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Jones Case Settlement Appears Unlikely

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  • Full Coverage: Clinton Accused

  • By Peter Baker
    Washington Post Staff Writer
    Friday, October 16, 1998; Page A14

    The prospects of a settlement in the Paula Jones case diminished sharply yesterday amid squabbles within her camp over the finances of any potential deal and how much her lawyers should be paid, according to people close to the situation.

    Jones has been considering dropping her four-year-old lawsuit in exchange for a payment by President Clinton combined with an unsolicited $1 million offer by an eccentric real estate developer, Abe Hirschfeld, who has said he would pay to make the case go away. Clinton's attorney has offered as much as $700,000.

    But after a former Jones attorney wrote Hirschfeld on Wednesday to assert his right to outstanding legal bills, the New York millionaire suddenly balked and all but withdrew his offer.

    As a result, some lawyers involved said it was unlikely any settlement could be reached before Tuesday, when lawyers for Jones and Clinton are scheduled to present oral arguments before the 8th U.S. Circuit Court of Appeals, which is considering whether to reinstate the sexual harassment lawsuit that was dismissed in April. For some, the oral arguments have loomed as something of a make-or-break deadline in the latest round of settlement talks.

    "At this point it looks like the case is going to be argued on Tuesday," said John W. Whitehead, president of the Rutherford Institute, which has helped fund the Jones legal battle. "That's where it's headed."

    Clinton advisers had hoped to resolve the case to finally rid him of a political albatross and to help his ability to strike a separate deal with Congress to head off impeachment after the Nov. 3 midterm elections.

    Even though Jones's claim was thrown out, lawyers involved believe it could be revived if the appeals court concludes that Clinton committed perjury and obstruction of justice during the case to cover up his affair with Monica S. Lewinsky, as independent counsel Kenneth W. Starr has alleged.

    To reach an agreement with Congress for a punishment short of impeachment, some Clinton advisers believe he ultimately will be forced to admit in blunter terms that he lied under oath, a confession that would be legally dangerous to make if the Jones case were still alive.

    But Jones and both her current and previous lawyers are quarreling over how to respond. Just as she did a year ago when settlement talks collapsed, Jones has asked Bill McMillan, the husband of her friend and adviser Susan Carpenter-McMillan, to help in her discussions with her Dallas-based law firm. Stephen Jones, her husband, has been particularly adamant on holding out for enough money to make Clinton pay dearly.

    "Bill will make sure that Paula gets the very best deal there is," Susan Carpenter-McMillan said last night. "No one will take advantage of her, from the White House to past lawyers."

    Her current lawyers at Rader, Campbell, Fisher and Pyke have a 40 percent contingency agreement with Jones that she would like to reduce. Her previous lawyers, Joseph Cammarata and Gilbert K. Davis, quit after Jones refused a $700,000 settlement offer last year and have since placed an $800,000 lien against any proceeds from the case.

    Cammarata wrote Hirschfeld this week "to hereby place you on notice of the lien" and said "any settlement or adjustment of the . . . case is void against that lien."

    Hirschfeld responded with a letter to Jones and Clinton demanding that both give him a written "hold harmless agreement" guaranteeing him complete legal immunity in the case. "In absence of such absolute written assurance," wrote Hirschfeld's lawyer, Harvard Hollenberg, "his offer to fund the settlement in the Jones case must be withdrawn."

    Neither side indicated any willingness to give such an assurance yesterday, and Hirschfeld has set a deadline of noon today. White House advisers previously have said they want nothing to do with Hirschfeld's offer.

    © Copyright 1998 The Washington Post Company

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