TACOMA — Federal prosecutors said Friday they are satisfied that an attorney for indicted Washington State Auditor Troy Kelley does not have a conflict of interest that might warrant his removal from the case.
The government last month said Kelley had paid more than $900,000 in stolen money as a retainer to Davis Wright Tremaine, the Seattle firm where his attorney, Mark Bartlett, works. Prosecutors said they were concerned that it could create a conflict of interest if Bartlett had provided Kelley with advice about spending that money, and they asked U.S. District Judge Ronald Leighton to consider whether a conflict might exist.
They said they were concerned Bartlett might need to be called as a witness in the case or that he might have to cross-examine partners in his own law firm about how the retainer was handled. They said it could also raise issues that Bartlett previously represented Kelley’s wife.
Bartlett said no conflicts existed. He said he did not give Kelley advice on paying the retainer, and he noted his firm is holding Kelley’s money in trust rather than spending it.
Kelley said he wants to keep Bartlett as his attorney, and that even if Bartlett had given the advice, he would waive any right to claim he was acting on advice of counsel in spending the disputed money. “Acting on advice of counsel” can be a defense to certain criminal charges.
Leighton said in court Friday that was fine by him: “I am not inclined to advance the process further.”
That said, the judge told prosecutors that if they wanted to pursue the matter he would appoint a well-known Seattle defense attorney, John Wolfe, to act as a special master to review the issues involved.
Assistant U.S. Attorney Andrew Friedman told the judge that wouldn’t be necessary. But he said similar issues might arise if another lawyer who has been informally advising Kelley, tax defense attorney Rob McCallum, formally enters the case.
Kelley is on a leave of absence as he fights a criminal indictment alleging he stole money from clients of his former business, a real estate services firm, and evaded taxes. In an email to Bartlett, Friedman said the government will likely seek to have the $908,000 Kelley paid to the law firm turned over as proceeds of criminal activity.
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