(Refiles to fix garbled words in second paragraph)
By Dan Levine
SAN FRANCISCO, April 17 The U.S. Justice
Department in San Francisco has instituted new oversight for
complex cases, a federal prosecutor said, following a failed
drug conspiracy prosecution against delivery service FedEx Corp
U.S. Attorney Brian Stretch, in an interview with Reuters
last week, said his staff has identified about 20 of the
office's most complex cases to undergo "investigative progress
reviews." He declined to identify any specific matters but said
such cases would likely include corporate fraud and complicated
Every two months, the lead prosecutor assigned to such a
case will meet with supervisors in the office, including the
U.S. attorney, Stretch said. Management will receive regular
updates on the investigation, help decide novel legal issues,
and ensure the case receives proper resources.
"This allows everybody in chain to be sharing in real time a
lot of the decisions on these larger investigations," Stretch
The new protocols were put in place after Stretch ordered a
review of the FedEx case to improve future prosecutions. In that
case, prosecutors obtained a grand jury indictment in 2014
against the courier service alleging it had knowingly helped
internet pharmacies ship illegal pills. The Justice Department
abruptly dropped all charges four days into trial last year amid
evidence the company had actually tried to cooperate with the
government on combating such pharmacies.
The judge commended the decision, saying it was clear FedEx
was "factually innocent." An attorney for FedEx called the
prosecution "an epic institutional failure."
Stretch's office is currently investigating a phony accounts
scandal at Wells Fargo & Co.
John Zach, a former federal prosecutor in Manhattan who
investigated SAC Capital, said unit chiefs in that U.S.
attorneys office closely monitored cases but line prosecutors
did not usually meet with top officials until it was time to
decide if someone would face charges.
The problem in the FedEx case was that prosecutors,
including supervisors, did not recognize the significance of
cooperation evidence that FedEx had highlighted before the
company was charged, FedEx attorney Cristina Arguedas said.
The new oversight system "is certainly a good idea,"
Arguedas said, although its success will depend on whether
supervisors look at the actual evidence or rely on a single
Stretch declined to comment on FedEx case details, but said
no one wants to have to dismiss a case during trial.
"It is my expectation that this new review process can only
aid with such situations," he said.
(Reporting by Dan Levine; Editing by Bill Trott)