Bloomberg
By Edvard Pettersson
February 8, 2013

The judge who will preside over the U.S. government’s lawsuit against Standard & Poor’s is a former prosecutor and Vietnam War veteran who travels to Afghanistan to help reform the judiciary in that war-torn country.

U.S. District Judge David O. Carter in Santa Ana, California, is assigned to the case the Justice Department filed Feb. 4. The government accuses McGraw-Hill Cos. and its S&P unit of knowingly understating the credit risks of residential mortgage-backed securities and collateralized-debt obligations in order to gain more business.

Carter, 68, was nominated by President Bill Clinton in 1998. Before becoming a federal judge, he was an Orange County homicide prosecutor and a California state court judge. He earned a Bronze Star and a Purple Heart during his service with the U.S. Marine Corps in Vietnam.

“He’s not afraid of anything or anyone,” said Wayne Gross, formerly a federal prosecutor in charge of the U.S. Attorney’s office in Santa Ana. “Both sides could not have gotten a better judge. He gives every fiber of his being to the case before him.”

In the S&P case, Carter will face another decorated Marine Corps veteran, San Francisco lawyer John Keker, who represents the rating firm. Keker, whose clients have included Lance Armstrong during his criminal investigation and class-action lawyer Bill Lerach, retired from the military in 1967 after being wounded in Vietnam.

Justice Partnership

Carter is part of a public-private partnership for justice reform in Afghanistan, a program that, among other projects, sends U.S. judges to that nation to work with local legal professionals to help create a better judicial system.

“That’s how much he cares about justice,” Gross, now a lawyer with Greenberg Traurig LLP in Irvine, California, said in a telephone interview. “He’s going around the globe despite his heavy court load.”

In 2009, Carter threw out a so-called birther lawsuit that challenged the legitimacy of President Barack Obama’s presidency on the assumption that the Democrat, now in his second term, wasn’t a natural-born U.S. citizen.

In his ruling dismissing the case, Carter responded to the plaintiffs’ arguments that courts that rejected their lawsuit weren’t patriotic.

‘Ultimate Reflection’

“Plaintiffs have attacked the judiciary, including every prior court that has dismissed their claim, as unpatriotic and even treasonous for refusing to grant their requests and for adhering to the terms of the Constitution which set forth its jurisdiction,” Carter said. “This court considers commitment to that constitutional role to be the ultimate reflection of patriotism.”

The judge also presided over trials involving numerous members of prison gangs, including the Mexican Mafia and the Aryan Brotherhood.

“He’s the hardest-working judge I’ve ever encountered and I’ve been doing this for 47 years,” said Mark Overland, a lawyer who represented a Mexican Mafia member in a six-month trial before Carter.

Overland, of Santa Monica, California, said Carter would have lawyers come to court at 6:30 or 7 a.m. to deal with outstanding issues before the jury came in. After the trial ended for the day, Carter would handle his civil case agenda in the evening, he said.

‘Till Midnight’

“There’d be lawyers there till midnight,” Overland said in a telephone interview.

Carter handled the second jury trial between toymakers Mattel Inc. and MGA Entertainment Inc. over the rights to Bratz dolls.

In 2011, Carter awarded MGA $225 million in punitive damages, attorney fees and costs after it prevailed on most of the claims Mattel had brought.

“Mattel asserted a copyright claim that was stunning in scope and unreasonable in relief it requested,” the judge said in his ruling. “The claim imperiled free expression, competition and the only serious competitor Mattel had faced in the fashion doll market in nearly 50 years.”

A U.S. Court of Appeals last month vacated part of Carter’s ruling and left intact his decision that Mattel had to pay its rival $137.2 million for having to defend against the copyright- infringement claims.

The case is U.S. v. McGraw-Hill, 13-00779, U.S. District Court, Central District of California (Los Angeles).

To contact the reporter on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net