U.S. Attorney for the Southern District of New York Geoffrey S. Berman. (Photo: David Handschuh/ALM)

Manhattan U.S. Attorney Geoffrey Berman announced he will step down, ending a standoff over his removal with Attorney General William Barr.

After initially refusing to leave his post when Barr suddenly announced Berman's resignation late Friday night, Berman said he will step down immediately. The announcement capped off a contentious 24-hour period in which Berman said he was not resigning, sparking a new crisis within the Justice Department.

Audrey Strauss, a deputy attorney in the Southern District, is slated to be the acting attorney.

"In light of Attorney General Barr's decision to respect the normal operation of law and have Deputy U.S. Attorney Audrey Strauss become acting U.S. attorney, I will be leaving the U.S. Attorney's Office for the Southern District of New York, effective immediately," Berman said in a statement. "It has been the honor of a lifetime to serve as this District's U.S. attorney and a custodian of its proud legacy, but I could leave the district in no better hands than Audrey's.  She is the smartest, most principled, and effective lawyer with whom I have ever had the privilege of working.  And I know that under her leadership, this Office's unparalleled AUSAs, investigators, paralegals, and staff will continue to safeguard the Southern District's enduring tradition of integrity and independence."

The sudden resolution came hours after Attorney General William Barr reportedly said the president had decided to fire Berman. But that narrative quickly came under fire as President Donald Trump, on his way to a rally in Tulsa, Oklahoma, told reporters he was not involved in any decision to fire Berman.

"That's all up to the attorney general. Attorney General Barr is working on that," Trump said. "That's his department, not my department. But we have a very capable attorney general, so that's really up to him. I'm not involved."

Barr issued a statement late Friday night announcing Berman's resignation, but in short order Berman denied he had resigned and said he would not abandon his job.

A second version of the Justice Department statement omitted any language about a resignation tendered by Berman, and it also did not say Berman was being removed.

That raised fears of a protracted dispute if Barr attempted to install Craig Carpenito, currently the U.S. attorney for New Jersey, as the top federal prosecutor in the Southern District on an acting basis, as initially announced.

But in Saturday's letter from Barr relaying Trump's firing, there was no mention of Carpenito. It said Strauss would remain as acting U.S. attorney "until a permanent successor is in place."

Berman served as U.S. attorney under Section 546(d) of Title 28 of the U.S. Code, which addresses the judiciary and judicial procedure. On April 25, 2018, the judges of the Southern District issued an order appointing Berman upon the expiration of the 120-day term after his interim selection by then-Attorney General Jeff Sessions.

Without a resignation from Berman or his ouster, there was no vacancy for Barr to appoint an acting U.S. attorney to fill.

A former acting U.S. attorney for the Eastern District of New York said Berman's initial rejection of the resignation announcement may have stymied Barr. And he questioned the reasoning for the sudden Friday night announcement.

"Geoff Berman in the SDNY has called the Attorney General's bluff: the statute for appointment and removal of U.S. attorneys [28 U.S.C. Section 541] , provides that the president, not the attorney general has the power to remove a court-appointed U.S. attorney," said Kelly T. Currie, now a partner at Crowell & Moring. "It's telling that Berman's statement following Barr's attempt to oust him by press release explicitly defended ongoing investigations in that office. Coming in the wake of Barr's actions in the Roger Stone sentencing and seeking to dismiss the Michael Flynn case, it's hard not to suspect that Barr's move is anything but an effort to thwart investigations that could be damaging to the president or his associates."

There was a lack of clarity going into Saturday over whether the president or attorney general could remove a U.S. attorney installed by the district judges.

"As far as I know, I have never heard it employed," said Elkan Abramowitz, a partner in Morvillo Abramowitz Grand Iason & Anello, and a former chief of the Southern District's criminal division, of the removal of a U.S. attorney appointed by the court under Section 546(d).

"If Berman chooses to sue to keep his job, he will have great support from alumni of the Southern District U.S. Attorney's Office who are interested in maintaining the historic independence of the office," Abramowitz said.

If Barr's announcement involved an attempt to interfere with one or more of the ongoing investigations in the SDNY, Harry Sandick, a partner at Patterson Belknap Webb & Tyler and a former assistant U.S. attorney in the Southern District, said it's hard to say which case it would be.

"There are so many cases that have been reported on that have some connection to the president or his associates," Sandick said. "The Giuliani investigation, the National Enquirer/Michael Cohen case, the inaugural committee case, who knows what else is out there—Deutsche Bank being investigated, Epstein being investigated. So it's possible that it does have something to do with one or more of those cases. Ordinarily it would be easy to figure out, because there wouldn't be many cases being handled concerning the president and his associates. That's an unusual event."

Sandick said Congress may want Barr to testify soon.

"It's a complicated situation and we don't really know what animates it, what's driving it," Sandick said. "So one way to figure that out might be for Congress to require the attorney general to come, under oath, explain why he said Berman was stepping down when Berman said that wasn't true, explain why the president is making this decision or why Barr is making this decision."

State Bar President Scott Karson condemned the attempt to replace Berman, saying politics has no place in the administration of justice.

"The important investigations being carried out by the Southern District of New York, including the probe of former New York City Mayor Rudy Giuliani, must continue unabated," Karson said. "Otherwise, ordinary citizens will have no faith in our justice system."

Shortly after the first Justice Department statement, Trump announced that Securities and Exchange Commission Chairman Jay Clayton would be nominated as the U.S. attorney for the Southern District.

The fate of that nomination is in doubt since Sen. Chuck Schumer said Clayton should withdraw from consideration, implying he would object to the nomination. In a separate statement, Sen. Lindsey Graham, chairman of the Senate Judiciary Committee, said he will honor the "blue slip" process, where home-state senators may put a hold on nominations.

"I have not been contacted by the administration in this regard" Graham said Saturday. "However, I know Mr. Clayton and believe him to be a fine man and accomplished lawyer. As to processing U.S. attorney nominations, it has always been the policy of the Judiciary Committee to receive blue slips from the home state senators before proceeding to the nomination."

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