FOR IMMEDIATE RELEASE TUESDAY, SEPTEMBER 27, 1994

AG (202) 616-2777 TDD (202) 514-1888

NEW REPORT FINDS NO CREDIBLE BASIS FOR INSLAW CLAIMS, RECOMMENDS MATTER BE CLOSED WASHINGTON, D.C. -- Affirming findings of a special counsel appointed in the previous Administration, the Department of Justice today concluded that there is no credible evidence that Department officials conspired to steal computer software developed by INSLAW, Inc. or that the company is entitled to additional government payments. The report also reaffirmed police findings that the death of J. Daniel Casolaro, a free-lance journalist investigating the INSLAW matter, was a suicide. It said there is no basis for asking for the appointment of an Independent Counsel, and recommended that the affair be closed. The case began in 1982 when the Justice Department awarded a $10 million contract to INSLAW to install case management software called PROMIS in U.S. Attorneys' offices around the country. Since then, a series of disputes led to allegations by INSLAW that resulted in several lawsuits, two Congressional investigations, a number of internal Justice Department reviews including one by the Office of Professional Responsibility and another by the Public Integrity Section, the appointment of Nicholas Bua, a former federal judge, as special counsel whose six-member legal team issued a 267-page report in March 1993, and today's review of that report which runs another 187 pages. Today's report states that the evidence compiled by Judge Bua fully supported the findings and conclusions he reached that there was no criminal wrongdoing in furtherance of the Department on the part of any past or present Justice Department employee. Says the report, "(T)here is no credible evidence that employees of the Department of Justice conspired with anyone to steal PROMIS or to injure INSLAW in any other way." The report also concluded that the use of PROMIS by the Executive Office of United States Attorneys and in U.S. Attorneys' offices conforms with the contractual agreements that were made, and that INSLAW is not entitled as a matter of law to additional compensation for the use of its PROMIS software. The report says INSLAW's contention that Justice Department officials conspired to destroy INSLAW and secretly profit from its work was based largely on alleged statements of anonymous sources, in and outside the Department. None came forward despite assurances from Attorney General Janet Reno that they would be protected from reprisals. Individuals who were identified as sources denied making the statements attributed to them by INSLAW. Two primary sources relied on by INSLAW were not credible: Michael Riconosciuto, currently serving a 30-year sentence on methamphetamine charges, and Ari Ben-Menashe, found by two Congressional investigations into the alleged "October Surprise" conspiracy to be totally untrustworthy. Additional investigation was conducted into several relatively recent claims by INSLAW, and into matters which a House Judiciary Committee report recommended be subject to further review. For example, an MIT professor, Dr. Randall

Davis, was hired to compare the computer code in INSLAW's PROMIS software with the code in the FBI's FOIMS software, which INSLAW contends is a pirated version of PROMIS. Dr. Davis concluded that there was no relation between FOIMS and PROMIS. The report also concluded that there was no credible evidence that INSLAW's PROMIS was being used elsewhere in the government, or had been improperly distributed to a foreign government or entity, or that INSLAW related documents had been destroyed by the Justice Department Command Center, or that the Department had obstructed the reappointment of a bankruptcy judge who had ruled favorably to INSLAW and was later overturned. The report rebuffed claims that PROMIS was stolen to raise money to reward individuals working for the release of American hostages in Iran, or to penetrate foreign intelligence agencies, or as part of a U.S.-Israeli slush fund connected with the late British publisher Robert Maxwell, or in aid of a secret U.S. intelligence agency concealed within the Office of Special Investigations Nazi-hunting unit which INSLAW asserts participated in illegal trafficking of PROMIS software and in the alleged murder of Mr. Casolaro. The death of Mr. Casolaro was extensively investigated because of the allegations that he was murdered and because Judge Bua did not address the issue in significant detail. Today's report concurs in the conclusion of the Martinsburg, W. Va., Police Department that Mr. Casolaro committed suicide. Extensive forensic evidence, including the autopsy, a blood spatter analysis and the toxicology report, strongly supports that conclusion. Many of Mr. Casolaro's friends described him as depressed. He also appeared to be greatly concerned about his professional failures, including his inability to generate income from his investigation into the INSLAW matter. He was suffering from multiple sclerosis. Says the report, "There is no credible evidence that Mr. Casolaro was murdered." In recommending that no additional compensation be paid to INSLAW, the report said the Department had adhered to the terms and conditions of its contract with INSLAW. Furthermore, it said, INSLAW had allowed some of its claims to languish for eight years before they were finally dismissed in late 1992. Currently, INSLAW is asking Congress to relieve it of the statutory time bar on the basis of an alleged conspiracy by the government, a conspiracy for which no credible evidence exists. "INSLAW was provided a full and fair opportunity to litigate its claims," says the report. "The ability of INSLAW and its counsel to keep this matter in the public spotlight by making a series of unsubstantiated allegations linking this affair to some of the major alleged conspiracies of the last 15 years should not be rewarded by acquiescing to their money demands." ##### 94-555