On their honor - Judges and their assets graphic
U.S. Judicial Conference urges judges to obey ethics laws

By JOE STEPHENS - Staff Writer
Date: 05/14/98 23:19

The U.S. Judicial Conference, under fire from Congress, has written each of the nation's 2,000 federal judges and urged them to obey ethics laws.

Marked "Urgent Information," the letters stress that judges must withdraw from any lawsuit in which they have a financial interest. The letters also reveal that court administrators are looking into creating a computer system that would ferret out financial conflicts among judges nationwide.

"Recent events have highlighted the importance of judges being alert to possible conflicts of interest," say the letters, issued by the federal court system's top governing body.

The letters are in response to a series published last month in The Kansas City Star that revealed judges repeatedly flouted ethics laws.

The series, "On Their Honor," showed that federal judges in the Kansas City area and in other regions presided over dozens of lawsuits against companies in which they owned stock. The newspaper's investigation identified more than 300 court orders entered by judges who had a financial interest in the lawsuits those orders affected.

The articles documented how the judiciary had failed to police ethical lapses by its own members. And although judges list their stocks on annual disclosure reports, the series showed that court rules ensured few people reviewed them.

In light of the revelations, federal lawmakers plan a congressional inquiry. Judges in at least three of the nation's 13 appellate circuits also are studying reforms.

A committee of the U.S. Judicial Conference will address the newspaper's findings at an Aug. 17 meeting, according to U.S. Circuit Judge Frank Magill. The Judicial Conference, which meets in secret, sets policy for all federal courts and is led by Chief Justice William H. Rehnquist.

The letters, which were not publicly announced, arrived in judges' chambers this week. They were signed by Magill, chairman of the conference's committee on financial disclosure, and Circuit Judge A. Raymond Randolph of Washington, head of the conference's Codes of Conduct committee.

The letters warn judges about "possible conflicts of interest between their financial interests and their assigned cases....United States Code places the responsibility for avoiding such conflicts on each individual judge."

In an underlined section, the letters emphasize that the rule requiring judges to withdraw from cases in which they have a financial stake "is mandatory under the statute and cannot be waived."

The letters suggest strategies for averting conflicts. For example, they recommend that judges limit their stock investments and instead invest in mutual funds.

Even judges who give control of their portfolios to professional money managers must stay abreast of stock purchases, the letters stress, and judges must recuse from cases involving those companies.

The letters recommend that judges use clerks and secretaries to help identify conflicts. At least one state court system uses computers to automatically compare judges' stock holdings with their caseloads, they point out.

"The Administrative Office is conducting a survey to identify what automated systems of this kind are in use and determine whether any would have national applicability," they add.

The letters conclude by offering each judge a copy of The Star's series, saying its findings underscore the importance of avoiding conflicts.

Independently, the Federal Judicial Center last week distributed copies of the series to chief judges from each of the nation's 94 judicial districts. The center, the federal courts' agency for judicial education, used the articles during an ethics seminar in San Diego.

In an interview, Randolph said he was disappointed at the frequency of ethical lapses discovered among federal judges. But because the judiciary is largely decentralized, he does not favor new laws or judicial rules.

Instead, he said, the solution is for individual judges to take responsibility.

"We have a very conscientious group of people," he said of the judges. "I think the problem is due to inattention or a lack of knowledge."

In fact, Randolph speculated that the problem would fix itself. Judges across the country already have renewed their efforts to identify conflicts, he said.

"I am confident that whatever the problems were, they are going to be corrected (by individual judges)," Randolph said. "The rules are there. The only thing that is required is for judges to pay close attention."

Magill, too, remains unconvinced new rules are needed in his area of authority, financial disclosure. The court's current system for making judges' financial disclosure reports available to litigants meets all requirements set by Congress, he said.

Judges file lists of their assets only in Washington. The public can request copies but must use a special order form unavailable outside the capital. All requests must be notarized. And before court officials mail out a disclosure statement, they alert the judge to the name and employer of the person who is looking into their holdings.

Critics say the rules ensure that few litigants look at the reports for fear of angering the judge handling their case.

Magill described the rules as a security precaution. But he could not explain how someone could use the disclosure statements to harm a judge.

"We are going to have to study that," Magill said. "Trial judges are very skittish about security."

Rehnquist, who presides over the judicial conference, did not respond to a written request for comment.

Reporter Joe Stephens can be reached by calling 234-4800, Ext. 4427, or by e-mail at stephens@kcstar.com. The most recent financial disclosure reports filed by local district judges can be reviewed on The Star's Web site at www.kcstar.com/judges.