Stolt Nielsen v. United States

Opinions of the United

2006 Decisions States Court of Appeals

for the Third Circuit

3-23-2006

Stolt Nielsen v. USA

Precedential or Non-Precedential: Precedential

Docket No. 05-1480

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PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 05-1480

STOLT-NIELSEN, S.A.;

STOLT-NIELSEN TRANSPORTATION GROUP LTD.;

RICHARD B. WINGFIELD

v.

UNITED STATES OF AMERICA

Appellant

Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. Civil Action No. 04-cv-00537)

District Judge: Honorable Timothy J. Savage

Argued September 30, 2005

Before: ALITO * and AMBRO, Circuit Judges

RESTANI,** Judge

(Opinion filed: March 23, 2006)

R. Hewitt Pate

Assistant Attorney General

Scott D. Hammond

Makan Delrahim

Deputy Assistant Attorneys General

John P. Fonte, Esquire

John J. Powers, III, Esquire (Argued)

United States Department of Justice

Antitrust Division, Room 30224

950 Pennsylvania Avenue, N.W.

Washington, D.C. 20530

Robert E. Connolly, Esquire

Antonia R. Hill, Esquire

Wendy B. Norman, Esquire

Kimberly Justice, Esquire

Richard S. Rosenberg, Esquire

*

Then Judge, now Justice, Alito heard oral argument in

this case but was elevated to the United States Supreme Court

on January 31, 2006. This opinion is filed by a quorum of the

panel. 28 U.S.C. § 46(d).

**

Honorable Jane A. Restani, Chief Judge, United States

Court of International Trade, sitting by designation.

2

U.S. Department of Justice

One Independence Square West

7th & Walnut Streets, Suite 650

Philadelphia, PA 19106-2424

Counsel for Appellant

Ian M. Comisky, Esquire

Matthew D. Lee, Esquire

Blank Rome LLP

One Logan Square

130 North 18th Street

Philadelphia, PA 19103

George J. Terwillinger III, Esquire

John M. Gidley, Esquire

Christopher M. Curran, Esquire (Argued)

Lucius B. Lau, Esquire

White & Case LLP

701 Thirteenth Street, N.W.

Washington, D.C. 20005

Counsel for Appellee Stolt-Nielsen S.A. and

Stolt-Nielsen Transportation Group Ltd.

Roberta D. Liebenberg, Esquire

Allen D. Black, Esquire (Argued)

Gerard A. Dever, Esquire

Fine, Kaplan & Black

1835 Market Street, 28th Floor

Suite 2300

3

Philadelphia, PA 19103

James A. Backstrom, Jr., Esquire

Suite 200

Two Penn Center Plaza

Philadelphia, PA 19102

Counsel for Appellee

Richard B. Wingfield

OPINION OF THE COURT

AMBRO, Circuit Judge

This case raises a significant constitutional question of

first impression in this Circuit: whether federal courts have

authority, consistent with the separation of powers, to enjoin the

executive branch from filing an indictment. Although federal

courts have this authority in narrow circumstances, we conclude

that this is not such a case and therefore reverse the District

Court’s judgment to the contrary.

4

I.

A. Background

Appellee Stolt-Nielsen, S.A., through its subsidiary Stolt-

Nielsen Transportation Group Ltd. (collectively “Stolt-Nielsen”

or the “Company”), is a leading supplier of parcel tanker

shipping services. In March 2002, Stolt-Nielsen’s general

counsel, Paul O’Brien, resigned. According to a complaint

O’Brien filed against Stolt-Nielsen in Connecticut Superior

Court in November 2002, and a subsequent article in The Wall

Street Journal, O’Brien advised his superiors of illegal collusive

trading practices between Stolt-Nielsen and two of its

competitors, and resigned after the Company failed to take

action to resolve the problem. On receiving O’Brien’s

November 2002 complaint, Stolt-Nielsen hired John Nannes, a

former Deputy Assistant Attorney General in the Antitrust

Division at the U.S. Department of Justice, to conduct an

internal investigation of possible antitrust violations by the

Company and advise it regarding any criminal liability.

On November 22, 2002, Nannes met with the chairman

of Stolt-Nielsen’s tanker division, Samuel Cooperman.

Cooperman informed Nannes that O’Brien “rais[ed] some

antitrust concerns” in early 2002, and that in response Stolt-

Nielsen revised its antitrust compliance policy and disseminated

it to its employees and competitors. Cooperman also told

Nannes that he believed an internal investigation would

5

demonstrate that the Company was in violation of federal

antitrust laws and asked Nannes about the possibility of leniency

from the Department of Justice. With Cooperman’s permission,

Nannes spoke with an Antitrust Division official later that day

to inquire about amnesty if Stolt-Nielsen were to admit its

violations, and the Government informed him that an

investigation had already begun.

Specifically, Nannes inquired about possible protection

for Stolt-Nielsen and its officers under the Antitrust Division’s

Corporate Leniency Policy. Under this Policy, the Government

agrees “not [to] charg[e] a firm criminally for the activity being

reported” if (in the case of an applicant who comes forward after

an investigation has begun) seven conditions are met: (1) the

applicant is the first to report the illegal activity; (2) the

Government does not, at the time the applicant comes forward,

have enough information to sustain a conviction; (3) the

applicant, “upon its discovery of the illegal activity being

reported, took prompt and effective action to terminate its part

in the activity”; (4) the applicant’s report is made “with candor

and completeness and provides full, continuing and complete

cooperation” with the Government’s investigation; (5) the

applicant confesses to illegal anticompetitive conduct as a

corporation and not merely through individual confessions by

corporate officers; (6) the applicant makes restitution where

possible; and (7) the Government determines that granting

leniency to the applicant would “not be unfair to others.” The

officers and directors of the corporation who assist with the

6

investigation are considered for immunity from prosecution on

the same basis as if they had come forward individually.

B. The Conditional Leniency Agreement

The Government informed Nannes that Stolt-Nielsen

would not be eligible for amnesty under the Corporate Leniency

Policy if O’Brien’s departure was involuntary and due to his

exposure of the Company’s antitrust violations. Nannes assured

the Government that O’Brien left voluntarily and detailed the

changes to the Company’s antitrust policy that were

implemented in response to O’Brien’s concerns. During the

ensuing investigation, Nannes learned that between 1998 and

2001 a Stolt-Nielsen executive, Andrew Pickering, exchanged

customer allocation lists with two of Stolt-Nielsen’s

competitors, presumably for the purpose of apportioning

customers among the companies and restraining competition. In

January 2003, Pickering’s successor, appellee Richard

Wingfield, provided Nannes with four such lists, which

confirmed that Stolt-Nielsen had indeed engaged in illegal

anticompetitive behavior. Nannes promptly turned these lists

over to the Government, which entered into a Conditional

Leniency Agreement (the “Agreement”) with Stolt-Nielsen on

January 15, 2003.

Under the terms of the Agreement, the Government

agreed “not to bring any criminal prosecution against [Stolt-

Nielsen] for any act or offense it may have committed prior to

7

the date of this [Agreement] in connection with the

anticompetitive activity being reported.” This promise was, of

course, subject to Stolt-Nielsen’s strict compliance with the

aforementioned conditions, “[s]ubject to verification [by the

Government] and subject to [Stolt-Nielsen’s] full, continuing

and complete cooperation.” The Agreement further stated:

If the Antitrust Division at any time

determines that [Stolt-Nielsen] has

violated this Agreement, [it] shall

be void . . . . Should the Antitrust

Division revoke the conditional

acceptance of [Stolt-Nielsen] into

the Corporate Leniency Program,

the A ntitrust Division may

thereafter initiate a criminal

prosecution against [Stolt-Nielsen],

without limitation. Should such a

prosecution be initiated, any

documentary or other information

provided by [Stolt-Nielsen], as well

as any statements or other

information provided by any

current or former director, officer,

or employee of [Stolt-Nielsen] to

the Antitrust Division pursuant to

this Agreement, may be used

against Stolt-Nielsen in any such

8

prosecution.

The Agreement also provided that the Government would

not prosecute officers and directors of the Company who “admit

their knowledge of, or participation in, and fully and truthfully

cooperate with the Antitrust Division in its investigation of the

anticompetitive activity being reported.” Specifically, that

cooperation entailed: (1) producing all documents and records

requested by the Government; (2) being available for

Government interviews; (3) “responding fully and truthfully to

all inquiries of the [Government] . . . without falsely implicating

any person or intentionally withholding any information”; (4)

voluntarily providing any information or materials not requested

by the Government that were nonetheless relevant to the

investigation; and (5) testifying under oath when asked by the

Government. It concluded with a standard integration clause:

“This letter constitutes the entire agreement between the

[parties], and supersedes all prior understandings, if any,

whether oral or written, relating to the subject matter herein.”

Using the information provided by Stolt-Nielsen and its

executives (including Wingfield), the Government secured

guilty pleas from Stolt-Nielsen’s co-conspirators, resulting in

prison sentences for individual executives at those companies

and fines totaling $62 million.

9

C. The Government Terminates the Agreement

In the weeks following execution of the Agreement, the

Government’s investigation revealed that Stolt-Nielsen’s

participation in the conspiracy persisted for several months after

O’Brien raised his concerns to Cooperman in early 2002. The

Government concluded that Stolt-Nielsen, and Wingfield in

particular, continued to collude unlawfully with competitors

until November 2002. Based on this information, the

Government informed Nannes on April 8, 2003 that it was

suspending Stolt-Nielsen’s obligations under the Agreement and

considering withdrawing the grant of conditional leniency

entirely because the Company did not take “prompt and

effective action to terminate its part in the anticompetitive

activity being reported upon discovery of the activity,” as

required by the Agreement. One of Wingfield’s subordinates,

Bjorn Jansen, then admitted that the anticompetitive agreement

between Stolt-Nielsen and its competitors was still in place in

the fall of 2002, despite having told Nannes that such conduct

ceased in March 2002 once the Company learned of O’Brien’s

allegations and issued its new antitrust policy.

In June 2003, the Government concluded that Wingfield

had not fulfilled his obligations under the Agreement because he

never informed the Government that his unlawful

communications with Stolt-Nielsen’s competitors did not cease

in March 2002 when Stolt-Nielsen issued its new antitrust

policy. On June 24, 2003, the Government charged Wingfield

10

by criminal complaint with violating the Sherman Act, 15

U.S.C. § 1. The Government withdrew its grant of conditional

leniency to Stolt-Nielsen on March 2, 2004, and announced that

it intended to indict the Company and Wingfield for violations

of the Sherman Act.1

D. District Court Proceedings

Shortly before the Government revoked Stolt-Nielsen’s

conditional leniency, the Company and Wingfield filed

complaints in the United States District Court for the Eastern

District of Pennsylvania seeking enforcement of the Agreement

and an injunction preventing the Government from filing

indictments against them. The Government agreed to postpone

its indictments of both parties pending the District Court’s

consideration of the complaints.

The District Court bifurcated the proceedings into two

phases. In Phase One, the Court considered whether Stolt-

1

Although the Government “charged” Wingfield by

criminal complaint in June 2003, it could not prosecute him

without an indictment. See 1 Charles Alan Wright, Fed.

Practice & Procedure § 121, at 518 (3d ed. 1999) (“Although a

criminal proceeding may be instituted by a complaint, this only

permits issuance of a warrant for the arrest of the offender, and

he cannot be tried unless an indictment or information, as the

case may require, is brought against him.”).

11

Nielsen’s alleged conduct between March and November 2002

violated the terms of the Agreement. If so, Phase Two would

determine whether the conduct actually occurred. During the

Phase One proceedings, the District Court consolidated

consideration of Stolt-Nielsen’s and Wingfield’s requests for

preliminary injunctions with the trial on the merits, and heard

testimony from Nannes and James Griffin, the Assistant

Attorney General in charge of the Antitrust Division at the

Department of Justice.

In January 2005, the District Court granted judgment in

favor of Stolt-Nielsen and Wingfield and permanently enjoined

the Government from indicting either of them for violations of

the Sherman Act. See Stolt-Nielsen S.A. v. United States, 352

F. Supp. 2d 553 (E.D. Pa. 2005). The Court concluded that the

Government could not unilaterally rescind the Agreement

without a judicial determination that Stolt-Nielsen and

Wingfield breached it, an issue appropriate for consideration

before indictment “because if an indictment were later

determined to have been wrongfully secured, it would be too

late to prevent the irreparable consequences.” Id. at 560. The

Court further found that the Agreement did not specify a

discovery date and instead granted amnesty for activity before

January 15, 2003, the date on which it was signed. Indeed, it

found that “the date when [Stolt-Nielsen] ended its participation

[in the conspiracy] was never clearly established,” id. at 562

n.10, and therefore, in light of the Agreement’s integration

clause, “DOJ, especially because it drafted the agreement,

12

cannot depend upon a tacit understanding of what it contends

was meant [to be the discovery date] but was not memorialized

in the integrated agreement.” Id. at 562. The Court concluded:

The agreement immunizes

[Stolt-Nielsen] from prosecution

for activity prior to January 15,

2003. Now DOJ contends the

activity had to have stopped at an

earlier unspecified date that is not

set forth in the agreement. Had it

wanted to fix the date sometime

before January 15, 2003, it could

have replaced the words “to the

date of this letter” with the earlier

date it now contends the parties

contemplated.

. . . [The Government’s]

goals [in concluding the Agreement

with Stolt-Nielsen] were to pursue

[Stolt-Nielsen’s] co-conspirators

and break up the conspiracy. It got

what it had bargained for in the

agreement. . . . Now that it has

received the benefit of the bargain,

DOJ cannot prosecute the party that

incriminated itself w hen it

13

delivered the evidence DOJ used to

accomplish its goals.

Id.

E. Appeal

On appeal, the Government contends that the District

Court erred in two respects. First, it argues that federal courts

lack jurisdiction to enjoin the executive branch from filing an

indictment. Second, it asserts that the District Court erred in

holding that Stolt-Nielsen’s and Wingfield’s actions between

March and November 2002 did not violate the terms of the

Agreement. For the reasons that follow, the District Court’s

judgment is reversed and the case remanded to that Court so that

it may dismiss the appellees’ complaints.2

II.

We review a District Court’s grant or denial of a

permanent injunction for abuse of discretion, United States v.

Bell, 414 F.3d 474, 478 (3d Cir. 2005), but exercise plenary

2

The District Court had jurisdiction over this case under

28 U.S.C. § 1331, as it is a civil action arising under the laws of

the United States. Our jurisdiction arises under 28 U.S.C. §

1291, since the Government filed a timely notice of appeal from

a final decision of the District Court.

14

review over the District Court’s underlying legal conclusions.

Freethought Soc’y of Greater Phila. v. Chester County, 334 F.3d

247, 255–56 (3d Cir. 2003). A District Court’s determination

whether a cooperation agreement has been breached is a legal

conclusion. United States v. Baird, 218 F.3d 221, 229 (3d Cir.

2000). All findings of fact are reviewed for clear error. See

Bell, 414 F.3d at 478 (reviewing findings of fact related to a

permanent injunction for clear error); Baird, 218 F.3d at 229

(reviewing findings of fact related to a cooperation agreement

for clear error).

III.

The Supreme Court has observed that the executive

branch “has exclusive authority and absolute discretion to decide

whether to prosecute a case,” United States v. Nixon, 418 U.S.

683, 693 (1974), and the Government therefore argues that

courts lack jurisdiction to enjoin a criminal prosecution. See

United States v. Cox, 342 F.2d 167, 171 (5th Cir. 1965) (en

banc) (“It follows, as an incident of the constitutional separation

of powers, that the courts are not to interfere with the free

exercise of the discretionary powers of the attorneys of the

United States in their control over criminal prosecutions.”).

There are exceptions to this general rule, however,

usually to avoid a chilling effect on First Amendment rights. As

the Supreme Court has recognized,

15

[a] criminal prosecution under a

statute regulating expression

usually involves imponderables and

contingencies that themselves may

inhibit the full exercise of First

Amendment freedoms. . . . The

assumption that defense of a

criminal prosecution will generally

assure ample vindication of

constitutional rights is unfounded

in such cases. . . . [W]e have not

thought that the improbability of

successful prosecution makes the

case different. The chilling effect

upon the exercise of First

Amendment rights may derive from

the fact of the prosecution,

unaffected by the prospects of its

success or failure.

Dombrowski v. Pfister, 380 U.S. 479, 486–87 (1965); see also

Ashcroft v. ACLU, 542 U.S. 656, 670–71 (2004) (upholding

preliminary injunction against criminal enforcement of the Child

Online Protection Act because, inter alia, “[w]here a prosecution

is a likely possibility, yet only an affirmative defense is

available, speakers may self-censor rather than risk the perils of

trial”).

16

It is also well established that the Government must

adhere strictly to the terms of agreements made with defendants

— including plea, cooperation, and immunity agreements — to

the extent the agreements require defendants to sacrifice

constitutional rights. See, e.g., Santobello v. New York, 404

U.S. 257, 262 (1971); United States v. Hodge, 412 F.3d 479,

485 (3d Cir. 2005) (“The government must adhere strictly to the

terms of the bargains it strikes with defendants. Because

defendants entering pleas forfeit a number of constitutional

rights, courts are compelled to scrutinize closely the promise

made by the government in order to determine whether it has

been performed.” (citation and internal quotation marks

omitted)).

Therefore, although the Government is certainly correct

that there is no free-ranging jurisdiction on the part of courts to

enjoin criminal prosecutions, that authority does exist in limited

situations, typically those where the mere threat of prosecution

would inhibit the exercise of First Amendment freedoms.

Federal courts also have jurisdiction to consider, and hold the

Government to, the terms of agreements it makes with

defendants. The question thus becomes whether, in those cases

not concerning First Amendment rights, the authority to enforce

cooperation or immunity agreements may be exercised pre-

indictment in the form of an injunction.

The District Court relied on a Seventh Circuit case,

United States v. Meyer, 157 F.3d 1067 (7th Cir. 1998), as

17

authority for conducting a pre-indictment review of the

Agreement before us. See Stolt-Nielsen, 352 F. Supp. 2d at

560–61. In Meyer, the Seventh Circuit stated, in dicta, that “the

preferred procedure, absent exigent circumstances, would be for

the government to seek relief from its obligations under the

immunity agreement prior to indictment. Since the government

is required to obtain a judicial determination of a defendant’s

breach prior to trial, it is but a de minimis inconvenience for the

government to secure that determination pre-indictment.” 157

F.3d at 1077.

We have no quarrel with the Seventh Circuit’s

observation that, in many circumstances, a pre-indictment

determination of the parties’ obligations under an immunity

agreement would be a good idea. As we explain below,

however, federal courts (including the Seventh Circuit) agree

that a pre-indictment determination is not required. Indeed,

notwithstanding its dicta regarding the “preferred procedure,”

the Meyer Court held the defendant was constitutionally

“entitled to a judicial determination of his breach before being

deprived of his interest in the enforcement of an immunity

agreement,” and that this “interest” was in not being convicted,

rather than not being indicted. Id. at 1076–77.3 As the Court

3

In keeping with the case law discussed below, the

Seventh Circuit reached this conclusion despite the fact that the

immunity agreement before it stated that the Government would

not “charge” the defendant. Meyer, 157 F.3d at 1077.

18

noted, “a post-indictment evidentiary hearing on the defendant’s

alleged breach was sufficient to satisfy due process.” Id. at 1076

(citing United States v. Verrusio, 803 F.2d 885, 889 (7th Cir.

1986)).

Other immunity agreements that have promised not to

charge or otherwise criminally prosecute a defendant, like the

agreement at issue in this case, have likewise been construed to

protect the defendant against conviction rather than indictment

and trial. See, e.g., Heike v. United States, 217 U.S. 423, 431

(1910) (construing the Sherman Act’s immunity provision,

which protected a testifying witness from being “prosecuted,”

see Act of Feb. 25, 1903, ch. 755, § 1, 32 Stat. 854, 904

(repealed 1970), “not . . . to secure to a person making such a

plea immunity from prosecution, but to provide him with a

shield against successful prosecution, available to him as a

defense”); United States v. Bailey, 34 F.3d 683, 690–91 (8th

Cir. 1994) (holding that an agreement “not to prosecute”

protected the defendant from “the inherent risk of conviction

and punishment as a result of the trial, not the trial itself”);

United States v. Bird, 709 F.2d 388, 392 (5th Cir. 1983) (“While

the agreement is phrased in terms of nonprosecution, its essence

is a promise of immunity. [The defendant’s] immunity from

punishment will not be lost simply because she is forced to stand

trial.”).

19

This distinction is grounded in the understanding that

simply being indicted and forced to stand trial is not generally

an injury for constitutional purposes but is rather “one of the

painful obligations of citizenship.” Cobbledick v. United States,

309 U.S. 323, 325 (1940); see Deaver v. Seymour, 822 F.2d 66,

69 (D.C. Cir. 1987) (“Although it is surely true that an innocent

person may suffer great harm to his reputation and property by

being erroneously accused of a crime, all citizens must submit

to a criminal prosecution brought in good faith so that larger

societal interests may be preserved.”).4 As the District of

4

We do not address in this opinion those circumstances

in which equity might serve to enjoin an ultra vires prosecution

brought in bad faith. The Supreme Court has only approved

federal injunctions against state criminal proceedings on that

basis. See Younger v. Harris, 401 U.S. 37, 55 (1971) (noting

that, although “the possible unconstitutionality of a statute ‘on

its face’ does not in itself justify an injunction against [a state’s]

good-faith attempts to enforce it,” a “showing of bad faith [or]

harassment” might “justify federal intervention”); see also

Howard W. Brill, Equity and the Criminal Law, 2000 Ark. L.

Notes 1, 3-4 (noting that state courts have sometimes used

injunctions to prevent bad-faith prosecutions, such as those

brought solely to “harass and to retaliate for the exercise of

constitutional rights,” or where the prosecutor charges conduct

that is not illegal). As our precedent makes clear, however, in

the absence of a state prosecution, federal-state abstention

doctrine is irrelevant and Younger does not apply. Pik-A-State

Pa., Inc. v. Reno, 76 F.3d 1294, 1300 (3d Cir. 1996). Moreover,

20

Columbia Circuit noted in Deaver, in the absence of an

unconstitutional chilling effect on First Amendment rights, the

adversary system “afford[s] defendants, after indictment, a

federal forum in which to assert their defenses — including

those based on the Constitution. Because these defendants are

already guaranteed access to a federal court, it is not surprising

that subjects of federal investigation have never gained

injunctive relief against federal prosecutors.” 822 F.2d at

69–70.5

even if the principles of Younger or the willingness of certain

state courts to entertain injunctions against bad-faith or illegal

prosecutions could be applied to a federal prosecution, we

perceive no bad faith on the part of the Government in this case;

rather, the parties are engaged merely in a good-faith dispute

over the meaning of the Agreement.

5

We note that the District Court’s finding that Stolt-

Nielsen and Wingfield would be irreparably harmed by an

indictment does not bring this case within the ambit of the cases

in which injunctions against indictment and trial have been

approved. Even assuming that irreparable harm is a factor that

may properly be considered in deciding upon a permanent (as

opposed to preliminary) injunction — which is a matter of some

tension in our case law, compare Chao v. Rothermel, 327 F.3d

223, 228 (3d Cir. 2003) (stating that a permanent injunction may

be granted “where the moving party has demonstrated that: (1)

the exercise of jurisdiction is appropriate; (2) the moving party

has actually succeeded on the merits of its claim; and (3) the

21

Although this interpretation of agreements “not to

prosecute” may seem counterintuitive, it comports with the

federal courts’ general reluctance to recognize a right not to be

indicted or tried in the absence of an express constitutional (or

perhaps statutory) command. In the context of interlocutory

appeals challenging the Government’s authority to proceed with

a prosecution, for example, the Supreme Court has allowed

those appeals only in very limited circumstances. For example,

the Double Jeopardy Clause, see U.S. Const. amend. V (“[N]or

shall any person be subject for the same offense to be twice put

in jeopardy of life or limb . . . .”), protects interests that are

“wholly unrelated to the propriety of any subsequent

‘balance of equities’ favors granting injunctive relief”), and

ACLU of N.J. v. Black Horse Pike Reg’l Bd. of Educ., 84 F.3d

1471, 1477 nn.2–3 (3d Cir. 1996) (en banc) (noting that a

preliminary injunction requires consideration of, inter alia,

irreparable injury, while a permanent injunction merely requires

consideration of whether “the plaintiff has actually succeeded on

the merits,” and, if so, whether an injunction is an “appropriate

remedy” (internal quotation marks omitted)), with Shields v.

Zuccarini, 254 F.3d 476, 482 (3d Cir. 2001) (stating that a court

may grant a permanent injunction if it finds, inter alia, that “the

moving party will be irreparably injured by the denial of

injunctive relief” (citing Black Horse Pike, 84 F.3d at 1477

nn.2–3)) — we note that, as stated above, other courts have not

accepted the argument that the unpleasantness of an indictment

brought in good faith constitutes an injury that may be remedied

by a pre-indictment injunction, and neither have we.

22

conviction,” in that it provides a “guarantee against being twice

put to trial for the same offense.” Abney v. United States, 431

U.S. 651, 661 (1977) (emphasis added). Because the prohibition

against double jeopardy affords a defendant the right to

“contest[] the very authority of the Government to hale him into

court to face trial on the charge against him,” it necessitates an

exception to the “firm congressional policy against interlocutory

or ‘piecemeal’ appeals.” Id. at 656, 659. Likewise, the Speech

and Debate Clause, see U.S. Const. art. I, § 6, cl. 1 (“[F]or any

speech or debate in either House, [members of Congress] shall

not be questioned in any other Place.”), has been construed “to

protect Congressmen not only from the consequences of

litigation’s results but also from the burden of defending

themselves,” thus allowing interlocutory appeals from denials of

claims of immunity under that Clause. Helstoski v. Meanor, 442

U.S. 500, 508 (1979) (internal quotation marks omitted).

Our case is not an interlocutory appeal, but the Supreme

Court’s cases in that field are instructive because they reinforce

the narrowness of a defendant’s ability to challenge the

Government’s decision to pursue a prosecution. Just as the

authority to enjoin criminal enforcement of a law regulating

speech is grounded in the overriding need to avoid a chilling

effect on the exercise of core constitutional rights, so too does

the right not to be prosecuted recognized in Abney and Helstoski

stem from express textual commands in the Constitution that

prohibit any interference with the rights against double jeopardy

or of members of Congress to speak freely in legislative session.

23

In other contexts, however, courts have refused to allow

interlocutory appeals to stop prosecutions. See, e.g., United

States v. Hollywood Motor Car Co., 458 U.S. 263, 268 (1982)

(per curiam) (holding that a vindictive prosecution claim may

not be raised in an interlocutory appeal to stop an ongoing

prosecution, but rather may only be raised after the defendant

has been convicted, because “reversal of the conviction and

. . . the provision of a new trial free of prejudicial error normally

are adequate means of vindicating the constitutional rights of the

accused”); Parr v. United States, 351 U.S. 513, 519 (1956)

(holding that the mere fact a defendant would have to “hazard

a trial” in one venue before challenging the District Court’s

order transferring his case from a different venue did not

warrant an interlocutory appeal); cf. United States v. P.H.E.,

Inc., 965 F.2d 848, 855 (10th Cir. 1992) (noting that, in

comparing the vindictive prosecution claim in Hollywood Motor

Car to a vindictive prosecution claim based on the defendants’

dissemination of constitutionally protected speech, “[t]he wrong

alleged is similar, but the right sought to be vindicated is not”

because the “procedural rule [at issue in Hollywood Motor Car]

raises concerns distinct from and less pressing than the courts’

obligation to protect the First Amendment right not to be

subjected to a pretextual prosecution”). Indeed, when a district

court rejects prior to trial a defendant’s contention that an

immunity agreement bars his conviction, the defendant may not

avail himself of an interlocutory appeal challenging that

decision; rather, “the availability of dismissal after final

judgment will adequately protect and secure for the defendant

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the benefit of his bargain under the nonprosecution agreement

if he is entitled to it.” Bailey, 34 F.3d at 691; see Bird, 709 F.2d

at 392 (same).

Here, Stolt-Nielsen and Wingfield may interpose the

Agreement (as a defense to conviction) in a pre-trial motion.

See, e.g., Meyer, 157 F.3d at 1077 (“In accordance with due

process, [the defendant] was entitled to a judicial determination

that he had breached the agreement before being subjected to the

risk of conviction. The district court’s pretrial [but post-

indictment] evidentiary hearing satisfied this requirement.”).6

6

In our view, the pre-trial determination approved by the

Seventh Circuit in Meyer does not conflict with the observations

of the Fifth and Eighth Circuits that non-prosecution agreements

of the sort involved in this case protect against the risk of

conviction and punishment, not trial. See Bailey, 34 F.3d at

691; Bird, 709 F.2d at 392. For one thing, Bailey and Bird

concerned attempted interlocutory appeals from district court

denials of post-indictment claims that immunity agreements

barred conviction, and as such were not concerned with the

timing of the claims in the district court. In any event, it is not

in the interest of defendants or the Government, once an

indictment has been issued, to proceed with a trial before

determining whether an immunity agreement bars conviction.

We therefore agree with the Seventh Circuit that a pre-trial

hearing is appropriate in these circumstances. We note,

however, that this timing is not essential, and a defendant may

raise an immunity agreement as a defense during the trial.

25

But their contention that the immunity they purportedly received

under the Agreement precludes an indictment in the first place

is belied by precedent, and we see no compelling reason to reach

a different result in this case.

* * * * *

“[A] suit in equity does not lie where there is a plain,

adequate and complete remedy at law . . . [that is] as complete,

practical and efficient as that which equity could afford.”

Terrace v. Thompson, 263 U.S. 197, 214 (1923). Here, Stolt-

Nielsen and Wingfield have a practical and efficient — and

indeed complete — legal remedy available to them, i.e., access

to a federal forum post-indictment in which they may assert the

Agreement as a defense. Separation-of-power concerns thus

counsel against using the extraordinary remedy of enjoining the

Government from filing the indictments. Although courts have

carved out a narrow exception to this rule in those cases in

which the very act of filing an indictment may chill First

Amendment rights, this case does not implicate that concern.

Instead, we are guided by other cases in which the Supreme

Court and Courts of Appeals have held that non-prosecution

agreements may not form the basis for enjoining indictments

before they issue.

In this context, we conclude that the District Court lacked

authority to employ the extraordinary remedy of enjoining the

Government’s indictments of Stolt-Nielsen and Wingfield. The

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judgment is therefore reversed and the case remanded with the

instruction that the District Court dismiss their complaints with

prejudice.7

7

Because we conclude that the District Court lacked the

power to enjoin the filing of indictments in this case, we need

not consider, at this stage, the Government’s alternative

argument that the District Court inappropriately concluded that

Stolt-Nielsen’s and Wingfield’s actions between March and

November 2002 did not violate the terms of the Agreement. As

stated, the District Court’s lack of authority compels us to

reverse the judgment and remand to that Court so that it may

dismiss the complaints. Because the judgment is reversed, it

lacks preclusive effect. See, e.g., Joseph A. ex rel. Wolfe v.

Ingram, 275 F.3d 1253, 1266 (10th Cir. 2002) (“A judgment that

has been vacated, reversed, or set aside on appeal is thereby

deprived of all conclusive effect, both as res judicata and as

collateral estoppel.” (internal quotation marks omitted)).

Therefore, if the appellees assert the Agreement as a defense

after they are indicted, the District Court must consider the

Agreement anew and determine the date on which Stolt-Nielsen

discovered its anticompetitive conduct, the Company’s and

Wingfield’s subsequent actions, and whether, in light of those

actions, Stolt-Nielsen complied with its obligation under the

Agreement to take “prompt and effective action to terminate its

part in the anticompetitive activity being reported upon

discovery of the activity.”

27