GULFPORT -- Regardless of whether she finds State Auditor Stacey Pickering in civil contempt of court, Chancery Judge Jennifer Schloegel directed his office and the Mississippi Department of Marine Resources to produce public records by Monday, as she ordered in October.
At the contempt hearing Wednesday, Pickering's chief of investigations, David Huggins, said under oath Assistant U.S. Attorney John Dowdy subpoenaed records from the DMR to avoid making them public -- not because a grand jury needed them.
The Sun Herald sued the DMR, Pickering and the Auditor's Office under the Mississippi Public Records Act for documents the DMR produced in the daily course of business. The auditor in January seized the records as part of an ongoing investigation into the DMR. After the newspaper's lawsuit was filed, the auditor agreed, then refused, to release copies to the newspaper.
Schloegel declared the records public Oct. 31 at the end of a two-day trial. The auditor's office once again agreed to make the records available for copying, but instead whisked them off in the night Nov. 4 to Jackson
under a federal grand jury subpoena for Nov. 5.
Huggins said he made the decision to move the records to Jackson, despite Schloegel's order. Attorney General Jim Hood or one of his assistants advised Huggins the federal grand jury subpoena trumped the judge's order, Huggins testified.
Huggins and Pickering both said they had agreed in writing to federal rules involving secrecy of grand jury material. However, Schloegel had found the DMR records were created by the agency, not as investigative reports.
After the fact
Pickering testified he was informed after the fact the records had been delivered to the grand jury. Schloegel recessed the hearing until Friday, when Assistant Attorney General Melissa Patterson is expected to testify.
Huggins told Patterson about the subpoena the day it was issued, Nov. 4, but she did not notify Schloegel until after business hours.
At the time, Patterson said she was under the impression the records were still on the Coast and could be copied before delivery to the grand jury. Huggins testified he thought so, too. In the past, he said, he has simply had to secure records, not deliver them to the grand jury.
Huggins said he also had not previously been personally served with a grand jury subpoena in the joint federal and state grand jury investigation. Subpoenas normally went to his investigators. Huggins said he feared a federal subpoena would be forthcoming, and told Pickering so, because Dowdy and Huggins had more than once discussed the need for secrecy where the grand jury investigation was involved. Some of the records the newspaper requested -- from the DMR's artificial reef and emergency disaster relief funds -- will be used as evidence in cases against former DMR employees, he said.
Huggins said Dowdy advised the afternoon of Nov. 4 that Huggins would have to bring the records with him to the grand jury the next morning. Investigator Chris Lott accompanied the 38 boxes of records to Jackson. They arrived in a U-Haul truck in Jackson about 12:45 a.m. Nov. 5. Huggins said he assumed Lott, who lives on the Coast, stayed in a Jackson motel, but he was not sure where the truck was parked. He said the records were delivered the next morning to the grand jury and remain in federal custody.
Schloegel pointed out the grand jury could hardly have had time to examine the records before issuing indictments in the DMR case. The federal grand jury indictments against former DMR Director Bill Walker, his son Scott Walker, and two DMR managers had been issued that same day.
Huggins said Dowdy subpoenaed the records to protect them, not for the grand jury investigation.
The state and federal investigation is not over, "not by any stretch of the imagination," Huggins said. "It's very active."
Schloegel learned Nov. 5 the records were gone from the Bolton Building in Biloxi, where both the DMR and auditor's investigators had offices. She said all the parties realized at that point the auditor appeared to be in contempt of her orders to protect and produce the records, but she wanted to research the issue before an official ruling. The records had been in her court's custody before they went to Jackson.
The Auditor's Office did not seek direction from Schloegel before taking the records to Jackson. Instead, Huggins said, Dowdy said Nov. 4 "we" were going to call Schloegel. Huggins assumed that meant Dowdy or another federal authority would talk to Schloegel that afternoon.
Dowdy was not in court Wednesday. When reached later by telephone, he declined to comment on his role in the federal subpoena.
Earlier Wednesday, Schloegel denied the auditor's motion to recuse herself from the case because of her previous mention of contempt. "It suggests the court has a bias against my clients," said private attorney John Corlew of Jackson, who represented Pickering and his office at the hearing. Schloegel said the auditor's office had already had the opportunity ask for recusal. She also said her references to contempt were made when she expected the documents in her courtroom and they were not there.
She was willing to listen to any explanation the auditor had for the contempt, she said, that would avoid sanctions. Those sanctions could include paying the newspaper's attorney fees and a $100 fine for each violation of the Public Records Act.
A simple solution
Sun Herald attorney Henry Laird said Pickering should purge himself of contempt by producing the records.
Schloegel also refused Wednesday morning the auditor's request to close the hearing to the public. The auditor had cited the state and federal investigations of the DMR as his reason for the request.
Pickering said he had hoped his office could comply with both Schloegel's order to turn over the public records and with the grand jury subpoena. He said he left it up to his staff to do so.
Pickering petitioned the state Supreme Court on Nov. 21 to stay action in the Chancery Court case, including the contempt hearing, but the Supreme Court turned him down Monday.
Pickering told Schloegel he is now prepared to ask a federal judge to release the records so they can be copied for the newspaper.
"I think we have exhausted all the stays," the auditor said. "I think the only prudent thing to do is to go to federal court so that we can satisfy not only the federal grand jury but this court."
Schloegel wanted to know why the auditor's office failed to copy the records before they were turned over to the grand jury. Huggins said he and the Attorney General's Office were trying to work out the details to get the records copied but ran out of time.