The Justice Department has filed a sealed report notifying the special court responsible for appointing independent counsels that it has found "no reasonable grounds" for recommending that a special prosecutor investigate conflict-of-interest allegations involving former Supreme Court nominee Douglas H. Ginsburg, department sources said yesterday.
The sources said Assistant Attorney General William F. Weld filed the report with the special three-judge court, as required under the independent-counsel law, after a 90-day preliminary investigation of Ginsburg by the Justice Department's Public Integrity Section. They said Weld asked that the report, which was filed late last week, be made public.
Under the law, the attorney general has 90 days either to ask the court to appoint an independent counsel or to report "that there are no reasonable grounds to believe that further investigation or prosecution is warranted."
In this case, Weld was in charge of making the final decision because all the higher-ranking department officials -- Attorney General Edwin Meese III, Deputy Attorney General Arnold I. Burns, Solicitor General Charles Fried, Associate Attorney General Stephen S. Trott and Assistant Attorney General Charles J. Cooper -- recused themselves from the case.
Ginsburg, who is a judge on the federal appeals court here, was nominated for the Supreme Court Oct. 29 after the defeat of Judge Robert H. Bork and withdrew nine days later after admitting that he had smoked marijuana while a professor at Harvard Law School.
After Ginsburg's nomination, press reports suggested that as a high-ranking Justice Department official, Ginsburg handled a number of matters involving the cable television industry at a time when he had almost $140,000 invested in Rogers Cablesystems, a Toronto-based cable television company that has operations in the United States.
Ginsburg told the Senate Judiciary Committee when he was nominated to the appeals court in 1986 that he was a "principal participant" in drafting a Supreme Court brief arguing that cable operators are protected by the First Amendment. Ginsburg sided with the cable industry in arguing against the "must carry" regulations, proposed Federal Communications Commission rules to require cable operators to provide certain channels.
He also filed comments with the FCC opposing proposed restrictions on multiple ownership of cable systems and supervised an antitrust divsion investigation into whether cable companies conspired to force pay cable channels to scramble their signals so that satellite dish owners could not intercept them.
Federal law makes it a crime for government officials to participate "personally and substantially" in any matters in which they have a financial interest.
Neither Ginsburg, who sources said was interviewed in connection with the preliminary investigation, nor his lawyer was available for comment yesterday. Justice Department spokesman Patrick S. Korten said he could not comment because the matter is under seal.
At the time of Ginsburg's nomination, Justice Department spokesman Terry Eastland said Ginsburg, "after consultation with staff . . . determined that Rogers would not be affected financially" by the Supreme Court case.
Eastland said the company was not a subject of the antitrust scrambling probe and that although Ginsburg was "informed of the position taken" in the FCC filings, he "was as a matter of course not involved in the development or articulation of the antitrust division's position."