Acting in concert with the U.S. attorney for Mississippi's Southern District, the State Auditor's Office defied a court order by whisking away public records the Sun Herald was granted the right to review, the judge in the case concluded.
Judge Jennifer Schloegel ordered the State Auditor's Office on Oct. 31 to return business records to the Mississippi Department of Resources so they could be copied for public inspection. Her ruling came in a lawsuit the Sun Herald filed almost 10 months ago to secure the records.
She found that they were public records the DMR created in the course of doing business, not investigative reports exempt from the state Public Records Act, as Auditor Stacey Pickering claimed.
The Sun Herald was making arrangements Monday to get copies when the Auditor's Office revealed a federal grand jury had subpoenaed the documents, commanding that they be brought Tuesday
morning to Jackson. Schloegel issued a protective order at 11:30 p.m. Monday to keep the records in Biloxi for copying under court supervision.
But the records, Schloegel and the newspaper learned Tuesday morning, were already gone.
Schloegel told attorneys in the case Tuesday: "It has been relayed now ultimately, finally to me from the federal prosecutor -- I have not spoken to him directly -- but it has been relayed that he has no intention of turning over the records or that they be copied, that they are exempt as an investigative report, and he disagrees with my ruling.
"And I have no choice at this time but to find that the auditor, by acting in cooperation with the federal prosecutor, is in direct contempt of my ruling and my order of last week on Oct. 31, and certainly in direct contempt of my protective order, which I issued last night."
Formal contempt proceedings have not yet been initiated. Meanwhile, Attorney General Jim Hood filed a motion Wednesday to stop all proceedings in the case pending an appeal to the state Supreme Court. His motion says the attorneys assigned to the auditor's office, who ultimately work for Hood, intend to appeal Schloegel's rulings that the DMR records are public and must be provided to the newspaper.
Hood's motion tells Schloegel: "This court was presented with the unenviable task of resolving, largely as a matter of first impression, the interplay between the Mississippi Public Records Act and important bedrock legal principles such as disclosure limitations imposed on prosecutors and law enforcement by state law and rules of court.
"This court's resolution has created a conflict between the practice in chancery and circuit courts, between the interpretation of a statute and judicially created rules of procedure and conduct, and between the federal and state governments. These weighty issues deserve a full and complete review, at both the trial and appellate level, before further proceedings ."
Circuit court rules govern the conduct of criminal investigations by state law enforcement.
For more than a year, the State Auditor's Office and the Federal Bureau of Investigation and U.S. Attorney's Office have been investigating the DMR's operations under former Executive Director Bill Walker, who was fired in January.
At the same time, the Sun Herald has documented and reported on mismanagement of the agency. In December and January, the newspaper filed written requests for records from the DMR's Artificial Reef and Emergency Disaster Relief programs. The auditor then subpoenaed the same records, using language similar or identical to the wording in the newspaper's requests.
The auditor then seized the original records rather than allowing the DMR to copy them. The DMR's attorneys, who also work for Hood, say they have been unable to comply with the Sun Herald records requests even though their records are public.
The DMR did give the Sun Herald some of the records sought, on computer disc, shortly after the newspaper sued, but the Auditor's Office has the only copies of other records, including receipts for credit card spending.
With Schloegel's ruling last week, the newspaper appeared on course to inspect the records. State auditor's attorney Melissa Patterson notified Schloegel after business hours Monday about the federal subpoena. The federal subpoena incorporated the exact language from the auditor's January subpoena.
Sun Herald lawyer Henry Laird, an attorney for 38 years, told Schloegel on Tuesday: "I would say on behalf of Gulf Publishing (the Sun Herald) that in all my years of practicing law I've never seen such a flagrant violation of the court's rulings and orders."
Laird explained to the newspaper that attorneys for the state could have filed for court protection of the records rather than sending them to Jackson. In fact, Patterson told the judge Monday night that David Huggins, who heads the auditor's investigative division, intended to appear before the federal grand jury in Jackson on Tuesday morning and explain the DMR records were in Biloxi for copying under a Chancery Court order.
Patterson did not realize federal prosecutors had already taken the records, she confirmed for Schloegel on Tuesday.
"It's a sad day when relief ordered by any court is denied because a party violates court orders," Laird told the newspaper Wednesday evening, "and that's what we're dealing with here."
U.S. Attorney Greg Davis told the Sun Herald on Wednesday evening, "In that we have an ongoing investigation, there are some things it's just inappropriate for me to comment on at this time, but hopefully, in the near future, we may be able to address that."
Pickering's office said he would be making a statement "at the appropriate time," and Hood's office said he will speak through his court filings.