Developer Terry Diehl reaches financial settlement with feds following failed prosecution


On August 17, 2018, the United States Attorney’s Office for the District of Utah signed a settlement agreement with Terry Diehl and thereby avoided a hearing on Mr. Diehl’s motion seeking attorneys’ fees in which he alleged that the case against him was frivolous, vexatious, and brought in bad faith.

The settlement includes a significant financial award. The United States Attorney’s Office also recently confirmed that it “does not have any open investigations in which Mr. Diehl is the purported target.” Although the settlement agreement includes language indicating the US Attorney does not admit to any wrongdoing, a settlement involving a criminal defendant under the Hyde Amendment*—which allows those the government wrongly accused of a crime to obtain attorneys’ fees in exceptional cases—is rare, and receiving a payment due to a Hyde Amendment claim is virtually unheard of. In fact, to our knowledge, the federal government has never paid an award related a Hyde Amendment claim in Utah prior to this case. The unprecedented action taken by the federal government in this instance—settling this claim before judicial action—speaks for itself.

Mr. Diehl’s attorney Loren Washburn, of Smith Washburn, LLP, issued the following statement related the settlement agreement:

“Terry Diehl has endured years of reckless and cavalier accusations and assumptions by members of the Utah news media reporting on his time at UTA, which ended almost a decade ago. As shown by this settlement, the investigation by the FBI that spent countless taxpayer-funded hours by investigators, prosecutors and the courts ended without any showing that Mr. Diehl violated a single law. Through it all, Mr. Diehl insisted on his innocence. In the end, the government dismissed all charges against Mr. Diehl and acknowledged that they could no longer ethically proceed with their case against him.

With the case behind him and this recent settlement award, Mr. Diehl would appreciate, and in fact demands, that individuals in the news media stop reporting on false accusations as fact. To date, the news media has often approached its reporting on Mr. Diehl with sloppy journalism, reporting on partial information, rumors, unsourced hearsay, inuendo and contortions of fact.

Should there be anything defamatory published, Mr. Diehl will consider every remedy available to a private citizen under the law to hold journalists and news outlets accountable. The fact that Mr. Diehl was willing to fight every charge brought by the US Attorney, and then seek damages from the United States government, should be ample evidence that Mr. Diehl is willing to fight to protect and restore his good name.”


On November 22, 2017, following the dismissal of all charges in United States v. Diehl, Terry Diehl filed motions in federal court pursuant to the Hyde Amendment for attorney’s fees and for disclosure of matters occurring before the grand jury. Passed in 1997, the Hyde Amendment to the Equal Access to Justice Act allows federal courts to award attorneys’ fees and court costs to criminal defendants where the court finds that the position of the United States was vexatious, frivolous, or in bad faith.

In his 68-page motion, Mr. Diehl contended that the government was responsible under each standard of the Hyde Amendment—that their position was vexatious, frivolous, and in bad faith. Additionally, Mr. Diehl sought a review of information from the grand jury proceedings to determine what, if anything, the government told the grand jury that was not true.