House Speaker Nancy Pelosi, D-Calif., had called on Mukasey to open a grand jury investigation. The House earlier voted to pursue contempt of Congress charges against White House Chief of Staff Josh Bolten and former White House Counsel Harriett Miers for not responding to subpoenas issued as part of Congress' investigation into the U.S. attorney firing probe.

In a letter sent to Pelosi Friday, Mukasey said the president ordered the two staff members not to testify, citing executive privilege.

"These directives were based on legal opinions from the Department of Justice advising that the assertions of privilege and immunity were legally proper," he said.

Citing a 1984 department opinion, Mukasey said "the Department of Justice's longstanding position taken during administrations of both parties is 'that the contempt of Congress statute was not intended to apply and could not constitutionally be applied to an executive branch official who asserts the president's claim of executive privilege.'"

Mukasey said the department "has determined that the non-compliance by Mr. Bolten and Ms. Miers ... did not constitute a crime" and would not bring the contempt citations before a grand jury or take any other steps to prosecute Bolten or Miers.