Notice: This opinion is subject to formal revision before publication in the
Federal Reporter or U.S.App.D.C. Reports. Users are requested to notify
the Clerk of any formal errors in order that corrections may be made
before the bound volumes go to press.
United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
–————
Filed January 9, 2004
Division No. 94-1
IN RE: MADISON GUARANTY SAVINGS & LOAN
(MCDOUGAL FEE APPLICATION)
–————
Division for the Purpose of
Appointing Independent Counsels
Ethics in Government Act of 1978, As Amended
–————
Before: SENTELLE, Presiding, FAY and REAVLEY, Senior
Circuit Judges.
ORDER
This matter coming to be heard and being heard before the
Special Division of the Court upon the application of Susan
McDougal for reimbursement of attorneys’ fees and costs
pursuant to section 593(f) of the Ethics in Government Act of
1978, as amended, 28 U.S.C. § 591 et seq. (2000), and it
appearing to the court for the reasons set forth more fully in
the opinion filed contemporaneously herewith that the peti-
tion is not well taken, it is hereby
ORDERED, ADJUDGED, and DECREED that the peti-
tion of Susan McDougal for attorneys’ fees that she incurred
2
during the investigation by Independent Counsel be denied.
PER CURIAM
For the Court:
Mark J. Langer, Clerk
By:
Marilyn R. Sargent
Chief Deputy Clerk
Notice: This opinion is subject to formal revision before publication in the
Federal Reporter or U.S.App.D.C. Reports. Users are requested to notify
the Clerk of any formal errors in order that corrections may be made
before the bound volumes go to press.
United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
–————
Filed January 9, 2004
Division No. 94-1
IN RE: MADISON GUARANTY SAVINGS & LOAN
(MCDOUGAL FEE APPLICATION)
–————
Division for the Purpose of
Appointing Independent Counsels
Ethics in Government Act of 1978, As Amended
–————
Before: SENTELLE, Presiding, FAY and REAVLEY, Senior
Circuit Judges.
ON APPLICATION FOR ATTORNEYS’ FEES
Opinion of the Special Court filed PER CURIAM.
PER CURIAM: Susan McDougal, who was indicted and con-
victed in connection with the Independent Counsel’s investi-
gation of fraudulent activity at the Madison Guaranty Savings
and Loan, petitions the court for reimbursement of attorneys’
fees in the amount of $345,412 under § 593(f) of the Ethics in
Government Act of 1978, as amended, 28 U.S.C. §§ 591–99
(2000) (the Act). Because the Act provides for reimburse-
ment of attorneys’ fees only to individuals against whom ‘‘no
indictment is brought,’’ we hold that McDougal’s application
is invalid on its face.
2
Background
Under the unique provisions of the Ethics in Government
Act, this court is empowered to award reimbursement for
attorneys’ fees under the terms of 28 U.S.C. § 593(f)(1).
That section states:
Upon the request of an individual who is the subject of
an investigation conducted by an independent counsel
pursuant to this chapter, the division of the court may, if
no indictment is brought against such individual pursuant
to that investigation, award reimbursement for those
reasonable attorneys’ fees incurred by that individual
during that investigation which would not have been
incurred but for the requirements of this chapter.
We have often discussed the elements of entitlement to
attorneys’ fees under the Act, see, e.g., In re Madison Guar-
anty Savings & Loan (Clinton Fee Application), 334 F.3d
1119, 1123 (D.C. Cir., Spec. Div., 2003) (per curiam); In re
North (Bush Fee Application), 59 F.3d 184, 188 (D.C. Cir.,
Spec. Div., 1995) (per curiam); In re North (Dutton Fee
Application), 11 F.3d 1075, 1079 (D.C. Cir., Spec. Div., 1993)
(per curiam). In most cases in which we have held the
applicant not entitled to a fee award, it has been because of
the failure of the applicant to prove the ‘‘but for’’ element.
We have also held that the fees were not incurred by a
‘‘subject’’ of the investigation or ‘‘during’’ the investigation.
In this rare case, we need not probe so far. On the face of
her application, McDougal has admitted that she does not
meet a threshold requirement for entitlement under the
statute. In the words of the statute, the court may only
make such award ‘‘if no indictment is brought against such
individualTTTT’’ The second sentence of McDougal’s applica-
tion declares that her ‘‘participation in this matter has result-
ed in two multi-count felony indictmentsTTTT’’ On the face of
the application, McDougal is not entitled to any fee award.
Analysis
There is no question that McDougal meets some of the
requirements of the statute. She was a subject of the
3
investigation, and she incurred attorneys’ fees. However, as
McDougal admits in her application, on August 17, 1995, the
Independent Counsel obtained from a federal grand jury an
indictment charging McDougal with eight counts of criminal
wrongdoing and financial transactions involving Madison
Guaranty and Capital Management Services, Inc., the princi-
pal matter then under investigation by the Independent
Counsel. As a result of this indictment, McDougal was
convicted on four of the eight counts and sentenced to two
years in prison. By the words of the statute, this indictment
disqualifies McDougal from the receipt of any counsel fees.
Without elaboration, McDougal declares in a footnote to her
fee petition that ‘‘on January 20, 2001, Ms. McDougal was
granted a full and unconditional Presidential pardon in rela-
tion to the 1995 indictment and conviction.’’ The pardon is
immaterial.
We confronted this question once before. In In re North
(George Fee Application), 62 F.3d 1434 (D.C. Cir., Spec. Div.,
1994) (per curiam), a subject who had been indicted but
pardoned sought attorneys’ fees. In that case, we reviewed
the effects of pardons in various circumstances throughout
our constitutional history. Id. at 1435–36. We relied heavily
on Knote v. United States, 95 U.S. (5 Otto) 149 (1877), a case
involving a confederate supporter who had lost his property
through confiscation. He was thereafter pardoned and
sought restoration of his confiscated estate. The Supreme
Court held that while a pardon ‘‘blots out the offense’’ so that
guilt of it cannot thereafter affect the rights of the pardoned
felon, it does not ‘‘make amends for the past.’’ 95 U.S. (5
Otto) at 153. Therefore, the Supreme Court held, ‘‘[h]owever
large TTT may be the power of pardon possessed by the
President,’’ that power is not unlimited, and ‘‘it cannot touch
monies in the treasury of the United States, except as ex-
pressly authorized by act of Congress.’’ Id. at 154. The
petitioner in George Fee Application, like the plaintiff in
Knote, sought the distribution of funds without compliance
with the statutory condition. The pardon made no difference.
We granted no relief.
4
McDougal, like the petitioner in George Fee Application, is
asking ‘‘this court to do precisely what the Constitution,’’ and
the Supreme Court in Knote and other cases, forbid. 62 F.3d
at 1436. That is, she is seeking ‘‘to have the court authorize
payment from the treasury despite the lack of congressional
authorization.’’ Pardoned or not, McDougal cannot truthfully
assert that no indictment has been brought against her. Like
the petitioner in George Fee Application, she can take noth-
ing under the statute.
McDougal, however, apparently believes the effect of the
indictment runs only as to the portion of the investigation
that preceded it. This is not a self-evident proposition.
Congress did not declare that subjects who were unindicted
could recover all of their reasonable attorneys’ fees and that
those who were indicted could recover their attorneys’ fees
only thereafter. As we have said many times, the Act
‘‘constitutes a waiver of sovereign immunity’’ and therefore
‘‘is to be strictly construed.’’ In re Nofziger, 925 F.2d 428,
438 (D.C. Cir., Spec. Div., 1991) (per curiam). McDougal’s
argument also approximates a theory we have previously
rejected. In In re Nofziger (Bragg Fee Application), 956
F.2d 287 (D.C. Cir., Spec. Div., 1992) (per curiam), we stated
‘‘since the statute only contemplated awarding reimburse-
ment of fees if no indictment was brought, it follows that
Congress never considered waiving sovereign immunity for
the payment of any post-indictment attorneys’ fees.’’ Id. at
289. We acknowledge that the facts of the Bragg petition
differ from those before us. However, we need not pursue
whether that decision is distinguishable, since even as to the
fees after the initial indictment, McDougal pleads her own
ineligibility on the face of her petition. On May 4, 1998,
McDougal was again indicted, this time for two counts of
criminal contempt and one count of obstructing the Indepen-
dent Counsel’s investigation. In her application McDougal
states, ‘‘this indictment seeks only reimbursement of fees
stemming from the 1998 indictment.’’ While we appreciate
her candor, we cannot help but find it surprising that the face
of an application dependent upon the lack of an indictment
reflects the connection of the petition to an indictment.
5
McDougal makes an argument, albeit a lame one, asserting
her eligibility for an award of fees in spite of the clear
incompatibility of the language of the statute and her petition.
She notes that the trial jury acquitted her on one count of the
indictment and deadlocked on the other two. She further
notes that thereafter, the Independent Counsel accepted dis-
missal of the counts upon which the jury had reached no
verdict. She then asserts her eligibility for fees on the
theory that this case is governed by In re Nofziger. In that
case we held that an individual who had been the subject of
an invalid indictment survived the ‘‘no indictment’’ require-
ment of the statute.1 However, Nofziger is in no sense
parallel to the present case. In Nofziger, before the filing of
the fee petition, the Court of Appeals for the District of
Columbia Circuit had held that the indictment omitted an
essential element of the offense it purported to charge, and
therefore was invalid as stating no offense against the laws of
the United States. 925 F.2d at 434–35. Not only has no
court held the indictment against McDougal to be invalid, her
petition advances no argument as to any defect in the indict-
ment. Her assertion is simply that because she was never
convicted, and because the investigation was surrounded by a
‘‘carnival-like atmosphere’’ and reflected law becoming ‘‘poli-
tics by other means,’’ this court should ‘‘find [that] the 1998
indictment was invalid.’’ None of this offers any legal reason
why the indictment is not valid or why it does not disqualify
her from the receipt of counsel fees.
Congress did not say that fee awards are available to an
individual who is indicted but acquitted. Congress did not
say that the court may award attorneys’ fees to an individual
whose indictment was drawn in a ‘‘carnival-like atmosphere’’
or in an investigation which the fee petitioner or anyone else
deems ‘‘political.’’ Congress explicitly said that the court may
award fees only ‘‘if no indictment is brought against such
individual pursuant to that investigation.’’ 28 U.S.C.
1 The petitioner in Nofziger nonetheless was not awarded attor-
neys’ fees as the court concluded that he had not satisfied ‘‘the ‘but
for’ requirement of the Act.’’ 925 F.2d at 450.
6
§ 593(f)(1). The Act ‘‘constitutes a waiver of sovereign im-
munity’’ and therefore ‘‘it is to be strictly construed.’’ In re
Nofziger, 925 F.2d at 438. We have no statutory authority to
award McDougal any fees on this petition, and the petition is
therefore denied.
Conclusion
For the reasons set forth above, we award no fees to the
petitioner and dismiss the petition.
So ordered.2
2The court thanks the Attorney General and the Independent
Counsel for their comments on this petition pursuant to 28 U.S.C.
§ 593(f)(2).