By Susan Schmidt and Joan Biskupic
In a legal setback for Starr, the court decided not to bypass the normal appeals process and hear the disputes on a rare emergency basis before its summer recess, dismissing the prosecutor's contention that a quick resolution was vital to the national interest. None of the justices dissented in the one-page order, which sent the matters back to the appeals court, suggesting it "proceed expeditiously."
The decision means that Starr, even if he ultimately wins the legal battle, likely will not be able to obtain the testimony he has sought from White House deputy counsel Bruce R. Lindsey or three Secret Service employees until perhaps the end of the year.
But lawyers close to the case said the court's decision makes it more likely that Starr will send Congress an interim report about possible impeachable offenses by President Clinton without waiting to question everyone he wants to interrogate. And Starr may not wait to indict Lewinsky for perjury or strike a deal for her testimony about the nature of her relationship with the president, although she may be in a stronger position knowing that no Secret Service officers will testify anytime soon.
The high court's action came as Starr finally was able to bring Clinton aide Sidney Blumenthal back before the grand jury yesterday to testify about internal White House discussions regarding the Lewinsky investigation. Blumenthal had refused to answer certain questions until Clinton dropped his claim of executive privilege this week.
Another key player appeared at the courthouse for the first time. Democratic fund-raiser Nathan Landow testified about his contacts with Kathleen E. Willey, a former White House aide who alleged that Clinton groped her in the Oval Office suite. Landow has denied trying to influence Willey's testimony in the Paula Jones lawsuit.
Starr is investigating whether Clinton committed perjury during the now-dismissed Jones case when he denied under oath having sex with Lewinsky or making an advance on Willey, and whether the president or anyone else tried to obstruct justice in the matter. According to court papers, Starr believes Secret Service officers may have witnessed events that would corroborate such allegations and prosecutors want to explore whether Clinton directed Lindsey to cover up any presidential indiscretions.
A federal judge rejected Clinton's attempts to block testimony by Blumenthal and Lindsey by invoking executive privilege and attorney-client privilege, and the same court rejected the Justice Department's assertion of a new "protective function privilege" to shield Secret Service officers.
While Clinton abandoned the executive privilege claim, his administration appealed the other two issues and Starr had asked the Supreme Court to take the case immediately because "the nation has a compelling interest that this criminal investigation of the president of the United States conclude as quickly as possible."
The court's rebuff was Starr's first defeat in numerous battles at the appeals court level or higher during his four years investigating Whitewater, and it gave heart to the Clinton camp, which saw it as proof that he had overreached with overheated claims. "The court's decision, in light of the independent counsel's rhetoric, speaks for itself," said David E. Kendall, the president's personal attorney.
White House press secretary Michael McCurry denied that the administration was seeking to delay the investigation. "Today is, what, Day 1,400 of Ken Starr's tenure as an independent counsel at the rate of $30,000 a day of taxpayers' money," he said. "If there's any delay, that's the delay right there."
The development gives some breathing room to the new Lewinsky legal team that took over this week. Without having to worry about what any Secret Service officers might say, attorneys Plato Cacheris and Jacob A. Stein have a stronger position from which to negotiate, according to lawyers watching the matter.
Anthony Zaccagnini, an attorney representing Linda R. Tripp, whose secret tape recordings of Lewinsky discussing an affair with Clinton launched the investigation, said the decision "forces the independent counsel to make a decision about whether they want that information before making a decision about Ms. Lewinsky."
But another defense lawyer involved in the investigation said he believes Starr has no intention of holding up matters. "They'll just go ahead with Monica; they are not going to wait on it," he said.
In the short term, Starr spokesman Charles Bakaly said the decision will have little effect on how his office proceeds with Lewinsky.
"We're not sure it's going to have any impact," he said. "We knew it was extraordinary when we asked for [the quick review]. We did it because we believe that the American people's need for the facts justified our request. The Secret Service might have evidence of obstruction and perjury and witness intimidation -- a body of evidence we need and will do everything in our power to get."
Legal observers also said the court's action may prompt Starr to make a partial submission of evidence to Congress soon for possible impeachment proceedings, rather than wait to try to gather the disputed testimony. The later any report is sent to Congress, the less chance any action will be taken this year, given the reluctance of the Republican leadership to deal with such an explosive matter in the middle of the fall congressional elections.
"It increases the likelihood of an interim report," said Jonathan Turley, a law professor at George Washington University.
While Lindsey is the only White House lawyer Starr has brought to the grand jury so far, the Clinton camp is worried that others could be called if it loses that privilege battle. The White House lawyers could be asked to testify about damage-control meetings and any statements or admissions made by the president.
But yesterday's decision means months more litigation. The U.S. Court of Appeals for the D.C. Circuit likely will expedite its review, with briefs probably filed later this month and oral arguments next month. But the appeals court then would have until the Supreme Court reconvenes in October to issue rulings that almost certainly would be appealed by the losers.
If they had granted Starr's request to leapfrog the dispute past the appeals court, the justices would have broken with long-standing tradition. Such an emergency move has been taken only a handful of times -- examples include the government seizure of steel mills during the Korean War and the Watergate battle over President Richard M. Nixon's secret Oval Office tapes.
The justices offered no elaboration on their decision yesterday. But some of the reasons are self-evident. The justices traditionally do not accept cases that have not been heard by appellate courts, which they count on to fully develop the record and take a first crack at the legal issues. And the two privileges asserted in this case -- between the president and his guards and between the president and government lawyers -- are fresh terrain for the courts.
Starr also had bad timing. The justices are in the hectic final weeks of their term, still finishing opinions in 30 cases, and most justices travel and teach abroad in July and August.
Dennis J. Hutchinson, a University of Chicago law professor, said the court responded yesterday in a predictably "technical and practical" manner. "These folks aren't naive," he said. "They know this is a big case and this has political consequences. They ask themselves, 'Boy, do we really want to make fundamental, constitutional legal policy on the fly?' "
At the grand jury yesterday, Landow testified for about an hour. "Despite his appearance before the grand jury today, we still have no reason whatsoever to conclude Mr. Landow is in any jeopardy," said his lawyer, Joe Caldwell.
Blumenthal testified for about 2 1/2 hours later in the day but will have to return for more. One of his lawyers, William McDaniel, complained afterward that prosecutors wasted most of their time asking superfluous questions. "What we had was two hours of questions about, 'Up there at the White House, do they talk about us as prosecutors? And up there at the White House, do you talk about Starr's investigation?' " McDaniel said.
McDaniel characterized this approach as "just a further example of what appears to be the obsessive view these people [in the Starr investigation] have about what other people think of them." It was not until the last 10 minutes of his appearance that Blumenthal was asked about his conversations with the president and first lady, McDaniel said.
Staff writer Peter Baker and staff researcher Nathan Abse contributed to this report.
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