Stock options, steroids mark departing U.S. Attorney's tenure

SAN FRANCISCO - Kevin Ryan may not be a household name, but two criminal investigations that the departing U.S. attorney for coastal Northern California is overseeing are widely known: steroids in sports and stock options backdating by corporate America.

Ryan, who was among a handful of top prosecutors nationwide who announced their resignations Tuesday to the backdrop of pressure from the Bush administration, leaves his office with both issues still squarely in the public's attention.

Last July, Ryan became the nation's first U.S. attorney to file charges against company executives for allegedly violating securities laws by backdating stock options without properly accounting for them. Backdating is when options are retroactively issued to coincide with low points in a company's share price - allowing shareholders to potentially reap a big windfall when prices subsequently rise.

The government is now investigating more than 100 companies, and Ryan created a government task force to investigate stock options fraud.

The Republican appointee also made headlines last week in the investigation of Hewlett-Packard Co.'s ill-fated boardroom spying probe. A low-level private investigator pleaded guilty to identity theft and conspiracy charges for illegally accessing private phone records of journalists and board members in the company's quest to ferret out the source of leaks to the media.

Ryan has actively pursued gang and drug cases while working with local law enforcement agencies. He also prosecuted Pavlo Lazarenko, the former prime minister of Ukraine on money laundering charges in a case that had more exposure in the former Soviet republic than at home.

One of the prosecutor's highest-profile criminal targets has been baseball player Barry Bonds. The Giants slugger is under investigation for allegedly lying to a federal grand jury in 2003 probing a Burlingame-based nutritional supplement company that doled out once-undetectable steroids to elite athletes.

The grand jury investigating Bonds expired in July, and a new panel got the case.

Bonds' attorney, Mike Rains, said then that Ryan could not "indict a ham sandwich," a sentiment he repeated Wednesday.

"Maybe they'll get somebody in there that's got half of a brain for a change and a sense of putting on a case for what it really means and he'll call off the hounds," Rains said of Ryan's departure. "It's clear that Mr. Ryan had to catapult himself into some sort of notoriety by messing with Mr. Bonds."

Five others connected to the Bay Area Laboratory Co-Operative steroid scandal have been indicted and convicted including Bonds' personal trainer, Greg Anderson. A sixth person, cyclist Tammy Thompson, is under indictment on similar allegations dogging Bonds. More indictments are expected.

Ryan was a San Francisco County judge when he was tapped in 2002 to succeed Robert Mueller, who Bush named director of the Federal Bureau of Investigation.

It's not known what's next for Ryan, but the legal newspaper The Recorder cited anonymous sources Wednesday that Ryan had been circulating his resume with large law firms.

In a statement to his staff, which had a 50 percent turnover rate during his tenure, Ryan said "for some months now, I have been considering the possibility of pursuing other challenges for a variety of personal and professional reasons."

Ryan spokesman Luke Macaulay said Ryan reached a "mutually agreeable decision with Washington" to step down. No date was provided.

While Ryan has been criticized privately by many departing prosecutors, Donald Clay, Ryan's top deputy until late 2003, is among his top defenders.

"He has a good heart and he wants to do the right thing," said Clay, now an Alameda County judge. "In the end of the day, that's what you want from anybody running the front office."

San Francisco Federal Defender Barry Portman has seen seven U.S. attorneys come and go during his 20-year tenure here. "Everybody has some pluses and everybody has some minuses," Portman said.

In all, eight U.S. attorneys resigned on Tuesday, including Ryan's counterpart in San Diego, U.S. Attorney Carol Lam.

Lam, also appointed in 2002, did not comment on the circumstances of her departure, slated for Feb. 15., or discuss future plans in a statement.

In her tenure leading the Southern District, which covers San Diego and Imperial counties, she prioritized prosecuting political corruption and health care fraud. She oversaw the government's case against Randy "Duke" Cunningham, the former Republican congressman who pleaded guilty to taking $2.4 million in bribes, and her office won corruption convictions of two San Diego city councilmen.

House Judiciary Chairman John Conyers and Rep. Howard Berman, a member of the Judiciary Subcommittee on Courts, said they were concerned that Lam's "forced" resignation might leave an impression that it was because of her prosecution of public corruption cases.

Regardless of party, I'm real curious as to what the heck the rationale is. I posted an article the other day about Carol Lam's resignation. From what I'd read over the past few years, she was an excellent US Attorney.

This was from today's LA Times:

http://www.latimes.com/news/printedition/california/la-me-resign17jan17,1,169363.story?coll=la-headlines-pe-california

Sen. Dianne Feinstein (D-Calif.), in a Senate speech Tuesday, said at least five other U.S. attorneys have been forced to resign without explanation. She accused the Bush administration of trying to circumvent Senate confirmation of their replacements.

Such appointments were subject to Senate review until last year, when the Patriot Act was reauthorized with a provision that allowed the U.S. attorney general to appoint longer-term, interim replacements without Senate approval.

The departures, Feinstein said, come at a sensitive time as federal prosecutors are pursuing political corruption cases.

"The U.S. attorney's job is too important for there to be unnecessary disruptions or, worse, any appearance of undue influence," Feinstein said.

A Justice Department spokesman, Brian Roehrkasse, said senators would be consulted before the nomination of replacements, as has been the routine since the law was changed.

"It is inconceivable for a member of Congress to believe that use of an appointment authority to fill a vacancy is in any way an attempt to circumvent the confirmation process," Roehrkasse said.

Feinstein said she planned to bring up the issue at a Senate Judiciary Committee hearing Thursday at which U.S. Atty. Gen. Alberto R. Gonzalez was scheduled to appear.

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