A federal judge in Chicago has given the independent special counsel to the multibillion-dollar Teamsters Central States Pension Fund permission to become a law partner of T. Timothy Ryan, the former Labor Department solicitor who supervised efforts to clean up the scandal-ridden fund and played a key role in hiring him.

U.S. District Court Judge James B. Moran said it would not be a conflict-of-interest for former attorney general William B. Saxbe to join the Washington law firm of Pierson, Ball & Dowd, of which Ryan is a partner.

But Moran said that in handling the fund, Saxbe can seek Ryan's legal advice only about the fund's "withdrawal liability problems," an area that he said Ryan had "no significant contact" with as solicitor. If Saxbe wants to discuss other fund matters with Ryan, he must first notify a number of persons, including government and Teamsters officials, to see if they object, the judge said.

Saxbe was appointed special counsel after the Labor Department signed a consent degree with the Teamsters to settle government charges of mismanagement against several former fund trustees. Ryan played a major role in negotiating the decree and recommended Saxbe for the job of special counsel.

"This court has no expectation that Mr. Saxbe, Mr. Ryan or the firm will seek to use Mr. Ryan's services with respect to any litigation or any matter related to any litigation against any former trustee or executive of the fund which commenced or was proceeding or was under consideration during Mr. Ryan's tenure with the Labor Department, as that would obviously be improper," the judge said. "This court believes, moreover, that the 'Chinese wall' procedures contemplated are reasonably calculated to avoid ethical violations."

Saxbe, who receives $180,000 per year from the fund to supervise compliance with the decree, would also receive a share of the law firm's profits. The firm's members, including Ryan, also could bill the fund for legal advice to Saxbe regarding fund matters.

Saxbe's former firm, Jones, Day, Reavis & Pogue of Washington and Cleveland, received about $350,000 last year from the fund for legal work at Saxbe's request, according to George Lehr, pension fund director. Overall, the fund has a budget of $8 million for outside legal fees, Lehr said.