Alito Hearings Fact Check: Judge Alito and the Vanguard Case

Judiciary Committee, Minority Staff
Contact: Tracy Schmaler, 224-7703
See this document at: http://democrats.senate.gov/judiciarycommitteesupremecourt

Fact Check: Fact Check: Judge Alito and the Vanguard Case

NOW:

Today, when asked by Senator Hatch about the Vanguard case, Judge Alito testified: "I think that once the facts are set out, I think that everybody will realize that in this instance I not only complied with the ethical rules that are binding on federal judges -- and they're very strict -- but also that I did what I've tried to do throughout my career as a judge, and that is to go beyond the letter of the ethics rules and to avoid any situation where there might be an ethical question raised." (1/9/06)

Judge Alito did not mention his own pledge to the Senate to recuse himself from any case involving Vanguard until Senator Kennedy brought it up later. Then, Judge Alito retreated from his earlier testimony to Senator Hatch and remarked that "if I had it to do over again, I would have handled this case differently . . . I did not focus on the issue of recusal."

Beyond any potential violation of the code of ethics, the issue is one of a broken promise. Judge Alito promised the Senate that he would recuse himself, then refused to admit error until directly confronted with that promise.

THEN:

Judge Alito promised the Senate he would disqualify himself from considering five categories of cases. However, he then went on to decide cases in at least four - and possibly all five - of those categories. His explanations for his decision not to recuse on one key case have shifted over time and have been roundly contradicted by the Third Circuit's own documents.

Judge Alito's Pledge to the Senate:

Judge Alito told the Senate Judiciary Committee, "I do not believe that conflicts of interest relating to my financial interests are likely to arise. I would, however, disqualify myself from any cases involving the Vanguard companies, the brokerage firm of Smith Barney, or the First Federal Savings & Loan of Rochester, New York." He further promised to disqualify himself from cases involving his sister's law firm and cases he worked on or supervised at the United States Attorney's Office in New Jersey.
- Hearings on the Nomination of Samuel Alito to be Judge for the Third Circuit Court of Appeals, 1990

Apparent Violations of the Recusal Pledge:

In 2002, Judge Alito ruled on the case of Monga v. Ottenberg, in which Vanguard Group and two other Vanguard entities were not only named parties but were mentioned extensively in papers filed with the court and the opinion Judge Alito signed. At the time, he held investments worth between $390,000 and $930,000 in Vanguard funds, which represented by far the largest share of his total investments, according to his office financial disclosure reports. - Monga v. Ottenberg, 43 Fed. Appx. 523 (3d Cir. 2002).
In 1997, he ruled on the case of Johnston v. HBO Film Management, Inc., in which Smith Barney, Inc. was a named party. Smith Barney is a brokerage firm with which Alito has long invested. - Johnston v. HBO Film Management, Inc., 129 F.3d 1255 (3d Cir. 1997).
In 1995, Judge Alito participated in the Third Circuit's decision not to re-hear the case of Midlantic National Bank v. Hansen. The law firm in which his sister was a partner, McCarter & English, represented one of the parties. -Midlantic National Bank v. Hansen, 1995 U.S. App. LEXIS 6452 (3d Cir. 1995).
In 1991, he participated in the Third Circuit's decision not to re-hear the case of United States v. Kopp. Judge Alito had signed the indictment and overseen the unit prosecuting Kopp as United States Attorney in 1989. - See United States v. Kopp, 951 F.2d 521 (3d Cir. 1992); United States v. Kopp, Indictment.

Another case raises significant questions as well:

In 1997, he ruled on the case of Abraham v. Gold, in which First Federal Savings and Loan Association of Rochester was a named party. It is unclear whether or not Judge Alito still held a mortgage with First Federal at the time he heard that case. - See Abraham v. Gold, 124 F.3d 185 (3d Cir. 1997)

After the most serious of his potential conflicts, the Vanguard case, came to light, Judge Alito's numerous explanations for his initial participation and subsequent involvement in the case have at times been inconsistent with each other and with the facts the Judiciary Committee has learned. While at least one leading scholar has suggested that Judge Alito should have recused himself, the shifting explanations are even more alarming.

After the plaintiff in Monga moved the court to vacate the opinion based upon Judge Alito's apparent conflict in 2003, he wrote a letter, to Chief Judge Scirica, writing, "I do not believe that I am required to disqualify myself based on my ownership of mutual fund shares." He expressed surprise at the complaint, but said that he would disqualify himself even thought he didn't have to. - Letter from Judge Alito to Chief Judge Scirica, December 10, 2003.
After this recusal issue came to light following Judge Alito's nomination to the Supreme Court, Judge Alito told Senators, including Senator Feingold and Senator Conrad, that he initially failed to recuse himself in the case due to a computer glitch. - National Journal's Congress Daily, November 9 and 10, 2005.
In a recent letter to Judiciary Committee Chairman Arlen Specter, Judge Alito provided several additional explanations for his involvement in the case. He asserted that a possible recusal issue did not occur to him "due to an oversight"; that his promise during his 1990 confirmation hearings only referred to his "initial service"; that he realized as his service continued that his 1990 promise to recuse himself from cases involving entities in which he had a financial interest was unduly restrictive; and that the mutual funds in which he was invested were not at issue in the case. - Letter from Judge Alito to the Judiciary Committee, November 10, 2005.
A letter sent by Senator Kennedy to Judge Alito, dated December 5, 2005, recounts that in conversations "with at least two Senators," Judge Alito suggested that the fact that the plaintiff in Monga was pro se (representing herself) had some bearing on his failure to recuse. - Letter from Senator Edward Kennedy to Judge Alito, December 5, 2005.
Interestingly, documents received from the Third Circuit indicate that Vanguard was definitely not on Judge Alito's recusal list in 1993, only three years after his promise to the Senate, and throughout the mid-1990's. Vanguard was not on Judge Alito's recusal list when the Monga case came before him in 2002 and 2003, and the Third Circuit has no documents indicating that it ever was on the list prior to December 2003 (encompassing periods both before and after the process became computerized). Surprisingly, Third Circuit records show that Judge Alito added Vanguard to his recusal list in December 2003, after the plaintiff in Monga raised the issue.
These Third Circuit documents call into questions several of his explanations: the fact that Vanguard was not on his recusal list prior to December 2003 undermines his claim that his failure to recuse in Monga was due to a computer glitch or an oversight, the fact that it was not on the list even as far back as 1993 deflates his argument that his pledge to the Senate applied to his "initial service," and the fact that he then chose to add Vanguard to his list undermines his claims that, as of 2003, he didn't need to recuse on cases involving Vanguard.