The Christic Institute, a religious activist group that normally wages its battles through the courts, is fighting for its institutional life. For the last three years, the institute has chased after an alleged "secret team" of former CIA operatives, right-wing activists, arms merchants and drug smugglers. In June, a federal judge in Miami dismissed a lawsuit in which the Christic Institute linked 29 defendants to a May 1984 bomb explosion at a news conference in La Penca, Nicaragua, and other illegal activities. The organization appealed the decision. But U.S. District Court Judge James Lawrence King has ordered the group to pay $1 million in legal fees to the defendants, who include many of the key figures in the Iran-contra affair. The order has sent the group's 35 staff members scrambling to raise the sum from loyal followers around the country, while preparing legal appeals. By federal law, the defendants will be authorized to seize the institute's assets if the organization does not come up with the money by early March. The battle for survival is the latest episode for the group, which has gained a swashbuckling reputation in leftist circles. The institute first made its name by representing the family of Karen Silkwood, a nuclear plant worker who was killed in a mysterious car accident. The family eventually was awarded a $1.38 million settlement from the Kerr-McGee Corp., where Silkwood was a union organizer. The group's attorneys also have represented, among others, church workers prosecuted for giving illegal sanctuary to Central American aliens and the widows of five communist demonstrators killed in a 1979 Ku Klux Klan rally in Greensboro, N.C. More recently, the Christic Institute defended two Native Americans who staged an armed takeover of a newspaper in Lumberton, N.C., to bring attention to allegations of official corruption, drug trafficking and racial discrimination in Robeson County. The Christic Institute, which describes itself as "an interfaith center for law and public policy," takes its name from the writings of Pierre Teilhard de Chardin, the late Jesuit philosopher who wrote of a "Christic force" that unites the world. In May 1986, the organization filed the lawsuit linking Iran-contra figures such as retired Air Force Maj. Gen. Richard V. Secord, arms dealer Albert Hakim and ex-CIA official Theodore Shackley to gun-running, cocaine smuggling and political assassination. The suit alleged that they and others were part of a secret team that, over three decades, has carried out illegal covert operations in Southeast Asia, Latin America and the Middle East. According to the suit, this team was tapped by former National Security Council aide Oliver North when U.S. assistance to the Nicaraguan contras was banned by Congress. The claims, which seemed preposterous and drew little attention when first made, gained credibility when the details of the Iran-contra affair began to surface later in the year. The Christic Institute was the first to reveal the existence of a private contra supply network linked to the White House and North. Since then, however, the group has come under criticism from a variety of sources. Conservatives have put pressure on national church agencies to halt funding of the institute. Even left-leaning magazines such as The Nation and Mother Jones have published articles accusing the organization of spinning a far-fetched conspiracy theory in its suit. Yet support for the institute and its Iran-contra suit has remained strong, despite Judge King's dismissal in June. In December, two dozen liberal church groups filed court papers in support of the institute's appeal of the case. Hollywood celebrities and rock singers have helped raise considerable sums of money for the group, which operates on a $2.5 million annual budget. The Christic Institute has interpreted recent developments as bolstering the credibility of its case. For instance, Costa Rican authorities recently arrested John Hull, a U.S.-born farmer accused by the institute of using his Costa Rican ranch to smuggle cocaine to the United States and arms to the contras. Hull was arrested in January on drug charges and has been denied bail. In the aftermath of Judge King's decision to award large attorneys' fees to the defendants, including Hull, Christic Institute attorneys say they are confident they will raise a $1 million bond and win an appeal of the judge's order.