The Fallout From The Alina Habba Ruling Has Begun

Legal turmoil is accelerating in New Jersey’s federal court after a judge this week rejected President Donald Trump’s use of a loophole to keep Alina Habba in charge of the federal prosecutor’s office.

Shortly after U.S. District Judge Matthew Brann ruled Thursday that Habba was acting illegally as the U.S. attorney for New Jersey, another judge delayed the sentencing of a CEO convicted of scheming to mislead investors during the pandemic. The new sentencing delay, ordered by U.S. District Judge Esther Salas, appears to be the first instance of fallout from the Habba ruling, which declared that Habba must be disqualified from participating in any of the office’s cases as its leader.

Salas, an Obama appointee, delayed the sentencing, which was set for Sept. 4, until further notice. In her order, she rejected DOJ's arguments that Habba or other prosecutors are “legally authorized” to handle the sentencing of Marc Schessel, who was found guilty last summer of issuing false public statements claiming his company, SCWorx, was buying and reselling tens of millions of Covid-19 test kits during the early days of the pandemic.

An attorney for Schessel did not immediately respond to a request for comment.

As legal questions about Habba’s authority mounted in recent weeks, court records from the last several days show that the Justice Department’s No. 2, Deputy Attorney General Todd Blanche, has begun co-signing legal filings with Habba in routine criminal cases, an apparent attempt to insulate the cases from being undermined by challenges to Habba’s authority.

Blanche’s move means one of the country’s top law enforcement officials is now listed as the attorney on cases that normally wouldn’t merit the attention of officials in Washington.

The Justice Department did not immediately respond to requests for comment about Blanche’s role in the cases.

In his 77-page opinion Thursday, Brann ruled Habba “is not lawfully holding the office of United States Attorney” and has been in the position without legal authority since July 1.

Brann, a Pennsylvania-based Obama appointee tapped to address the issue after New Jersey’s federal judges bowed out, stayed his ruling pending appeal. But if other judges follow Salas’ approach, countless criminal prosecutions could be held up while higher courts sort out whether the multi-step maneuver the Trump administration used to keep Habba in place without Senate confirmation is legal.

Attorney General Pam Bondi said Thursday she would immediately appeal Brann’s ruling, although as of midday Friday the appeal had not yet been filed. Habba’s office declined to comment on Salas’ order.

Separately, in July, a triple homicide trial scheduled for September was delayed after Trump fired the career prosecutor who was handling it to clear the way for Habba to lead the office. It has since been rescheduled for November.

Erica Orden contributed to this report.