U.S. Bankruptcy Judge George Francis Bason Jr. yesterday ordered the Justice Department to pay Inslaw Inc., a Washington computer software company, a total of $6.8 million in damages for misappropriating one of Inslaw's computer software programs.
In a separate action, Bason filed suit yesterday to seek to block his replacement on the bankruptcy bench by a Justice Department attorney who had worked on the Inslaw case. Bason, who claimed he was denied due process in the selection process, has said he has been told by local lawyers that he was not reappointed in part because of his decisions in the Inslaw case. Bason is scheduled to leave office next Monday.
The damage award is the latest victory for Inslaw in a three-year battle with the Justice Department, which Inslaw alleged tried to drive the company out of business and steal the software, called Promis, which is used by U.S. attorney's offices to track cases. Inslaw filed for bankruptcy protection in February 1985.
Bason ruled last September that the Justice Department used "trickery, fraud and deceit" to steal the software program, and that the Justice Department had tried to force Inslaw to liquidate because of a personal vendetta against the company by Justice Department officials.
Inslaw's law firm, McDermott, Will & Emory, said in a statement yesterday that Inslaw was "extremely gratified by this result. ... Inslaw has been waiting for this day for a very long time."
Dean S. Cooper, the lead attorney on the case for the Justice Department, said the department would appeal the damage ruling. He declined to comment further on the ruling.
Inslaw had argued that the Justice Department owed it $6.8 million in damages for the use of 44 copies of Promis software that the department did not pay for under a contract with the company.
The request was based on the price of similar software the company markets.
The Justice Department had argued it owed Inslaw no more than $3 million based on a fair market value for the software at the time the company went into bankruptcy.
Bason said Justice's calculations of damages were based on "erroneous assumptions."
"Following ... all the precedents I am aware of, when a party converts someone else's property, the measure of damages is the full fair market value of that property," Bason said.
Bason is to decide on Thursday who pays Inslaw's $1 million in attorney's fees.
Bason's suit seeking an explanation for why he was not reappointed was filed in U.S. District Court against the District's judicial council, a body composed of U.S. Court of Appeals and U.S. District Court judges that selects bankruptcy judges.
Bason also wants a temporary restraining order preventing Justice Department lawyer S. Martin Teel Jr. from becoming the new District bankruptcy judge until Bason's case can be heard.
Neither Teel nor Karen Knab, circuit executive for the D.C. circuit courts, had any comment on the Bason's suit.
At a press conference yesterday, Bason said: "I do not know what charges have been made against me, nor do I know what may have motivated whoever may have made those charges. I do know that the decision to pass me over in favor of a person who is obviously far less qualified and far less experienced than I can only be described as arbitrary, capricious and utterly lacking in any factual foundation."