-federal government litigation in the Supreme Court or 
lower federal appellate courts, it is not uncommon for the Solicitor or 
members of his staff to meet with counsel for the parties in an effort 
to understand their respective positions and interests of the United 
States that might warrant its participation.
           ii. organization of the solicitor general's office
    The Office of the Solicitor General has a staff of 48, of which 22 
(including the Solicitor General) constitute its legal staff and the 
remainder serve in managerial, technical, or clerical capacities. Of 
the 22 attorneys, four are Deputy Solicitors General, senior lawyers 
with responsibility for supervising matters in the Supreme Court and 
lower courts within their respective areas of expertise. Seventeen 
attorneys serve as Assistants to the Solicitor General. Sixteen are 
assigned a ``docket'' of cases presenting a wide spectrum of legal 
problems under the guidance and supervision of the Deputies. One of 
these assistant positions is currently vacant. The seventeenth, the Tax 
Assistant, is a senior lawyer who devotes himself almost entirely to 
litigation arising under the Internal Revenue Code. Additionally, OSG 
employs four lawyers who are recipients of the Bristow Fellowships, a 
one-year program open to highly qualified young attorneys, generally 
following a clerkship with a federal court of appeals' judge. Bristow 
Fellows assist the Deputies and Assistants in a variety of tasks 
related to the litigation responsibilities of the Office. All of the 
attorneys in the Office have outstanding professional credentials.
    The authorized personnel levels and budget of the Office of the 
Solicitor General have remained relatively stable in recent years. 
Fiscal Year 2003 funding level is 49 workyears and $7,656,000. About 
90% of the Office's budget pertains to nondiscretionary items. For 
example, approximately 75% is devoted to personnel and personnel-
related costs, 12% to GSA rent, and 3% to printing.
    To offset otherwise rising costs, the Office has realized savings 
by moving from reliance on outside printers to an in-house desktop 
publishing operation.
                          iii. office workload
    The following statistics may provide a helpful way of measuring the 
Office's heavy workload given the relatively small staff of attorneys. 
During the 2001 Term of the Supreme Court (June 30, 2001 to June 28, 
2002), the Solicitor General's Office handled approximately 3657 cases 
in the Supreme Court. We filed full merits briefs in 66 cases 
considered by the Court (and presented oral argument in 65 of those 
cases), \1\ which represented 83% of the cases that the Supreme Court 
heard on the merits in that Term. The government prevailed in 84% of 
the cases in which we participated. We filed 23 petitions for a writ of 
certiorari or jurisdictional statements urging the Court to grant 
review in government cases, 450 briefs in response to petitions for 
certiorari filed by other parties, and waivers of the right to file a 
brief in response to an additional 3108 petitions for certiorari. In 
response to invitations from the Supreme Court, we also filed 10 briefs 
as amicus curiae expressing the government's views on whether 
certiorari should be granted in cases in which the government was not a 
party. The above figures do not include the Office's work in cases 
filed under the Supreme Court's ``original'' docket (cases, often 
between States but involving the federal government, in which the 
Supreme Court sits as a trial court), and they also do not include the 
numerous motions, responses to motions, and reply briefs that we filed 
relating to matters pending before the Court.
---------------------------------------------------------------------------
    \1\ Of the 66 merits briefs filed, some were consolidated resulting 
in 1 oral argument.
---------------------------------------------------------------------------
    During this same one-year period, the Office of the Solicitor 
General reviewed more than 2145 cases in which the Solicitor General 
was called upon to decide whether to petition for certiorari; to take 
an appeal to one of the federal courts of appeals; to participate as an 
amicus in a federal court of appeals or the Supreme Court; or to 
intervene in any court. In the past year, lawyers from the Office of 
Solicitor General personally handled an additional 5 arguments in the 
courts of appeals and another 5 major arguments in the district courts. 
Thus, during this one-year period, the Office of the Solicitor General 
handled well over 5802 substantive matters on subjects touching on 
virtually all aspects of the law and the federal government's 
operations.
                             iv. conclusion
    In carrying out the foregoing responsibilities, my staff and I have 
productively and efficiently adhered to the time-honored traditions of 
the Office of the Solicitor General--to be forceful and dedicated 
advocates for the government, as well as officers of the Court with a 
special duty of candor and fair dealing.






















































































































                                   - 
