The prospect that the Russian defendants, including companies, would appear in court to face prosecution had seemed unlikely. None of the individuals were in U.S. custody at the time of indictment, and Russia does not allow its citizens to be extradited to the United States to face trial. Additionally, Mueller prosecutors said in a filing last week that Russia’s prosecutor general has declined to accept summonses for the defendants, and the Russian government has taken no steps under a mutual legal assistance treaty to serve them.
The clash Wednesday revolved around the appearance of attorneys only on behalf of Concord’s management business and not two related defendants under indictment — a subsidiary catering company and Concord’s founder, Yevgeniy Viktorovich Prigozhin, a Russian businessman nicknamed “Putin’s chef” because of his close ties to President Vladimir Putin.
Special counsel prosecutor Jeannie Rhee noted Wednesday that although Washington lawyers Eric A. Dubelier and Katherine Seikaly of the Reed Smith law firm entered an appearance in court only for Concord management, their law firm notified the U.S. Treasury Department that it had been engaged by both Concord entities. The notice was required because the companies and Prigozhin have been hit with U.S. sanctions.
Dubelier said he was authorized to appear in the criminal case only for Concord management to enter a plea, and called it “disturbing” to learn at the hearing that prosecutors had reviewed “confidential” Treasury filings.
Dubelier also asserted that with Concord Catering, U.S. authorities had indicted the “proverbial ham sandwich,” charging a company that he said did not formally exist at the time the government alleged it was active. However, he added, “If they show me that they did exist, then we would probably represent them.”
The testy exchanges came in the first response to the special counsel’s allegations that the Concord firms financed — and Prigozhin approved and controlled — the operations of a third corporate defendant, the Internet Research Agency of St. Petersburg. Prosecutors contend IRA served as the hub of the ambitious conspiracy and fraud to trick Americans online into following and promoting Russian-fed political propaganda about the campaign.
U.S. spy agencies have documented Prigozhin’s links to senior Russian intelligence figures.
The legal moves by Concord could be aimed at forcing Mueller’s team to turn over material that might expose or undermine the broad investigation or to reveal sensitive intelligence information, legal analysts said, and elicit those disclosures in a case involving a company rather than a trial that exposed accused individuals to risk.
On the same day Reed Smith filed its Treasury notice, April 11, Dubelier and Seikaly said they would represent Concord management in the criminal case, and sent the special counsel’s office a demand for investigative details to prepare a defense, according to prosecutors.
The request, prosecutors have said, included asking for identities of online platforms discovered by federal investigators and any related, charged or uncharged individuals; names of potential witnesses; any statements, recordings or surveillance of Concord employees; and any instances since 1945 in which the U.S. government interfered with elections or political processes of other countries.
Federal prosecutors had asked a federal judge to postpone the arraignment until it could be confirmed that Concord and its attorneys were submitting to the jurisdiction of the court given that the case involved a “foreign corporate defendant, controlled by another, individual foreign defendant, that has already demanded production of sensitive intelligence gathering, national security, and foreign affairs information.”
Concord management’s lawyers opposed a delay — and a judge denied putting off the arraignment.
Dubelier on Wednesday affirmed to U.S. Magistrate Judge G. Michael Harvey that Concord Management, which had no other corporate representatives present, would comply with the rules and orders of the court.
The indictment alleges the Russian efforts began in 2014, when three Russian conspirators visited 10 states, gathering intelligence about U.S. politics. Officials say that as the operation progressed, the suspects also engaged in extensive online conversations with Americans who became unwitting tools.
Concord was the primary funding source for the interference operations, prosecutors charged, and it also recommended personnel and oversaw activities with Internet Research Agency management.
While pretrial discovery could be risky for the government, there are procedures that allow for the sharing of sensitive information that could limit, with court approval, how much the defense could see, analysts said.
Prosecutors may charge a corporation to convey a message that the wrongdoing was so widespread or pernicious that it warranted charging a corporate entity, said Paul Krieger, former chief of the complex fraud and cybercrime unit in the U.S. attorney’s office for the Southern District of New York.
Publicity can be so damaging that it leads to negative consequences for owners or other stakeholders who may be incentivized to cooperate, said Krieger, now a partner in Krieger Kim & Lewin. “Sometimes charging a corporation is a better way to deter” the company — and others — from future criminal activity,” he added.