Senior Justice Department officials blocked the U.S. attorney in Colorado from supporting a whistle-blower's suit last year, jeopardizing the government's prospects for recovering as much as $40 million from a major oil company for its alleged underpayment of royalties.
U.S. Attorney Troy Eid said Washington overruled his request to enter the case against the Kerr-McGee Corp.
A lawyer for the whistle-blower said he was told that decision was made "at the highest levels" of the Justice Department, then run by former Attorney General Alberto Gonzales.
"I recommended strongly that we intervene," Eid said. "My view did not prevail."
Moreover, McClatchy Newspapers found that the Justice Department has participated in only a handful of the 80 whistle-blower cases brought against the oil industry since 1995.
At issue in Colorado was whether the federal government would join in a suit filed by a former senior auditor for the federal Minerals Management Service, known as MMS, under the False Claims Act, which gives whistle-blowers a share of any cash they recover for taxpayers. MMS collects as much as $10 billion in royalties each year from federal oil and gas leases.
In January 2007, a federal jury ruled that Kerr-McGee owed $7.5 million to former senior MMS auditor Bobby Maxwell and the federal government because the company had understated the proceeds of oil sales to hold down royalty costs.
After the jury's verdict, the presiding judge signaled he might overturn the verdict on grounds that Maxwell did not meet the law's strict definition of a whistle-blower.
As a result, Richard LaFond, a Denver lawyer for Maxwell, said he urged the U.S. Attorney's Office to intervene to protect taxpayers' interests by keeping the case alive.
LaFond and co-counsel Michael Porter estimated that the U.S. Treasury would lose as much as $40 million if the Justice Department did not intervene and they lost on appeal.
LaFond said that an official in the Denver office agreed, and she later told him she got approval from Eid, the U.S. attorney, to take on the case.
His bosses in Washington, however, reversed him.
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While many Liberians and international human rights advocates have praised the creation
of the TRC, some have criticized Sirleaf’s nomination of Kabineh Janneh, the transitional
government’s justice minister and a former leading member of the LURD rebel group, as
a Supreme Court Justice.
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