Two years, two cases collapse: What went wrong for federal prosecutors

Federal prosecutors have come under fire for the second time in two years after a surprise acquittal in a high-profile criminal case.

A jury acquitted Vagos Motorcycle Club members Feb. 24 of racketeering and murder charges in a case that has cost taxpayers millions of dollars. Prosecutors pursued the case even after their star witness, former Vagos member Gary “Jabbers” Rudnick, was caught lying two months into the seven-month trial.

“For whatever reason — stubbornness, arrogance, just blind refusal to look at facts and evidence — the federal government did nothing to vet Rudnick,” said former federal prosecutor Kathleen Bliss, a defense lawyer in the case. “This could happen to any group of people the government decides it doesn’t like.”

The verdict cast a shadow over the government’s decadelong, and sometimes criticized, investigation into the Vagos club. When prosecutors obtained a sweeping indictment in the case in June 2017, a top federal law enforcement official in Washington said the charges were aimed at dealing a “crippling blow to one of this country’s most ruthless and violent criminal gangs.”

U.S. District Judge Gloria Navarro tossed out the Bundy case in the middle of the trial because of “flagrant” government misconduct. Navarro, who also presided over the Vagos case, chastised the government for not providing the Bundy defense with evidence that could have harmed prosecution efforts.

The missteps tarnished the reputation of the Nevada U.S. attorney’s office and left the rest of the criminal case in disarray. Fallout from the government’s actions was felt within the office. The lead case prosecutor, Steven Myhre, was removed as acting head of the office, and an interim U.S. attorney was brought in from outside Nevada to take control.

Prosecutors, who have appealed the Bundy dismissal, are not accused of similar transgressions in the Vagos case. But defense lawyers and legal experts voiced concerns about the government’s handling of Rudnick and other major witnesses who were attacked at trial for lacking credibility.

“These cases show that sometimes the federal government wields enormous power to prosecute unpopular people regardless of the evidence,” said Dan Hill, who defended clients in both cases. “We have to remember the government’s interest in a criminal case shouldn’t be convicting at any cost. It should be serving justice and presenting the truth.”

What makes the outcome of both cases rare is that the government generally has a high conviction rate in federal court, roughly 95 percent or higher, because of the amount of time and unlimited resources it can put into an investigation.

Key witness disavowed

Prosecutors were forced to disavow Rudnick’s testimony in the Vagos case, leaving open the possibility that it could cast doubt on the alleged racketeering conspiracy that centered on the 2011 shooting death of a rival motorcycle gang leader at a casino in Sparks.

Rudnick alleged that the killing of Hells Angels member Jeffrey “Jethrow” Pettigrew was authorized by lead Vagos defendant Pastor Palafox, then-international president of the club.

Defense lawyers maintained that the shooting death was not planned and was the result of a fight between the two groups on the casino floor. Pettigrew belonged to the San Jose, California, Hells Angels chapter.

Bliss said jurors didn’t think much of Rudnick’s testimony.

“My impression from their comments was that they thought Rudnick was a train wreck,” she said. “They didn’t believe him. They didn’t understand why he was testifying.”

But prosecutors presented an array of other evidence to the jury that supported the charges, including eyewitness testimony and a video of the killing in the casino. They also played recordings of the defendants discussing the use of violence against rival motorcycle gangs and provided the testimony of an undercover federal agent who had infiltrated the exclusive Vagos hierarchy.

The jury acquittals have left 13 other Vagos defendants waiting to stand trial in limbo.

Defense lawyers are considering asking for dismissals, but the Nevada U.S. attorney’s office has not said whether it will drop the charges. The office said in a statement that a case against several of the remaining defendants is still set for trial on April 20.

After the jury acquitted eight defendants, Nevada U.S. Attorney Nicholas Trutanich said in a statement: “I’m grateful for the court’s time, the jury’s consideration and the diligent work of the assistant U.S. attorneys toward a verdict that the jury found to be fair and just.”

Trutanich would not discuss the government’s decision on whether to move forward with the trial.

Sufficient evidence needed

UNLV law professor Eve Hanan, who specializes in criminal law and procedure, said prosecutors should go forward with a case at trial only if they are convinced they have “sufficient evidence” to obtain a conviction.

“Prosecutors are not supposed to throw spaghetti against the wall to see if it sticks,” Hanan said. “Informants who could be tried and charged with crimes are notoriously untrustworthy because of their motive to lie to avoid prosecution.”

Charles La Bella, a former deputy chief in the Justice Department’s fraud section, said he hopes the Vagos prosecutors had a serious discussion about whether to proceed with the trial after Rudnick acknowledged lying on the witness stand.

“It’s always a tough decision if your main cooperator goes south on you and you continue the case,” said La Bella, now in private practice in San Diego. “They were really caught between a rock and a hard place, but at the end of the day prosecutors are supposed to do the right thing, not what saves face. If justice demands that a case be stopped, then they probably should stop it.”

Other Vagos defendants acquitted at trial include Albert “Al” Lopez, Albert “Dragon Man” Perez, James “Jimbo” Gillespie and Ernesto “Romeo” Gonzalez. Prosecutors said Gonzalez fired the fatal shots at Pettigrew during an annual motorcycle club festival. Gonzalez was found guilty in the slaying in state court, but the Nevada Supreme Court overturned his conviction, prompting federal authorities to include the killing in their conspiracy case.

Most of the defendants held rank on an international, regional or chapter level at the biker club, which was formed in San Bernardino, California, in the mid-1960s and since has spread to at least seven countries. It is said to have 75 chapters in the United States, 54 of which are in Nevada and California. The indictment describes the Vagos as a highly organized, closed society that calls itself a “brotherhood.”

Though the government turned its back on Rudnick, it stood by its theory that Pettigrew’s shooting was an assassination involving a coordinated cover-up and threats of retaliation against members who cooperated with law enforcement.

“The problem is that if you know someone is a liar, how do you keep going?” asked Los Angeles defense lawyer Amy Jacks, who represented Palafox. “You can’t take somebody’s life away based on lies.”

With all their time and money invested in the case, prosecutors were unwilling to walk away, Jacks said.

“The Vagos were not Boy Scouts,” she said. “They engaged in distasteful conduct. But this prosecution was a prosecution that was overreaching.”

Las Vegas defense lawyer Chris Oram agreed.

“When Rudnick fell apart on the witness stand, the government should have conceded and moved to dismiss the case,” said Oram, who represented Cesar Morales, president of the San Jose Vagos and another of the defendants who was acquitted. “What an epic waste of time and money.”

Judge didn’t toss charges

Navarro had the chance to throw out the charges at trial, but in November, after more than four hours of oral arguments, she declined to do so. She acknowledged, however, that the government’s case was “a lot weaker than it was in the beginning.”

The defense raised a serious claim of government wrongdoing during the seven months of trial, saying that prosecutors knowingly sponsored Rudnick’s false testimony.

But on Feb. 14, Navarro issued an order finding no merit to the allegation. According to her 11-page order, “The government did not know, and could not have known, that Rudnick’s testimony was false at the time it called Rudnick to testify.”

In a statement to the Las Vegas Review-Journal, the U.S. attorney’s office said: “We agree with the detailed opinion issued by the District Court, which carefully considered and rejected the defense’s allegation that the prosecution knew or could have known that a witness testified untruthfully.”

Defense lawyers Crane Pomerantz and Lisa Rasmussen, who represented Rudnick, declined comment.

Lance Maningo, who is defending one of the remaining 13 defendants, said lawyers for the other Vagos members would meet to “nail down some sort of collective strategy” in the wake of the acquittals.

“I understand that the government has to look into these cases, but I think they need to vet them out better before they move to an indictment,” Maningo said. “I’m hoping the government takes a hard look at this and realizes the jurors got it right.”

Contact Jeff German at jgerman@reviewjournal.com or 702-380-4564. on Twitter. Contact Rio Lacanlale at rlacanlale@reviewjournal.com or 702-383-0381. Follow @JGermanRJ and @riolacanlale on Twitter.