THE JUDGE didn't mince words. The defendant, he said, "took, converted, stole" the plaintiff's property "by trickery, fraud and deceit." The defendant made "an institutional decision . . . at the highest level simply to ignore serious questions of ethical impropriety, made repeatedly by persons of unquestioned probity and integrity, and this failure constitutes bad faith, vexatiousness, wantonness and oppressiveness." The defendant also engaged "in an outrageous, deceitful, fraudulent game of cat and mouse, demonstrating contempt for both the law and any principle of fair dealing." And who do you suppose this defendant is -- a corporation set up by the mob to swindle widows? A brokerage house stealing from clients and trading on insider information? Not at all. The culprit is the United States Department of Justice.
U.S. Bankruptcy Judge George Bason used these terms in a recent ruling against the department. The plaintiff was Inslaw, a corporation that had developed software that is widely used by prosecutors to track the progress of cases and compile information about caseloads, dispositions, characteristics of offenders and other material. Inslaw is now in the process of reorganizing in bankruptcy because of problems involving a contract with the Justice Department. The contract, which accounts for 70 percent of the corporation's business, called for Inslaw to install its software system in the offices of each of the 94 U.S. attorneys. Judge Bason found that the company was the victim of bias on the part of C. Madison Brewer, who had been fired by Inslaw and then hired by the Department of Justice to supervise the software contract. Over the course of several years, department officials had been challenged about the apparent bias of Mr. Brewer -- the judge found that he "was consumed by hatred for and intense desire for revenge against" the president of the company -- but undertook no real investigation. Moreover, the department continued to use Inslaw's property without compensation.
These are not simply charges; they are a judicial finding. While the department will undoubtedly appeal the judgment and the order to pay substantial damages, a more immediate public accounting is in order. Why was Mr. Brewer hired for this particular job in the first place? Why did no one at the department take seriously the charges of conflict of interest? What steps are being taken to provide a permanent mechanism within the department for reviewing charges of this kind?